<PAGE> 1
REGISTRATION NO. 333-88509
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- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 2
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
TEXTRON FINANCIAL CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
DELAWARE 05-6008768
(STATE OR OTHER JURISDICTION OF INCORPORATION OR (I.R.S. EMPLOYER IDENTIFICATION NUMBER)
ORGANIZATION)
</TABLE>
40 WESTMINSTER STREET
P.O. BOX 6687
PROVIDENCE, RHODE ISLAND 02940-6687
(401) 621-4200
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------------
ELIZABETH C. PERKINS, ESQ.
40 WESTMINSTER STREET
P.O. BOX 6687
PROVIDENCE, RHODE ISLAND 02940-6687
(401) 621-4200
(NAME, ADDRESS, INCLUDING ZIP CODE, AND
TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE)
------------------------
COPY TO:
MAUREEN S. BRUNDAGE, ESQ.
WHITE & CASE LLP
1155 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10036
(212) 819-8200
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after this Registration Statement becomes effective.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, 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, 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,
please check the following box. [ ]
------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
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<PAGE> 2
THE INFORMATION IN THIS PROSPECTUS SUPPLEMENT AND THE ATTACHED PROSPECTUS
ARE 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 SUPPLEMENT AND THE ATTACHED
PROSPECTUS ARE NOT AN OFFER TO SELL THESE SECURITIES AND THEY ARE NOT
SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR
SALE IS NOT PERMITTED.
SUBJECT TO COMPLETION DATED NOVEMBER 29, 1999
PRELIMINARY PROSPECTUS SUPPLEMENT
(To Preliminary Prospectus dated November 29, 1999)
TEXTRON FINANCIAL CORPORATION
$500,000,000
Floating Rate Notes due December , 2002
Interest payable March , June , September and December
ISSUE PRICE: %
$500,000,000
% Notes due December , 2004
Interest payable June and December
ISSUE PRICE: %
The floating rate notes will mature on December , 2002. Interest will accrue
from December , 1999. The per annum rate of interest will equal three-month
LIBOR, reset quarterly, plus basis points ( %). Interest will be
computed on the basis of a 360-day year and the actual number of days in the
applicable interest period. Interest is payable quarterly on March , June ,
September and December of each year, commencing March , 2000. The floating
rate notes will not be redeemable prior to maturity unless certain events occur
involving U.S. taxation.
The fixed rate notes will mature on December , 2004. Interest will accrue from
December , 1999, at the rate of % per annum. Interest is payable
semiannually on June and December of each year, commencing June , 2000.
The fixed rate notes will not be redeemable prior to maturity unless certain
events occur involving U.S. taxation.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus supplement or the prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.
<TABLE>
<CAPTION>
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PRICE TO DISCOUNTS AND PROCEEDS TO TEXTRON
PUBLIC COMMISSIONS FINANCIAL CORPORATION
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<S> <C> <C> <C>
Per 2002 note % % %
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Total $ $ $
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Per 2004 note % % %
- -----------------------------------------------------------------------------------------------------------------
Total $ $ $
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</TABLE>
We will apply to list the notes on the Luxembourg Stock Exchange. We also will
apply to list the notes on the New York Stock Exchange.
We expect that delivery of the notes will be made to investors on or about
December , 1999 only through The Depository Trust Company, Cedelbank and
Euroclear.
Joint Bookrunners
MERRILL LYNCH & CO. J.P. MORGAN & CO.
BANC OF AMERICA SECURITIES LLC
CHASE SECURITIES INC.
SALOMON SMITH BARNEY INC.
WARBURG DILLON READ LLC
December , 1999
<PAGE> 3
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Description of Textron Financial Corporation................ S-3
Description of Textron Inc.................................. S-4
Description of Support Agreement............................ S-4
Use of Proceeds............................................. S-5
Consolidated Capitalization of Textron Financial
Corporation............................................... S-5
Selected Consolidated Financial Data of Textron Financial
Corporation............................................... S-6
Directors and Executive Officers of Textron Financial
Corporation............................................... S-7
Description of Notes........................................ S-9
U.S. Federal Taxation....................................... S-16
Underwriting................................................ S-20
General and Listing Information............................. S-21
Legal Opinions.............................................. S-22
PROSPECTUS
About this Prospectus....................................... 1
Textron Financial Corporation............................... 1
Use of Proceeds............................................. 2
Ratio of Earnings to Fixed Charges.......................... 2
Description of Debt Securities.............................. 2
Plan of Distribution........................................ 12
Where You Can Find More Information......................... 13
Legal Opinions.............................................. 14
Experts..................................................... 14
</TABLE>
We have not, and the underwriters have not, authorized any other person to
provide you with any information or to make any representations not contained in
this prospectus supplement or the attached prospectus. If anyone provides you
with different or inconsistent information, you should not rely on it. We are
not, and the underwriters are not, making an offer of any securities other than
the notes. This prospectus supplement is part of, and you must read it in
addition to, the attached prospectus dated , 1999. You should assume
that the information appearing in this prospectus supplement and the attached
prospectus, as well as the information incorporated by reference, is accurate as
of the date on the front cover of this prospectus supplement only.
The distribution of this prospectus supplement and the attached prospectus, and
the offering of the notes, may be restricted by law in certain jurisdictions.
You should inform yourself about, and observe, any of these restrictions. This
prospectus supplement and the attached prospectus do not constitute, and may not
be used in connection with, an offer or solicitation by anyone in any
jurisdiction in which the offer or solicitation is not authorized, or in which
the person making the offer or solicitation is not qualified to do so, or to any
person to whom it is unlawful to make the offer or solicitation.
This prospectus supplement and the attached prospectus include particulars given
in compliance with the rules governing the listing of securities on the
Luxembourg Stock Exchange. We accept full responsibility for the accuracy of the
information contained in this prospectus supplement and the attached prospectus.
We confirm, having made all reasonable inquiries, that to the best of our
knowledge and belief there are no other facts that we have omitted that make any
statement contained in this prospectus supplement and attached prospectus
misleading.
References in this prospectus supplement and the attached prospectus to
"dollars" and "$" are to United States dollars.
This prospectus supplement and the attached prospectus, together with the
documents incorporated in them by reference, will be available free of charge at
the office of Kreditbank S.A. Luxembourg. You may also review this prospectus
supplement and the attached prospectus, together with the documents incorporated
by reference into the prospectus, at the New York Stock Exchange's library.
S-2
<PAGE> 4
DESCRIPTION OF TEXTRON FINANCIAL CORPORATION
GENERAL
Textron Financial Corporation was incorporated on February 5, 1962 in the State
of Delaware. We are a diversified commercial finance company with operations in
three active segments:
- term loans and leases;
- revolving credit; and
- specialty finance.
Our term lending and leasing activity focuses on aircraft, equipment and golf
finance. Our revolving credit products consist primarily of dealer inventory
finance, factoring and working capital loans. Our specialty finance operations
include broadcast media finance, franchise finance, resort receivables finance
and structured investment grade transactions. The company's other financial
services and products include:
- transaction syndication;
- equipment appraisal and management;
- portfolio servicing; and
- insurance brokerage.
Since our inception, Textron Inc., a multi-industry company with operations in
aircraft, automotive, industrial and finance, has owned all of our stock. We
were organized to finance the distribution of Textron Inc.'s products. However,
we have progressively diversified the scope of the financial services that we
offer. As of September 30, 1999, approximately 24% of our managed finance
receivables related to Textron Inc.'s products. We have full recourse to Textron
Inc. on approximately three-quarters of the managed receivables related to
Textron Inc.'s products.
We limit our financing activities almost exclusively to commercial markets and
to lease and secured lending products. We offer our services primarily in North
America and, to a minor extent, in South America, Europe, and Australia.
However, we do finance Textron Inc.'s products, principally Bell helicopters and
Cessna aircraft, worldwide.
We operate approximately 29 offices nationwide, with division offices and
operation centers in or around Tempe, AZ; East Hartford, CT; Atlanta, GA;
Portland, OR; Columbus, OH; King of Prussia, PA; Wichita, KS; Williamstown, MA;
Minneapolis, MN; Providence, RI; and Ft. Worth, TX. Our principal executive
offices are located at 40 Westminster Street, Providence, RI 02903.
S-3
<PAGE> 5
RECENT ACQUISITIONS
We have grown through a combination of internal expansion and selective
acquisitions. These acquisitions were, and we expect future acquisitions will
be, complementary to our principal business segments. Acquired businesses must
offer meaningful transaction origination capabilities and credit standards
compatible with our standards and, when integrated with us, must meet certain
return on investment standards established by Textron Inc. We completed six
significant acquisitions within the last two years. They are as follows:
<TABLE>
<CAPTION>
ASSETS
DATE NAME TYPE ACQUIRED PRIMARY BUSINESS
- ---- ---------------------------- ------ ------------ -------------------------------
<S> <C> <C> <C> <C>
February 1998 Systran Financial Services Stock $ 68 million Factoring
December 1998 Business Leasing Group Assets $186 million Small ticket equipment leasing
March 1999 Southern Capital Corporation Assets $ 53 million Specialized equipment financing
July 1999 RFC Capital Stock $ 65 million Factoring
October 1999 Green Tree Financial Assets $432 million Aircraft and franchise finance
November 1999 Litchfield Financial Stock $610 million Resort receivables and other
receivables oriented
transactions
</TABLE>
DESCRIPTION OF TEXTRON INC.
Textron Inc. is a global, multi-industry company with operations in four
business segments -- aircraft, automotive, industrial and finance. Textron
Inc.'s products include commercial and military helicopters, light and mid-size
business jets, plastic fuel tanks, automotive trim products, golf cars and
utility vehicles, turf-care equipment, industrial pumps and gears, engineered
fastening systems and solutions and other industrial products. Textron Inc. also
is a leading commercial finance company for select markets.
Textron Inc. is a Delaware corporation. Textron Inc.'s principal executive
offices are located at 40 Westminster Street, Providence, Rhode Island 02903 and
its telephone number is (401) 421-2800.
Textron Inc. files annual, quarterly and special reports, proxy statements and
other information with the SEC. Copies of these reports, statements and other
information are available to you as described under "Where You Can Find More
Information" in the attached prospectus.
DESCRIPTION OF SUPPORT AGREEMENT
We entered into a Support Agreement dated as of May 25, 1994 with Textron Inc.
The Support Agreement requires Textron Inc. to pay us, quarterly, an amount
sufficient to provide that pre-tax earnings, before extraordinary items and
fixed charges, will not be less than 125% of our fixed charges. Fixed charges
for purposes of the Support Agreement include interest on indebtedness and
amortization of debt discount. Textron Inc. was not required to make any
payments under the Support Agreement for the nine months ended September 30,
1999, or for the years ended 1998, 1997, 1996, 1995 and 1994, when our fixed
charge coverage ratios were 170%, 173%, 171%, 165%, 160% and 172%, respectively.
In addition, Textron Inc. has agreed to maintain our consolidated shareholder's
equity at an amount not less than $200 million. Under the terms of the Support
Agreement, we agree with Textron Inc. that 100% of our issued and outstanding
common stock will be owned by Textron Inc. or a corporation controlled by,
controlling, or under common control with, Textron Inc. The Support Agreement is
not a guarantee by Textron Inc. of the payment of interest or principal of any
obligation, indebtedness or liability by us, including the notes that we are
offering by this prospectus supplement. However, the Support Agreement does
contain provisions protecting our investors from the termination of the Support
Agreement and entitling them to enforce its provisions against Textron Inc. As a
result, if Textron Inc. does not comply with its obligations under the Support
Agreement, holders of our debt securities, including the notes that we are
offering by this prospectus supplement, and other creditors could bring an
action against Textron Inc. to compel Textron Inc. to comply with its
obligations.
S-4
<PAGE> 6
USE OF PROCEEDS
We will receive from the offering of the notes net proceeds before expenses of
. We estimate expenses of . We will use the net
proceeds to repay outstanding commercial paper. Our outstanding commercial
paper, as of November 24, 1999, had a weighted average yield of 5.56% and
weighted average maturity of 26 days. We have used the net proceeds from the
portion of our outstanding commercial paper that will be repaid for working
capital.
CONSOLIDATED CAPITALIZATION OF TEXTRON FINANCIAL CORPORATION
The following table sets forth our consolidated capitalization at September 30,
1999 and as adjusted for the offering of the notes. You should read the table
with our consolidated financial statements and related notes that are
incorporated by reference into the attached prospectus. See "Where You Can Find
More Information" in the attached prospectus. All amounts are in thousands of
U.S. dollars. Since September 30, 1999, no material change has occurred in our
consolidated capitalization.
<TABLE>
<CAPTION>
SEPTEMBER 30, 1999
------------------------
HISTORICAL ADJUSTED
---------- ----------
<S> <C> <C>
DEBT
Commercial paper and short-term debt(1)..................... $1,177,331 $
Floating Rate Notes due December , 2002................. -- 500,000
% Notes due December , 2004........................ -- 500,000
Other long-term notes..................................... 2,425,500 2,425,500
---------- ----------
Total debt........................................ $3,602,831 $
========== ==========
SHAREHOLDER'S EQUITY
Common stock, $100 par value; 4,000 shares authorized,
2,500 shares issued and outstanding.................... $ 250 $ 250
Capital surplus........................................... 188,976 188,976
Retained earnings......................................... $ 339,441 $ 339,441
---------- ----------
Total shareholder's equity(2)..................... $ 528,667 $ 528,667
========== ==========
</TABLE>
- ---------------
(1) As of November 24, 1999, the outstanding face amount of our commercial paper
and short-term debt outstanding was $1.892 billion.
(2) As of October 31, 1999, our total shareholder's equity was $845 million.
S-5
<PAGE> 7
SELECTED CONSOLIDATED FINANCIAL DATA
OF TEXTRON FINANCIAL CORPORATION
The following table sets forth selected financial data that we derived from the
audited consolidated financial statements of Textron Financial Corporation for
each of the three years in the period ended January 2, 1999 and from unaudited
financial statements for the nine months ended September 30, 1999 and 1998. We
believe that we have made all adjustments necessary for the fair presentation of
our unaudited financial data. The results for the interim period ended September
30, 1999 are not necessarily indicative of the results for the full year. Our
year-end dates conform with Textron Inc.'s year-end, which falls on the nearest
Saturday to December 31st. All interim periods are calendar month-end. All
amounts are in thousands of U.S. dollars, except for percentages. You should
read the following information with the consolidated financial statements and
related notes incorporated by reference in the attached prospectus. See "Where
You Can Find More Information" in the attached prospectus.
<TABLE>
<CAPTION>
NINE MONTHS ENDED YEAR ENDED
----------------------------- --------------------------------------------------------------
SEPTEMBER 30, SEPTEMBER 30,
1999 1998 1998 1997 1996 1995 1994
------------- ------------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
RESULTS OF OPERATIONS
Finance charges and discounts.... $ 270,036 $ 223,053 $ 297,091 $ 290,943 $ 281,830 $ 271,580 $ 237,634
Rental revenues on operating
leases......................... 11,926 13,011 17,181 18,664 19,071 20,859 20,841
Other income..................... 39,943 38,705 52,890 40,613 26,346 18,777 18,692
Net income....................... 58,110 51,939 69,576 67,741 58,339 54,447 51,141
BALANCE SHEET DATA
Total finance receivables........ $4,424,033 $3,098,812 $3,611,397 $3,069,123 $3,172,824 $2,967,569 $2,786,891
Reserve for losses............... 89,208 79,148 83,887 77,394 74,824 74,769 69,981
Operating lease equipment, net... 105,785 121,747 118,590 111,518 127,691 124,728 136,135
Total assets..................... 4,683,849 3,234,972 3,784,538 3,177,965 3,269,141 3,060,521 2,910,841
Commercial paper & short-term
debt........................... 1,177,331 961,629 1,424,872 1,073,665 1,014,613 1,009,761 940,371
Long-term notes.................. 2,425,500 1,338,945 1,403,958 1,290,903 1,426,783 1,266,911 1,220,778
Deferred income taxes............ 336,986 313,028 321,521 319,293 315,366 302,741 293,532
Shareholder's equity............. 528,667 428,715 472,452 405,876 411,715 382,476 354,629
External debt to shareholder's
equity......................... 6.81x 5.37x 5.99x 5.83x 5.93x 5.95x 6.09x
SELECTED DATA AND RATIOS
PROFITABILITY
Net interest margin as a
percentage of average net
investment(1).................. 6.66% 6.93% 6.88% 6.51% 6.15% 5.98% 6.32%
Return on equity................. 15.69% 16.29% 16.2% 16.8% 14.8% 14.8% 15.0%
Return on average assets(2)...... 1.87% 2.08% 2.06% 2.07% 1.84% 1.82% 1.85%
Ratio of earnings to fixed
charges........................ 1.69x 1.72x 1.72x 1.70x 1.65x 1.60x 1.72x
Salaries and administrative
expenses as a percentage of
average managed
receivables(3)................. 1.78% 1.72% 1.73% 1.54% 1.65% 1.59% 1.66%
CREDIT QUALITY
60+ days contractual delinquency
as a percentage of finance
receivables(4)................. 1.12% 0.91% 0.87% 0.86% 0.75% 2.52% 0.93%
Nonperforming assets as a
percentage of finance assets... 1.9% 2.5% 2.3% 3.1% 3.6% 4.1% 4.7%
Reserves for losses as a
percentage of finance
receivables.................... 2.0% 2.6% 2.3% 2.5% 2.4% 2.5% 2.5%
</TABLE>
- ---------------
(1) Represents revenues earned less interest expense on borrowings as a
percentage of average net investment. Average net investment includes
finance receivables plus operating leases less deferred taxes on leveraged
leases.
(2) Average assets include finance receivables less allowance for loan loss,
operating leases and other assets. Investments in leveraged leases are not
net of deferred taxes.
(3) Average managed receivables include owned receivables plus receivables
serviced under securitizations, participations and third party portfolio
servicing agreements.
(4) Delinquency excludes captive receivables with recourse to Textron Inc.
Captive receivables represent third party finance receivables originated in
connection with the sale or lease of Textron Inc.'s manufactured products.
S-6
<PAGE> 8
DIRECTORS AND EXECUTIVE OFFICERS
OF TEXTRON FINANCIAL CORPORATION
The directors and executive officers of our company are as follows:
DIRECTORS
<TABLE>
<CAPTION>
NAME AGE POSITION
- ---- --- --------
<S> <C> <C>
Edward C. Arditte.............. 44 Director since May 1997. Vice President and Treasurer of
Textron Inc. since 1997. Vice President Finance and
Business Development, Textron Fastening Systems, from 1995
to 1997, and Vice President -- Communications and Risk
Management of Textron Inc. from 1994 to 1995.
Lewis B. Campbell.............. 53 Director since January 1993. Chairman and Chief Executive
Officer of Textron Inc. since 1999. President and Chief
Executive Officer from 1998 to 1999. President and Chief
Operating Officer of Textron Inc. from 1994 to 1998.
Stephen A. Giliotti............ 51 Director since December 1994. Chairman, President and Chief
Executive Officer of Textron Financial Corporation since
1999. President from 1995 to 1999. Executive Vice President
and Chief Operating Officer from 1994 to 1995.
John A. Janitz................. 57 Director since May 1999. President and Chief Operating
Officer of Textron Inc. since 1999. Chairman, President and
Chief Executive Officer of Textron Automotive Company from
1996 to 1999. Executive Vice President, General Manager,
Occupant Restraint, Seat Belt and Fasteners of TRW, Inc.
from 1990 to 1996.
Wayne W. Juchatz............... 53 Director since May 1995. Executive Vice President and
General Counsel of Textron Inc. since 1995. Executive Vice
President, General Counsel and Secretary of RJ Reynolds Co.
from 1994 to 1995.
</TABLE>
EXECUTIVE OFFICERS
<TABLE>
<CAPTION>
NAME AGE POSITION
- ---- --- --------
<S> <C> <C>
Stephen A. Giliotti............ 51 Chairman, President and Chief Executive Officer since 1999.
President from 1995 to 1999. Executive Vice President and
Chief Operating Officer from 1994 to 1995.
Buell J. Carter................ 53 Executive Vice President and Chief Operating Officer since
1999. Senior Vice President -- Operations from 1997 to
1999. Vice President, Division Manager, Asset Based Finance
from 1991 to 1997.
Andrew M. Chester.............. 45 Executive Vice President -- Human Resources since 1999.
Senior Vice President, Human Resources from 1998 to 1999.
Vice President, Human Resources from 1989 to 1998.
Thomas J. Cullen............... 43 Executive Vice President and Chief Financial Officer since
1999. Senior Vice President and Chief Financial Officer
from 1997 to 1999. Senior Vice President, Finance from 1995
to 1997. Vice President and Controller from 1992 to 1995.
O. Lewis Humphrey.............. 52 Executive Vice President and Chief Credit Officer since
1999. Senior Vice President and Chief Credit Officer from
1995 to 1999. Vice President, Corporate Investment Control
from 1991 to 1995.
</TABLE>
S-7
<PAGE> 9
<TABLE>
<CAPTION>
NAME AGE POSITION
- ---- --- --------
<S> <C> <C>
John W. Mayers, Jr............. 45 Executive Vice President -- Corporate Development since
1999. Vice President, Risk Management and Insurance for
Textron Inc. from 1997 to 1999. Director, Risk Management
and Insurance for Textron Inc. from 1993 to 1997.
Elizabeth C. Perkins........... 45 Executive Vice President, General Counsel and Secretary
since 1999. Senior Vice President, General Counsel and
Secretary from 1994 to 1999.
David A. Raspallo.............. 40 Executive Vice President and Chief Information Officer
since 1999. Senior Vice President and Chief Information
Officer from 1998 to 1999. Vice President, Financial
Segments TFC/AFS 1998. Vice President, Information Systems
from 1993 to 1998.
Dan R. McCullough.............. 55 Senior Vice President -- Operations since 1995. Vice
President Vendor Finance and Floorplan Finance from 1991 to
1995.
Richard H. Mitterling.......... 52 Senior Vice President -- Operations since 1998. Vice
President, Division Manager, Resort Receivable Division
from 1994 to 1998.
Ronald W. Oake................. 55 Senior Vice President -- Operations since 1999. Vice
President, Division Manager, Floorplan Finance Division
from 1998 to 1999. General Manager of Avco Financial
Services from 1995 to 1998. Vice President, Operations,
Floorplan Finance Division from 1992 to 1995.
Richard A. Stratton............ 49 Senior Vice President -- Operations since 1999. Chief
Executive Officer of Litchfield Financial Corporation from
1996 to 1999. President of Litchfield Financial Corporation
from 1988 to 1996.
Barry L. Elfstrom.............. 47 Vice President, Controller Financial Reporting since 1999.
Vice President and Controller or Assistant Controller from
1986 to 1999.
Brian F. Lynn.................. 40 Vice President and Treasurer since 1999. Vice President,
Division Manager, Vendor Finance Division from 1996 to
1999. Vice President and Treasurer from 1994 to 1996.
Eric Salander.................. 40 Vice President, Finance since 1999. Vice President,
Strategic Planning from 1996 to 1999. Vice President
Administration for AAA Southern New England from 1995 to
1996. Manager Ernst & Young from 1989 to 1995.
Kathleen A. Smith.............. 50 Vice President, Tax since 1998. Assistant Vice President,
Tax from 1996 to 1998. Senior Manager of Tax for Lefkowitz,
Garfunkel, Champi & DiRenzo from 1992 to 1996.
</TABLE>
S-8
<PAGE> 10
DESCRIPTION OF NOTES
GENERAL
The following is a description of the particular terms of the Floating Rate
Notes due December , 2002 (the "Floating Rate Notes") and the % Notes due
December , 2004 (the " % Notes" and, with the Floating Rate Notes, the
"Notes") that we are offering. This description supplements, and to the extent
inconsistent replaces, the description of the general terms and provisions of
the debt securities set forth in the accompanying prospectus. The Notes are part
of the debt securities that we registered on 1999 to be issued on
terms to be determined at the time of sale.
We will issue the Floating Rate Notes in an aggregate principal amount initially
of $500,000,000. We will issue the % Notes in an aggregate principal amount
initially of $500,000,000. We may issue, from time to time, additional Notes as
described below. We will issue the Notes pursuant to an indenture dated as of
December , 1999, which is more fully described in the attached prospectus. Our
officers authorized and approved the issuance of the Notes pursuant to a
resolution of our Board of Directors dated November 3, 1999.
The indenture and the Notes provide that they are governed by, and construed in
accordance with, the laws of the State of New York, United States.
The Floating Rate Notes will mature on December , 2002 and the % Notes
will mature on December , 2004. We are not permitted to redeem the Notes prior
to maturity unless certain events occur involving U.S. taxation. See "Redemption
for Tax Reasons."
FLOATING RATE NOTES
The Floating Rate Notes will bear interest at a rate per annum, reset quarterly,
equal to three-month LIBOR plus basis points ( %), as determined
by the calculation agent referred to below. Interest will be computed on the
basis of a 360-day year and the actual number of days in the applicable interest
period, as defined below. Interest is payable quarterly on each March , June
, September and December , commencing March , 2000. Interest is payable
for the period commencing on and including the immediately preceding interest
payment date and ending on and including the day preceding the next interest
payment date (an "Interest Period"), with the exception that the first Interest
Period will commence on and include December , 1999. We will pay interest to
the persons in whose names the Floating Rate Notes are registered at the close
of business on the fifteenth calendar day prior to the interest payment date.
If any interest payment date, other than at maturity, for the Floating Rate
Notes would otherwise be a day that is not a Business Day (as defined below),
the interest payment date will be postponed to the next day that is a Business
Day, except that if the Business Day is in the next succeeding calendar month,
the interest payment date will be the immediately preceding Business Day. If the
maturity or any redemption date for the Floating Rate Notes falls on a day that
is not a Business Day, payment of principal and interest with respect to the
Floating Rate Notes will be paid on the next succeeding Business Day with the
same force and effect as if made on that date and no interest on the payment
will accrue from and after that date.
The interest rate for each Interest Period will be determined by SunTrust Bank,
Atlanta, as calculation agent in accordance with the following provisions:
The per annum rate of interest for each Interest Period will be three-month
LIBOR on the second Business Day preceding the relevant Interest Reset Date (as
defined below) for the Interest Period (the "Interest Determination Date") plus
the applicable spread described above. The Interest Determination
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Date for the first Interest Period will be , 1999. "LIBOR" for each
subsequent Interest Period will be determined by the calculation agent in
accordance with the following provisions:
(1) On each Interest Determination Date, the calculation agent will
determine LIBOR as the offered rate for three-month deposits in U.S.
dollars in the London interbank market, which appears on Telerate Page 3750
as of 11:00 a.m., London time, on the Interest Determination Date.
(2) If the rate does not appear on Telerate Page 3750, or Telerate
Page 3750 is unavailable, the calculation agent will request each of four
major reference banks in the London interbank market to provide the
calculation agent with its offered quotation, expressed as a rate per
annum, for three-month deposits in U.S. dollars to leading banks in the
London interbank market at approximately 11:00 a.m., London time, on the
Interest Determination Date, in a principal amount of not less than
$1,000,000, that is representative for a single transaction in U.S. dollars
in that market at that time. If at least two quotations from the major
reference banks are provided, LIBOR in respect of the Interest
Determination Date will be the arithmetic mean of those quotations.
(3) If less than two of the major reference banks in the London
interbank market provide the calculation agent with the offered quotations,
LIBOR in respect of that Interest Determination Date will be the arithmetic
mean of the rates quoted by three major banks in New York City selected by
the calculation agent, at approximately 11:00 a.m., New York City time, on
that Interest Determination Date for three-month loans in U.S. dollars to
leading European banks, in a principal amount equal to an amount of not
less than $1,000,000, that is representative for a single transaction in
that market at that time.
(4) If the major banks in New York City selected by the calculation
agent are not quoting as described in clause (3), LIBOR will be LIBOR in
effect on the Interest Determination Date.
"Business Day" means any day, other than a Saturday or Sunday, on which banking
institutions in New York City are open for business and which is also a London
Banking Day.
"Interest Reset Date" means, with respect to any Interest Period, the first day
of such Interest Period.
"London Banking Day" means any day, other than a Saturday or Sunday, on which
commercial banks are open for business, including dealings in U.S. dollars, in
London.
"Telerate Page 3750" means the display designated as page "3750" on the Dow
Jones Telerate Service, or any other page as may replace that page on that
service for the purpose of displaying the LIBOR Index on a daily basis.
All percentages resulting from any calculation on the Floating Rate Notes will
be rounded, if necessary, to the nearest one hundred-thousandth of a percentage
point, with five one-millionths of a percentage point rounded upward (e.g.,
9.876545% (or .09876545) being rounded to 9.87655% (or .0987655)), and U.S.
dollar amounts used in or resulting from such calculations will be rounded to
the nearest cent, with one-half cent being rounded upward.
We have agreed that, so long as any of the Floating Rate Notes remain
outstanding, we will maintain under appointment a calculation agent to calculate
the rate of interest payable on the Floating Rate Notes in respect of each
Interest Period. The calculation agent's calculation of the rate of interest
payable on the Floating Rate Notes, will be conclusive and binding on us and the
holders of the Floating Rate Notes, absent manifest error. If the calculation
agent is unable or unwilling to continue to act as calculation agent, or if the
calculation agent fails to establish the applicable rate of interest for any
Interest Period, or if we remove the calculation agent, we will appoint another
bank to act as the calculation agent. The calculation agent, however, cannot
resign or be removed until acceptance of an appointment by a successor as
evidenced by an appropriate agreement entered into between us and the successor
calculation agent.
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% NOTES
The % Notes will bear interest, calculated on the basis of a 360-day year
consisting of twelve 30-day months, from December , 1999 at the rate of %
per annum. Interest is payable on June and December of each year, commencing
June , 2000, to the person in whose name the % Notes are registered at
the close of business on the and preceding the respective interest
payment date.
BOOK-ENTRY, DELIVERY AND FORM
We will offer and sell the Notes in principal amounts of U.S. $1,000 and
integral multiples thereof. We will issue each of the Notes in the form of one
or more fully registered global book-entry notes which we will deposit with, or
on behalf of, The Depository Trust Company and register in the name of Cede &
Co., The Depository Trust Company's nominee. Beneficial interests in the global
notes are represented through book-entry accounts of financial institutions
acting on behalf of beneficial owners as direct or indirect participants in The
Depository Trust Company. Investors may elect to hold interests in the global
notes through The Depository Trust Company, Cedelbank or Morgan Guaranty Trust
Company of New York, Brussels Office, as operator of the Euroclear System, if
they are participants of those systems, or indirectly through organizations
which are participants in those systems. Cedelbank and Euroclear will hold
interests on behalf of their participants through customers' securities accounts
in Cedelbank's and Euroclear's names on the books of their respective
depositaries, which in turn will hold those interests in customers' securities
accounts in the depositaries' names on the books of The Depository Trust
Company. Citibank, N.A. will act as the U.S. depositary for Cedelbank and The
Chase Manhattan Bank will act as the U.S. depositary for Euroclear. Except as
set forth below, holders may transfer the global notes, in whole and not in
part, only to another nominee of The Depository Trust Company or to a successor
of The Depository Trust Company or its nominee.
The Depository Trust Company's management is aware that some computer
applications, systems, and systems for processing data that are dependent upon
calendar dates, including dates before, on, and after January 1, 2000, may
encounter "Year 2000 problems." The Depository Trust Company has informed its
participants and other members of the financial community that it has developed
and is implementing a program so that its computer applications and systems, as
the same relate to the timely payment of principal, interest and other
distributions to security holders, book-entry deliveries, and settlement of
trades within The Depository Trust Company, continue to function appropriately.
This program includes a technical assessment and a remediation plan, both of
which are complete. Additionally, The Depository Trust Company's plan included a
testing phase, which was completed in October 1999. The Depository Trust Company
has determined that its internal applications, systems software, hardware and
data service providers' data feeds are Year 2000 ready.
However, The Depository Trust Company's ability to perform its services properly
is also dependent upon other parties, including but not limited to: (1) issuers
and their agents, (2) third-party vendors from whom The Depository Trust Company
licenses software and hardware, and (3) third-party vendors on whom The
Depository Trust Company relies for information or the provision of services,
including telecommunication and electric utility service providers. The
Depository Trust Company has informed its participants and other members of the
financial community that it is contacting third-party vendors from whom The
Depository Trust Company acquires services to: (1) impress upon them the
importance of such services being Year 2000 compliant and (2) determine the
extent of their efforts for Year 2000 remediation and, as appropriate, testing
of their services. In addition, The Depository Trust Company has developed
contingency plans to handle any disruptions relating to the Year 2000 problems.
Cedelbank advises that it is incorporated under the laws of Luxembourg as a
professional depositary. Cedelbank holds securities for its participating
organizations and facilitates the clearance and settlement of securities
transactions between Cedelbank's participants through electronic book-entry
changes in accounts of Cedelbank's participants, thereby eliminating the need
for physical movement of certificates. Cedelbank provides to its participants,
among other things, services for safekeeping, administration, clearance and
settlement of internationally traded securities and securities lending and
borrowing. Cedelbank interfaces
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with domestic markets in several countries. As a professional depositary,
Cedelbank is subject to regulation by the Luxembourg Monetary Institute.
Cedelbank's participants are recognized financial institutions around the world,
including underwriters, securities brokers and dealers, banks, trust companies,
clearing corporations and certain other organizations and may include the
underwriters. Indirect access to Cedelbank is also available to others, such as
banks, brokers, dealers and trust companies that clear through or maintain a
custodial relationship with one of Cedelbank's participants, either directly or
indirectly.
Distributions with respect to the Notes held beneficially through Cedelbank will
be credited to cash accounts of Cedelbank participants in accordance with its
rules and procedures, to the extent received by the U.S. depositary for
Cedelbank.
Euroclear advises that it was created in 1968 to hold securities for its
participants and to clear and settle transactions between Euroclear's
participants through simultaneous electronic book-entry delivery against
payment. This eliminates the need for physical movement of certificates and any
risk from lack of simultaneous transfers of securities and cash. Euroclear
provides various other services, including securities lending and borrowing and
interfaces with domestic markets in several countries. The Brussels, Belgium
office of Morgan Guaranty Trust Company of New York operates Euroclear under
contract with Euroclear Clearance Systems S.C., a Belgian cooperative
corporation. Morgan Guaranty conducts all operations. All Euroclear securities
clearance accounts and Euroclear cash accounts are accounts with Morgan
Guaranty, not Euroclear Clearance Systems S.C. Euroclear Clearance Systems S.C.
establishes policy for Euroclear on behalf of Euroclear's participants.
Euroclear's participants include banks, including central banks, securities
brokers and dealers and other professional financial intermediaries, and may
include the underwriters. Indirect access to Euroclear is also available to
other firms that clear through or maintain a custodial relationship with a
participant in Euroclear, either directly or indirectly.
Morgan Guaranty Trust Company of New York in Brussels, Belgium is the Belgian
branch of a New York banking corporation which is a member bank of the Federal
Reserve System. As a result, it is subject to the regulation and examination of
the Board of Governors of the Federal Reserve System and the New York State
Banking Department, as well as the Belgian Banking Commission.
Securities clearance accounts and cash accounts with Morgan Guaranty are
governed by the Terms and Conditions Governing Use of Euroclear, and the related
Operating Procedures of the Euroclear System and applicable Belgian law. These
terms, conditions and procedures govern transfers of securities and cash within
Euroclear, withdrawals of securities and cash from Euroclear, and receipts of
payments with respect to securities in Euroclear. All securities in Euroclear
are fungible without attribution of specific certificates to specific securities
clearance accounts. Morgan Guaranty acts under the above-mentioned terms,
conditions and procedures only on behalf of Euroclear's participants, and has no
record of or relationship with persons holding through Euroclear's participants.
Distributions with respect to the Notes held beneficially through Euroclear will
be credited to the cash accounts of Euroclear's participants in accordance with
the above-mentioned terms, conditions and procedures, to the extent received by
Euroclear's U.S. depositary.
If we issue the Notes in definitive form, we will appoint a paying agent and
transfer agent in Luxembourg. If we issue the Notes in definitive form, the
holders of the Notes in definitive form will be able to receive payments on, and
effect transfers of, their Notes at the offices of the Luxembourg paying and
transfer agent.
We will not issue individual certificates for the Notes in exchange for the
global notes, except in very limited circumstances. If Euroclear, Cedelbank or
The Depository Trust Company notifies us that it is unwilling or unable to
continue as a clearing system in connection with a global note or, in the case
of The Depository Trust Company only, The Depository Trust Company ceases to be
a clearing agency registered under the Securities Exchange Act of 1934, and in
each case we do not appoint a successor clearing system within 90 days after
receiving such notice from Euroclear, Cedelbank or The Depository Trust Company
or on becoming aware that The Depository Trust Company is no longer so
registered, we will
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issue or cause to be issued individual certificates in registered form on
registration of transfer of, or in exchange for, book-entry interests in the
Notes represented by the global notes upon delivery of the global notes for
cancellation.
Title to book-entry interests in the Notes will pass by book-entry registration
of the transfer within the records of Euroclear, Cedelbank or The Depository
Trust Company, as the case may be, in accordance with their procedures.
Euroclear and Cedelbank may transfer book-entry interests within and between
Euroclear and Cedelbank in accordance with procedures that they establish. The
Depository Trust Company may transfer book-entry interests in the Notes in
accordance with procedures that it establishes. Euroclear, Cedelbank and The
Depository Trust Company may establish procedures to effect transfers of
book-entry interests in the Notes among themselves.
GLOBAL CLEARANCE AND SETTLEMENT PROCEDURES
We will make initial settlement for the Notes in immediately available funds.
Secondary market trading between The Depository Trust Company's participants
will occur in the ordinary way in accordance with The Depository Trust Company's
rules. Settlement will occur in immediately available funds using The Depository
Trust Company's Same-Day Funds Settlement System. Secondary market trading
between Cedelbank's participants and/or Euroclear's participants will occur in
the ordinary way in accordance with the applicable rules and operating
procedures of Cedelbank and Euroclear. The traders will settle the Notes using
the procedures applicable to conventional Eurobonds in immediately available
funds.
Persons holding directly or indirectly through The Depository Trust Company, on
the one hand, and directly or indirectly through Cedelbank's or Euroclear's
participants, on the other, will effect cross-market transfers in The Depository
Trust Company in accordance with The Depository Trust Company rules on behalf of
the relevant European international clearing system by its U.S. depositary.
These cross-market transactions will require delivery of instructions to the
relevant European international clearing system by the counterparty in the
system in accordance with its rules and procedures and within its established
deadlines, European time. The relevant European international clearing system
will, if the transaction meets its settlement requirements, deliver instructions
to its U.S. depositary to take action to effect final settlement on its behalf
by delivering or receiving the Notes in The Depository Trust Company, and making
or receiving payment in accordance with normal procedures for same-day funds
settlement applicable to The Depository Trust Company. Cedelbank's participants
and Euroclear's participants may not deliver instructions directly to their
respective U.S. depositaries.
Because of time-zone differences, credits of the Notes received in Cedelbank or
Euroclear as a result of a transaction with a participant of The Depository
Trust Company will be made during subsequent securities settlement processing
and dated the business day following The Depository Trust Company settlement
date. These credits or any transactions in the Notes settled during the
processing will be reported to the relevant participants of Euroclear or
Cedelbank on that business day. Cash received in Cedelbank or Euroclear as a
result of sales of the Notes by or through a participant of Cedelbank or
Euroclear to a participant of The Depository Trust Company will be received with
value on The Depository Trust Company settlement date but will be available in
the relevant Cedelbank or Euroclear cash account only as of the business day
following settlement in The Depository Trust Company.
Although The Depository Trust Company, Cedelbank and Euroclear have agreed to
the foregoing procedures in order to facilitate transfers of the Notes among
their respective participants, they are under no obligation to perform or
continue to perform these procedures. The Depository Trust Company, Cedelbank
and Euroclear may change or discontinue these procedures at any time.
FURTHER ISSUES
We may from time to time, without notice to or the consent of the registered
holders of the Notes, create and issue additional Notes ranking pari passu with
the Notes of the same series that we originally issued in all respects or in all
respects except for (1) the payment of interest accruing prior to the issue date
of the additional Notes or (2) the first payment of interest following the issue
date of the additional Notes. As a
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result, we may consolidate the additional Notes, forming a single series with
the Notes of the same series that we originally issued and having the same terms
as to status, redemption or otherwise as the Notes that we originally issued of
the same series.
PAYMENT OF ADDITIONAL AMOUNTS
We will make all payments on the Notes without withholding or deduction for any
taxes, assessments or other governmental charges in effect on the date of
issuance of the Notes or imposed in the future by or on behalf of the United
States or any taxing authority in the United States. In the event any United
States taxes or other charges are imposed on payments on the Notes, we will pay
to the holder of any Note who is a United States alien (as defined below) such
additional amounts as may be necessary so that the net amounts of the principal
and interest on the Notes receivable by a United States alien after withholding
or deduction of any tax, assessment or governmental charge will equal the
amounts of principal and any interest which would have been receivable on a Note
if there were no such withholding or deduction of tax, assessment or
governmental charge. We will not pay any additional amounts, however, with
respect to:
(1) any tax, assessment or other governmental charge which would not
have been so imposed but for (a) the existence of any present or former
connection between the holder (or a fiduciary, settlor, beneficiary, member
or shareholder, or holder of a power over, the holder, if the holder is an
estate, trust, partnership or corporation) and the United States,
including, without limitation, such holder (or such fiduciary, settlor,
beneficiary, member, shareholder of, or holder of a power) being or having
been a citizen or resident or treated as a resident thereof or being or
having been engaged in a trade or business therein or being or having been
present therein or having or having had a permanent establishment therein,
or (b) the holder's present or former status as a personal holding company
or foreign personal holding company or controlled foreign corporation or
passive foreign investment company for United States federal income tax
purposes or as a corporation which accumulates earnings to avoid United
States federal income tax or as a private foundation or other tax-exempt
organization;
(2) any tax, assessment or other governmental charge which would not
have been so imposed but for the presentation by the holder of the Note for
payment on a date more than 10 days after the date on which the payment
became due and payable or the date on which payment thereof is duly
provided for, whichever occurs later;
(3) any estate, inheritance, gift, sales, transfer, personal property
or excise tax or any similar tax, assessment or governmental charge;
(4) any tax, assessment or other governmental charge which is payable
otherwise than by withholding from payments in respect of principal of or
any interest on any Note;
(5) any tax, assessment or other governmental charge imposed on
interest received by a holder or beneficial owner of a Note who actually or
constructively owns 10% or more of the total combined voting power of all
classes of our stock entitled to vote or is a bank that acquired a Note in
consideration of an extension of credit made pursuant to a loan agreement
entered into in the ordinary course of business;
(6) any tax, assessment or other governmental charge imposed as a
result of the failure to comply with (a) certification, information,
documentation, reporting or other similar requirements concerning the
nationality, residence, identity or connection with the United States of
the holder or beneficial owner of the Note, if such compliance is required
by statute, or by regulation of the United States Treasury Department, as a
precondition to relief or exemption from such tax, assessment or other
governmental charge (including backup withholding) or (b) any other
certification, information, documentation, reporting or other similar
requirements under United States income tax laws or regulations that would
establish entitlement to otherwise applicable relief or exemption from such
tax, assessment or other governmental charge;
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(7) any tax, assessment or other governmental charge required to be
withheld by any paying agent from any payment of the principal of, or any
interest on any Note, if the payment can be made without such withholding
by at least one other paying agent; or
(8) any combination of items(1), (2), (3), (4), (5), (6) or (7).
Furthermore, we will pay no additional amounts to any holder who is a fiduciary
or partnership or other than the sole beneficial owner of the Note if a settlor
or beneficiary with respect to such fiduciary or a member of such partnership or
a beneficial owner of the Note would not have been entitled to payment of such
additional amounts had such beneficiary, settlor, member or beneficial owner
been the holder of the Notes.
Except as specifically provided under this heading "Payment of Additional
Amounts" and under the heading "Description of Notes-Redemption for Tax
Reasons", we will not be required to make any payment with respect to any tax,
assessment or governmental charge imposed by any government or a political
subdivision or taxing authority thereof or therein.
The term "United States alien" means any person who, for United States federal
income tax purposes, is a foreign corporation, a non-resident alien individual,
a non-resident alien fiduciary of a foreign estate or trust, or a foreign
partnership, one or more of the members of which is a foreign corporation, a
non-resident alien individual or a non-resident alien fiduciary of a foreign
estate or trust.
REDEMPTION FOR TAX REASONS
We can redeem either series of the Notes before their maturity, in whole but not
in part, if, at any time after the date of issuance of the relevant series of
Notes, as a result of:
- any amendment to, or change in, the laws, including any regulations or
rulings promulgated thereunder, of the United States or any political
subdivision; or
- any change in the application or official interpretation of such laws,
including any proposals for change, amendment or application or
interpretation of such laws;
where the amendment or change becomes effective after the date of this
prospectus supplement, or which proposal is made after such date, or as a result
of any action taken by any taxing authority of the United States which action is
taken or becomes generally known after such date, or any commencement of a
proceeding in a court of competent jurisdiction in the United States after such
date, whether or not such action was taken or such proceeding was brought with
respect to us, we become, or will become, obligated to pay any additional
amounts as provided above under "-- Payments of Additional Amounts" (a "tax
event") in respect of the relevant series of Notes.
Before we can redeem either series of the Notes, we must deliver to the trustee
at least 45 days prior to the date fixed for redemption:
- a written notice stating that the Notes of the relevant series are to be
redeemed, specifying the redemption date and other pertinent information;
and
- an opinion of independent legal counsel to the effect that, as a result
of a tax event, we have or will become obligated to pay any additional
amounts in respect of the relevant series of Notes.
We will give you at least 30 days', but not more than 60 days', notice before
any redemption of your Notes. On the redemption date, we will pay you 100% of
the principal amount of your Note, plus any accrued interest, including any
additional amounts, to the redemption date.
NOTICES
Notices to holders of the Notes will be published in authorized daily newspapers
in New York City, in London, and, so long as the Notes are listed on the
Luxembourg Stock Exchange, in Luxembourg. It is expected that publication will
be made in New York City in The Wall Street Journal, in London in the Financial
Times, and in Luxembourg in the Luxemburger Wort. Any notice will be deemed to
have been given on the date of such publication or, if published more than once,
on the date of the first such publication.
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U.S. FEDERAL TAXATION
The following is a description of the material United States federal income and
certain estate tax consequences of ownership and disposition of the Notes. This
description provides general information only and is directed solely to original
holders purchasing Notes at the issue price. The issue price is the first price
to the public at which a substantial amount of the Notes are sold, excluding
sales to bond houses, brokers or similar persons or organizations acting in the
capacity of underwriters, placement agents or wholesalers. This description is
based on the Internal Revenue Code, existing administrative pronouncements and
judicial decisions, existing and proposed Treasury regulations, each as
available and in effect on the date of this prospectus supplement. Changes to
any of the foregoing after the date of this prospectus supplement may affect the
tax consequences described below, possibly with retroactive effect. This
description discusses only Notes held as capital assets. This description does
not discuss all of the tax consequences that may be relevant to a holder in
light of his particular circumstances. This description also does not discuss
all of the tax consequences that may be relevant to holders subject to special
rules, such as (1) certain financial institutions, (2) real estate investment
trusts, (3) regulated investment companies, (4) grantor trusts, (5) insurance
companies, (6) dealers or traders in securities or currencies, (7) persons
holding Notes in connection with a hedging transaction, straddle, conversion
transaction or other integrated transaction or (8) persons who have ceased to be
United States citizens or to be taxed as resident aliens. Persons considering
the purchase of Notes should consult their tax advisors with regard to the
application of the United States federal income and estate tax laws to their
particular situations, as well as any tax consequences arising under the laws of
any state, local or foreign taxing jurisdiction.
UNITED STATES HOLDERS
For purposes of this discussion, a United States holder means a beneficial owner
of a Note that is for United States federal income tax purposes:
- a citizen or resident of the United States;
- a corporation or a partnership created in or organized under the laws of
the United States, any state thereof or the District of Columbia;
- an estate the income of which is subject to United States federal income
taxation regardless of its source;
- a trust if it has validly elected to be treated as a United States person
for United States federal income tax purposes or if (1) a court within
the United States is able to exercise primary supervision over its
administration and (2) one or more United States persons have the
authority to control all of its substantial decisions; or
- a person otherwise subject to United States federal income taxation on a
net income basis in respect of a Note.
A Non-United States holder is a beneficial owner of a Note that is not a United
States holder.
Payments of Interest
Interest on a Note generally is taxable to a United States holder as ordinary
interest income at the time it is accrued or is received in accordance with the
United States holder's usual method of accounting for tax purposes.
Sale, Exchange or Retirement of the Notes
If you are a United States holder and you sell your Note or it is retired, you
will recognize taxable gain or loss equal to the difference between the amount
realized on the sale, exchange or retirement and your adjusted tax basis in the
Note. For these purposes, the amount realized does not include any amount
attributable to accrued interest on the Notes. Amounts attributable to accrued
interest are treated as
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interest as described under "Payments of Interest" above. A United States
holder's adjusted tax basis in a Note generally will equal the cost of the Note
to the United States holder.
In general, gain or loss realized on the sale, exchange or redemption of a Note
will be capital gain or loss. You should consult your tax advisor regarding the
treatment of capital gains which may be taxed at lower rates than ordinary
income for taxpayers who are individuals, trusts or estates. In addition,
prospective investors should consult their tax advisors regarding the treatment
of capital losses, the deductibility of which is subject to limitations.
NON-UNITED STATES HOLDERS
Interest on Notes
Subject to the discussion under "Backup Withholding and Information Reporting"
below, if you are a Non-United States holder, but are not:
- a controlled foreign corporation related to Textron Financial Corporation
by stock ownership;
- a shareholder owning actually or constructively 10% or more of the total
combined voting power of all classes of stock of Textron Financial
Corporation entitled to vote; or
- a bank which acquired Notes in consideration of an extension of credit
made pursuant to a loan agreement entered into in the ordinary course of
business
and receive an interest payment from Textron Financial Corporation, you will not
be subject to United States federal income or withholding tax provided that: (1)
the interest is not effectively connected with the conduct of a trade or
business within the United States and (2) you provide valid certifications
meeting the requirements of the Internal Revenue Code or otherwise establish an
exemption.
If you are engaged in a trade or business in the United States and interest on
the Note is effectively connected with the conduct of such trade or business,
you will be subject to United States federal income tax on the interest on a net
income basis in the same manner as if you were a United States holder. In
addition, a Non-United States holder that is a foreign corporation may be
subject to a branch profits tax equal to 30%, or lower applicable treaty rate,
of its effectively connected earnings and profits, including any premium and
interest on a Note, for the taxable year, subject to adjustments.
Sale, Exchange or Retirement
As a Non-United States holder, you will not be subject to United States federal
income tax on gain recognized on a sale, exchange or retirement of a Note unless
(1) such gain is effectively connected with the conduct of a trade or business
within the United States or (2) you are individual that is present in the United
States for 183 or more days in the taxable year of disposition and certain other
requirements are met.
Federal Estate Taxes
If you hold a Note and at the time of your death are not a citizen or resident
of the United States, you will not be subject to United States federal estate
tax as a result of such death, provided that you were not a shareholder owning
actually or constructively 10% or more of the total combined voting power of all
classes of stock of Textron Financial Corporation entitled to vote and, at the
time of your death, payments of interest with respect to your Notes would not
have been effectively connected with your conduct of a trade or business in the
United States.
BACKUP WITHHOLDING AND INFORMATION REPORTING
A 31% backup withholding tax and information reporting requirements apply in the
case of certain non-corporate United States persons to certain payments of
principal of, and interest on, an obligation, and of
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proceeds of the sale of an obligation before maturity. If you are a United
States person that is not a corporation or other "exempt recipient", backup
withholding will apply to you if you:
- fail to furnish your Taxpayer Identification Number ("TIN") which in the
case of an individual is your Social Security Number,
- furnish an incorrect TIN,
- are notified by the Internal Revenue Service that you have failed to
properly report payments of interest or dividends, or
- under certain circumstances, fail to certify, under penalty of perjury,
that you furnished a correct TIN and have not been notified by the
Internal Revenue Service that you are subject to backup withholding.
Under current Treasury regulations, if you are not a United States person,
backup withholding and information reporting will not apply to payments on Notes
that we or any paying agent make outside the United States, provided that we
have received valid certifications meeting the requirements of the Internal
Revenue Code and neither we nor the paying agent has actual knowledge that you
are a United States person for purposes of such backup withholding tax and
information reporting requirements. In addition, if principal or interest is
paid to the beneficial owner of a Note by a foreign office of a foreign
custodian, foreign nominee or other foreign agent of a beneficial owner, or if a
foreign office of a foreign broker pays the proceeds of the sale of a Note to
the seller of the Note, backup withholding and information reporting will not
apply, provided that the nominee, custodian, agent or broker derives less than
50% of its gross income for certain periods from the conduct of a trade or
business in the United States and is not a controlled foreign corporation.
Principal and interest so paid by a foreign office of other custodians, nominees
or agents, or the payment by a foreign office of other brokers of the proceeds
of the sale of a Note will not be subject to backup withholding, but will be
subject to information of reporting unless (1) the custodian, nominee, agent, or
broker has documentary evidence in its records that the beneficial owner is not
a United States person for purposes of these backup withholding and information
reporting requirements and certain conditions are met, or (2) the beneficial
owner otherwise establishes an exemption. Principal and interest so paid by the
United States office of custodian, nominee or agent, or the payment of the
proceeds of a sale of a Note by the United States office of a broker, is subject
to both backup withholding and information reporting, unless the beneficial
owner certifies its non-United States status under penalties of perjury or
otherwise establishes an exemption.
Treasury regulations issued on October 6, 1997, and an Internal Revenue Service
notice announcing amendments to these regulations issued on April 29, 1999 (the
"Withholding Regulations"), would modify certain of the rules discussed above
generally with respect to payments on the Notes made after December 31, 2000. In
the case of payments to foreign partnerships, other than payments to foreign
partnerships that qualify as withholding foreign partnerships within the meaning
of the Withholding Regulations and payments to foreign partnerships that are
effectively connected with the conduct of a trade or business in the United
States, the partners of these partnerships will be required to provide the
certification discussed above in order to establish an exemption from backup
withholding tax and information reporting requirements. Moreover, a payor may
rely on a certification provided by a Non-United States holder only if the payor
does not have actual knowledge or a reason to know that any information or
certification stated in the certificate is unreliable. Further, if any payment
of principal, any premium or interest with respect to a Note is made to the
beneficial owner of the Note by the foreign office of a foreign custodian,
foreign nominee or other foreign agent of the beneficial owner, or the foreign
office of a foreign broker pays the proceeds of the sale of a Note to the seller
of the Note, backup withholding and information reporting will not apply,
provided that the nominee, custodian, agent or broker (1) derives less than 50%
of its gross income for certain periods from the conduct of trade of business in
the United States, (2) is not a controlled foreign corporation and (3) is not a
foreign partnership (a) one or more of the partners of which, at any time during
its tax year, is a United States person who, in the aggregate, holds more than
50% of the income or capital interest in the partnership or (b) which, at any
time during its tax year, is engaged in the conduct of trade or business in the
United States. Moreover,
S-18
<PAGE> 20
payments of principal, any premium, or interest with respect to Notes made by
the foreign offices of the other custodians, nominees or agents, or the payment
by the foreign office of other brokers of the proceeds of the sale of the Notes,
will not be subject to a backup withholding, unless the payor has actual
knowledge that the payee is a United States person, but will not be subject to
information reporting unless (1) the custodian, nominee, agent or broker had
documentary evidence in its records that the beneficial owner is not a United
States person and certain conditions are met, or (2) the beneficial owner
otherwise establishes an exemption.
Prospective investors are strongly urged to consult their own tax advisors with
respect to the withholding tax, backup withholding tax and related matters.
S-19
<PAGE> 21
UNDERWRITING
Subject to the terms and conditions set forth in an underwriting agreement dated
December , 1999, we have agreed to sell to each of the underwriters named
below, and each of the underwriters has severally agreed to purchase the
principal amount of the Notes set forth opposite its name below. Merrill Lynch,
Pierce, Fenner & Smith Incorporated and J.P. Morgan Securities Inc. are acting
as representatives of the underwriters with respect to the offering of the
Notes. In the underwriting agreement, the several underwriters have agreed,
subject to the terms and conditions set forth therein, to purchase all the Notes
offered hereby if any of the Notes are purchased.
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT PRINCIPAL AMOUNT
UNDERWRITER OF FLOATING RATE NOTES OF % NOTES
- ----------- ---------------------- ----------------
<S> <C> <C>
Merrill Lynch, Pierce, Fenner & Smith
Incorporated................................. $ $
J.P. Morgan Securities Inc................................
Banc of America Securities LLC............................
Chase Securities Inc. ....................................
Salomon Smith Barney Inc. ................................
Warburg Dillon Read LLC...................................
------------ ------------
Total........................................... $500,000,000 $500,000,000
============ ============
</TABLE>
The representatives of the underwriters have advised us that they propose
initially to offer the Notes to the public at the offering prices set forth on
the cover page of this prospectus supplement and to certain dealers at such
price less a concession not in excess of %, in the case of the Floating
Rate Notes, and %, in the case of the % Notes, of the principal amount
of the Notes. The underwriters may allow, and the dealers may reallow, a
discount of %, in the case of the Floating Rate Notes, and %, in the
case of the % Notes, of the principal amount of the Notes to certain other
dealers. After the initial public offering, the public offering prices and
concessions to selected dealers and the allowances to other dealers may be
changed.
We have agreed to indemnify the underwriters against certain liabilities,
including liabilities under the Securities Act of 1933.
The Notes are offered for sale in those jurisdictions in the United States and
Europe where it is legal to make offers. Only offers and sales of the Notes in
the United States, as part of the initial distribution or in connection with
resales of these Notes under circumstances where this prospectus supplement and
the attached prospectus must be delivered, are made pursuant to the registration
statement of which the prospectus, as supplemented by this prospectus
supplement, is a part.
Each underwriter has represented and agreed that it will comply with all
applicable laws and regulations in force in any jurisdiction in which it
purchases, offers, sells or delivers the Notes or possesses or distributes this
prospectus supplement or the attached prospectus. Each underwriter also has
represented that it will obtain any consent, approval or permission required by
it for the purchase, offer or sale by it of the Notes under the laws and
regulations in force in any jurisdiction to which it is subject or in which it
makes purchases, offers or sales. Neither we nor any other underwriter will have
responsibility for obtaining any consent, approval or permission required by an
underwriter as described above.
Each underwriter, severally and not jointly, represents and agrees that:
(1) it has not offered or sold and will not offer or sell any Notes to
persons in the United Kingdom prior to the end of the period of six months
from the issue date of the Notes except to persons whose ordinary
activities involve them in acquiring, holding, managing or disposing of
investments, as principal or agent, for the purposes of their businesses or
otherwise in circumstances which have not resulted and will not result in
an offer to the public in the United Kingdom within the meaning of the
Public Offers of Securities Regulations 1995;
(2) it has only issued or passed on and will only issue or pass on in
the United Kingdom any document received by it in connection with the issue
of the Notes to a person who is of a kind
S-20
<PAGE> 22
described in Article 11 (3) of the Financial Services Act 1986 (Investment
Advertisements) (Exemptions) Order 1996, as amended, or is a person to whom
such document may otherwise lawfully be issued or passed on; and
(3) it has complied and will comply with all applicable provisions of
the Financial Services Act 1986 with respect to anything done by it in
relation to any Notes in, from or otherwise involving the United Kingdom.
Although we will apply to list the Notes on the Luxembourg Stock Exchange and we
will apply to list the Notes on the New York Stock Exchange, the Notes are a new
issue of securities with no established trading market. We cannot give you any
assurance as to the liquidity of, or the trading markets for, the Notes. The
underwriters have advised us that they intend to make a market in the Notes, but
they are not obligated to do so and may discontinue such market-making at any
time without notice.
Purchasers of the Notes may be required to pay stamp taxes and other charges in
accordance with the laws and practices of the country of purchase in addition to
the issue price set forth on the cover page of this prospectus supplement.
In connection with the sale of the Notes, certain of the underwriters may engage
in transactions that stabilize, maintain or otherwise affect the price of the
Notes. Specifically, the underwriters may sell Notes in an aggregate principal
amount exceeding that set forth in this prospectus supplement, creating a short
position. In addition, the underwriters may bid for, and purchase, the Notes in
the open market to cover short positions or to stabilize the price of the Notes.
Any of these activities may stabilize or maintain the market price of the Notes
above independent market levels. The underwriters will not be required to engage
in these activities, and may end any of these activities at any time.
In the ordinary course of their respective businesses, certain of the
underwriters or their affiliates have engaged, and will in the future engage, in
commercial banking and investment banking transactions with us and certain of
our affiliates.
GENERAL AND LISTING INFORMATION
We will apply to list the Notes on the Luxembourg Stock Exchange. In connection
with the listing application, we will deposit prior to our listing our
certificate of incorporation, our by-laws and a legal notice relating to the
issuance of the Notes with the Greffier en Chef du Tribunal d'Arrondissement de
et a Luxembourg, where you may obtain copies upon request. So long as any Notes
are outstanding, we will make available for inspection at the main office of
Kreditbank S.A. Luxembourg copies of the above documents, as well as this
prospectus supplement, the attached prospectus, the indenture, our registration
statement on Form 10, as amended, and all future annual reports on Form 10-K,
quarterly reports on Form 10-Q and current reports on Form 8-K that we file with
the SEC. You also may obtain copies of our registration statement on Form 10, as
amended, as well as our future annual reports, quarterly reports and current
reports free of charge at the office of Kreditbank S.A. Luxembourg.
We have not appointed a Luxembourg paying or transfer agent with respect to the
Notes. We have agreed to appoint an agent in Luxembourg if Notes in definitive
form are issued in the limited circumstances set forth in "Description of
Notes." Kreditbank S.A. Luxembourg will act as intermediary between the
Luxembourg Stock Exchange and us and the holders of the Notes.
We will apply to list the Notes on the New York Stock Exchange. You may review
copies of this prospectus supplement, the attached prospectus and our
registration statement on Form 10, as amended, as well as our future annual
reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form
8-K at the New York Stock Exchange's library. The New York Stock Exchange's
library is located at 20 Broad Street, New York, New York.
Except as we may have disclosed in this prospectus supplement, in the attached
prospectus or in the documents incorporated by reference into the prospectus,
there has been no material adverse change in our financial position since
January 2, 1999.
S-21
<PAGE> 23
We are not a party to any legal or arbitration proceedings, including any that
are pending or threatened, which may have or have had during the previous 12
months a significant effect on our consolidated financial position.
The Floating Rate Notes have been accepted for clearance through Euroclear and
Cedelbank and have been assigned Euroclear and Cedelbank Common Code No. ,
International Security Identification Number (ISIN) and CUSIP No.
. The % Notes have been accepted for clearance through Euroclear
and Cedelbank and have been assigned Euroclear and Cedelbank Common Code No.
, International Security Identification Number (ISIN) and CUSIP No.
.
LEGAL OPINIONS
White & Case LLP will pass upon the validity of the Notes for us. Brown & Wood
LLP will pass upon the validity of the Notes for the underwriters.
S-22
<PAGE> 24
REGISTERED OFFICES OF THE COMPANY
40 Westminster Street
P.O. Box 6687
Providence, Rhode Island 02940-6687
United States
LEGAL AND TAX ADVISORS
TO TEXTRON FINANCIAL CORPORATION
WHITE & CASE LLP
1155 Avenue of the Americas
New York, New York 10036-2787
United States
AUDITORS
Independent Auditors
of Textron Financial Corporation
ERNST & YOUNG LLP
200 Clarendon Street
Boston, MA 02116
United States
LEGAL ADVISORS TO THE UNDERWRITERS
BROWN & WOOD LLP
One World Trade Center
New York, New York 10048-0557
United States
LISTING AGENT
KREDITBANK S.A. LUXEMBOURG
43, Boulevard Royal
L-2955
Luxembourg
TRUSTEE
SUNTRUST BANK, ATLANTA
Corporate Trust Division
25 Park Place, 24th Floor
Atlanta, Georgia 30303-2900
United States
<PAGE> 25
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 NOVEMBER 29, 1999
PROSPECTUS
TFC TEXTRON LOGO
TEXTRON FINANCIAL CORPORATION
40 WESTMINSTER STREET
P.O. BOX 6687
PROVIDENCE, RHODE ISLAND 02940-6687
(401) 621-4200
$3,000,000,000
DEBT SECURITIES
-------------------------
WE WILL PROVIDE SPECIFIED 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 of 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> 26
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
About this Prospectus............... 1
Textron Financial Corporation....... 1
Use of Proceeds..................... 2
Ratio of Earnings to Fixed
Charges............................. 2
Description of Debt Securities...... 2
</TABLE>
<TABLE>
<CAPTION>
PAGE
<S> <C>
Plan of Distribution................ 12
Where You Can Find More
Information......................... 13
Legal Opinions...................... 14
Experts............................. 14
</TABLE>
i
<PAGE> 27
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
SEC using a "shelf" registration process. Under this shelf registration process,
we may sell any combination of the debt securities described in this prospectus
in one or more offerings up to a total maximum offering price of $3,000,000,000.
This prospectus provides you with a general description of the securities
we may offer. Each time we sell securities, we will provide a prospectus
supplement that will contain specific information about the terms of the
securities offered. Each prospectus supplement may also add to or update or
change information contained in this prospectus. You should read both this
prospectus and any prospectus supplement together with additional information
described under the heading WHERE YOU CAN FIND MORE INFORMATION.
TEXTRON FINANCIAL CORPORATION
We were incorporated in the State of Delaware in 1962. Our executive office
is at 40 Westminster Street, Providence, Rhode Island. Our telephone number is
401-621-4200. We are a diversified commercial finance company offering term
loans and leases for equipment, revolving credit arrangements and, other
specialty financial products. Our finance transactions involve many industries,
including aircraft, golf, timeshare resorts, transportation, machine tool, and
automotive service and repair. Our other financial services and products include
transaction syndications, equipment appraisal and management, portfolio
servicing and insurance brokerage. We are a wholly-owned subsidiary of Textron
Inc., a multi-industry company with market-leading operations in aircraft,
automotive, industrial and finance.
We entered into a Support Agreement dated as of May 25, 1994 with Textron
Inc. The Support Agreement requires Textron Inc. to pay us, quarterly, an amount
sufficient to provide that pre-tax earnings, before extraordinary items and
fixed charges, will not be less than 125% of our fixed charges. Fixed charges
for purposes of the Support Agreement include interest on indebtedness and
amortization of debt discount. Textron Inc. was not required to make any
payments under the Support Agreement for the nine months ended September 30,
1999, or for the years ended 1998, 1997, 1996, 1995 and 1994, when our fixed
charge coverage ratios were 170%, 173%, 171%, 165%, 160% and 172%, respectively.
In addition, Textron Inc. has agreed to maintain our consolidated shareholders'
equity at an amount not less than $200 million. Under the terms of the Support
Agreement, we agree with Textron Inc. that one hundred percent (100%) of our
issued and outstanding common stock will be owned by Textron Inc. or a
corporation controlled by, controlling, or under common control with, Textron
Inc. The Support Agreement is not a guarantee by Textron Inc. of the payment of
interest or principal of any obligation, indebtedness or liability by us,
including the debt securities offered hereby, to any person. However, the
Support Agreement does contain provisions protecting our investors from the
termination of the Support Agreement and entitling them to enforce its
provisions against Textron Inc. As a result, if Textron Inc. does not comply
with its obligations under the Support Agreement, holders of our debt securities
and other creditors could bring an action against Textron Inc. to compel Textron
Inc. to comply with its obligations.
<PAGE> 28
USE OF PROCEEDS
We will use the net proceeds from the sale of the debt securities that we
offer for sale by this prospectus for the purpose that we specify in the
prospectus supplement for those debt securities. Those purposes may include
repayment of debt, origination of loan and lease financings, acquisition of
finance portfolios and businesses and other general corporate purposes.
RATIO OF EARNINGS TO FIXED CHARGES
Our ratio of earnings to fixed charges for each of the periods indicated is
as follows:
<TABLE>
<CAPTION>
NINE MONTHS ENDED YEARS ENDED
SEPTEMBER 30, 1999 1998 1997 1996 1995 1994
- ------------------ ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
1.69 1.72 1.70 1.65 1.60 1.72
</TABLE>
For these ratios, we calculated earnings by adding the following:
- pre-tax income from continuing operations before adjustment for minority
interests in consolidated subsidiaries or income or loss from investments
that we account for using the equity method of accounting;
- fixed charges;
- amortization of previously capitalized interest;
- distributed income of investments that we account for using the equity
method of accounting; and
- our share of pre-tax losses of investments that we account for using the
equity method of accounting and then subtracting:
-- capitalized interest and
-- minority interests in pre-tax income of subsidiaries that have not
incurred fixed charges.
For this purpose, we calculated fixed charges by adding the following:
- interest expensed and capitalized;
- amortized premiums, discounts and capitalized expenses relating to
indebtedness;
- an estimate of interest included in rental expense; and
- preferred stock dividend requirements, if any, of consolidated
subsidiaries.
DESCRIPTION OF DEBT SECURITIES
We will issue the debt securities under an indenture between us and
SunTrust Bank, Atlanta, as trustee.
We have summarized below provisions of the indenture and the Trust
Indenture Act of 1939. The summary does not contain all of the provisions that
you may want to consider as an investor in the debt securities. You may wish to
review the indenture. We have filed a copy of the indenture with the SEC.
2
<PAGE> 29
GENERAL
The indenture does not limit the amount of debt securities that we may
issue under it. In addition, the indenture does not limit the amount of any
other debt that we may issue under other financing documents.
We are allowed under the indenture to issue debt securities in one or more
series. We will include in the prospectus supplement for a series of debt
securities being offered specific terms of the debt securities. These terms will
include some or all of the following:
- the title of the debt securities;
- the total principal amount and the permitted denominations of the debt
securities;
- the currency or currencies in which the principal of and any interest on
the debt securities will be payable;
- the date on which the debt securities will be payable;
- the interest rate, if any, for the debt securities or the method that
will be used to determine the interest rate;
- the places where principal and any interest will be payable;
- any mandatory or optional repayment or redemption provisions; and
- any other terms of the debt securities.
We are allowed under the indenture to issue debt securities of a single
series at various times, with different maturity dates and redemption and
repayment provisions, if any, and different interest rates. We will specify in
the prospectus supplement the persons to whom and the manner in which any
interest will be payable.
The debt securities will be unsecured, unsubordinated indebtedness of our
company. The debt securities will rank equally with all of our other unsecured
and unsubordinated indebtedness.
We will issue the debt securities in the denominations that we set forth in
the applicable prospectus supplement. The trustee will register the debt
securities in the names of the holders of the debt securities. We will maintain
an office or agency where holders of the debt securities may present the debt
securities for payment, transfer or exchange. We will not charge any service
charge for any transfer or exchange of the debt securities, but we may require a
payment sufficient to cover any tax or other governmental charge payable on the
debt securities.
We may sell some of the debt securities at a substantial discount below
their stated principal amount and we may provide for the payment of no interest
or interest at a rate which at the time of issuance is below market rates. We
will describe the U.S. federal income tax consequences and other special
considerations applicable to any discounted debt securities in the prospectus
supplement relating to the discounted debt securities.
BOOK-ENTRY PROCEDURES
We may issue the debt securities in the form of one or more book-entry
certificates registered in the name of a depositary or a nominee of a
depositary. Unless we otherwise state in the applicable prospectus supplement,
the depositary will be The Depository Trust Company. The Depository Trust
Company has informed us that its nominee will be
3
<PAGE> 30
Cede & Co., who will be the initial registered holder of any series of debt
securities that are issued in book-entry form.
If we use the book-entry only form, we will not issue certificates to
individual holders of the debt securities, except as set forth below or in the
applicable prospectus supplement. The Depository Trust Company and its
participating organizations will only show beneficial interests in book-entry
securities on and transfers of book-entry securities through the records that it
and its participating organizations maintain. In addition, if holders of debt
securities issued in book-entry form want to take any action, they must instruct
the participating organization through which they hold the debt securities. The
participating organization then must instruct The Depository Trust Company or
Cede & Co., as the registered holder of the debt securities, to take action.
The Depository Trust Company has provided us with the following
information. The Depository Trust Company is a limited purpose trust company
organized under the New York Banking Law, a "banking organization" within the
meaning of the New York Banking Law, a member of the United States Federal
Reserve System, a "clearing corporation" within the meaning of the New York
Uniform Commercial Code and a "clearing agency" registered under Section 17A of
the Securities Exchange Act of 1934. The Depository Trust Company holds
securities that its participating organizations, or direct participants, deposit
with it. The Depository Trust Company also facilitates the clearance and
settlement of securities transactions among direct participants through
electronic book-entries. This eliminates the need for physical exchange of
certificates. Direct participants include securities brokers and dealers, banks,
trust companies, clearing corporations and certain other organizations. Other
organizations, including banks, brokers, dealers and trust companies that work
with a direct participant also use The Depository Trust Company's book-entry
system. The rules that apply to The Depository Trust Company and its
participants are on file with the SEC.
If anyone wishes to purchase, sell or otherwise transfer debt securities
issued in book-entry form, they must do it through a direct or indirect
participant. Holders will not be recognized as registered holders of the debt
securities and, thus, will be permitted to exercise their rights only indirectly
through and subject to the procedures of participants and, if applicable,
indirect participants.
The absence of physical certificates may limit the ability of a holder to
pledge debt securities issued in book-entry form to persons or entities that do
not participate in The Depository Trust Company system, or to otherwise act with
respect to the debt securities.
The Depository Trust Company has advised us that it will only take an
action that the indenture permits a registered holder of any debt securities to
take if a participant directs it to do so.
Debt securities represented by a book-entry security will be exchangeable
for debt securities in definitive form with the same terms only if:
- The Depository Trust Company notifies us that it is unwilling or unable
to continue as depositary or The Depository Trust Company ceases to be a
clearing agency registered under applicable law and we do not appoint a
new depositary within 90 days;
- we determine that the book-entry security is now exchangeable for debt
securities in definitive form; or
4
<PAGE> 31
- an event of default has occurred and is continuing with respect to the
debt securities.
If any of these events occur, The Depository Trust Company will generally notify
all direct participants of the availability of definitive debt securities.
Except as we describe in this section, a book-entry security may not be
transferred except as a whole by The Depository Trust Company to its nominee or
by its nominee to The Depository Trust Company or another of its nominees or to
a successor depositary appointed by us.
CERTAIN COVENANTS
We must comply with the covenants which are contained in the indenture
described below. However, the covenants may not ensure that the holders of debt
securities will receive payments of principal and interest on the debt
securities when due in the event of a highly leveraged or similar transaction
involving our company. These types of transactions would include a leveraged
buyout or a change of control of our company. Also, the covenants will not limit
the amount of debt we may incur or the amount of dividends we may pay to our
shareholder.
LIMITATIONS ON LIENS
We will not directly or indirectly, and will not allow any Subsidiary to,
create, assume or incur any Lien on any of the properties and assets of our
company or any Subsidiary unless we grant to the holders of the outstanding debt
securities a Lien on the same property or assets that is equal in seniority to
the Lien. However, we will not be required to grant a Lien as security to the
holders of the outstanding debt securities if our company or any Subsidiary
merely:
- leases property to others in the ordinary course of business, or leases
or subleases property that is not necessary in the operation of its
business;
- creates, assumes or incurs any Lien if (1) the Lien secures indebtedness
for borrowed money which was used to finance the acquisition of the
property that is subject to the Lien and (2) the Lien is created at the
same time as our company or the Subsidiary acquired the property or
within 90 days after the acquisition;
- assumes:
-- any Lien existing on any asset of any Person at the time the Person
becomes a Subsidiary that is not created in contemplation of the
event;
-- any Lien on any asset of any Person existing at the time the Person
merges or consolidates with or into our company or a Subsidiary that
is not created in contemplation of the merger or consolidation; and
-- any Lien existing on any asset prior to the time our company or a
Subsidiary acquires the asset if the Lien is not created in
contemplation of the acquisition;
5
<PAGE> 32
- makes any deposit with or gives any form of security to any governmental
agency or similar body in order to enable our company or any Subsidiary
to:
-- maintain self-insurance;
-- participate in any fund in connection with workmen's compensation,
unemployment insurance, old-age pensions, or other social security;
-- share in any privileges or other benefits available to corporations
participating in any arrangement described above; or
-- for any other purpose at any time required by law or regulation in
order to transact business or exercise any privilege or license;
- deposits assets of our company or any Subsidiary with any surety company
or clerk of any court, or in escrow, as collateral in connection with any
bond on appeal by our company or any Subsidiary from any judgment or
decree against it, or in connection with any other judicial proceedings
by or against our company or any Subsidiary;
- incurs upon any of its property or assets:
-- Liens for taxes or other governmental charges which are not yet due
or are payable without penalty or which our company or any Subsidiary
is contesting in good faith and for which our company or the
Subsidiary has set aside adequate reserves on our company's or the
Subsidiary's books, as long as foreclosure or similar proceedings
have not been started;
-- the Liens of any judgment, if the judgment has not remained
undischarged, or unstayed on appeal or otherwise, for more than six
months;
-- undetermined Liens or charges incident to construction;
-- materialmen's, mechanics', workmen's, repairmen's or other similar
Liens arising in the ordinary course of business in respect of
obligations which are not yet due or which our company or such
Subsidiary is contesting in good faith, or deposits to obtain the
release of these Liens; or
-- any encumbrances consisting of zoning restrictions, licenses,
easements and restrictions on the use of real property and minor
defects and irregularities in the title, which do not materially
impair our company's or the Subsidiary's use of the property or
decrease the value of the property for the purpose of our or any
Subsidiary's business;
- creates other Liens arising in the ordinary course of its business which:
-- do not secure Debt;
-- do not secure any obligation in an amount exceeding $5,000,000; and
-- do not in the aggregate materially detract from the value of its
property or assets or materially impair the use in the operation of
its business;
- creates Liens not otherwise permitted securing Debt in an aggregate
principal amount at any time outstanding not to exceed 15% of
Consolidated Net Tangible Assets;
6
<PAGE> 33
- creates in favor of any lender or holder of commercial paper of our
company or any of our Subsidiaries in the ordinary course of business a
banker's lien or right to offset amounts deposited with the lender or
holder of commercial paper;
- creates or assumes Liens securing debt that a Subsidiary owes to our
company or another Subsidiary;
- creates, assumes or incurs any Lien upon any of its properties or assets
in connection with the sale, transfer or other disposition of the
properties or assets:
-- in connection with the securitization or other asset-based financing;
-- to a real estate investment trust or similar entity; or
-- in connection with any transaction similar to the transactions
referred to in the immediately preceding clauses;
provided, however, that any sale, transfer or disposition must be for
valid consideration and must not benefit directly or indirectly any
holder of any outstanding obligation or indebtedness of our company more
than any other holder if that outstanding obligation or indebtedness did
not previously benefit from a Lien; and
- causes or allows any extension, renewal or replacement of any Lien
referred to above, as long as:
-- we or any Subsidiary do not increase the principal amount of the
obligations and indebtedness secured by the Lien, except that:
- the amount of obligations or indebtedness secured by extensions,
renewals or replacements of Liens on property acquired as a
result of defaults on receivables may exceed the principal amount
prior to the extension, renewal or replacement; and
- the amount of obligations secured by extensions, renewals or
replacements of Liens on property may exceed the amount of the
obligations prior to the extension, renewal or replacement if the
value of the property has increased and the loan to value ratio
of the refinanced obligations does not exceed the loan to value
ratio of the obligations relating to the original Lien; and
-- the extension, renewal or replacement of any Lien is limited to that
portion of the property which secured the Lien that is extended,
renewed or replaced plus improvements on the property.
CERTAIN DEFINITIONS
"CONSOLIDATED NET TANGIBLE ASSETS" means, as of any particular time, the
aggregate amount of assets after deducting (a) all current liabilities,
excluding any liability that by its terms is extendable or renewable at the
option of the obligor to a time more than 12 months after the time the amount
thereof is computed, and (b) all goodwill, excess of cost over assets acquired,
patents, copyrights, trademarks, tradenames and other like intangibles, all as
shown in our company's and our subsidiaries' most recent consolidated financial
statements prepared in accordance with generally accepted accounting principles.
"DEBT" of any Person means at any date, without duplication:
- all obligations of the Person for borrowed money;
- all obligations of the Person evidenced by bonds, debentures, notes or
other similar instruments;
7
<PAGE> 34
- all obligations of the Person to pay the deferred purchase price of
property or services, except trade accounts payable arising in the
ordinary course of business;
- all obligations of the Person as lessee which the Person capitalizes in
accordance with generally accepted accounting principles;
- all Debt of others secured by a Lien on any asset of the Person, whether
or not the Debt is assumed by the Person; and
- all Debt of others that the Person guarantees.
However, "Debt" of our company or a Subsidiary will not include
Non-recourse Debt.
"LIEN" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest, hypothecation or encumbrance of any kind on the
asset. However, "Lien" does not mean security interests under Article 9 of the
Uniform Commercial Code, or any successor provision, on sales of accounts or
chattel paper. For the purposes of the debt securities, our company or any
Subsidiary will be deemed to own subject to a Lien any asset which it has
acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title retention agreement
relating to the asset.
"NON-RECOURSE DEBT" of our company or a Subsidiary means any obligations
for borrowed money of our company or a Subsidiary that (1) are secured by
specific assets, (2) are not reflected in the balance sheet of our company or a
Subsidiary in accordance with generally accepted accounting principles and (3)
are issued under instruments which limit the recourse against the obligor to the
specific assets. In the case of all Non-recourse Debt incurred after the date of
the indenture, if under applicable law, a holder of the obligation could ever
become entitled to recourse against the obligor under applicable bankruptcy law,
the instrument must also contain a provision that:
- the holder's recourse claim in respect of the obligation will be
subordinate and junior to all Debt evidenced by the debt securities of
any series; and
- the holder of the obligation cannot receive any payment in respect of any
obligation, other than the proceeds of the specific assets that secures
the obligation, until we have paid all debt securities of any series in
full or have provided funds for their payment.
"PERSON" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"SUBSIDIARY" means at any date any entity in which we directly or
indirectly own or control securities or other ownership interests having
ordinary voting power to elect a majority of the board of directors or other
persons performing similar functions.
MERGER AND CONSOLIDATION
We may consolidate or merge with or into any other Person and may transfer
or lease all or substantially all of our property to any Person only if:
- the Person formed by or resulting from the consolidation or merger, or
which will receive the property enters into a supplemental indenture in
which it
-- assumes the due and punctual payment of the principal, premium, and
interest on the debt securities; and
8
<PAGE> 35
-- agrees to perform and observe each agreement or covenant under the
debt securities and the indenture; and
- immediately after giving effect to the consolidation, merger, transfer or
lease of property discussed above, no Event of Default and no event
which, after notice or lapse of time or both, would become an Event of
Default will have occurred and is continuing.
Any transfer described above, but not a lease, will concurrently release us from
further obligations under the debt securities and the indenture.
EVENTS OF DEFAULT, WAIVER AND NOTICE
The following will be "Events of Default" for any series of debt
securities:
- our failure to pay any interest or any additional amounts on any series
of debt securities when due and which remains unpaid for a period of 30
days;
- our failure to pay the principal or any premium on any series of debt
securities when due;
- our failure to perform, or our breaching, any covenant or warranty of our
company contained in any series of debt securities or the indenture which
remains unremedied 90 days after the holders of at least 25% in aggregate
principal amount of any series of debt securities then outstanding
provide written notice of our failure to us;
- if any event of default under any mortgage, indenture or instrument
occurs and results in debt in excess of $50,000,000 of our company
becoming or being declared due prior to the date on which it would
otherwise become due, and the acceleration is not annulled, or the debt
is not discharged, within 30 days after the holders of at least 25% in
aggregate principal amount of any series of debt securities then
outstanding provide to us written notice of the event of default;
- the Support Agreement ceases to be in full force and effect for any
reason or is amended or modified in any manner unless
-- prior to its termination or amendment, Standard & Poor's Corporation,
Moody's Investor Service and any other nationally recognized
statistical rating organization then rating securities of our company,
confirm they will not downgrade or place on what is commonly referred
to as a "watch list" for possible downgrading any of our securities as
a result of the termination or amendment of the Support Agreement; or
-- if the termination or amendment is as a result of another Person's
assumption of the debt securities under the provisions described in
"Merger and Consolidation" above, the senior debt securities of the
Person assuming the debt securities are rated by Standard & Poor's
Corporation or Moody's Investor Service immediately following the
assumption at a rating equal to or greater than the rating assigned to
securities of our company by each rating agency;
- Textron Inc., our company or any "significant subsidiary," as defined in
Section 1.02(w) of Regulation S-X of the Securities Act, or any successor
provision thereto, of our company:
-- commences or consents to a voluntary case or other proceeding seeking
liquidation, reorganization or other relief with respect to itself or
its debts
9
<PAGE> 36
under any bankruptcy or similar law or seeking the appointment of a
trustee or other similar official of it or any substantial part of
its property;
-- makes a general assignment for the benefit of creditors;
-- fails generally or admits its inability to pay its debts as they
become due; or
-- takes any corporate action to authorize any of the foregoing;
- an involuntary case or other proceeding (1) is commenced against Textron
Inc., our company or any significant subsidiary of our company seeking
liquidation or other relief with respect to its or our debts under any
bankruptcy or other similar law or seeking the appointment of a trustee
or other similar official and (2) is not dismissed or stayed within 60
days; or
- an order for relief is entered against Textron Inc., our company or any
significant subsidiary of our company under the Federal bankruptcy laws.
In case an Event of Default other than one described in the last two
bullet-points above occurs and is continuing with respect to a particular series
of debt securities, then the holders of at least 25% in aggregate principal
amount of that particular series of debt securities then outstanding may declare
the principal of all outstanding debt securities of that particular series to be
immediately due and payable. If an Event of Default described in the last two
bullet-points occurs and is continuing with respect to a particular series of
debt securities, the principal of all outstanding debt securities of that
particular series will automatically become due and payable. Upon any
acceleration, any premium and interest on the debt securities so accelerated
will also become immediately due and payable. At any time after an acceleration
but before the holders of debt securities obtain a judgment or decree for
payment of money due, the holders of a majority in aggregate principal amount of
outstanding debt securities may rescind and annul the acceleration and its
consequences, provided all required payments, other than as a result of the
acceleration, shall have been made and all Events of Default are cured or
waived.
The holders of a majority in aggregate principal amount of any series of
outstanding debt securities may waive, on behalf of all of the holders of that
series, any Event of Default and its consequences or past defaults, except a
default in the payment of the principal of, or premium, if any, or interest, if
any, on, debt securities of that particular series or a default under a covenant
or agreement that cannot be modified without the consent of the holder of each
debt security that is affected.
If a default or an Event of Default occurs and continues for any series of
debt securities, the holders of at least a majority in aggregate principal
amount then outstanding for any series of debt securities may direct the time,
method and place of conducting any proceeding or remedy available to the
trustee, or exercising any power given to the trustee under the indenture for
that series of debt securities.
The trustee does not have to exercise any of its rights or powers under the
indenture at the direction of any holders of debt securities unless the holders
offer the trustee reasonable security or indemnity against expenses and
liabilities.
We must file with the trustee annually a written statement regarding the
presence or absence of certain defaults.
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<PAGE> 37
DEFEASANCE
DEFEASANCE AND DISCHARGE
The indenture provides that we will be discharged from all
non-administrative obligations in respect of the debt securities of any series
if we deposit with the trustee, in trust, money and/or U.S. government
obligations which will provide enough money to pay the principal and interest on
the debt securities of the series on the stated due dates of these payments in
accordance with the terms of the indenture and the debt securities of that
series.
We may establish this trust only if, among other things, we deliver to the
trustee an opinion of counsel stating that the holders of the debt securities of
the series will not recognize income, gain or loss for federal income tax
purposes as a result of the defeasance and will be subject to federal income tax
on the same amount and in the same manner and at the same times as would have
been the case if the defeasance had not occurred.
DEFEASANCE OF LIMITATIONS ON LIENS COVENANT AND RELATED EVENTS OF DEFAULT
The indenture provides that we may be released from our obligation to
comply with the restrictive covenant regarding limitations on Liens and we would
no longer trigger Events of Default under the indenture and the debt securities
of a series with respect to this covenant, if we deposit with the trustee, in
trust, money and/or U.S. government obligations which, through the payment of
interest and principal thereon, will provide enough money to pay the principal
and interest on the debt securities of that series on the stated due dates of
these payments in accordance with the terms of the indenture and the debt
securities of that series. Our other obligations under the indenture and the
debt securities of that series and other Events of Default would remain in full
force and effect.
We may establish this trust only if, among other things, we deliver to the
trustee an opinion of counsel stating that the holders of the debt securities of
the series will not recognize income, gain or loss for federal income tax
purposes as a result of the defeasance of the covenant and Events of Default
described above and will be subject to federal income tax on the same amounts
and in the same manner and at the same times as would have been the case if the
defeasance had not occurred.
If we exercise the option described in this section and the debt securities
of the series are declared due and payable because of the occurrence of any
Event of Default, other than the Event of Default described above in the third
bullet point under "Events of Default", the amount of money and U.S. government
obligations on deposit with the trustee will be sufficient to pay amounts due on
the debt securities of that series at the time of their stated maturity but may
not be sufficient to pay amounts due on the debt securities of that series at
the time of the acceleration resulting from the Event of Default.
CHANGES TO THE INDENTURE
Under the indenture, we may modify our rights and obligations and the
rights of the holders of debt securities with the consent of the holders of at
least a majority of the principal amount of the outstanding debt securities of
all series issued under the indenture affected by the modification. However, we
are required to get the consent of the holder of each debt security affected to
make the following modifications of the debt securities:
- an extension of the fixed maturity of any debt security;
- a reduction of the principal amount payable on any debt security;
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<PAGE> 38
- a reduction in the rate of interest, or change in the calculation of
interest, payable on any debt security;
- change any obligation to pay any additional amounts or reduce any
additional amounts payable on any debt security;
- a change in currency in which payments are made;
- an extension of the time of payment of interest;
- a modification that affects adversely any right of a holder of a debt
security to repayment;
- a reduction in the principal amount of an original issue discount debt
security due and payable upon acceleration of the maturity;
- a reduction in the portion of the principal amount of a debt security
payable in bankruptcy;
- a reduction in amounts payable upon redemption;
- a reduction in the rate of interest payable on overdue amounts;
- a modification that impairs the right of any holder of any debt security
to institute suit for the enforcement of any required payment on the debt
security on or after the fixed maturity of the debt security; and
- a reduction in the percentage of holders of the outstanding debt
securities of each series required to consent to any modification
discussed above.
Under the indenture, we can make modifications to the indenture with the
consent of the trustee but without the consent of any holders of debt securities
to evidence our merger or the replacement of the trustee and for other purposes
set forth in the indenture.
CONCERNING THE TRUSTEE
We enter into a variety of banking transactions with the trustee in the
ordinary course of our business.
GOVERNING LAW
The debt securities and the indenture will be governed by, and construed in
accordance with, the laws of the State of New York, without regard to conflict
of law principles.
PLAN OF DISTRIBUTION
We may sell the debt securities described in this prospectus:
- to or through underwriters or dealers;
- directly to one or more purchasers; or
- through agents.
BY UNDERWRITERS
If we use underwriters in the sale, the underwriters will acquire debt
securities for their own account. The underwriters may resell the debt
securities in one or more
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<PAGE> 39
transactions, including negotiated transactions, at a fixed public offering
price or at varying prices determined at the time of sale. The obligations of
the underwriters to purchase the securities will be subject to certain
conditions. The underwriters may from time to time modify any initial public
offering price and any discounts or concessions allowed or re-allowed or paid to
dealers.
DIRECT SALES
We may directly sell debt securities of any series. In this case, no
underwriters or agents would be involved.
BY AGENTS
We may sell debt securities of any series through agents that we designate.
The agents will agree to use their reasonable best efforts to solicit purchases
for the period of their appointment.
GENERAL INFORMATION
Underwriters, dealers and agents that participate in the distribution of
the debt securities may be underwriters, as defined in the Securities Act of
1933, and any discounts, concessions or commissions that we pay them and any
profit on their resale of the debt securities offered by this prospectus may be
treated as underwriting discounts, concessions and commissions under the
Securities Act. We will identify any underwriters or agents and describe their
compensation in a prospectus supplement.
We may have agreements with the underwriters, dealers and agents who
participate in the sale of debt securities to indemnify them against certain
civil liabilities, including liabilities under the Securities Act, or to
contribute with respect to payments which the underwriters, dealers or agents
may be required to make.
Underwriters, dealers and agents may engage in transactions with, or
perform services for, us or our subsidiaries in the ordinary course of their
businesses.
The debt securities of a series, when first issued, will have no
established trading market. Any underwriters or agents to or through whom we
sell debt securities of a series for public offering and sale may make a market
in the debt securities, but will not be obligated to do so and could stop doing
so at any time without notice. We cannot assure you that a market for any series
of debt securities we issue will exist.
If we indicate in a prospectus supplement, we will authorize underwriters
or our agents to solicit offers by certain institutional investors to purchase
debt securities from us which will be paid for and delivered on a future date
specified in the prospectus supplement. The obligations of any purchasers under
these delayed delivery and payment arrangements will not be subject to any
conditions except that the purchase at delivery must not be prohibited under the
laws of any jurisdiction in the United States to which the institutional
investor is subject.
WHERE YOU CAN FIND MORE INFORMATION
We have filed a registration statement on Form S-3 (File No. 333-88509)
with the SEC under the Securities Act of 1933, covering the debt securities to
be offered from time to time by this prospectus. This prospectus does not
contain all of the information included in the registration statement.
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<PAGE> 40
We also have filed a registration statement on Form 10 (File No.
0-27559)with the SEC under the Securities Exchange Act of 1934. We will file
annual, quarterly and special reports, and other information with the SEC. Our
parent company, Textron Inc., also files annual, quarterly and special reports,
and other information with the SEC. Textron Inc.'s and our SEC filings are
available to the public over the Internet from the SEC's web site at
http://www.sec.gov. You may also read and copy any document we file, or Textron
Inc. files, at the SEC's public reference rooms in Washington, D.C., New York,
New York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for
further information on the public reference rooms and their copy charges.
The SEC allows us to "incorporate by reference" in this prospectus the
information in documents we file with it. This 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 information in documents that we file later with the SEC will
automatically update and supersede information contained in documents filed
earlier with the SEC or contained in this prospectus. We incorporate by
reference in this prospectus the Form 10 and any future filings that we may make
with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Securities
Exchange Act of 1934 until we, or our agents, sell all of the securities that
may be offered by this prospectus.
You may request a copy of these documents at no cost to you by writing or
telephoning us at the following address:
Textron Financial Corporation
40 Westminster Street
P.O. Box 6687
Providence, Rhode Island 02940-6687
Attention: Brian F. Lynn
(401) 621-4200
You should rely only on the information incorporated by reference or
provided in this prospectus or any prospectus supplement. We have not authorized
anyone else to provide you with different information. We are not making an
offer of the securities described in this prospectus in any state where the
offer is not permitted. You should not assume that the information in this
prospectus or any prospectus supplement is accurate as of any date other than
the date on the front of those documents.
LEGAL OPINIONS
White & Case LLP will issue for us an opinion about the legality of the
debt securities.
Any underwriters will be advised about the validity of the debt securities
by their own legal counsel.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our consolidated
financial statements for the year ended January 2, 1999 as set forth in their
report included in our registration statement on Form 10, and which is
incorporated by reference in this prospectus. Our consolidated financial
statements are incorporated by reference in reliance on their reports, given on
their authority as experts in accounting and auditing.
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<PAGE> 41
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION*
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee......... $ 834,000
Printing and engraving expenses............................. $ 55,000
Rating agency fees.......................................... $2,000,000
Trustee's fees.............................................. $ 75,000
Legal fees.................................................. $ 150,000
Accounting expenses......................................... $ 75,000
Blue Sky fees and expenses.................................. $ 10,000
Other....................................................... $ 2,000
----------
Total.................................................. $3,201,000
==========
</TABLE>
- -------------------------
* All amounts other than the registration fee are estimated.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law authorizes and empowers
each Delaware corporation to indemnify its directors, officers, employees and
agents against liabilities incurred in connection with, and related expenses
resulting from, any claim, action or suit brought against any such person as a
result of his or her relationship with the corporation, provided that such
persons acted in good faith and in a manner such person reasonably believed to
be in, and not opposed to, the best interests of the corporation in connection
with the acts or events on which such claim, action or suit is based. The
finding of either civil or criminal liability on the part of such person in
connection with such acts or events is not necessarily determinative of the
question of whether such person has met the required standard of conduct and is,
accordingly, entitled to be indemnified. The foregoing statements are subject to
the detailed provisions of Section 145 of the General Corporation Law of the
State of Delaware.
The By-Laws of Textron Financial Corporation provide that each person who
at any time is or shall have been a director or elected or appointed officer of
Textron Financial Corporation, or is or shall have been serving another
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise in any capacity at the request of Textron Financial Corporation, and
his or her heirs, executors and administrators, shall be indemnified by Textron
Financial Corporation in accordance with and to the full extent permitted by the
General Corporation Law of the State of Delaware. Paragraph (f) of Article XII
of the By-Laws of Textron Financial Corporation facilitates enforcement of the
right of directors and owners to be indemnified by establishing such right as a
contract right pursuant to which the person entitled thereto may bring suit as
if the indemnification provisions of the By-Laws were set forth in a separate
written contract between Textron Financial Corporation and the director or
officer.
The By-Laws of Textron Financial Corporation provide that Textron Financial
Corporation shall indemnify, in all respects and to the full extent authorized
or permitted by law, any person who was or is a party or is threatened to be
made a party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal,
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administrative or investigative, by reason of his or her being or having been a
director, elected or appointed officer or employee of Textron Financial
Corporation or, at the request of Textron Financial Corporation as a director,
officer, employee or agent, of any other corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by such person in connection with such action,
suit or proceeding. Such indemnification of any person shall inure to the
benefit of his or her heirs, executors and administrators.
The By-Laws of Textron Financial Corporation also provide similar
indemnification for officers of Textron Inc. who serve as directors of Textron
Financial Corporation.
ITEM 16. EXHIBITS
<TABLE>
<C> <S>
1.1 Form of Underwriting Agreement.
4.1 Indenture to be dated on or about the date of the issuance
of the first series of debt securities thereunder between
the Textron Financial Corporation and SunTrust Bank, Atlanta
(including form of debt securities).
4.2 Support Agreement dated as of May 25, 1994 between Textron
Inc. and Textron Financial Corporation (Incorporated by
reference to Exhibit 10.1 to Textron Financial Corporation's
Form 10 filed on October 5, 1999 (the "Textron Financial
Form 10")).
5.1* Opinion re legality of debt securities of White & Case LLP
(including consent).
12.1 Computation of Ratio of Earnings to Fixed Charges
(Incorporated by reference to Exhibit 12.1 to the Textron
Financial Form 10).
23.1* Consent of Ernst & Young LLP, independent auditors.
23.2 Consent of White & Case LLP (contained in Exhibit 5.1).
24.1* Powers of Attorney of certain officers and directors of
Textron Financial Corporation (See page II-4 to the
Registration Statement as originally filed).
24.2* Powers of Attorney of certain directors of Textron Financial
Corporation.
25.1* Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939, as amended, of SunTrust Bank, Atlanta, as
Trustee under the indenture.
</TABLE>
- ---------------
* Previously filed with the Commission.
ITEM 17. UNDERTAKINGS
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a posteffective 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
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<PAGE> 43
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 (1)(i) and (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 with or furnished to the
Commission 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.
(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.
(4) 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 therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
(5) That, 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.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described under Item 15 above, or
otherwise, the registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of an 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 Act and will
be governed by the final adjudication of such issue.
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<PAGE> 44
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED, THE
REGISTRANT HAS DULY CAUSED THIS AMENDMENT TO THE REGISTRATION STATEMENT TO BE
SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY
OF PROVIDENCE, STATE OF RHODE ISLAND, ON THE 29TH DAY OF NOVEMBER, 1999.
TEXTRON FINANCIAL CORPORATION
By STEPHEN A. GILIOTTI
------------------------------------
Stephen A. Giliotti
Chairman, President and
Chief Executive Officer
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED,
THIS AMENDMENT TO THE REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE
FOLLOWING PERSONS, WHICH INCLUDE A MAJORITY OF THE BOARD OF DIRECTORS, IN THE
CAPACITIES AND ON THE DATES INDICATED.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
STEPHEN A. GILIOTTI Chairman, President, Chief November 29, 1999
------------------------------------------ Executive Officer and Director
Stephen A. Giliotti (Principal Executive Officer)
* Director November 29, 1999
------------------------------------------
Edward C. Arditte
* Director November 29, 1999
------------------------------------------
Lewis B. Campbell
* Director November 29, 1999
------------------------------------------
John A. Janitz
* Director November 29, 1999
------------------------------------------
Wayne W. Juchatz
* Executive Vice President November 29, 1999
------------------------------------------ and Chief Financial Officer
Thomas J. Cullen (Principal Financial Officer)
* Vice President -- Finance November 29, 1999
------------------------------------------ (Principal Accounting Officer)
Eric Salander
*By: ELIZABETH C. PERKINS
------------------------------------
Elizabeth C. Perkins
Attorney-in-fact
</TABLE>
II-4
<PAGE> 45
EXHIBIT INDEX
<TABLE>
<C> <S>
1.1 Form of Underwriting Agreement.
4.1 Indenture to be dated on or about the date of the issuance
of the first series of debt securities thereunder between
the Textron Financial Corporation and SunTrust Bank, Atlanta
(including form of debt securities).
4.2 Support Agreement dated as of May 25, 1994 between Textron
Inc. and Textron Financial Corporation (Incorporated by
reference to Exhibit 10.1 to the Textron Financial Form 10).
5.1* Opinion re legality of debt securities of White & Case LLP
(including consent).
12.1 Computation of Ratio of Earnings to Fixed Charges
(Incorporated by reference to Exhibit 12.1 to the Textron
Financial Form 10).
23.1* Consent of Ernst & Young LLP, independent auditors.
23.2 Consent of White & Case LLP (contained in Exhibit 5.1).
24.1* Powers of Attorney of certain officers and directors of
Textron Financial Corporation. (See page II-4 to the
Registration Statement as originally filed).
24.2* Powers of Attorney of certain directors of Textron Financial
Corporation.
25.1* Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939, as amended, of SunTrust Bank, Atlanta, as
Trustee under the indenture.
</TABLE>
- ---------------
* Previously filed with the Commission.
<PAGE> 1
TEXTRON FINANCIAL CORPORATION
UNDERWRITING AGREEMENT
STANDARD PROVISIONS (DEBT)
December __, 1999
<PAGE> 2
From time to time, Textron Financial Corporation, a Delaware
corporation (the "Company"), may enter into one or more underwriting agreements
that provide for the sale of designated securities to the several underwriters
named therein (the "Underwriters"), for whom the underwriters named therein are
acting as representatives (the "Representatives"). The standard provisions set
forth herein may be incorporated by reference in any such underwriting agreement
(an "Underwriting Agreement"). The Underwriting Agreement, including the
provisions incorporated therein by reference, is herein referred to as this
Agreement. Unless otherwise defined herein, terms defined in the Underwriting
Agreement are used herein as therein defined.
I.
The Company proposes to issue from time to time senior debt securities
(the "Securities") to be issued pursuant to the provisions of the Indenture,
dated as of December ___, 1999, between the Company and SunTrust Bank, Atlanta,
as Trustee (the "Trustee"), as the same may be from time to time amended or
supplemented (the "Indenture"). The Securities will have varying designations,
maturities, rates and times of payment of interest, selling prices and
redemption terms.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement including a prospectus relating to the
Securities and has also filed with the Commission a prospectus supplement
specifically relating to the Offered Securities pursuant to Rule 424 under the
Securities Act of 1933, as amended (the "Act"). The term Registration Statement
means the registration statement as amended to the date of the Underwriting
Agreement. The term Basic Prospectus means the prospectus included in the
Registration Statement. The term Prospectus means the Basic Prospectus together
with the prospectus supplement specifically relating to the Offered Securities,
as filed with the Commission pursuant to Rule 424. The term preliminary
prospectus means any preliminary form of the Prospectus filed with the
Commission pursuant to Rule 424. As used herein, the terms "Registration
Statement," "Basic Prospectus," "Prospectus" and "preliminary prospectus" shall
include in each case the material, if any, incorporated by reference therein.
The term Underwriters' Securities means the Offered Securities to be
purchased by the Underwriters herein. The term Contract Securities means the
Offered Securities, if any, to be purchased pursuant to the delayed delivery
contracts referred to below.
II.
If the Prospectus provides for sales of Offered Securities pursuant to
delayed delivery contracts, the Company hereby authorizes the Underwriters to
solicit offers to purchase Contract Securities on the terms and subject to the
conditions set forth in the Prospectus pursuant to delayed delivery contracts
substantially in the form of Schedule I attached hereto ("Delayed Delivery
Contracts") but with such changes therein as the Company may authorize or
approve. Delayed Delivery Contracts are to be with institutional investors
approved by the Company and of the types set forth in the Prospectus. On the
Closing Date (as hereinafter defined), the Company will pay the Representatives
as compensation, for the accounts of the Underwriters, the fee set forth in the
Underwriting Agreement in respect of the principal amount of Contract
<PAGE> 3
Securities. The Underwriters will not have any responsibility in respect of the
validity or the performance of Delayed Delivery Contracts.
If the Company executes and delivers Delayed Delivery Contracts with
institutional investors, the Contract Securities shall be deducted from the
Offered Securities to be purchased by the several Underwriters and the aggregate
principal amount of Offered Securities to be purchased by each Underwriter shall
be reduced pro rata in proportion to the principal amount of Offered Securities
set forth opposite each Underwriter's name in the Underwriting Agreement, except
to the extent that the Representatives determine that such reduction shall be
otherwise and so advise the Company.
III.
The Company is advised by the Representatives that the Underwriters
propose to make a public offering of their respective portions of the
Underwriters' Securities as soon after this Agreement is entered into as in the
Representatives' judgment is advisable. The terms of the public offering of the
Underwriters' Securities are set forth in the Prospectus.
IV.
Payment for the Underwriters' Securities shall be by wire transfer of
immediately available funds to an account designated by the Company, upon
delivery to the Representatives for the respective accounts of the several
Underwriters of the Underwriters' Securities registered in such names and in
such denominations as the Representatives shall request in writing not less than
two full business days prior to the date of delivery. The time and date of such
payment and delivery with respect to the Underwriters' Securities are herein
referred to as the Closing Date.
V.
The several obligations of the Underwriters hereunder are subject to
the following conditions:
(a) Subsequent to the execution and delivery of the
Underwriting Agreement and prior to the Closing Date,
(i) no stop order suspending the effectiveness of the
Registration Statement shall be in effect, and no proceedings for such
purpose shall be pending before or threatened by the Commission and
there shall have been no material adverse change in the condition,
financial or otherwise, earnings, business or operations of the Company
and its subsidiaries, taken as a whole, from that set forth in the
Prospectus (excluding, for purposes of this paragraph, any amendments
or supplements filed after the date of the Underwriting Agreement); and
the Representatives shall have received, on the Closing Date, a
certificate, dated the Closing Date and signed by an executive officer
of the Company, to the foregoing effect. Such certificate will also
provide that the representations and warranties of the Company
contained in this Agreement are true and correct as of the Closing
Date. The officer making such certificate may rely upon the best of his
knowledge as to proceedings pending or threatened;
2
<PAGE> 4
(ii) there shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading, of
a review indicating possible negative implications or of any review for
a possible change that does not indicate the direction of the possible
change, in the rating accorded any of the securities of the Company or
Textron Inc., a Delaware corporation ("Textron"), by any "nationally
recognized statistical rating organization," as such term is defined
for purposes of Rule 436(g)(2) under the Act; and
(iii) there shall not have occurred (A) any change in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole, from
that set forth in the Prospectus or (B) any change in the condition,
financial or otherwise, or in the earnings, business or operations of
Textron and its subsidiaries, taken as a whole, from that set forth in
its most recent Annual Report on Form 10-K, as supplemented by any
Current Reports on Form 8-K and/or its most recent Quarterly Report on
Form 10-Q, filed pursuant to the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), that, in either such case, in the
judgment of the Representatives, is material and adverse and that makes
it, in the judgment of the Representatives, impracticable to market the
Offered Securities on the terms and in the manner contemplated in the
Prospectus.
(b) The Underwriters shall have received on the Closing Date
an opinion of White & Case LLP, counsel for the Company, dated the
Closing Date, to the effect set forth in Exhibit A.
(c) The Underwriters shall have received on the Closing Date
an opinion of the General Counsel of the Company, dated the Closing
Date, to the effect set forth in Exhibit B.
(d) The Underwriters shall have received on the Closing Date
an opinion of counsel for Textron, dated the Closing Date, to the
effect set forth in Exhibit C.
(e) The Underwriters shall have received on the Closing Date
an opinion of counsel for the Underwriters, dated the Closing Date, to
the effect set forth in Exhibit D.
(f) The Underwriters shall have received, as of the date of
the Closing Date, a letter, dated as of the Closing Date, in form and
substance satisfactory to the Representatives, from Ernst & Young LLP,
independent public accountants, containing statements and information
of the type ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and certain
financial information contained in or incorporated by reference into
the Registration Statement and the Prospectus.
3
<PAGE> 5
VI.
In further consideration of the agreements of the Underwriters
contained in this Agreement, the Company covenants as follows:
(a) To furnish the Representatives, without charge, four
signed copies of the Registration Statement including exhibits and
materials, if any, incorporated by reference therein and, during the
period mentioned in paragraph (c) below, as many copies of the
Prospectus, any documents incorporated by reference therein and any
supplements and amendments thereto as the Representatives may
reasonably request. The terms "supplement" and "amendment" or "amend"
as used in this Agreement shall include all documents filed by the
Company with the Commission subsequent to the date of the Basic
Prospectus, pursuant to the Exchange Act, which are deemed to be
incorporated by reference in the Prospectus.
(b) Before amending or supplementing the Registration
Statement or the Prospectus with respect to the Offered Securities, to
furnish the Representatives a copy of each such proposed amendment or
supplement.
(c) If, during such period after the first date of the public
offering of the Offered Securities, as in the opinion of counsel for
the Underwriters the Prospectus is required by law to be delivered, any
event shall occur as a result of which it is necessary to amend or
supplement the Prospectus in order to make the statements therein, in
the light of the circumstances when the Prospectus is delivered to a
purchaser, not misleading, or if it is necessary to amend or supplement
the Prospectus to comply with law, forthwith to prepare and furnish, at
its own expense, to the Underwriters, either amendments or supplements
to the Prospectus so that the statements in the Prospectus as so
amended or supplemented will not, in the light of the circumstances
when the Prospectus is delivered to a purchaser, be misleading or so
that the Prospectus will comply with law.
(d) To qualify the Offered Securities for offer and sale under
the securities or Blue Sky laws of such jurisdictions as the
Representatives shall reasonably request and to pay all expenses
(including fees and disbursements of counsel) in connection with such
qualification and in connection with the determination of the
eligibility of the Offered Securities for investment under the laws of
such jurisdictions as the Representatives may designate.
(e) To make generally available to the Company's security
holders as soon as practicable an earnings statement covering a
twelve-month period beginning after the date of the Underwriting
Agreement, which shall satisfy the provisions of Section 11(a) of the
Act and the applicable rules and regulations thereunder.
(f) The Company will, whether or not any sale of the Offered
Securities is consummated, pay all expenses incident to the performance
of its obligations under this Agreement, including the fees and
disbursements of its accountants and counsel, the cost of printing and
delivery of the Registration Statement, any preliminary prospectus, the
4
<PAGE> 6
Prospectus, all amendments thereof and supplements thereto, the
Indenture, this Agreement and all other documents relating to the
offering, the cost of preparing, printing, packaging and delivering the
Offered Securities, the fees and disbursements, including fees of
counsel, incurred in connection with the qualification of the Offered
Securities for sale and determination of eligibility for investment of
the Offered Securities under the securities or Blue Sky laws of each
such jurisdiction as the Underwriters may reasonably designate, the
fees and disbursements of the Trustee and the fees of any agency that
rates the Offered Securities, the cost of providing any CUSIP or other
identification for the notes and the fees and expenses of any
depository for the Offered Securities.
(g) During the period beginning on the date of the
Underwriting Agreement and continuing to and including the Closing
Date, not to offer, sell, contract to sell or otherwise dispose of any
debt securities of the Company substantially similar to the Offered
Securities, without the prior written consent of the Representatives.
VII.
The Company represents and warrants to each Underwriter that:
(a) As of the date hereof, when any amendment to the
Registration Statement becomes effective (including the filing of any
document incorporated by reference in the Registration Statement) after
the date hereof, when any supplement to the Prospectus is filed with
the Commission after the date hereof and at the Closing Date, (i) the
Registration Statement, as amended as of any such time, and the
Prospectus, as supplemented as of any such time, and the Indenture
complies and will comply in all material respects with the applicable
requirements of the Act, the Trust Indenture Act of 1939, as amended
(the "Trust Indenture Act") and the Exchange Act and the respective
rules thereunder, (ii) the Registration Statement does not and will not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to
make the statements therein not misleading and (iii) the Prospectus
does not and will not include an untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading, provided that the Company makes no representations or
warranties as to (i) that part of the Registration Statement which
shall constitute the Statement of Eligibility and Qualification (Form
T-1) under the Trust Indenture Act of the Trustee or (ii) the
information contained in or omitted from the Registration Statement or
Prospectus in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of an Underwriter
specifically for use in connection with the preparation of the
Registration Statement and the Prospectus.
5
<PAGE> 7
(b) There has not been any material adverse change in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries taken as a whole from
that set forth in the Prospectus.
(c) The execution and delivery of, and the performance by the
Company of its obligations under, this Agreement have been duly
authorized by the Company, and this Agreement has been duly executed
and delivered by the Company.
(d) The Indenture and the Support Agreement, dated May 25,
1994 between the Company and Textron (the "Support Agreement"), have
each been duly authorized, executed and delivered by the Company and
each constitutes a valid and binding agreement of the Company
enforceable in accordance with its terms, except as enforcement thereof
may be limited by bankruptcy, insolvency or other similar laws
affecting the enforcement of creditors' rights generally and by general
principles of equity.
(e) The Offered Securities have been duly authorized and, when
executed by the Company, authenticated by the Trustee and issued in
accordance with the Indenture and delivered pursuant to the provisions
of this Agreement against payment therefor as described in the
Registration Statement and the Prospectus, will constitute valid and
legally binding obligations of the Company entitled to the benefits of
the Indenture and enforceable against the Company in accordance with
their terms, except as enforceability thereof may be limited by
bankruptcy, insolvency or other similar laws affecting the enforcement
of creditors' rights generally and by general principles of equity and
except as rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general
applicability and except further as enforcement thereof may be limited
by (x) requirements that a claim with respect to any Offered Securities
denominated other than in U.S. dollars (or a foreign currency or
currency unit judgment in respect of such claim) be converted into U.S.
dollars at a rate of exchange prevailing on a date determined pursuant
to applicable law or (y) governmental authority to limit, delay or
prohibit the making of payments outside the United States.
(f) The Company is a corporation duly organized and validly
existing in good standing under the laws of the State of Delaware with
full corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Registration
Statement and the Prospectus, and is duly registered and qualified to
conduct its business and is in good standing in each jurisdiction or
place where the nature of its properties or the conduct of its business
requires such registration or qualification, except where the failure
so to register or qualify does not have a material adverse effect on
the condition (financial or other), business, properties, net worth or
results of operations of the Company and its subsidiaries taken as a
whole.
6
<PAGE> 8
(g) Each of Cessna Finance Corporation, Litchfield Financial
Corporation, RFC Capital Corporation, Systran Financial Services
Holding Company and Westminster Development Bank (collectively, the
"Significant Subsidiaries") is a corporation duly organized, validly
existing and in good standing in the jurisdiction of its incorporation,
with full corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Registration
Statement and the Prospectus, and is duly registered and qualified to
conduct its business and is in good standing in each jurisdiction or
place where the nature of its properties or the conduct of its business
requires such registration or qualification, except where the failure
so to register or qualify does not have a material adverse effect on
the condition (financial or other), business, properties, net worth or
results of operations of the Company and its subsidiaries taken as a
whole. Except as disclosed in the Registration Statement and the
Prospectus, the Company owns of record, directly or indirectly, all of
the outstanding shares of capital stock of each of the Significant
Subsidiaries free and clear of any lien, adverse claim, security
interest, equity or other encumbrance.
(h) The execution and delivery of this Agreement and the
Indenture by the Company and the consummation of the transactions
contemplated herein and therein will not contravene any provision of
applicable law or the Certificate of Incorporation or By-Laws of the
Company or any other agreement or instrument binding upon the Company
or any of the Company's Significant Subsidiaries or any judgment, order
or decree of any governmental body, agency or court having jurisdiction
over the Company or such Significant Subsidiaries, except such
contraventions as would not, individually or in the aggregate, have a
material adverse effect on the condition (financial or other),
business, properties, net worth or results of operations of the Company
and its subsidiaries taken as a whole and no consent, approval or
authorization or order of, or qualification with, any governmental body
or agency is required for the performance by the Company of its
obligations under this Agreement or the Indenture, and the consummation
of the transactions contemplated hereby, except such as are required
pursuant to state securities or Blue Sky Laws.
(i) The Company is not and, after giving effect to the
offering and sale of the Offered Securities, will not be an "investment
company" within the meaning of the Investment Company Act of 1940, as
amended (the "Investment Company Act").
(j) The statements under the captions "Description of Debt
Securities", "Description of [Insert title of Offered Securities]",
"Underwriting" and "Plan of Distribution" in the Prospectus insofar as
they constitute a summary of this Agreement,
7
<PAGE> 9
the Indenture and the [Insert title of Offered Securities], fairly
present the information called for by Form S-3 with respect to such
documents.
(k) The statements included under the caption "Legal
Proceedings" in the Company's registration statement on Form 10 insofar
as they describe statements of law or legal conclusions are accurate
and fairly present the information required to be shown.
(l) The Support Agreement has not been amended since the date
thereof and remains in full force and effect.
VIII.
The Company agrees to indemnify and hold harmless each Underwriter and
each person, if any, who controls such Underwriter within the meaning of either
Section 15 of the Act or Section 20 of the Exchange Act, from and against any
and all losses, claims, damages and liabilities caused by any untrue statement
or alleged untrue statement of a material fact contained in the Registration
Statement, any preliminary prospectus or the Prospectus (if used within the
period set forth in paragraph (c) of Article VI hereof and as amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto), or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission or alleged
untrue statement or omission based upon information furnished in writing to the
Company by any Underwriter expressly for use therein.
Each Underwriter agrees severally and not jointly to indemnify and hold
harmless the Company, its directors, its officers who sign the Registration
Statement and any person controlling the Company to the same extent as the
foregoing indemnity from the Company to each Underwriter, but only with
reference to information relating to such Underwriter furnished in writing by
such Underwriter expressly for use in the Registration Statement, any
preliminary prospectus or the Prospectus.
In case any proceeding (including any governmental investigation) shall
be instituted involving any person in respect of which indemnity may be sought
pursuant to either of the two preceding paragraphs, such person (the
"indemnified party") shall promptly notify the person against whom such
indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party. In case any such proceeding 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 reasonably 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 such indemnified party under this
Article for any legal expenses of other counsel or any other expenses, in each
case subsequently incurred by such indemnified party, in connection with the
defense thereof other than reasonable costs of investigation. Notwithstanding
the foregoing, in any such proceeding, any indemnified party shall have the
right to retain its own counsel, but the fees and expenses of such counsel shall
be at the expense
8
<PAGE> 10
of such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in connection with any proceeding or relating proceedings in the same
jurisdiction, be liable for the reasonable fees and expenses of more than one
separate firm (in addition to any local counsel) for all such indemnified
parties and that all such fees and expenses shall be reimbursed as they are
incurred. Such firm shall be designated in writing by the Representatives in the
case of parties indemnified pursuant to the second preceding paragraph and by
the Company in the case of parties indemnified pursuant to the first preceding
paragraph. The indemnifying party shall not be liable for any settlement of any
proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party from and against any loss or
liability by reason of such settlement or judgment. No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement of any proceeding in respect of which any indemnified party is a
party unless such settlement includes an unconditional release of such
indemnified party from all liability on claims that are the subject matters of
such proceeding.
If the indemnification provided for in this Article VIII is unavailable
to an indemnified party under the first or second paragraphs hereof or
insufficient in respect of any losses, claims, damages or liabilities referred
to therein, then each indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (i)
in such proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the Underwriters on the other from the
offering of the Offered Securities or (ii) if the allocation provided by clause
(i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and of the
Underwriters on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities, as well as any other
relevant equitable considerations. The relative benefits received by the Company
on the one hand and the Underwriters on the other in connection with the
offering of the Offered Securities shall be deemed to be in the same proportion
as the total net proceeds from the offering of such Offered Securities (before
deducting expenses) received by the Company bear to the total underwriting
discounts and commissions received by the Underwriters in respect thereof. The
relative fault of the Company on the one hand and of the Underwriters on the
other shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
or by the Underwriters and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Article VIII were determined by pro
rata allocation or by any other method of allocation which does not take account
of the considerations referred to in the immediately preceding paragraph. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other
9
<PAGE> 11
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Article VIII, no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the Offered
Securities underwritten and distributed to the public by such Underwriter were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute pursuant to this
Article VIII are several, in proportion to the respective principal amounts of
Offered Securities purchased by each of such Underwriters, and not joint.
The remedies provided for in this Article VIII are not exclusive and
shall not limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
The indemnity and contribution agreements contained in this Article
VIII and the representations and warranties of the Company in this Agreement
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by any Underwriter or
on behalf of any Underwriter or any person controlling any Underwriter or by or
on behalf of the Company, its directors or officers or any person controlling
the Company and (iii) acceptance of and payment for any of the Offered
Securities.
IX.
This Agreement shall be subject to termination in the absolute
discretion of the Representatives, by notice given to the Company, if (a) after
the execution and delivery of the Underwriting Agreement and prior to the
Closing Date (i) trading generally shall have been suspended or materially
limited on or by, as the case may be, any of the New York Stock Exchange, the
American Stock Exchange, the National Association of Securities Dealers, Inc.,
the Chicago Board of Options Exchange, the Chicago Mercantile Exchange or the
Chicago Board of Trade, (ii) trading of any securities of the Company shall have
been suspended on any exchange or in any over-the-counter market, (iii) a
general moratorium on commercial banking activities in New York shall have been
declared by either Federal or New York State authorities, or (iv) there shall
have occurred any outbreak or escalation of hostilities or any change in
financial markets or any calamity or crisis that, in the judgment of the
Representatives, is material and adverse and (b) in the case of any of the
events specified in clauses (a) (i) through (iv), such event, in the judgment of
the Representatives, makes it impracticable to market the Offered Securities on
the terms and in the manner contemplated in the Prospectus.
If, on the Closing Date, any one or more of the Underwriters shall fail
or refuse to purchase the Offered Securities which it or they have agreed to
purchase hereunder, and the aggregate principal amount of the Offered Securities
which such defaulting Underwriter or Underwriters agreed but failed or refused
to purchase is not more than one-tenth of the aggregate principal amount of the
Offered Securities, the other Underwriters shall be obligated severally in the
proportions which the respective amounts of the Offered Securities set forth
opposite their names in the Underwriting Agreement bear to the aggregate
principal amount of the Offered Securities set forth opposite the names of all
such non-defaulting Underwriters, or in such other
10
<PAGE> 12
proportions as you may specify, to purchase the Offered Securities which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase;
provided that in no event shall the principal amount of the Offered Securities
which any Underwriter has agreed to purchase hereunder be increased pursuant to
this Article IX by an amount in excess of one-tenth of such principal amount of
the Offered Securities without the written consent of such Underwriter. If, on
the Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase the Offered Securities which it or they agreed to purchase hereunder
and the aggregate principal amount of the Offered Securities which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
is more than one-tenth of the aggregate principal amount of the Offered
Securities, and arrangements satisfactory to you and the Company for the
purchase of such Offered Securities are not made within 36 hours after such
default, this Agreement shall terminate without liability on the part of any
non-defaulting Underwriter or of the Company. In any such case either the
Representatives or the Company shall have the right to postpone the Closing
Date, but in no event for longer than seven days, in order that the required
changes, if any, in the Registration Statement and in the Prospectus or in any
other documents or arrangements may be effected. Any action taken under this
paragraph or any such termination shall not relieve any defaulting Underwriter
from liability in respect of any default of such Underwriter under this
Agreement.
X.
If this Agreement shall be terminated by the Underwriters or any of
them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason the Company shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement, with respect to themselves, severally, for
all out-of-pocket expenses (including the fees and disbursements of their
counsel) reasonably incurred by such Underwriters in connection with the Offered
Securities.
XI.
This Agreement shall inure to the benefit of and be binding upon the
Company, the Underwriters, any controlling persons referred to herein and their
respective successors and assigns. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any other person, firm or
corporation any legal or equitable right, remedy or claim under or in respect of
this Agreement or any provision herein contained. No purchaser of Offered
Securities from any Underwriter shall be deemed to be a successor by reason
merely of such purchase.
XII.
Any action by the Underwriters hereunder may be taken by the
Representatives jointly or by each Representative alone on behalf of the
Underwriters, and any such action taken by the Representatives jointly or by
each Representative alone shall be binding upon the Underwriters. All notices
and other communications hereunder shall be in writing and shall be deemed to
have been duly given if mailed or transmitted by any standard form of
telecommunication. Notices to the Underwriters shall be given at the addresses
set forth in the Underwriting Agreement.
11
<PAGE> 13
Notices to the Company shall be given at 40 Westminster Street, Providence,
Rhode Island 02940, Attention: Treasurer, telephone: (401) 621-4200, telecopier:
(401) 621-5045, with a copy to the General Counsel, telephone: (401) 621-4200,
telecopier: (401) 621-5045.
XIII.
This Agreement may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.
XIV.
This Agreement shall be governed by and construed in accordance with
the laws of the State of New York, without giving effect to the conflicts of
laws provisions thereof.
12
<PAGE> 14
SCHEDULE I
DELAYED DELIVERY CONTRACT
[insert date]
Dear Sirs:
The undersigned hereby agrees to purchase from Textron Financial
Corporation, a Delaware corporation (the "Company"), and the Company agrees to
sell to the undersigned
$
principal amount of the Company's [state title of issue] (the "Securities"),
offered by the Company's Prospectus dated ___________, 1999 and Prospectus
Supplement dated _________ __, ____, receipt of copies of which are hereby
acknowledged, at a purchase price of ______________ of the principal amount
thereof plus accrued interest and on the further terms and conditions set forth
in this contract. The undersigned does not contemplate selling Securities prior
to making payment therefor.
The undersigned will purchase from the Company Securities in the
principal amounts and on the delivery dates set forth below:
<TABLE>
<CAPTION>
Delivery Principal Plus Accrued
Date Amount Interest From:
---- ------ --------------
<S> <C> <C> <C>
______________ $__________________ _______________
______________ $__________________ _______________
______________ $__________________ _______________
</TABLE>
Each such date on which Securities are to be purchased hereunder is
hereinafter referred to as a "Delivery Date".
Payment for the Securities which the undersigned has agreed to purchase
on each Delivery Date shall be made to the Company by wire transfer of
immediately available funds to an account designated by the Company at 10:00
A.M. (New York time) on the Delivery Date, upon delivery to the undersigned of
the Securities to be purchased by the undersigned on the Delivery Date, in such
denominations and registered in such names as the undersigned may
I-1
<PAGE> 15
designate by written or telegraphic communication addressed to the Company not
less than five full business days prior to the Delivery Date.
The obligation of the undersigned to take delivery of and make payment
for the Securities on the Delivery Date shall be subject to the conditions that
(1) the purchase of Securities to be made by the undersigned shall not at the
time of delivery be prohibited under the laws of the jurisdiction to which the
undersigned is subject and (2) the Company shall have sold, and delivery shall
have taken place to the underwriters (the "Underwriters") named in the
Prospectus Supplement referred to above of, such part of the Securities as is to
be sold to them. Promptly after completion of sale and delivery to the
Underwriters, the Company will mail or deliver to the undersigned at its address
set forth below notice to such effect, accompanied by a copy of the opinion of
counsel for the Company delivered to the Underwriters in connection therewith.
Failure to take delivery of and make payment for Securities by any
purchaser under any other Delayed Delivery Contract shall not relieve the
undersigned of its obligations under this contract.
This contract will inure to the benefit of and be binding upon the
parties hereto and their respective successors, but will not be assignable by
either party hereto without the written consent of the other.
If this contract is acceptable to the Company, it is requested that the
Company sign the form of acceptance below and mail or deliver one of the
counterparts hereof to the undersigned at its address set forth below. This will
become a binding contract, as of the date first above written, between the
Company and the undersigned when such counterpart is so mailed or delivered.
I-2
<PAGE> 16
This contract shall be governed by and construed in accordance with the
laws of the State of New York, without giving effect to the conflicts of laws
provisions thereof.
Yours very truly,
________________________________________
(Purchaser)
By______________________________________
________________________________________
(Title)
________________________________________
(Address)
Accepted:
TEXTRON FINANCIAL CORPORATION
By_______________________________
Title:
I-3
<PAGE> 17
PURCHASER -- PLEASE COMPLETE AT TIME OF SIGNING
The name and telephone and department of the representative of the
Purchaser with whom details of delivery on the Delivery Date may be discussed is
as follows: (Please Print.)
<TABLE>
<CAPTION>
Telephone No.
Name (Including Area Code) Department
---- --------------------- ----------
<S> <C> <C>
---------------------- ---------------------- -------------------
---------------------- ---------------------- -------------------
---------------------- ---------------------- -------------------
---------------------- ---------------------- -------------------
---------------------- ---------------------- -------------------
</TABLE>
I-4
<PAGE> 18
EXHIBIT A
OPINION OF COUNSEL FOR THE COMPANY
The opinion of Counsel for the Company, to be delivered pursuant to
Article V, paragraph (b) of the document entitled Textron Financial Corporation
Underwriting Agreement Standard Provisions (Debt) shall be to the effect that:
(a) the Indenture has been duly authorized, executed and
delivered by the Company and is a valid and binding agreement of the
Company enforceable in accordance with its terms, except as (1) the
enforceability thereof may be limited by bankruptcy, insolvency or
similar laws affecting the enforcement of creditors' rights generally
and (2) the availability of equitable remedies may be limited by
equitable principles of general applicability and except further as
enforceability thereof may be limited by (x) requirements that a claim
with respect to any Notes denominated other than in U.S. dollars (or a
foreign currency or currency unit) judgment in respect of such claim be
converted into U.S. dollars at a rate of exchange prevailing on a date
determined pursuant to applicable law or (y) governmental authority to
limit, delay or prohibit the making of payments outside the United
States, and the Indenture has been duly qualified under the Trust
Indenture Act,
(b) the Offered Securities have been duly authorized by the
Company and, when executed and authenticated in accordance with the
provisions of the Indenture and delivered to and paid for by the
Underwriters or by institutional investors, if any, pursuant to Delayed
Delivery Contracts, will constitute valid and legally binding
obligations of the Company enforceable against the Company in
accordance with their terms and will be entitled to the benefits of the
Indenture, except as (1) enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting the enforcement of
creditors' rights generally and (2) the availability of equitable
remedies may be limited by equitable principles of general
applicability and except further as enforceability thereof may be
limited by (x) requirements that a claim with respect to any Notes
denominated other than in U.S. dollars (or a foreign currency or
currency unit judgment in respect of such claim) be converted into U.S.
dollars at a rate of exchange prevailing on a date determined pursuant
to applicable law or (y) governmental authority to limit, delay or
prohibit the making of payments outside the United States,
(c) the execution and delivery of, and the performance by the
Company of its obligations under the Underwriting Agreement have been
duly authorized by the Company and the Underwriting Agreement has been
duly executed and delivered by the Company,
(d) the execution and delivery of, and the performance by the
Company of its obligations under the Delayed Delivery Contracts, if
any, have been duly authorized by the Company and the Delayed Delivery
Contracts, if any, have been duly executed and delivered by the
Company, and are valid and binding agreements of the Company
enforceable in accordance with their respective terms, except as (1)
enforceability thereof may be limited by bankruptcy, insolvency or
similar laws affecting the enforcement of creditors' rights generally
and (2) and the availability of equitable remedies may be limited by
equitable principles of general applicability,
(e) the execution and delivery of the Underwriting Agreement
and the Indenture by the Company and the consummation of the
transactions contemplated
A-1
<PAGE> 19
therein will not contravene any provision of applicable law of the
State of New York (except as rights to indemnity and contribution under
the Underwriting Agreement may be limited by applicable law) or the
Certificate of Incorporation or By-Laws of the Company,
(f) the Company is not and, after giving effect to the
offering and sale of the Offered Securities, will not be an "investment
company" within the meaning of the Investment Company Act,
(g) the statements in the Prospectus under "Description of the
Securities", "Description of the [Offered Securities]", "Plan of
Distribution" and "Underwriting", insofar as such statements constitute
a summary of legal matters, documents or proceedings referred to
therein has been reviewed by such counsel and is correct in all
material respects,
(h) such counsel is of the opinion that the Registration
Statement and Prospectus, as amended or supplemented, if applicable
(except as to financial statements contained therein and the notes
thereto or omitted therefrom and the schedules and other financial and
statistical data included therein, as to which such counsel need not
express any opinion) comply as to form in all material respects with
the Act and the Trust Indenture Act and the rules and regulations
thereunder, and
(i) such counsel shall also state that nothing has come to
such counsel's attention that causes such counsel to believe that
(except for the financial statements contained therein or omitted
therefrom and the notes thereto and the schedules and other financial
and statistical data included therein, as to which such counsel need
not express any belief) the Registration Statement, filed with the
Commission pursuant to the Act, when it became effective, contained any
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading, or that (except for the financial statements
contained therein or omitted therefrom and the notes thereto and the
schedules and other financial and statistical data included therein, as
to which counsel need not express any belief) the Registration
Statement and the Prospectus on the date of the Underwriting Agreement
and the Prospectus, as amended or supplemented, if applicable, on the
Closing Date contained or contains any untrue statement of a material
fact or omitted or omits to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under
A-2
<PAGE> 20
which they were made, not misleading; provided that such counsel may
state that such counsel's opinion and belief is based upon such
counsel's participation in the preparation of the Registration
Statement and the Prospectus and any amendment and supplements thereto
(including the documents incorporated by reference therein) and review
and discussion of the contents thereof (including the documents
incorporated by reference therein), but is without independent check or
verification except as specified,
Terms capitalized herein and not otherwise defined shall have the
meanings assigned to them in the Textron Financial Corporation Underwriting
Agreement Standard Provisions (Debt). In rendering such opinion, such counsel
may rely as to matters of fact, to the extent such counsel deems proper, on
certificates of responsible officers of the Company and certificates or other
written statements of public officials.
A-3
<PAGE> 21
EXHIBIT B
OPINION OF GENERAL COUNSEL OF THE COMPANY
The opinion of the General Counsel of the Company, to be delivered
pursuant to Article V, paragraph (c) of the document entitled Textron Financial
Corporation Underwriting Agreement Standard Provisions (Debt) shall be to the
effect that:
(a) the Company is a corporation duly organized and validly
existing in good standing under the laws of the State of Delaware with
full corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Registration
Statement and the Prospectus, and is duly registered and qualified to
conduct its business and is in good standing in each jurisdiction or
place where the nature of its properties or the conduct of its business
requires such registration or qualification, except where the failure
so to register or qualify does not have a material adverse effect on
the condition (financial or other), business, properties, net worth or
results of operations of the Company and its subsidiaries taken as a
whole,
(b) each of Cessna Finance Corporation, Litchfield Financial
Corporation, REC Capital Corporation, Systran Financial Services
Holding Company and Westminster Development Bank (collectively, the
"Significant Subsidiaries") is a corporation duly organized, validly
existing and in good standing in the jurisdiction of its incorporation,
with full corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Registration
Statement and the Prospectus, and is duly registered and qualified to
conduct its business and is in good standing in each jurisdiction or
place where the nature of its properties or the conduct of its business
requires such registration or qualification, except where the failure
so to register or qualify does not have a material adverse effect on
the condition (financial or other), business, properties, net worth or
results of operations of the Company and its subsidiaries taken as a
whole; all of the issued and outstanding capital stock of each such
Significant Subsidiary has been duly authorized and validly issued and
is fully paid and non-assessable, and the Company owns of record,
directly or indirectly, all of the outstanding shares of capital stock
of each of the Significant Subsidiaries free and clear of any lien,
adverse claim, security interest, equity or other encumbrance,
(c) the execution and delivery of the Underwriting Agreement
and the Indenture by the Company and the consummation of the
transactions contemplated therein will not contravene any provision of
applicable law (except as rights to indemnity and contribution under
the Underwriting Agreement may be limited by applicable law) or to such
counsel's knowledge after due inquiry, any other agreement or
instrument binding upon the Company or any of the Company's Significant
Subsidiaries or any judgment, order or decree of any governmental body,
agency or court having jurisdiction over the Company or such
Significant Subsidiaries, except such contraventions as would not,
individually or in the aggregate, have a material adverse effect on the
condition (financial or other), business, properties, net worth or
results of operations of the Company and its subsidiaries taken as a
whole, and no consent, approval or authorization or order of, or
qualification with, any governmental body or agency is required for the
performance by
B-1
<PAGE> 22
the Company of its obligations under the Underwriting Agreement or the
Indenture, and the consummation of the transactions contemplated
thereby, except such as are required pursuant to state securities or
Blue Sky Laws,
(d) the statements included under the caption "Legal
Proceedings" in the Company's registration statement on Form 10,
insofar as they describe statements of law or legal conclusions are
accurate and fairly present the information required to be shown,
(e) such counsel (1) is of the opinion that each document
filed pursuant to the Exchange Act and incorporated by reference in the
Prospectus (except as to financial statements contained therein or
omitted therefrom and the notes thereto and the schedules and other
financial and statistical data included therein, as to which such
counsel need not express any opinion) complied when so filed as to form
in all material respects with such act and the rules and regulations
thereunder, (2) has no reason to believe that (except for the financial
statements contained therein or omitted therefrom and the notes thereto
and the schedules and other financial and statistical data included
therein, as to which such counsel need not express any belief) any part
of the Registration Statement (including the documents incorporated by
reference therein), filed with the Commission pursuant to the Act, when
such part became effective, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, (3)
is of the opinion that the Registration Statement and Prospectus, as
amended or supplemented, if applicable (except as to financial
statements contained therein or omitted therefrom and the notes thereto
and the schedules and other financial and statistical data included
therein, as to which such counsel need not express any opinion) comply
as to form in all material respects with the Act and the Trust
Indenture Act and the rules and regulations thereunder, (4) has no
reason to believe that (except for the financial statements contained
therein or omitted therefrom and the notes thereto and the schedules
and other financial and statistical data included therein, as to which
counsel need not express any belief) the Registration Statement and the
Prospectus on the date of the Underwriting Agreement and the
Prospectus, as amended or supplemented, if applicable, on the Closing
Date contained or contains any untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which
they were made, not misleading; provided that such counsel may state
that such counsel's opinion and belief is based upon such counsel's
participation in the preparation of the Registration Statement and the
Prospectus and any amendment and supplements thereto (including the
documents incorporated by reference therein) and review and discussion
of the contents thereof (including the documents incorporated by
reference therein), but is without independent check or verification
except as specified.
Terms capitalized herein and not otherwise defined shall have the
meanings assigned to them in the Textron Financial Corporation Underwriting
Agreement Standard Provisions (Debt). In rendering such opinion, such counsel
may rely as to matters of fact, to the extent such counsel deems proper, on
certificates of responsible officers of the Company and certificates or other
written statements of public officials.
B-2
<PAGE> 23
EXHIBIT C
FORM OF OPINION OF COUNSEL FOR TEXTRON INC.
The opinion of Counsel for Textron to be delivered pursuant to Article
V, paragraph (d) of the document entitled Textron Financial Corporation
Underwriting Agreement Standard Provisions (Debt) shall be to the effect that:
(a) Textron has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of
Delaware. Textron is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or
the ownership or leasing of property requires such qualification and
where the failure to be qualified or in good standing would have a
material adverse effect upon its operations or financial condition,
(b) the Support Agreement has been duly authorized, executed
and delivered by Textron and is a valid and binding agreement of
Textron enforceable by the parties thereto in accordance with its terms
by the parties thereto and by any party which lends funds to the
Company (each, a "Third-Party Beneficiary"), including the holders of
the Offered Securities issued by the Company pursuant to the
Underwriting Agreement (but with respect to any Third-Party Beneficiary
only which the Company is indebted to such Third-Party Beneficiary for
money borrowed), except as: (a) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting the
enforcement of creditors' rights generally and (b) the availability of
equitable remedies may be limited by equitable principles of general
applicability, and
(c) the execution, delivery and performance by Textron of the
Support Agreement does not, and will not, contravene any provisions of
currently applicable law, any current provision of the Certificate of
Incorporation or By-Laws of Textron, each as of the date hereof, or, to
the best of such counsel's knowledge, any current agreement or other
instrument currently binding upon Textron, and no consent, approval or
authorization of any governmental body is required in connection with
the performance of the Support Agreement.
Terms capitalized herein and not otherwise defined shall have the
meanings assigned to them in the Textron Financial Corporation Underwriting
Agreement Standard Provisions (Debt). In rendering such opinion, such counsel
may rely as to matters of fact, to the extent such counsel deems proper, on
certificates of responsible officers of Textron and certificates or other
written statements of public officials.
C-1
<PAGE> 24
EXHIBIT D
FORM OF OPINION OF COUNSEL FOR THE UNDERWRITERS
The opinion of Counsel for the Underwriters, to be delivered pursuant
to Article V, paragraph (e) of the document entitled Textron Financial
Corporation Underwriting Agreement Standard Provisions (Debt) shall be to the
effect that:
(a) the Indenture has been duly authorized, executed and
delivered by the Company and (assuming due authorization, execution and
delivery thereof by the Trustee) constitutes a valid and legally
binding agreement of the Company, enforceable against the Company in
accordance with its terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law) and except further as enforcement thereof may be
limited by (A) requirements that a claim with respect to any Offered
Securities denominated other than in U.S. dollars (or a foreign or
composite currency judgment in respect of such claim) be converted into
U.S. dollars at a rate of exchange prevailing on a date determined
pursuant to applicable law or (B) governmental authority to limit,
delay or prohibit the making of payments outside the United States, and
the Indenture has been duly qualified under the Trust Indenture Act,
(b) the Offered Securities have been duly authorized by the
Company for issuance and sale pursuant to the Underwriting Agreement,
and when issued and authenticated in the manner provided for in the
Indenture and delivered against payment of the consideration therefor
specified in the Underwriting Agreement or the Delayed Delivery
Contract, as the case may be, will constitute valid and legally binding
obligations of the Company, enforceable against the Company in
accordance with their terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law), and except further as enforcement thereof may be
limited by (A) requirements that a claim with respect to any Offered
Securities denominated other than in U.S. dollars (or a foreign or
composite currency judgment in respect of such claim) be converted into
U.S. dollars at a rate of exchange prevailing on a date determined
pursuant to applicable law or (B) governmental authority to limit,
delay or prohibit the making of payments outside the United States,
(c) the Underwriting Agreement has been duly authorized,
executed and delivered by the Company,
(d) the Delayed Delivery Contracts, if any, has been duly
authorized, executed and delivered by the Company and (assuming due
authorization, execution and delivery thereof by the institutional
investor named therein) constitutes a valid and legally
D-1
<PAGE> 25
binding agreement of the Company enforceable against the Company in
accordance with its terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement in considered in a proceeding in
equity or at law),
(e) the information in the Prospectus under "Description of
the Securities" and "Description of the [Offered Securities]", insofar
as such statements constitute a summary of the legal matters, documents
or proceedings referred to therein has been reviewed by such counsel
and is correct in all material respects,
(f) the Registration Statement and Prospectus, excluding the
documents incorporated by reference therein, as amended or
supplemented, if applicable (except as to financial statements and
supporting schedules contained therein or omitted therefrom and the
Trustee's Statement of Eligibility on Form T-1 (the "Form T-1"), as to
which such counsel need not express any opinion), comply as to form in
all material respects with the requirements of the Act and the
applicable rules and regulations thereunder,
(g) such counsel shall also state that nothing has come to
such counsel's attention that would lead such counsel to believe that
the Registration Statement or any post-effective amendment thereto
(except for financial statements and supporting schedules and other
financial data included or incorporated by reference therein or omitted
therefrom and the Form T-1, as to which such counsel need not make any
statement), at the time the Registration Statement or any
post-effective amendment thereto became effective, 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 the Prospectus, as amended or
supplemented (except for financial statements and schedules and other
financial data included or incorporated therein or omitted therefrom,
as to which such counsel need not make any statement), if applicable,
on the date of the Underwriting Agreement and on the Closing Date,
included or includes an untrue statement of a material fact or omitted
or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading; provided that such counsel may state that
their opinion and belief is based upon their participation in the
preparation of the Registration Statement and the Prospectus and any
amendment and supplements thereto (other than the documents
incorporated by reference therein) and review and discussion of the
contents thereof (including the documents incorporated by reference
therein), but is without independent check or verification except as
specified.
Terms capitalized herein and not otherwise defined shall have the
meanings assigned to them in the Textron Financial Corporation Underwriting
Agreement Standard Provisions (Debt). In rendering such opinion such counsel may
rely as to matters of fact, to the extent such counsel deems proper, on
certificates of responsible officers of the Company and certificates or other
written statements of public officials.
D-2
<PAGE> 1
Exhibit 4.1
TEXTRON FINANCIAL CORPORATION
AND
SUNTRUST BANK, ATLANTA,
TRUSTEE
INDENTURE
Dated as of December, 1999
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE ONE
DEFINITIONS 1 ...................................................... 1
SECTION 1.1 Certain Terms Defined.................................. 1
ARTICLE TWO
SECURITIES ........................................................ 7
SECTION 2.1 Forms Generally........................................ 7
SECTION 2.2 Form of Face of Security............................... 7
SECTION 2.3 Form of Reverse of Security............................ 10
SECTION 2.4 Form of Trustee's Certificate of Authentication........ 15
SECTION 2.5 Amount Unlimited; Issuable in Series................... 15
SECTION 2.6 Authentication and Delivery of Securities.............. 18
SECTION 2.7 Execution of Securities................................ 19
SECTION 2.8 Certificate of Authentication.......................... 19
SECTION 2.9 Denomination and Date of Securities; Payments of
Interest...................................................... 19
SECTION 2.10 Registration, Transfer and Exchange; Certain
Transfers and Exchanges....................................... 20
SECTION 2.11 Mutilated, Defaced, Destroyed, Lost and Stolen
Securities.................................................... 21
SECTION 2.12 Cancellation of Securities Paid, etc.................. 22
SECTION 2.13 Temporary Securities.................................. 23
SECTION 2.14 Global Securities..................................... 23
ARTICLE THREE
COVENANTS OF THE ISSUER............................................. 25
SECTION 3.1 Payment of Principal and Interest...................... 25
SECTION 3.2 Offices for Payments, etc.............................. 25
SECTION 3.3 Paying Agents.......................................... 26
SECTION 3.4 Limitation on Liens.................................... 27
SECTION 3.5 Statement as to Compliance............................. 29
SECTION 3.6 Existence.............................................. 29
ARTICLE FOUR
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT..... 31
</TABLE>
(i)
<PAGE> 3
<TABLE>
<CAPTION>
Page
----
<S> <C>
SECTION 4.1 Events of Default...................................... 31
SECTION 4.2 Payment of Securities on Default; Suit Therefor........ 33
SECTION 4.3 Application of Moneys Collected by Trustee............. 35
SECTION 4.4 Proceedings by Trustee................................. 36
SECTION 4.5 Restoration of Rights on Abandonment of Proceedings.... 36
SECTION 4.6 Proceedings by Securityholders......................... 36
SECTION 4.7 Remedies Cumulative and Continuing..................... 37
SECTION 4.8 Control by Securityholders............................. 37
SECTION 4.9 Waiver of Past Defaults................................ 38
ARTICLE FIVE
CONCERNING THE TRUSTEE.............................................. 38
SECTION 5.1 Reliance on Documents, Opinions, etc.; No Requirement
for Expenditure of Own Funds.................................. 38
SECTION 5.2 No Responsibility for Recitals, etc.................... 40
SECTION 5.3 Trustee and Agents May Hold Securities................. 40
SECTION 5.4 Moneys to Be Held in Trust............................. 41
SECTION 5.5 Compensation and Expenses of Trustee................... 41
SECTION 5.6 Right of Trustee to Rely on Officers' Certificate, etc. 41
SECTION 5.7 Eligibility of Trustee................................. 42
SECTION 5.8 Resignation or Removal of Trustee; Appointment of
Successor Trustee............................................. 42
SECTION 5.9 Acceptance of Appointment by Successor Trustee......... 43
SECTION 5.10 Merger, Conversion, Consolidation or Succession to
Business of Trustee........................................... 44
SECTION 5.11 Reports by Trustee to Securityholders................. 44
SECTION 5.12 Compliance with Backup Withholding and Information
Reporting..................................................... 44
ARTICLE SIX
CONCERNING THE SECURITYHOLDERS...................................... 45
SECTION 6.1 Action by Securityholders.............................. 45
SECTION 6.2 Proof of Execution by Securityholders.................. 46
SECTION 6.3 Holders to Be Treated as Owners........................ 46
SECTION 6.4 Securities Owned by Issuer Deemed Not Outstanding...... 46
SECTION 6.5 Right of Revocation of Action Taken.................... 47
SECTION 6.6 Securityholders' Meetings; Purposes.................... 47
SECTION 6.7 Call of Meetings by Trustee............................ 48
SECTION 6.8 Call of Meetings by Issuer or Securityholders.......... 48
SECTION 6.9 Qualifications for Voting.............................. 48
SECTION 6.10 Quorum; Adjourned Meetings............................ 48
SECTION 6.11 Regulations........................................... 49
SECTION 6.12 Voting................................................ 49
SECTION 6.13 No Delay of Rights by Meeting......................... 50
</TABLE>
(ii)
<PAGE> 4
<TABLE>
<CAPTION>
Page
----
<S> <C>
SECTION 6.14 Written Consent in Lieu of Meeting.................... 50
ARTICLE SEVEN
SUPPLEMENTAL INDENTURES............................................. 50
SECTION 7.1 Supplemental Indentures Without Consent of
Securityholders............................................... 50
SECTION 7.2 Supplemental Indentures With Consent of
Securityholders............................................... 52
SECTION 7.3 Effect of Supplemental Indenture....................... 53
SECTION 7.4 Certain Documents to Be Given to Trustee............... 53
SECTION 7.5 Notation on Securities................................. 53
ARTICLE EIGHT
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE................... 54
SECTION 8.1 Issuer May Consolidate, etc., on Certain Terms......... 54
SECTION 8.2 Successor Person to Be Substituted..................... 54
SECTION 8.3 Opinion of Counsel and Officers' Certificate to Be
Given to Trustee.............................................. 55
ARTICLE NINE
SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS........... 55
SECTION 9.1 Satisfaction and Discharge of Indenture................ 55
SECTION 9.2 Application by Trustee of Funds Deposited for Payment
of Securities................................................. 56
SECTION 9.3 Repayment of Moneys Held by Paying Agent............... 56
SECTION 9.4 Return of Moneys Held by Trustee and Paying Agent
Unclaimed for Two Years....................................... 56
ARTICLE TEN
REDEMPTION OF SECURITIES AND SINKING FUNDS.......................... 56
SECTION 10.1 Applicability of Article.............................. 56
SECTION 10.2 Notice of Redemption; Selection of Securities......... 56
SECTION 10.3 Payment of Securities Called for Redemption........... 57
SECTION 10.4 Exclusion of Certain Securities from Eligibility for
Selection for Redemption...................................... 58
SECTION 10.5 Mandatory and Optional Sinking Funds.................. 58
SECTION 10.6 Redemption for Tax Reasons............................ 61
ARTICLE ELEVEN
DEFEASANCE AND COVENANT DEFEASANCE.................................. 62
</TABLE>
(iii)
<PAGE> 5
<TABLE>
<CAPTION>
Page
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<S> <C>
SECTION 11.1 Applicability of Article; Issuer's Option to Effect
Defeasance or Covenant Defeasance............................. 62
SECTION 11.2 Defeasance and Discharge.............................. 62
SECTION 11.3 Covenant Defeasance................................... 62
SECTION 11.4 Conditions to Defeasance or Covenant Defeasance....... 63
SECTION 11.5 Deposited Money and U.S. Government Obligations to
Be Held in Trust; Other Miscellaneous Provisions.............. 64
ARTICLE TWELVE
MISCELLANEOUS PROVISIONS............................................ 65
SECTION 12.1 Incorporators, Stockholders, Officers and Directors
of Issuer Exempt from Individual Liability.................... 65
SECTION 12.2 Provisions of Indenture for the Sole Benefit of
Parties and Securityholders................................... 65
SECTION 12.3 Successors and Assigns of Issuer Bound by Indenture... 65
SECTION 12.4 Notices and Demands on Issuer, Trustee and
Securityholders............................................... 65
SECTION 12.5 Officers' Certificates and Opinions of Counsel;
Statements to Be Contained Therein............................ 66
SECTION 12.6 Official Acts by Successor Entity..................... 67
SECTION 12.7 Payments Due on Saturdays, Sundays and Legal Holidays. 67
SECTION 12.8 New York Law to Govern................................ 67
SECTION 12.9 Counterparts.......................................... 67
SECTION 12.10 Effect of Headings................................... 67
SECTION 12.11 Conflict with Trust Indenture Act.................... 68
SECTION 12.12 Severability......................................... 68
</TABLE>
(iv)
<PAGE> 6
TEXTRON FINANCIAL CORPORATION
(the "Issuer")
AND
SUNTRUST BANK, ATLANTA
(the "Trustee")
INDENTURE
Dated as of December __, 1999
Reference is made to the following provisions of the Trust
Indenture Act of 1939, as amended, which establish certain duties and
responsibilities of the Issuer and the Trustee which are not set forth in this
Indenture:
<TABLE>
<CAPTION>
Section Subject Section Subject
- ------- ------- ------- -------
<C> <S> <S> <S>
310(b) Disqualification of 315(b) Notice of default from
Trustee for conflicting Trustee to Security-
interest holders
311 Preferential collection 315(c) Duties of Trustee in
of claims of Trustee as case of default
creditor of the Issuer
312(a) Periodic filing of 315(d) Provisions relating to
information by responsibility of
the Issuer with Trustee Trustee
312(b) Access of Security- 315(e) Assessment of costs
holders to information against litigating Securityholders in
certain circumstances
313(a) Annual report of Trustee 316(a) Directions and waivers
to Securityholders by Securityholders in certain
circumstances
313(b) Additional reports of 316(b) Prohibition of impair-
Trustee to Securityholders ment of right of
Securityholders to payment
314(a) Reports by the Issuer, 316(c) Right of the Issuer to
including annual set record date for
compliance certificate certain purposes
</TABLE>
<PAGE> 7
<TABLE>
<CAPTION>
Section Subject Section Subject
- ------- ------- ------- -------
<C> <S> <S> <S>
314(c) Evidence of compliance 317(a) Special powers of
with conditions precedent Trustee
315(a) Duties of Trustee prior 318(a) Provisions of Act to
to default control in case of conflict
</TABLE>
<PAGE> 8
THIS INDENTURE, dated as of December __, 1999 between Textron
Financial Corporation, a Delaware corporation (the "Issuer"), and SunTrust Bank,
Atlanta, a state banking corporation existing under the laws of the State of
Georgia (the "Trustee").
W I T N E S S E T H :
WHEREAS, the Issuer has duly authorized the execution and
delivery of this Indenture for the issuance from time to time of its unsecured
bonds, debentures, notes and other evidences of indebtedness to be issued in one
or more series (the "Securities") up to such principal amount or amounts and
denominated in United States dollars or foreign currency or units or composites
of two or more thereof as may from time to time be authorized in accordance with
the terms of this Indenture and to provide, among other things, for the
authentication, delivery and administration thereof, the Issuer has duly
authorized the execution and delivery of this Indenture; and
WHEREAS, all things necessary to make this Indenture, when
executed and delivered by the parties hereto, a valid indenture and agreement
according to its terms, have been done;
NOW, THEREFORE:
In consideration of the premises and the purchases of the
Securities by the holders thereof, the Issuer and the Trustee mutually covenant
and agree for the equal and proportionate benefit of the respective holders from
time to time of the Securities as follows:
ARTICLE ONE
DEFINITIONS
SECTION 1.1 Certain Terms Defined. The following terms (except
as herein otherwise expressly provided or unless the context otherwise clearly
requires) for all purposes of this Indenture and of any indenture supplemental
hereto shall have the respective meanings specified in this Section. All other
terms used in this Indenture that are defined in the Trust Indenture Act of
1939, as amended to the date of this Indenture as originally executed, or the
definitions of which in the Securities Act of 1933, as amended to the date of
this Indenture as originally executed, are referred to in the Trust Indenture
Act of 1939 (except as herein otherwise expressly provided or unless the context
otherwise clearly requires), shall have the meanings assigned to such terms in
said Trust Indenture Act and in said Securities Act as in force at the date of
this Indenture. The words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture, as it may be amended from time to time,
as a whole and not to any particular Article, Section or other subdivision. The
terms defined in this Article have the meanings assigned to them in this Article
and include the plural as well as the singular.
"Additional Amounts" has the meaning set forth in Section 3.7.
<PAGE> 9
"Board of Directors" means either the Board of Directors of
the Issuer or any committee of such Board of Directors duly authorized to act
hereunder.
"Business Day" means, except as otherwise provided pursuant to
Section 2.5 for Securities of any series, any day that is not a Saturday or
Sunday and that is not a day on which banking institutions are generally
authorized or obligated by law to close in The City of New York or the city in
which the Corporate Trust Office is located.
"Commission" means the Securities and Exchange Commission, as
from time to time constituted, created under the Securities Exchange Act of
1934, or if at any time after the execution and delivery of this Indenture such
Commission is not existing and performing the duties now assigned to it under
the Trust Indenture Act of 1939, then the body performing such duties on such
date.
"Consolidated Net Tangible Assets" means, as of any particular
time, the aggregate amount of assets after deducting therefrom (a) all current
liabilities (excluding any such liability that by its terms is extendable or
renewable at the option of the obligor thereon to a time more than 12 months
after the time as of which the amount thereof is being computed) and (b) all
goodwill, excess of cost over assets acquired, patents, copyrights, trademarks,
tradenames and other like intangibles, all as shown in the Issuer's and its
subsidiaries' most recent consolidated financial statements prepared in
accordance with generally accepted accounting principles.
"Corporate Trust Office" means the office of the Trustee at
which the corporate trust business of the Trustee shall, at any particular time,
be principally administered, which office is, at the date as of which this
Indenture is dated, located at Corporate Trust Division, 25 Park Place, 24th
Floor, Atlanta, Georgia 30303-2900.
"covenant defeasance" and "defeasance" have the meanings
assigned to such terms, respectively, by Sections 11.3 and 11.2.
"Debt" of any Person means at any date, without duplication,
(i) all obligations of such Person for borrowed money, (ii) all obligations of
such Person evidenced by bonds, debentures, notes or other similar instruments,
(iii) all obligations of such Person to pay the deferred purchase price of
property or services, except trade accounts payable arising in the ordinary
course of business, (iv) all obligations of such Person as lessee which are
capitalized in accordance with generally accepted accounting principles, (v) any
obligation of others of a type described in the preceding clauses (i), (ii),
(iii) or (iv) secured by a Lien on any asset of such Person, whether or not such
obligation is assumed by such Person, and (vi) all obligations of others of a
type described in the preceding clauses (i), (ii), (iii) or (iv) guaranteed by
such Person; provided that "Debt " of the Issuer or a Subsidiary shall not be
deemed to include Non-recourse Debt.
"Depositary" means, with respect to the Securities of any
series or tranche issuable or issued in the form of one or more Global
Securities, the person designated as Depositary for such Global Securities by
the Issuer pursuant to Section 2.5 until a successor Depositary shall
-2-
<PAGE> 10
have become such pursuant to the applicable provisions of this Indenture, and
thereafter "Depositary" shall mean or include each person who is then a
Depositary for such Global Securities, and if at any time there is more than one
person designated as Depositary for Global Securities of a particular series or
tranche, "Depositary", as used with respect to the Securities of such series or
tranche, means the Depositary with respect to the particular Global Security or
Securities.
"Event of Default" means any event or condition specified as
such in Section 4.1.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Global Security" means a Security evidencing all or a part of
a series or tranche of Securities, issued to the Depositary for such series or
tranche, as the case may be, in accordance with Section 2.5 and bearing the
legend prescribed in Section 2.14.
"holder" "holder of Securities", "Securityholder" or other
similar terms mean the registered holder of any Security.
"Indenture" means this instrument as originally executed and
delivered or, if amended or supplemented as herein provided, as so amended
and/or supplemented from time to time, and shall include (i) for all purposes of
this instrument and any supplemental indenture, the provisions of the Trust
Indenture Act of 1939 that are deemed to be a part of and govern this instrument
and any such supplemental indenture, respectively, and (ii) the forms and terms
of particular series of Securities established as contemplated hereunder.
"interest" means, when used with respect to a non-interest
bearing Security, interest payable after the principal thereof has become due
and payable whether at maturity, by declaration of acceleration, by call for
redemption, pursuant to a sinking fund or otherwise.
"Issuer" means Textron Financial Corporation, a Delaware
corporation, until any successor Person shall have become such pursuant to
Article Eight and thereafter "Issuer" shall mean such successor except as
otherwise provided in Section 8.2.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest, hypothecation or encumbrance of any kind in
respect of such asset, provided that, "Lien" shall not mean security interests
under Article 9 of the Uniform Commercial Code, or any successor to such
Article, in respect of sales of accounts or chattel paper. For the purposes of
the Securities, the Issuer or any Subsidiary shall be deemed to own subject to a
Lien any asset which it has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, capital lease or other
title retention agreement relating to such asset.
"mandatory sinking fund payments" has the meaning set forth in
Section 10.5.
"Market Exchange Rate" has the meaning set forth in Section
6.1.
"Moody's" shall mean Moody's Investors Service, Inc. or any
successor thereto.
-3-
<PAGE> 11
"New York Location" means the location in the Borough of
Manhattan, The City of New York, State of New York, at which at any particular
time the Trustee receives and redelivers securities, which location at the date
of execution of this Indenture is SunTrust Bank, Atlanta, c/o Harris Trust
Company of New York, Wall Street Plaza, 88 Pine Street, 19th Floor, New York,
New York 10005.
"Non-recourse Debt" of the Issuer or a Subsidiary means any
obligations for borrowed money of the Issuer or a Subsidiary secured by specific
assets which obligations, in accordance with generally accepted accounting
principles, are not reflected in the balance sheet of the Issuer or a Subsidiary
and are issued pursuant to or evidenced by an instrument which limits the
recourse against the obligor thereunder to such specific assets, and (in the
case of all Non-recourse Debt incurred after the date of this Indenture), if
under applicable law in respect of such obligations, such assets or such
obligor, at the time any such obligation is created, a holder of such obligation
could ever become entitled to recourse against the obligor pursuant to
Section 1111(b) of the Bankruptcy Reform Act of 1978 (11 U.S.C. Section 1111(b),
or any successor section thereto) or any other provisions of any bankruptcy,
insolvency or other law of any jurisdiction, such instrument also contains a
provision to the effect that such holder's recourse claim in respect of such
obligation shall be and remain in all respects subordinate and junior to all
Debt evidenced by the Securities of any series and such holder shall not be
entitled to receive any payment, under any condition, in respect of any
obligation, other than the proceeds of such specific assets, until all
Securities of any series shall have been paid in full or funds for their payment
shall have been duly and sufficiently provided.
"Officers' Certificate" when used with respect to the Issuer,
means a certificate signed by the chairman of the Board of Directors, the
president or any vice president and by the chief financial officer, treasurer,
controller, the secretary or any assistant secretary of the Issuer and delivered
to the Trustee. Each such certificate shall include the statements required by
the Trust Indenture Act of 1939, or as provided for in Section 12.5, if and to
the extent required hereby.
"Opinion of Counsel" means an opinion, in writing, signed by
legal counsel who may be an employee of or counsel to the Issuer and who shall
be reasonably satisfactory to the Trustee. Each such opinion shall include the
statements required by the Trust Indenture Act of 1939 or as provided for in
Section 12.5, if and to the extent required hereby.
"optional sinking fund payment" has the meaning set forth in
Section 10.5.
"Original Issue Discount Security" means any Security that
provides for an amount less than the principal amount thereof to be due and
payable upon redemption or a declaration of acceleration of the maturity thereof
pursuant to Section 4.1.
"Outstanding" (except as otherwise required by the Trust
Indenture Act of 1939), when used with reference to Securities, shall, subject
to the provisions of Section 6.4, mean, as of any particular time, all
Securities theretofore authenticated and delivered by the Trustee under this
Indenture, except:
-4-
<PAGE> 12
(a) Securities theretofore canceled by the Trustee or
delivered to the Trustee for cancellation;
(b) Securities, or portions thereof, for which moneys and/or
U.S. Government Obligations for the payment thereof in the necessary
amount shall have been theretofore deposited in trust with the Trustee
or with any paying agent (other than the Issuer) or shall have been set
aside, segregated and held in trust by the Issuer for the holders of
such Securities (if the Issuer shall act as its own paying agent); and
(c) Securities in lieu of or in substitution for which other
Securities shall have been authenticated and delivered pursuant to the
terms of Section 2.11, or which shall have been paid pursuant to
Section 2.11.
In determining whether the holders of the requisite principal
amount of Outstanding Securities of any or all series have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, the
principal amount of an Original Issue Discount Security that shall be deemed to
be Outstanding for such purposes shall be the amount of the principal thereof
that would be due and payable as of the date of such determination upon a
declaration of acceleration of the maturity thereof pursuant to Section 4.1.
"Overdue Rate" means, unless otherwise specified in the
Securities of any series, the same rate as the rate of interest specified in the
Securities of such series or, in the case of a series of Original Issue Discount
Securities, the Yield to Maturity of such series of Securities.
"Person" means any individual, corporation, limited liability
company, partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"principal", whenever used with reference to the Securities or
any Security or any portion thereof, shall be deemed to include any premium
that may be payable thereon pursuant to the terms thereof.
"record date" has the meaning set forth in Section 2.9.
"Register" has the meaning set forth in Section 2.10
"Resolution" means a resolution of the Board of Directors,
including without limitation, any such resolution by which or pursuant to which
any series of Securities is authorized and established pursuant to Section 2.5
hereof.
"Responsible Officer", when used with respect to the Trustee,
means any vice president, the treasurer, any senior trust officer, trust
officer, any assistant trust officer, any assistant treasurer, or any other
officer or assistant officer of the Trustee who in each case is working with the
Trustee's corporate trust department at its Corporate Trust Office, or to whom
any corporate trust matter is referred because of his or her knowledge of, and
familiarity with, the particular subject.
"S&P" shall mean Standard & Poor's Corporation or any
successor thereto.
-5-
<PAGE> 13
"Security Registrar" has the meaning set forth in Section
2.10.
"Securities Act" means the Securities Act of 1933, as amended.
"Security" or "Securities" (except as otherwise required by
the Trust Indenture Act of 1939) has the meaning stated in the first recital of
this Indenture or means any Security or Securities issued, authenticated and
delivered under this Indenture, as the context may require.
"Specified Currency" has the meaning set forth in Section 6.1.
"Subsidiary" means any entity of which at least a majority of
the outstanding stock or other ownership interests having, by the terms thereof,
ordinary voting power for the election of directors, managers or trustees of
such entity or other persons performing similar functions (irrespective of
whether or not at the time stock or other ownership interests of any other class
or classes of such entity shall have or might have voting power by reason of the
happening any contingency) is at the time directly or indirectly owned or
controlled by the Issuer, or by one or more other Subsidiaries, or by the Issuer
and one or more other Subsidiaries.
"Support Agreement" means the Support Agreement dated as of
May 25, 1994 between the Issuer and Textron.
"Taxes" has the meaning set forth in Section 3.7.
"Tax Redemption Date" has the meaning set forth in Section
10.6.
"Textron" shall mean Textron Inc., a Delaware corporation or
any successor thereto.
"Trustee" means the Person identified as "Trustee" in the
first paragraph hereof and, subject to the provisions of Article Five, shall
also include any successor trustee. If, pursuant to the provisions of this
Indenture, there shall be at any time more than one Trustee hereunder, the term
"Trustee" as used with respect to Securities of any series shall mean the
Trustee or Trustees with respect to the Securities of that series.
"Trust Indenture Act of 1939" (except as otherwise provided in
Sections 7.1 and 7.2) means the Trust Indenture Act of 1939, as amended, and in
force at the date as of which this Indenture was originally executed; provided,
however, that in the event the Trust Indenture Act of 1939 is amended after such
date, "Trust Indenture Act of 1939" means, to the extent required by any such
amendment, the Trust Indenture Act of 1939 as so amended.
"Uniform Commercial Code" means the New York Uniform
Commercial Code as in effect from time to time.
"United States alien" has the meaning set forth in Section
3.7.
"U.S. Government Obligations" has the meaning set forth in
Section 11.4.
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<PAGE> 14
"vice president", when used with respect to the Issuer or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title of "vice president".
"Yield to Maturity" means, in the case of any Original Issue
Discount Security, the yield to maturity specified in such Security or in a
Resolution relating thereto.
ARTICLE TWO
SECURITIES
SECTION 2.1 Forms Generally. The Securities of each series
shall be substantially in the form set forth in this Article Two, or in such
other form as shall be established by or in an Officers' Certificate pursuant to
a Resolution or in one or more indentures supplemental hereto, in each case with
such appropriate insertions, omissions, substitutions and other variations as
are required or permitted by this Indenture and which may have imprinted or
otherwise reproduced thereon such letters, numbers or other marks of
identification and such legends or endorsements as may be required to comply
with any applicable law, rule or regulation or with the rules of any securities
exchange or as may, consistent with the provisions of this Indenture, be
determined by the officers executing such Securities, as evidenced by their
execution of the Securities.
The definitive Securities shall be printed, lithographed or
engraved on steel engraved borders or may be produced in any other manner, all
as determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
SECTION 2.2 Form of Face of Security. [If the Security is an
Original Issue Discount Security, insert any legend required by the Internal
Revenue Code of 1986, as amended and the regulations thereunder.]
No.
TEXTRON FINANCIAL CORPORATION
[Insert Designation of Series]
Textron Financial Corporation, a corporation duly organized
and existing under the laws of the State of Delaware (herein called the
"Issuer"), for value received hereby promises to pay to
________________________, or its registered assigns, the principal sum of
___________________ on ___________________ [if the Security is to bear interest
prior to maturity, insert--, and to pay interest thereon [[insert as
applicable--annually or semi-annually or quarterly]] on [[insert appropriate
interest payment dates]] (the "Interest Payment Dates") in each year, commencing
_________, [insert -- at the rate of ___% per annum or, if applicable, insert
the method for determining the adjustable, floating or other form of variable
interest rate borne by the Securities] until the principal hereof is paid or
made available for payment [if applicable, insert --,
-7-
<PAGE> 15
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,
if any, and on any overdue installment of interest]. This Security shall bear
interest from the most recent Interest Payment Date to which interest in respect
hereof has been paid or duly provided for, unless no interest has been paid on
this Security, in which case from __________. Any interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, subject
to certain exceptions provided in the Indenture referred to on the reverse
hereof, be paid to the Person in whose name this Security is registered at the
close of business on the __________ or __________ (whether or not a Business
Day) (the "Record Date") next preceding such Interest Payment Date; provided,
however, that the first payment of interest on this Security, if originally
issued between a Record Date and the related Interest Payment Date, shall be
made on the second Interest Payment Date following the date of original issuance
of this Security to the Person in whose name this Security is registered on the
Record Date relating to such second Interest Payment Date.]
[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 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.]
[If applicable, insert - All payments in respect of the
Securities of the series of which this Security is a part, including, without
limitation, payments of principal, [if the Security is to bear interest prior to
maturity, insert -- interest, if any,] and premium, if any, shall be made by the
Issuer without withholding or deduction for or on account of any present or
future taxes, duties, levies, or other governmental charges of whatever nature
in effect on the date of the original issuance of this Security or imposed or
established in the future by or on behalf of the United States or any authority
in the United States ("Taxes"). In the event any such Taxes are so imposed or
established, the Issuer shall pay such Additional Amounts ("Additional Amounts")
as may be necessary in order that the net amounts receivable by each holder of
this Security who is a United States alien (as defined below) after any payment,
withholding or deduction in respect of such Taxes shall equal the respective
amounts of principal [if the Security, if any, is to bear interest prior to
maturity, insert --, interest, if any,] and premium, if any, which would have
been receivable in respect of the Securities of this series in the absence of
such payment, withholding or deduction; provided that no such Additional Amounts
will be payable with respect to any payment on any Security of this series to,
or to a third party on behalf of, a holder who is a United States alien for or
on account of any such Taxes whatever that have been imposed with respect to (1)
any Tax which would not have been so imposed but for (a) the existence of any
present or former connection between the holder (or a fiduciary, settlor,
beneficiary, member, shareholder, or holder of a power over, the holder, if the
holder is an estate, trust, partnership or corporation) and the United States,
including, without limitation, such holder (or such fiduciary, settlor,
beneficiary,
-8-
<PAGE> 16
member, shareholder of, or holder of a power) being or having been a citizen or
resident or treated as a resident thereof or being or having been engaged in a
trade or business therein or being or having been present therein or having or
having had a permanent establishment therein, or (b) the holder's present or
former status as a personal holding company or foreign personal holding company
or controlled foreign corporation or passive foreign investment company for
United States federal income tax purposes or as a corporation which accumulates
earnings to avoid United States federal income tax or as a private foundation or
other tax-exempt organization; (2) any Tax which would not have been so imposed
but for the presentation by the holder of the Security of this series for
payment on a date more than 10 days after the date on which the payment became
due and payable or the date on which payment thereof is duly provided for,
whichever occurs later; (3) any estate, inheritance, gift, sales, transfer,
personal property or excise tax or any similar tax, assessment or governmental
charge; (4) any Tax which is payable otherwise than by withholding from payments
in respect of principal of, any premium, or any interest on any Security of this
series; (5) any Tax imposed on interest received by a holder or beneficial owner
of a Security of this series who actually or constructively owns 10% or more of
the total combined voting power of all classes of the Issuer's stock entitled to
vote or is a bank that acquired a Security of this series in consideration of an
extension of credit made pursuant to a loan agreement entered into in the
ordinary course of business; (6) any Tax imposed as a result of the failure to
comply with (a) certification, information, documentation, reporting or other
similar requirements concerning the nationality, residence, identity or
connection with the United States of the holder or beneficial owner of the
Security of this series, if such compliance is required by statute, or by
regulation of the United States Treasury Department, as a precondition to relief
or exemption from such Tax (including backup withholding tax) or (b) any other
certification, information, documentation, reporting or other similar
requirements under United States income tax laws or regulations that would
establish entitlement to otherwise applicable relief or exemption from such tax,
assessment or other governmental charge; (7) any tax, assessment or other
governmental charge required to be withheld by any paying agent from any payment
of the principal of, any premium or any interest on any Security of this series,
if the payment can be made without such withholding by at least one other paying
agent; or (8) any combination of items (1), (2), (3), (4), (5), (6) or (7).
Furthermore, no Additional Amounts shall be paid with respect to any payment on
any Security of this series to a holder who is a United States alien that is a
fiduciary or partnership or other than the sole beneficial owner of such payment
to the extent that a beneficiary or settlor with respect to such fiduciary or a
member of such partnership or beneficial owner would not have been entitled to
receive the Additional Amounts had such beneficiary, settlor, member or
beneficial owner been the holder of any Security of this series. The term
"United States alien" means any person who, for United States federal income tax
purposes, is a foreign corporation, a non-resident alien individual, a
non-resident alien fiduciary of a foreign estate or trust, or a foreign
partnership, one or more of the members of which is a foreign corporation, a
non-resident alien individual or a non-resident alien fiduciary of a foreign
estate or trust.
Whenever in this Security or in the Indenture there is a
reference, in any context, to the payment of the principal of [if the Security
is to bear interest prior to maturity, insert -- or interest, if any, on], or in
respect of, any Security, such payment shall be deemed to include the payment of
Additional Amounts to the extent that, in such context, Additional Amounts are,
were
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<PAGE> 17
or would be payable in respect of such payment pursuant to the provisions hereof
or thereof and express mention of the payment of Additional Amounts (if
applicable) in any provision hereof or thereof shall not be construed as
excluding Additional Amounts in those provisions hereof where such express
mention is not made.]
Payment of the principal of, premium if any, and [if
applicable, insert--any such] interest on this Security will be made at the
office or agency of the Issuer maintained for that purpose in [insert--the
places of payment], [insert -- the currency or currencies of payment]; provided,
however, that at the option of the Issuer 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--provided, however, that
a holder of U.S.$10,000,000 or more in aggregate principal amount of Securities
of this series will be entitled to receive interest payments on each Interest
Payment Date by wire transfer of immediately available funds if appropriate wire
transfer instructions have been received in writing by the Trustee not less than
15 calendar days prior to such Interest Payment Date. Any such wire transfer
instructions received by the Trustee shall remain in effect until revoked by
such holder by written notice received by the Trustee at least 15 calender days
prior to the first Interest Payment Date for which such notice shall be
effective.]
[If the Security is an extendible security, insert--The
Securities of this series are subject to repayment on [insert provisions with
respect to repayment date or dates] at the option of the holders thereof
exercisable on or before the __________, but not prior to the _________
preceding such ______________, at a repayment price equal to the principal
amount thereof to be repaid, together with interest payable thereon to the
repayment date, as described on the reverse side 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 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.
IN WITNESS WHEREOF, the Issuer has caused this instrument to
be duly executed as of the date first written above.
Dated:
TEXTRON FINANCIAL CORPORATION
By:_____________________________________
Name:___________________________________
Duly Authorized
SECTION 2.3 Form of Reverse of Security.
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<PAGE> 18
TEXTRON FINANCIAL CORPORATION
This Security is one of a duly authorized issue of securities
of the Issuer (herein called the "Securities"), issued and to be issued in one
or more series under an indenture, dated as of [______ __], 1999, as it may be
amended or supplemented from time to time (herein called the "Indenture"),
between the Issuer and SunTrust Bank, Atlanta, as Trustee (herein called the
"Trustee"), to which Indenture and all indentures supplemental thereto,
reference is hereby made for a statement of the respective rights, limitations
of rights, obligations, duties and immunities thereunder of the Issuer, 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 [if applicable, insert--limited in
aggregate principal amount to __________]. The separate series of Securities may
be issued in various aggregate principal amounts, may mature at different times,
may bear interest, if any, at different rates, may be subject to different
redemption provisions (if any), may be subject to different sinking or purchase
funds (if any), may be subject to different repayment provisions (if any), may
be subject to different covenants and Events of Default and may otherwise vary
as provided in the Indenture. The Indenture further provides that the Securities
of a single series may be issued at various times, with different maturity
dates, may bear interest, if any, at different rates, may be subject to
different redemption provisions (if any), may be subject to different sinking or
purchase funds (if any) and may be subject to different repayment provisions (if
any).
[If applicable, insert--The Securities of this series may not
be redeemed prior to maturity.]
[If applicable, insert -- If at any time subsequent to the
issuance of the Securities of this series, as a result of any change in, or
amendment to, the laws, including any regulations or rulings promulgated
thereunder, of the United States or of any political subdivision thereof or any
authority therein or thereof having power to tax or as a result of any change in
the application or official interpretation of such laws, including any proposals
for change, amendment or application or interpretation of such laws, where the
amendment or change becomes effective on or after the date on which the
underwriting, subscription, distribution, or similar agreement (an "Issuance
Agreement") is executed for the Securities of this series or if no such Issuance
Agreement is executed, the date on which the Securities of this series are first
offered for sale, or which proposal is made after such date, or as a result of
any action taken by any taxing authority of the United States which action is
taken or becomes generally known after such date, or any commencement of a
proceeding in a court of competent jurisdiction in the United States after such
date, whether or not such action was taken or such proceeding was brought with
respect to the Issuer, the Issuer becomes, or will become, obligated to pay any
Additional Amounts, then the Securities of this series will be redeemable as a
whole (but not in part), at the option of the Issuer, at any time upon not less
than thirty (30) nor more than sixty (60) days' notice given to the holders at
their principal amount [if the Security is to bear interest prior to maturity,
insert -- together with accrued interest thereon, if any,] [if the Security is
an Original Issue Discount Security, --(calculated as provided in the
Indenture).] (and any Additional Amounts payable with respect thereto) to the
date fixed for redemption (the "Tax Redemption Date"). In order to effect a
redemption of Securities of this series as described in this paragraph, the
Issuer shall deliver to the Trustee at least forty-five (45) days prior to the
Tax Redemption Date: (i) a written notice stating that the Securities of this
series are to be redeemed as a whole, specifying the redemption date and other
pertinent information and (ii) an Opinion of Counsel to the effect that the
Issuer has or will become obligated to pay Additional Amounts as a result of any
such
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<PAGE> 19
change or amendment. No notice of redemption may be given earlier than ninety
(90) days prior to the earliest date on which the Issuer would be obligated to
pay such Additional Amounts were a payment in respect of the Securities of this
series then due. The notice shall additionally specify the Tax Redemption Date
and all other information necessary to the publication and mailing by the
Trustee of notices of such redemption. The Trustee shall be entitled to rely
conclusively upon the information so furnished by the Issuer in such notice and
shall be under no duty to check the accuracy or completeness thereof. Such
notice shall be irrevocable and upon its delivery the Issuer shall be obligated
to make the payment or payments referred to therein to the Trustee.]
[If applicable, insert--The Securities of this series are
subject to redemption upon not less than 30 nor more than 60 days' notice by
mail, [[if applicable, insert --(1) on ________ in any year commencing with the
year ________ and ending with the year ________ through operation of the sinking
fund for this series (as more fully described in the next succeeding paragraph)
at [[insert either--a redemption price equal to 100% of the principal amount of
the Securities to be redeemed or the redemption prices for redemption through
operation of the sinking fund (expressed as percentages of the principal amount)
set forth in the table below,]], and (2)]) at any time [[if applicable,
insert--on or after __________]], as a whole or in part, at the election of the
Issuer, at the [[insert either--following redemption prices or redemption prices
for redemption otherwise than through operation of the sinking fund]] (expressed
as percentages of the principal amount): if redeemed [[if applicable, insert--on
or before ________, __%, and if redeemed]] during the 12-month period beginning
_________ of the years indicated,
[[If applicable,
Redemption Price insert - -
For Redemption Redemption Price
[[If applicable, For Redemption
insert - - Otherwise Than
Through Operation of the Through Operation of the
Year Sinking Fund]] Sinking Fund]]
and thereafter at a redemption price equal to ___% of the principal amount
thereof, together in the case of any such redemption (whether through operation
of the sinking fund or otherwise) with accrued interest to the date fixed for
redemption, but interest installments maturing on or prior to such redemption
date will be payable to the holders of such Securities of record at the close of
business on the relevant Record Dates referred to on the face hereof, all as
provided in the Indenture.]
[(If applicable, insert--The 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 payments") and not more than $____]] aggregate principal amount of
Securities of this series.] [(If applicable, insert -- Securities of this series
acquired or redeemed by the Issuer otherwise than through [[mandatory]] sinking
fund payments
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<PAGE> 20
may be credited against subsequent [[mandatory])] sinking fund payments
otherwise required to be made.]
[(If applicable, insert--Notwithstanding the foregoing, the
Issuer 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 Issuer (calculated
in accordance with generally accepted accounting principles) of less than __%
per annum.]
[(If applicable, insert--Partial redemptions must be in an
amount not less than $__________ principal amount of Securities.]
[(If applicable, insert--In the event of redemption of this
Security in part only, a new Security or Securities of this series for the
unredeemed portion hereof having the same interest rate and maturity as this
Security will be issued in the name of the holder hereof upon the cancellation
hereof.)]
[If the Security is not an Original Issue Discount Security,
insert--If an Event of Default with respect to Securities of this series shall
occur and be continuing, then the Trustee or the holders of not less than 25% in
aggregate principal amount (calculated as provided in the Indenture) of the
Securities of this series then Outstanding may declare the principal of the
Securities of this series and accrued interest thereon, if any, to be due and
payable in the manner and with the effect provided in the Indenture.] [If the
Security is an Original Issue Discount Security, insert--If an Event of Default
with respect to Securities of this series shall occur and be continuing, then
the Trustee or the holders of not less than 25% in aggregate principal amount
(calculated as provided in the Indenture) of the Securities of this series then
Outstanding may declare an amount of principal of the Securities of this series
due and payable in the manner and with the effect provided in the Indenture.
Such amount shall be equal to [[insert formula for determining the amount]].]
[(If the Security is an extendible security, insert--The
Securities of this series are subject to repayment in whole, or in part, on
[insert month, day and years], in increments of __________ or multiples of
__________ in excess of __________, provided that the portion of the principal
amount of any Security of this series not being repaid shall be at least
__________, at the option of the holder thereof at a repayment price equal to
the principal amount thereof to be repaid, together with interest payable
thereon, if any, to the repayment date. For this Security to be repaid at the
option of the holder, the Trustee must receive at the Corporate Trust Office or
the New York Location, on or before the [insert month and day] or, if such
[insert month and day] is not [insert --a day other than a day on which banking
institutions in the Borough of Manhattan, The City and State of New York are
authorized or required by law or regulation to close or, if applicable, insert
appropriate definition] (a "Business Day"), the next succeeding Business Day,
but not earlier than the (insert month and day) prior to the (insert month and
day) on which the repayment price will be paid (i) this Security, with the form
entitled "Option to Elect Repayment" below duly completed, or (ii) a telegram,
telex, facsimile transmission or letter from a member of a national securities
exchange or the National Association of Securities Dealers, Inc. or a commercial
bank or trust company in the United States of America setting forth the name of
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<PAGE> 21
the holder of the Security, the principal amount of the Security, the amount of
such Security to be repaid, a statement that the option to elect repayment is
being made thereby and a guarantee that the Security to be repaid with the form
entitled "Option to Elect Repayment" on the reverse thereof duly completed will
be received by the Issuer no later than five Business Days after the date of
such telegram, telex, facsimile transmission or letter, and such Security and
form duly completed are received by the Issuer by such fifth Business Day.
Either form of notice duly received on or before the [insert month and day]
preceding any such [insert month and day] shall be irrevocable. All questions as
to the validity, eligibility (including time of receipt) and acceptance of any
Securities of this series for repayment will be determined by the Issuer, whose
determination shall be final and binding.]
The Indenture permits, with certain exceptions as therein
provided, the amendment or supplementing thereof and the modification of the
rights and obligations of the Issuer and the rights of the holders of the
Securities of each series to be affected under the Indenture at any time by the
Issuer and the Trustee with the consent of the holders of not less than a
majority in aggregate principal amount (calculated as provided in the Indenture)
of the Securities at the time Outstanding of all series to be affected (all such
series voting as a single class). The Indenture also contains provisions
permitting the holders of not less than a majority in aggregate principal amount
(calculated as provided in the Indenture) of the Securities of each series at
the time Outstanding, on behalf of the holders of all Securities of such series,
to waive certain past defaults or Events of Default under the Indenture and the
consequences of any such defaults or Events of Default. Any such consent or
waiver by the holder of this Security (unless revoked as provided in the
Indenture) shall be conclusive and binding upon such holder and upon all future
holders of this Security and of any Security issued upon the registration of
transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the Issuer,
which is absolute and unconditional, to pay the principal of and interest, if
any, on this Security at the times, place and rate, if any, 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 due presentment of this Security for registration of
transfer at the office or agency of the Issuer in any place where the principal
of and interest, if any, on this Security are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Issuer and the Security Registrar duly executed by the holder hereof or his or
her attorney duly authorized in writing, and thereupon one or more new
Securities of this series, having the same interest rate, if any, and maturity
and bearing interest from the same date as this Security, of any authorized
denominations and for the same aggregate principal amount, will be issued to the
designated transferee or transferees.
The Securities of this series are issuable only in registered
form without coupons in denominations of ________ and any integral multiple
thereof. As provided in the Indenture and subject to certain limitations therein
set forth, Securities of this series are exchangeable for a like aggregate
principal amount of Securities of this series of a different authorized
denomination
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<PAGE> 22
having the same interest rate, if any, and maturity and bearing interest from
the same date as such Securities, as requested by the holder surrendering the
same.
No service charge shall be made for any such registration of
transfer or exchange, but the Issuer 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 Issuer, the Trustee and any agent of the Issuer or the Trustee may
treat the Person in whose name this Security is registered as the owner hereof
for all purposes, whether or not this Security be overdue and notwithstanding
any notation of ownership or other writing thereon, and neither the Issuer, the
Trustee nor any such agent shall be affected by notice to the contrary. All
payments made to or upon the order of such registered holder, shall, to the
extent of the sum or sums paid, effectually satisfy and discharge liability for
monies payable on this Security.
No recourse for the payment of the principal of or interest,
if any, on this Security, or for any claim based hereon or otherwise in respect
hereof, and no recourse under or upon any obligation, covenant or agreement of
the Issuer in the Indenture or any indenture supplemental thereto or in any
Security, or because of the creation of any indebtedness represented thereby,
shall be had against any incorporator, stockholder, official or director, as
such, past, present or future, of the Issuer or of any successor entity, either
directly or through the Issuer or any successor entity, whether by virtue of any
constitution, statute or rule of law or by the enforcement of any assessment or
penalty or otherwise, all such liability being, by the acceptance hereof and as
part of the consideration for the issue hereof, expressly waived and released.
All terms used in this Security and not otherwise defined
herein which are defined in the Indenture shall have the meanings assigned to
them in the Indenture.
This Security shall be governed by and construed in accordance
with the laws of the State of New York, without regard to conflict of law
principles.
SECTION 2.4 Form of Trustee's Certificate of Authentication.
The Trustee's certificate of authentication on all Securities shall be in
substantially the following form:
This is one of the Securities of the series designated herein
and referred to in the within-mentioned Indenture.
SUNTRUST BANK, ATLANTA
--------------------------,
as Trustee
By:______________________________________
Authorized Officer
SECTION 2.5 Amount Unlimited; Issuable in Series. The
aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is unlimited.
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<PAGE> 23
The Securities may be issued in one or more series. There
shall be established in or in an Officers' Certificate pursuant to a Resolution,
a copy of which, certified by the secretary or an assistant secretary of the
Issuer, shall be delivered to the Trustee or established in one or more
indentures supplemental hereto, prior to the issuance of securities of a
particular series:
(1) the title of the Securities of the series (which shall
distinguish the Securities of the series from all other Securities);
(2) any limit upon the aggregate principal amount of the
Securities of the series that may be authenticated and delivered under this
Indenture (except for Securities authenticated and delivered upon registration
of transfer of, or in exchange for, or in lieu of, other Securities of the
series pursuant to Sections 2.10, 2.11, 2.13 or 10.3);
(3) the date or dates on which the principal of the Securities
of the series is payable;
(4) the rate or rates at which the Securities of the series
shall bear interest, if any, or the method or methods, if any, by which such
rate or rates (including the Overdue Rate) shall be determined, the date or
dates from which such interest shall accrue or the method or methods, if any, by
which such date or dates may be determined, the interest payment dates on which
such interest shall be payable and the record dates for the determination of
holders to whom interest is payable, and the basis upon which interest on
Securities of the series shall be calculated if other than that of a 360-day
year of twelve 30-day months;
(5) if in addition to or other than The Borough of Manhattan,
The City of New York, the place or places where the principal and interest with
respect to the Securities of the series shall be payable, any of such
Securities may be surrendered for registration of transfer or exchange, any of
such Securities may be surrendered for exchange and notices or demands to or
upon the Issuer in respect of the Securities of the series and this Indenture
may be served;
(6) the price or prices at which, the period or periods within
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 Issuer, pursuant to any
sinking fund or otherwise;
(7) the obligation, if any, of the Issuer to redeem, purchase
or repay Securities of the series pursuant to any sinking fund or analogous
provisions or at the option of a holder thereof and the price or prices at
which, the period or periods within which and the terms and conditions upon
which Securities of the series shall be redeemed, purchased or repaid, in whole
or in part, pursuant to such obligation;
(8) whether and under what circumstances the Issuer will be
obligated to pay Additional Amounts in respect of the Securities of the series
as provided in Section 3.7 and, as a result, whether the Securities of the
series will be subject to redemption as provided in Section 10.6;
(9) if other than such coin or currency of the United States
of America as at the time of payment is legal tender for payment of public or
private debts, the coin or currency
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<PAGE> 24
(including composite currencies or currency units) in which the Securities of
the series shall be denominated and, if different, the coin or currency
(including composite currencies or currency units) in which payment of the
principal of and/or interest on the Securities of the series shall be payable;
(10) if the principal of and/or interest on the Securities of
the series are to be payable, at the election of the Issuer or a holder thereof,
in a coin or currency (including composite currencies or currency units) other
than that in which the Securities are stated to be payable, the period or
periods within which, and the terms and conditions upon which, such election may
be made;
(11) whether the amount of payments of principal of and/or
interest on the Securities of the series may be determined with reference to an
index, formula or other method or methods (which index, formula or method or
methods may be based, without limitation, on one or more currencies (including
composite currencies or currency units), commodities, equity securities, equity
indices or other indices), and, if so, the terms and conditions upon which and
the manner in which such amounts shall be determined;
(12) if other than denominations of U.S.$1,000 (or if the
Securities are denominated in a currency other than U.S. dollars or in a
composite currency or currency units , 1,000 units of such other currency or
composite currency or currency units) and any multiple thereof, the
denominations in which Securities of the series shall be issuable;
(13) if other 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 4.1 or
provable in bankruptcy pursuant to Section 4.2;
(14) if the Securities of the series are Original Issue
Discount Securities, the price at which and the date on which Securities of the
series are to be issued and the Yield to Maturity at the time of issuance of
such series;
(15) if the Securities of the series are to be issued in the
form of one or more Global Securities, the name of the Depositary for such
Global Security or Securities or the nominee of such Depositary; and
(16) any other terms of the series which are not inconsistent
with this Indenture.
All Securities of any one series shall be substantially
identical except as to denomination, interest rate, if any, and maturity and
except as may otherwise be provided in or pursuant to such Resolution or in any
such indenture supplemental hereto. The applicable Resolution or the applicable
supplemental indenture may provide that Securities of any particular series may
be issued at various times, with different maturities and redemption and
repayment provisions (if any) and bearing interest (if any) at different rates,
but shall for all purposes under this Indenture, including, but not limited to,
voting and Events of Default, be treated as Securities of a single series.
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<PAGE> 25
Except as otherwise specified pursuant to this Section 2.5 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 2.6 Authentication and Delivery of Securities. At any
time and from time to time after the execution and delivery of this Indenture,
the Issuer may deliver Securities of any series executed by the Issuer to the
Trustee for authentication, and the Trustee shall thereupon authenticate and
deliver such Securities to or upon the written order of the Issuer, signed by
both (a) the chairman of its Board of Directors, the president or any vice
president and (b) its chief financial officer, treasurer, controller, secretary
or any assistant secretary, without any further action by the Issuer. 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 the requirements of the Trust Indenture Act
of 1939) shall be fully protected in relying upon:
(1) a copy of any Resolution or Resolutions relating to such
series, certified by the secretary or an assistant secretary of the
Issuer;
(2) an executed supplemental indenture, if any, relating
thereto;
(3) an Officers' Certificate or executed supplemental
indenture setting forth the form and terms of the Securities as
required pursuant to Sections 2.1 and 2.5, respectively, and prepared
in accordance with the requirements of the Trust Indenture Act of 1939
and Section 12.5; and
(4) an Opinion of Counsel, prepared in accordance with the
requirements of the Trust Indenture Act of 1939 and Section 12.5, which
shall state that, if the form of such Securities has been established
by or pursuant to a Resolution as permitted by Section 2.1, that such
form or forms, as the case may be, have been established in conformity
with the provisions of this Indenture, and that the terms of such
Securities have been established by or pursuant to a Resolution as
permitted by Section 2.5 in conformity with the provisions of this
Indenture and that the authentication and delivery of such Securities
by the Trustee is authorized under the provisions of this Indenture and
(ii) that such Securities, when authenticated and delivered by the
Trustee and issued by the Issuer in the manner and subject to any
conditions specified in such Opinion of Counsel will constitute valid
and legally binding obligations of the Issuer, enforceable in
accordance with their terms, except as the enforceability thereof may
be limited by bankruptcy, insolvency, reorganization or other similar
laws affecting the enforcement of creditors' rights generally and to
general principles of equity regardless of whether the issue of
enforceability is considered in a proceeding in equity or at law.
The Trustee shall have the right to decline to authenticate
and deliver any Securities under this Section if the Trustee, being advised by
counsel, determines that such action may not lawfully be taken by the Issuer or
if the Trustee in good faith by its board of directors or board of trustees,
executive committee, or a trust committee of directors or trustees and/or
Responsible Officers shall determine that such action would expose the Trustee
to personal
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<PAGE> 26
liability to existing holders or would adversely affect the Trustee's own
rights, duties or immunities under this Indenture or otherwise.
The Trustee shall not be required to authenticate Securities
denominated in a coin or currency other than that of the United States of
America if the Trustee reasonably determines that such Securities impose duties
or obligations on the Trustee which the Trustee is not able or reasonably
willing to accept; provided that the Trustee, upon the request of the Issuer,
will resign as Trustee with respect to Securities of any series as to which such
a determination is made, prior to the issuance of such Securities, and will
comply with the request of the Issuer to execute and deliver a supplemental
indenture appointing a successor Trustee pursuant to Section 7.1 hereof.
SECTION 2.7 Execution of Securities. The Securities shall be
signed on behalf of the Issuer by both (a) the chairman of its Board of
Directors, its president or any vice president and (b) chief financial officer,
treasurer, controller or secretary. Such signatures may be the manual or
facsimile signatures of the present or any future such officers. Typographical
and other minor errors or defects in any such signature shall not affect the
validity or enforceability of any Security that has been duly authenticated and
delivered by the Trustee.
In case any officer of the Issuer who shall have signed any of
the Securities shall cease to be such officer before the Security so signed
shall be authenticated and delivered by the Trustee or disposed of by the
Issuer, such Security nevertheless may be authenticated and delivered or
disposed of as though the person who signed such Security had not ceased to be
such officer of the Issuer; and any Security may be signed on behalf of the
Issuer by such persons as, at the actual date of the execution of such Security,
shall be the proper officers of the Issuer, although at the date of the
execution and delivery of this Indenture any such person was not such an
officer.
SECTION 2.8 Certificate of Authentication. Only such
Securities as shall bear thereon a certificate of authentication substantially
in the form hereinbefore recited, executed by the Trustee by the manual
signature of one of its authorized officers, shall be entitled to the benefits
of this Indenture or be valid or obligatory for any purpose. Such certificate by
the Trustee upon any Security executed by the Issuer shall be conclusive
evidence that the Security so authenticated has been duly authenticated and
delivered hereunder and that the holder is entitled to the benefits of this
Indenture.
SECTION 2.9 Denomination and Date of Securities; Payments of
Interest. The Securities of each series shall be issuable as registered
securities without coupons and in denominations as shall be specified as
contemplated by Section 2.5. In the absence of any such specification with
respect to the Securities of any series, the Securities of such series shall be
issuable in denominations of U.S.$1,000 (or, if such Securities are denominated
in a currency other than U.S. dollars or in a composite currency, 1,000 units of
such other currency or composite currency) and any multiple thereof. The
Securities of each series shall be numbered, lettered, or otherwise
distinguished in such manner or in accordance with such plan as the officers of
the Issuer executing the same may determine with the approval of the Trustee as
evidenced by the execution and authentication thereof.
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Each Security shall be dated the date of its authentication,
shall bear interest, if any, from the date, and shall be payable on the dates,
in each case, which shall be specified as contemplated by Section 2.5.
Except as otherwise specified for a particular series pursuant
to Section 2.5, the Person in whose name any Security of any series is
registered at the close of business on any record date applicable to a
particular series with respect to any interest payment date for such series
shall be entitled to receive the interest, if any, payable on such interest
payment date notwithstanding the cancellation of such Security upon any
registration of any transfer or exchange of such Security subsequent to the
record date and prior to such interest payment date, except if and to the extent
the Issuer shall default in the payment of the interest due on such interest
payment date for such series, in which case such defaulted interest shall be
paid to the persons in whose names Outstanding Securities of such series are
registered at the close of business on a subsequent record date (which shall be
not less than five days prior to the date of payment of such defaulted interest)
established by notice given by mail by or on behalf of the Issuer to the holders
of Securities not less than 15 days preceding such subsequent record date. The
term "record date" as used with respect to any interest payment date (except a
date for payment of defaulted interest) shall mean the date specified as such in
the terms of the Securities of any particular series, or, if no such date is so
specified, if such interest payment date is the first day of a calendar month,
the fifteenth day of the next preceding calendar month or, if such interest
payment date is the fifteenth day of a calendar month, the first day of such
calendar month, whether or not such record date is a Business Day.
SECTION 2.10 Registration, Transfer and Exchange; Certain
Transfers and Exchanges. The Issuer will keep, either at the office or agency
designated and maintained by the Issuer for such purpose in the Borough of
Manhattan, The City of New York, in accordance with the provisions of Section
3.2, or at any of such other offices or agencies as may be designated and
maintained in accordance with the provisions of Section 3.2, a register or
registers in which, subject to such reasonable regulations as it may prescribe,
it will register, and will register the transfer of, Securities of a series as
in this Article provided. Such register shall be in written form in the English
language or in any other form capable of being converted into such form within a
reasonable time. At all reasonable times such register or registers shall be
open for inspection by the Trustee and any Security Registrar other than the
Trustee.
Upon due presentation for registration of transfer of any
Security of any series at any such office or agency to be maintained for the
purpose as provided in Section 3.2, the Issuer shall execute and the Trustee
shall authenticate and deliver in the name of the transferee or transferees a
new Security or Securities of the same series in authorized denominations for a
like aggregate principal amount and having the same interest rate, maturity,
repayment and redemption provisions.
Any Security or Securities of any series (other than a Global
Security, except as set forth in Section 2.14) may be exchanged for a Security
or Securities of the same series in other authorized denominations, in an equal
aggregate principal amount and having the same interest rate, maturity,
redemption and repayment provisions. Securities of any series to be exchanged
shall be surrendered at any office or agency to be maintained by the Issuer for
the purpose as provided in
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Section 3.2, and the Issuer shall execute and the Trustee shall authenticate and
deliver in exchange therefor the Security or Securities of the same series and
having the same interest rate and maturity which the Securityholder making the
exchange shall be entitled to receive, bearing numbers or other distinguishing
symbols not contemporaneously outstanding. Each Person designated by the Issuer
pursuant to the provisions of Section 3.2 as a Person authorized to register and
register transfer of the Security is sometimes herein referred to as a "Security
Registrar".
The Issuer will at all times designate one Person (who may be
the Issuer and who need not be a Security Registrar) to act as repository of a
master list of names and addresses of the holders of the Securities (the
"Register"). The Trustee shall act as such repository unless and until some
other Person is, by written notice from the Issuer to the Trustee and each
Security Registrar, designated by the Issuer to act as such. The Issuer shall
cause each Security Registrar to furnish to such repository, on a current basis,
such information as to all registrations of transfer and exchanges effected by
such Security Registrar, as may be necessary to enable such repository to
maintain the Register on as current a basis as is practicable.
No Person shall at any time be designated as or act as a
Security Registrar unless such Person is at such time empowered under applicable
law to act as such and duly registered to act as such under and to the extent
required by applicable law and regulations.
All Securities presented for registration of transfer,
exchange, redemption or payment shall (if so required by the Issuer or the
Trustee) be duly endorsed by, or be accompanied by a written instrument or
instruments of transfer or exchange in form satisfactory to the Issuer and the
Trustee duly executed by, the Securityholder or such Securityholders' attorney
duly authorized in writing.
The Issuer may require payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection with any
exchange or registration of transfer of Securities, other than exchanges
pursuant to Section 2.13, 7.5 or 10.3 not involving any registration of
transfer. No service charge shall be made for any such transaction.
The Issuer shall not be required to exchange or register a
transfer of (a) any Securities of any series for a period of 15 days immediately
preceding the day of selection of Securities of that series to be redeemed, or
(b) any Securities selected, called or being called for redemption or
surrendered for repayment in whole or in part except, in the case of any
Security to be redeemed or repaid in part, the portion thereof not to be so
redeemed or repaid.
Notwithstanding any other provision of this Indenture,
transfers and exchanges of Securities shall be made only in accordance with
Sections 2.10 or 2.11 or, in the case of Global Securities, Section 2.14.
SECTION 2.11 Mutilated, Defaced, Destroyed, Lost and Stolen
Securities. In case any temporary or definitive Security shall become mutilated,
defaced or be destroyed, lost or stolen and, in the absence of notice to the
Issuer or the Trustee that such Security has been acquired by a bona fide
purchaser, the Issuer may in its discretion execute and the Trustee shall
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authenticate and deliver, a new Security of the same series and of like tenor,
bearing a number or other distinguishing symbol not contemporaneously appearing
on an Outstanding Security, in exchange and substitution for the mutilated or
defaced Security, or in lieu of and substitution for the Security so destroyed,
lost or stolen. In every case the applicant for a substitute Security shall
furnish to the Issuer and to the Trustee (and any agent of the Issuer or
Trustee, if requested by the Issuer) such Security or indemnity as may be
required by them to indemnify and defend and to save each of them harmless and,
in every case of destruction, loss or theft, evidence to their satisfaction of
the destruction, loss or theft of such Security and of the ownership thereof.
Upon the issuance of any substitute Security, the Issuer 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.
In case any Security that has matured, or is about to mature,
or has been called for redemption in full, shall become mutilated or defaced or
be destroyed, lost or stolen, the Issuer in its discretion may instead of
issuing a substitute Security, pay or authorize the payment of the same (without
surrender thereof except in the case of a mutilated or defaced Security), if the
applicant for such payment shall furnish to the Issuer and to the Trustee (and
any agent of the Issuer or Trustee, if requested by the Issuer) such security or
indemnity as any of them may require to indemnify and defend and to save each of
them harmless, and, in every case of destruction, loss or theft, evidence to
their satisfaction of the destruction, loss or theft of such Security and of the
ownership thereof.
Every substituted Security of any series issued pursuant to
the provisions of this Section by virtue of the fact that any such Security is
destroyed, lost or stolen shall constitute an additional contractual obligation
of the Issuer, 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 (but
shall be subject to all the limitations of rights set forth in) this Indenture
equally and proportionately with any and all other Securities of such series
duly authenticated and delivered hereunder. All Securities shall be held and
owned upon the express condition that, to the extent permitted by law, the
foregoing provisions are exclusive with respect to the replacement or payment of
mutilated, defaced or destroyed, lost or stolen Securities and shall preclude
any and all other rights or remedies notwithstanding any law or statute existing
or hereafter enacted to the contrary with respect to replacement or payment of
negotiable instruments or other securities without their surrender.
SECTION 2.12 Cancellation of Securities Paid, etc. All
Securities surrendered for the purpose of payment, redemption, registration of
transfer or exchange, or for credit against any payment in respect of a sinking
or analogous fund, if surrendered to the Issuer, any Security Registrar, any
paying agent or any other agent of the Issuer or any agent of the Trustee, shall
be delivered to the Trustee and promptly canceled by it or, if surrendered to
the Trustee, shall be promptly canceled by it; and no Securities shall be issued
in lieu thereof except as expressly permitted by any of the provisions of this
Indenture. The Trustee shall destroy canceled Securities held by it and deliver
a certificate of destruction to the Issuer. If the Issuer shall acquire any of
the Securities, such acquisition shall not operate as a redemption or
satisfaction of
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the indebtedness represented by such Securities unless and until the same are
delivered to the Trustee for cancellation.
SECTION 2.13 Temporary Securities. Pending the preparation of
definitive Securities for any series, the Issuer may execute and the Trustee
shall authenticate and deliver temporary Securities for such series (printed,
lithographed, typewritten or otherwise reproduced). Temporary Securities of any
series shall be issuable as registered Securities without coupons, in any
authorized denomination, and substantially in the form of the definitive
Securities of such series in lieu of which they are issued but with such
omissions, insertions and variations as may be appropriate for temporary
Securities, all as may be determined by the Issuer. Temporary Securities may
contain such reference to any provisions of this Indenture as may be
appropriate. Every temporary Security shall be authenticated by the Trustee upon
the same conditions and in substantially the same manner, and with like effect,
as the definitive Securities in lieu of which they are issued. Without
unreasonable delay the Issuer shall execute and shall furnish definitive
Securities of such series and thereupon temporary Securities of such series may
be surrendered in exchange therefor without charge at each office or agency to
be maintained by the Issuer for that purpose pursuant to Section 3.2, and the
Trustee shall authenticate and deliver in exchange for such temporary Securities
of such series a like aggregate principal amount of definitive Securities of the
same series of authorized denominations having the same interest rate, maturity
and redemption and repayment provisions, and bearing interest, if any, from the
same date as such temporary Securities. Until so exchanged, the temporary
Securities of any series shall be entitled to the same benefits under this
Indenture as definitive Securities of the same series authenticated and
delivered hereunder.
SECTION 2.14 Global Securities. (a) Notwithstanding anything
in this Indenture to the contrary, if the Issuer shall establish pursuant to
Section 2.5 that the Securities of a series are to be issued in the form of one
or more Global Securities, then the Issuer shall execute and the Trustee shall,
in accordance with Section 2.6 and the order of the Issuer with respect to such
series, authenticate and deliver one or more Global Securities that (i) shall
represent and shall be denominated in an amount equal to the aggregate principal
amount of all of the Securities of such series, issued and not yet canceled,
(ii) shall be registered in the name of the Depositary for such Global Security
or Securities or the nominee of such Depositary, (iii) shall be delivered by the
Trustee to such Depositary or pursuant to such Depositary's instructions and
(iv) shall bear the legend provided in Section 2.14(f) or such other legend, if
any, as shall be required by the Depositary. Each Depositary of a Global
Security designated pursuant to Section 2.5 must, at the time of its designation
and at all times while it serves as Depositary hereunder, be a clearing agency
registered under the Exchange Act and any other applicable statute or
regulation.
(b) Except as otherwise specified pursuant to Section 2.5 with
respect to any series of Securities or as provided in this Section 2.14(b), no
Global Security may be exchanged in whole or in part for Securities registered,
and no transfer of a Global Security in whole or in part may be registered, in
the name of any Person other than the Depositary for such Global Security or a
nominee thereof. If (i) the Depositary advises the Issuer and the Trustee in
writing that such Depositary is no longer willing or able to continue as
Depositary with respect to such Global Security, and a qualified successor
Depositary is not appointed by the Issuer within 90 days of receipt of such
notice from the Depositary, (ii) the Depositary notifies the Issuer that it has
ceased to be a
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clearing agency registered and in good standing under the Exchange Act or other
applicable statute or regulation and a successor Depositary is not appointed by
the Issuer within 90 days after the Issuer receives such notice or becomes aware
of such condition, as the case may be, (iii) the Issuer, in its sole discretion,
determines that the Global Securities shall be exchangeable for Securities in
registered form as described below, or (iv) there shall have occurred and be
continuing an Event of Default with respect to the series of Securities
evidenced by the Global Security, the Issuer will execute, and subject to
Article Two of this Indenture, the Trustee will, upon receipt of an order,
authenticate and deliver Securities in definitive, certificated and
fully-registered form, without interest coupons, in authorized denominations,
and in an aggregate principal amount equal to the principal amount of the
Outstanding Securities of such series evidenced by the Global Securities of such
series in exchange for such Global Securities. Upon such exchange, the Global
Securities of such series shall be surrendered to the Trustee for cancellation.
Such Securities in definitive form shall be registered in such names and in such
authorized denominations as the Depositary shall instruct the Trustee. The
Trustee shall deliver such Securities to the Depositary for delivery to the
persons in whose names such Securities are registered.
(c) Except as otherwise explicitly provided in Section
2.14(b), every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any portion
thereof, whether pursuant to this Article Two or otherwise, shall be
authenticated and delivered in the form of, and shall be, a Global Security,
unless such Security is registered in the name of a Person other than the
Depositary for such Global Security or a nominee thereof.
(d) The Depositary or its nominee, as the registered owner of
a Global Security, shall be the owner and holder of such Global Security for all
purposes under this Indenture and the Securities, and owners of beneficial
interests in a Global Security shall hold such interests. Accordingly, any such
owner's beneficial interest in a Global Security shall be shown only on, and the
transfer of such interest shall be effected only through, records maintained by
the Depositary or its nominee or agent. None of the Issuer, the Trustee, any
Security Registrar or any agent thereof shall have any liability in respect of
(i) any transfers effected by the Depositary (ii) the accuracy of any records
maintained by the Depositary, (iii) the payment by the Depositary of any amount
due to the beneficial owners of the Securities of the principal of or interest
on the Securities or any other amounts payable with respect thereto, (iv) the
delivery or timeliness of delivery by the Depositary of any notice which is
required to be given to Securityholders under this Indenture to the beneficial
owners of the Securities, or (v) any consent given or other action taken by the
Depositary as registered owner of the Securities. Notwithstanding the foregoing,
nothing herein shall prevent the Issuer, the Trustee, any Securities Registrar
or any such agent from giving effect to any written certification, proxy or
other authorization furnished by the Depositary or, if applicable, such nominee,
or impair, as between the Depositary or its nominee and such owners of
beneficial interests, the operation of customary practices governing the
exercise of rights of the Depositary or its nominee as the holder of any
Security.
(e) The rights of owners of beneficial interests in a Global
Security shall be exercised only through the Depositary and shall be limited to
the rights established by law and agreements between such owners and the
Depositary and/or its members.
(f) Any Global Security issued hereunder shall bear a legend
in substantially the following form:
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"This Security is a Global Security within the meaning of the
Indenture hereinafter referred to and is registered in the name of a Depositary
or a nominee of a Depositary. This Security is exchangeable for Securities
registered in the name of a person other than the Depositary or its nominee only
in the limited circumstances described in the Indenture and may not be
transferred except as a whole by the Depositary to a nominee of the Depositary
or by a nominee of the Depositary to the Depositary or another nominee of the
Depositary."
(g) Any Global Security shall provide that the Depositary will
not sell, assign, transfer or otherwise convey any beneficial interest in such
Global Security unless such beneficial interest is in an amount equal to an
authorized denomination for Securities of such series, and that the Depositary,
by accepting such Global Security, agrees to be bound by such provision.
ARTICLE THREE
COVENANTS OF THE ISSUER
SECTION 3.1 Payment of Principal and Interest. The Issuer
covenants and agrees for the benefit of each series of Securities that it will
duly and punctually pay or cause to be paid the principal of and interest, if
any, (including any applicable premium or Additional Amounts) on each of the
Securities of such series at the place or places, at the respective times and in
the manner provided in such Securities. Each installment of interest on the
Securities of any series may be paid by mailing checks for such interest payable
to or upon the written order of the holders of Securities entitled thereto as
they shall appear in the Register; provided, however, that a holder of
U.S.$10,000,000 or more in aggregate principal amount of Securities of any
series will be entitled to receive installments of interests on each interest
payment date by wire transfer of immediately available funds if appropriate wire
transfer instructions have been received in writing by the Trustee not less than
15 calendar days prior to such interest payment date. Any such wire transfer
instructions received by the Trustee shall remain in effect until revoked by
such holder by written notice by the Trustee at least 15 calendar days prior to
the first Interest Payment Date for which such notice shall be effective.
SECTION 3.2 Offices for Payments, etc. So long as any of the
Securities remain Outstanding, the Issuer will designate and maintain in the
Borough of Manhattan, The City of New York, for each series: (a) an office or
agency where the Securities may be presented for payment, (b) an office or
agency where the Securities may be presented for registration of transfer and
for exchange as in this Indenture provided and (c) an office or agency where
notices and demands to or upon the Issuer in respect of the Securities or of
this Indenture may be served. In addition to such office or offices or agency or
agencies, the Issuer may from time to time designate and maintain one or more
additional offices or agencies within or outside the Borough of Manhattan, The
City of New York, where the Securities of that series may be presented for
payment or for registration of transfer or for exchange, and the Issuer may from
time to time rescind such designation, as it may deem desirable or expedient.
The Issuer will give to the Trustee written notice of the location of any such
office or agency and of any change of location thereof. The Issuer hereby
designates the New York Location and the Corporate Trust Office as the initial
offices to be maintained by it for such purposes. In case the Issuer shall fail
to maintain any such office or agency or shall fail to give such notice of the
location or of any change in the location thereof, presentations and demands may
be made and notices may be served at the Corporate
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Trust Office and the Issuer appoints the Trustee as its agent to receive all
such presentations, surrenders, notices and demands.
SECTION 3.3 Paying Agents. Whenever the Issuer shall appoint a
paying agent or agents other than the Trustee with respect to the Securities of
any series, it will cause each such paying agent to execute and deliver to the
Trustee an instrument in which each such paying agent shall agree with the
Trustee, subject to the provisions of this Section:
(a) that it will hold all sums received by it as such agent
for the payment of the principal of or interest, if any, on the
Securities of such series (whether such sums have been paid to it by
the Issuer or by any other obligor on the Securities of such 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;
(b) that it will give the Trustee notice of any default by the
Issuer (or by any other obligor on the Securities of such series) to
make any payment of the principal of or interest, if any, on the
Securities of such series when the same shall be due and payable; and
(c) that, at any time during the continuance of any such
default referred to in clause (b) above, upon the written request of
the Trustee, it will forthwith pay to the Trustee all sums so held in
trust by such paying agent.
Whenever the Issuer shall have one or more paying agents with
respect to Securities of any series, it will, prior to each due date of the
principal of or interest, if any, on the Securities of such series, deposit with
a designated paying agent a sum sufficient to pay such principal or interest, if
any, so becoming due, such sum to be held in trust for the benefit of the
Persons entitled to such principal or interest, if any, and (unless such paying
agent is the Trustee) the Issuer will promptly notify the Trustee of any failure
to take such action.
If the Issuer shall act as its own paying agent with respect
to the Securities of any series, it will, on or before each due date of the
principal of or interest, if any, on the Securities of such series, set aside,
segregate and hold in trust for the benefit of the Persons entitled to such
principal and interest, if any, a sum sufficient to pay such principal or
interest, if any, so becoming due until such sums shall be paid to such Persons
or otherwise disposed of as herein provided. The Issuer will promptly notify the
Trustee of any failure to take such action.
Anything in this Section to the contrary notwithstanding, the
Issuer may at any time, for the purpose of obtaining a satisfaction and
discharge with respect to one or more or all series of Securities hereunder, or
for any other reason, pay or cause to be paid to the Trustee all sums held in
trust for any such series by the Issuer or any paying agent hereunder, as
required by this Section, such sums to be held by the Trustee upon the trusts
herein contained.
Anything in this section to the contrary notwithstanding, the
agreement to hold sums in trust as provided in this Section is subject to the
provisions of Sections 9.3 and 9.4.
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SECTION 3.4 Limitation on Liens. The Issuer will not, at any
time directly or indirectly, and will not permit any Subsidiary to, create,
assume, incur or suffer to be created, assumed or incurred or to exist any Lien
upon any of the properties and assets of any character of the Issuer or any
Subsidiary without making effective provision whereby the Securities of any
series then outstanding shall be secured equally and ratably with (or prior to)
any other obligation or indebtedness so secured, so long as such other
obligation or indebtedness remains secured; except, however, that,
notwithstanding the foregoing, the Issuer or any Subsidiary, without so securing
the Securities of any series, may:
(a) lease property to others in the ordinary course of the
business of the Issuer or any Subsidiary or lease or sublease any property if
the property subject thereto is not needed by the Issuer or any Subsidiary in
the operation of its business;
(b) create, assume, incur, or suffer to be created, assumed or
incurred or to exist any Lien, provided, in each case, that the Lien secures
indebtedness for borrowed money, including purchase money indebtedness, which is
incurred to finance the acquisition of the property subject to such Lien and
that such Lien attaches to such asset concurrently with or within 90 days after
the acquisition thereof;
(c) assume or suffer to exist (i) any Lien existing on any
asset of any Person at the time such Person becomes a Subsidiary and not created
in contemplation of such event; (ii) any Lien on any asset of any Person
existing at the time such Person is merged or consolidated with or into the
Issuer or a Subsidiary and not created in contemplation of such event; and (iii)
any Lien existing on any asset prior to the acquisition thereof by the Issuer or
a Subsidiary and not created in contemplation of such acquisition;
(d) make any deposit with or give any form of security to any
governmental agency or other body created or approved by law or governmental
regulation in order to enable the Issuer or such Subsidiary to maintain
self-insurance, or to participate in any fund in connection with workmen's
compensation, unemployment insurance, old-age pensions, or other social
security, or to share in any privileges or other benefits available to Persons
participating in any such arrangement, or for any other purpose at any time
required by law or regulation promulgated by any governmental agency or office
as a condition to the transaction of any business or the exercise of any
privilege or license, or deposit assets of the Issuer or such Subsidiary with
any surety company or clerk of any court, or in escrow, as collateral in
connection with, or in lieu of, any bond on appeal by the Issuer or such
Subsidiary from any judgment or decree against it, or in connection with any
other proceedings in actions at law or suits in equity by or against the Issuer
or such Subsidiary;
(e) incur or suffer to be incurred or to exist upon any of its
property or assets (i) Liens for taxes, assessments or other governmental
charges or levies which are not yet due or are payable without penalty or of
which the amount, applicability or validity is being contested by the Issuer or
such Subsidiary in good faith by appropriate proceedings and the Issuer or such
Subsidiary shall have set aside on its books reserves which it deems to be
adequate with respect thereto (segregated to the extent required by generally
accepted accounting principles), provided that foreclosure, distraint, sale or
similar proceedings have not been commenced, (ii) the Liens of
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any judgment, if such judgment shall not have remained undischarged, or unstayed
on appeal or otherwise, for more than six months, (iii) undetermined Liens or
charges incident to construction, (iv) materialmen's, mechanics', workmen's,
repairmen's or other like Liens arising in the ordinary course of business in
respect of obligations which are not overdue or which are being contested by the
Issuer or such Subsidiary in good faith by appropriate proceedings, or deposits
to obtain the release of such Liens, or (v) any encumbrances consisting of
zoning restrictions, licenses, easements and restrictions on the use of real
property and minor defects and irregularities in the title thereto, which do not
materially impair the use of such property by the Issuer or such Subsidiary in
the operation of its business or the value of such property for the purpose of
such business;
(f) create other Liens arising in the ordinary course of its
business which (i) do not secure Debt, (ii) do not secure any obligation in an
amount exceeding U.S.$5,000,000, and (iii) do not in the aggregate materially
detract from the value of its property or assets or materially impair the use
thereof in the operation of its business;
(g) create or suffer to be created Liens not otherwise
permitted securing Debt in an aggregate principal amount at any time outstanding
not to exceed 15% of Consolidated Net Tangible Assets;
(h) create or suffer to be created or to exist in favor of any
lender of moneys or holder of commercial paper of the Issuer or a Subsidiary in
the ordinary course of business a banker's lien or right of offset in the holder
of such indebtedness or moneys of the Issuer or a Subsidiary deposited with such
lender or holder in the ordinary course of business;
(i) create, assume or suffer to exist Liens securing
indebtedness owed to the Issuer or any Subsidiary by another Subsidiary;
(j) create, assume, incur, or suffer to be created, assumed or
incurred or to exist any Lien upon any of its properties or assets of any
character in connection with the sale, transfer or other disposition of such
properties or assets (i) in connection with the securitization or other
asset-based financing thereof, (ii) to a real estate investment trust or similar
entity, or (iii) in connection with any transaction similar to the transactions
referred to in the immediately preceding clauses (i) or (ii); provided, however,
that any such sale, transfer or other disposition shall be for valid
consideration and shall not be to prefer directly or indirectly any holder of
any other obligation or indebtedness of the Issuer as to any such other
obligation or indebtedness that was already outstanding and did not previously
benefit from a Lien; and
(k) cause or allow any extension, renewal or replacement (or
successive extensions, renewals or replacements), in whole or in part, of any
Lien referred to in the foregoing clauses; provided, however, that the principal
amount of any and all other obligations and indebtedness secured thereby shall
not exceed the principal amount thereof so secured at the time of such
extension, renewal or replacement (except that (a) the amount of obligations or
indebtedness secured by extensions, renewals or replacements of Liens on
property acquired through the exercise of rights arising out of defaults on
receivables may exceed the principal amount prior to such extension, renewal or
replacement and (b) the amount of obligations or
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indebtedness secured by extensions, renewals or replacements of Liens on
property may exceed the principal amount of such obligations or indebtedness
prior to such extension, renewal or replacement if the value of such property
has increased and the loan to value ratio of the refinanced obligation or
indebtedness does not exceed the loan to value ratio of the obligation or
indebtedness relating to the original Lien); and provided further that such
extension, renewal or replacement shall be limited to all or a part of the
property which secured the Lien so extended, renewed or replaced (plus
improvements on such property).
SECTION 3.5 Statement as to Compliance. The Issuer will
deliver to the Trustee within 120 days after the end of each of the Issuer's
fiscal years, a certificate executed by the principal executive officer, the
principal financial officer or the principal financial accounting officer of the
Issuer as to his or her knowledge of the Issuer's compliance with all conditions
and covenants under the Indenture and, in the event of any noncompliance,
specifying such noncompliance and the nature and status thereof. For purposes of
this Section 3.5, such compliance shall be determined without regard to any
period of grace or requirement of notice under this Indenture.
SECTION 3.6 Existence. Subject to Article Eight hereof, the
Issuer will do or cause to be done all things necessary to preserve and keep in
full force and effect the existence, rights (charter and statutory) and
franchises of the Issuer and its Subsidiaries; provided, however, that the
Issuer shall not be required to preserve any right or franchise if the Board of
Directors shall determine that the preservation thereof is no longer desirable
in the context of the business of the Issuer and its Subsidiaries as a whole and
that the loss thereof is not disadvantageous in any material respect to the
holders of the Securities.
SECTION 3.7 Payment of Additional Amounts. If with respect to
Securities of any series it is specified pursuant to Section 2.5 that this
Section 3.7 shall apply to Securities of such series, then all payments in
respect of Securities of such series, including, without limitation, payments of
principal and interest, if any, shall be made by the Issuer without withholding
or deduction for or on account of any present or future taxes, duties, levies,
or other governmental charges of whatever nature in effect on the date that the
Securities of such series are originally issued or imposed or established in the
future by or on behalf of the United States or any authority in the United
States ("Taxes"). In the event any such Taxes are so imposed or established, the
Issuer shall pay such additional amounts ("Additional Amounts") as may be
necessary in order that the net amounts receivable by each holder of a Security
of such series who is a United States alien (as defined below) after any
payment, withholding or deduction in respect of such Taxes shall equal the
respective amounts of principal and interest, if any, which would have been
receivable in respect of the Securities in the absence of such payment,
withholding or deduction; provided that no Additional Amounts will be payable
with respect to any payment on any Security of such series to, or to a third
party on behalf of, a holder who is a United States alien for or on account of
any such Taxes whatever that have been imposed with respect to (1) any Tax which
would not have been so imposed but for (a) the existence of any present or
former connection between the holder (or a fiduciary, settlor, beneficiary,
member, shareholder, or holder of a power over, the holder, if the holder is an
estate, trust, partnership or corporation) and the United States, including,
without limitation, such holder (or such fiduciary, settlor, beneficiary,
member, shareholder of, or holder of a power) being or having been a citizen or
resident or treated as a resident thereof or being or having been engaged
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in a trade or business therein or being or having been present therein or having
or having had a permanent establishment therein, or (b) the holder's present or
former status as a personal holding company or foreign personal holding company
or controlled foreign corporation or passive foreign investment company for
United States federal income tax purposes or as a corporation which accumulates
earnings to avoid United States federal income tax or as a private foundation or
other tax-exempt organization; (2) any Tax which would not have been so imposed
but for the presentation by the holder of a Security of such series for payment
on a date more than 10 days after the date on which the payment became due and
payable or the date on which payment thereof is duly provided for, whichever
occurs later; (3) any estate, inheritance, gift, sales, transfer, personal
property or excise tax or any similar tax, assessment or governmental charge;
(4) any Tax which is payable otherwise than by withholding from payments in
respect of principal of, any premium, or any interest on any Security; (5) any
Tax imposed on interest received by a holder or beneficial owner of a Security
of such series who actually or constructively owns 10% or more of the total
combined voting power of all classes of the Issuer's stock entitled to vote or
is a bank that acquired a Security of such series in consideration of an
extension of credit made pursuant to a loan agreement entered into in the
ordinary course of business; (6) any Tax imposed as a result of the failure to
comply with (a) certification, information, documentation, reporting or other
similar requirements concerning the nationality, residence, identity or
connection with the United States of the holder or beneficial owner of the
Security, if such compliance is required by statute, or by regulation of the
United States Treasury Department, as a precondition to relief or exemption from
such tax, assessment or other governmental charge (including backup withholding
tax) or (b) any other certification, information, documentation, reporting or
other similar requirements under United States federal income tax laws or
regulations that would establish entitlement to otherwise applicable relief or
exemption from such tax, assessment or other governmental charge; (7) any Tax
required to be withheld by any paying agent from any payment of the principal
of, any premium or any interest on any Security of such series, if the payment
can be made without such withholding by at least one other paying agent; or (8)
any combination of items (1), (2), (3), (4), (5), (6) or (7). Furthermore, no
Additional Amounts shall be paid with respect to any payment on a Security of
such series to a holder who is a United States alien that is a fiduciary or
partnership or other than the sole beneficial owner of such payment to the
extent that a beneficiary or settlor with respect to such fiduciary or a member
of such partnership or beneficial owner would not have been entitled to receive
the Additional Amounts had such beneficiary, settlor, member or beneficial owner
been the holder of the Security of such series.
The term "United States alien" means any person who, for
United States federal income tax purposes, is a foreign corporation, a
non-resident alien individual, a non-resident alien fiduciary of a foreign
estate or trust, or a foreign partnership, one or more of the members of which
is a foreign corporation, a non-resident alien individual or a non-resident
alien fiduciary of a foreign estate or trust.
Whenever in this Indenture or the Securities of any series to
which this Section 3.7 is applicable there is a reference, in any context, to
the payment of the principal of or interest, if any, on, or in respect of, any
Security, such payment shall be deemed to include the payment of Additional
Amounts to which this Section 3.7 is applicable provided for in this Section to
the extent that, in such context, Additional Amounts are, were or would be
payable in respect of such payment pursuant to the provisions of this Section
and express mention of the payment of Additional Amounts (if applicable) in any
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provision hereof or thereof shall not be construed as excluding Additional
Amounts in those provisions hereof where such express mention is not made.
Except as specifically provided in this Section 3.7 and
Section 10.6 with respect to Securities of any series to which such sections are
applicable, the Issuer will not be required to make any payment with respect to
any tax, assessment or governmental charge imposed by any government or a
political subdivision or taxing authority thereof or therein.
ARTICLE FOUR
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 4.1 Events of Default. "Event of Default" with respect
to Securities of a particular series wherever used herein, means any one of the
following events and such other events as may be established with respect to the
Securities of such series as contemplated by Section 2.5 hereof, continued for
the period of time, if any, and after the giving of notice, if any, designated
in this Indenture or as may be established with respect to such Securities as
contemplated by Section 2.5 hereof, as the case may be, unless such event is
either inapplicable or is specifically deleted or modified in, or pursuant to,
the applicable Resolution or in the supplemental indenture under which such
series of Securities is issued, as the case may be, as contemplated by Section
2.5:
(a) default in the payment of any interest on or any
Additional Amounts, if any, with respect to such Securities when due and
payable, and continuance of such default for a period of 30 days;
(b) default in the payment of the principal of, or any premium
on, the Securities of such series when the same shall become due and payable
either at maturity, upon redemption, by declaration or otherwise;
(c) default in the performance, or breach, of any covenant or
warranty of the Issuer contained in the Securities of such series or this
Indenture, as the case may be, and continuance of such default or breach for a
period of 90 days after written notice thereof shall have been given to the
Issuer by the holders of at least 25% in aggregate principal amount of the
Securities of such series then outstanding;
(d) if any Event of Default as defined in any mortgage,
indenture or instrument under which there may be issued, or by which there may
be secured or evidenced, any indebtedness of the Issuer for money borrowed,
whether such indebtedness now exists or shall hereafter be created, shall occur
and shall result in such indebtedness in principal amount in excess of
$50,000,000 (or the equivalent thereof in foreign or composite currencies)
becoming or being declared due and payable prior to the date on which it would
otherwise become due and payable, and such acceleration shall not be rescinded
or annulled, or such indebtedness shall not have been discharged, within a
period of 30 days after written notice thereof shall have been given to the
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Issuer by the holders of at least 25% in aggregate principal amount of
Securities of such series then outstanding;
(e) the Support Agreement shall have ceased to be in full
force and effect for any reason or shall be amended or modified in any manner
unless, prior to such cessation, amendment or modification, S&P, Moody's and any
other "nationally recognized statistical rating organization" (as such term is
defined for purposes of Rule 436(g)(2) under the Securities Act) then rating
securities of the Issuer at the Issuer's request, have each confirmed that the
rating assigned to securities of the Issuer by such rating agency immediately
prior to such cessation, amendment or modification will not be downgraded, or
placed on what is commonly referred to as a "watch list" for possible
downgrading; provided, that, if the cessation, amendment or modification of the
Support Agreement is in connection with the assumption of the Securities of such
series by any other Person pursuant to the provisions described in Section 8.1
of this Indenture (whether by merger, consolidation, sale, conveyance, transfer
or lease), it shall not constitute an Event of Default if the senior debt
securities of the Person assuming the Securities of such series are rated by S&P
or Moody's immediately following such transfer or assumption at a rating equal
to or greater than the respective rating assigned to securities of the Issuer by
each such rating agency;
(f) Textron, the Issuer or any "significant subsidiary" (as
such term is defined in Section 1.02(w) of Regulation S-X of the Securities Act,
or any successor provision thereto) of the Issuer shall commence a voluntary
case or other proceeding seeking liquidation, reorganization or other relief
with respect to itself or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally or admit its inability to pay
its debts as they become due, or shall take any corporate action to authorize
any of the foregoing; or
(g) an involuntary case or other proceeding shall be commenced
against Textron, the Issuer or any significant subsidiary of the Issuer seeking
liquidation, reorganization or other relief with respect to it or its debts
under any bankruptcy, insolvency or other similar law now or hereafter in effect
or seeking the appointment of a trustee, receiver, liquidator, custodian or
other similar official of it or any substantial part of its property, and such
involuntary case or other proceeding shall remain undismissed and unstayed for a
period of 60 days; or an order for relief shall be entered against the Issuer,
Textron or any significant subsidiary of the Issuer under the federal bankruptcy
laws as now or hereafter in effect.
In case an Event of Default other than one under clause (f) or
(g) above shall have occurred and be continuing, then the holders of at least
25% in aggregate principal amount of the Securities of such series then
outstanding may declare the principal of all Outstanding Securities of such
series to be immediately due and payable. If an Event of Default under clause
(f) or (g) above shall have occurred and be continuing, the principal of all
Outstanding Securities of such
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series shall automatically become due and payable. Upon any such acceleration,
any premium and interest on the Securities of such series shall also become
immediately due and payable.
The foregoing provisions, however, are subject to the
condition that if, at any time after the principal (or, if the Securities are
Original Issue Discount Securities, such portion of the principal as may be
specified in the terms thereof) of the Securities of any series shall have been
so declared due and payable, and before any judgment or decree for the payment
of the moneys due shall have been obtained or entered as hereinafter provided:
(a) the Issuer shall pay or shall deposit with the Trustee a
sum sufficient to pay all matured installments of interest, if any,
upon all the Securities of such series and the principal of any and all
Securities of such series which shall have become due otherwise than by
such declaration of acceleration (with interest upon such principal
and, to the extent that payment of such interest is enforceable under
applicable law, on overdue installments of interest, if any, at the
Overdue Rate applicable to such series to the date of such payment or
deposit), and all amounts payable to the Trustee pursuant to Section
5.5; and
(b) any and all Events of Default under the Indenture with
respect to such series of Securities other than the non-payment of the
principal of such Securities which shall have become due by such
declaration of acceleration, shall have been cured, waived or otherwise
remedied as provided herein or provision shall have been made therefor
to the satisfaction of the Trustee,
then and in every such case the holders of not less than a majority in aggregate
principal amount of the Securities of such series then Outstanding, by written
notice to the Issuer and to the Trustee, may rescind and annul such declaration
and its consequences with respect to such series, but no such rescission and
annulment shall extend to or shall affect any subsequent default or shall impair
any right consequent thereon.
For all purposes under this Indenture, if a portion of the
principal of any Original Issue Discount Securities shall have been accelerated
and declared due and payable pursuant to the provisions hereof, then, from and
after such declaration, unless such declaration has been rescinded and annulled,
the principal amount of such Original Issue Discount Securities shall be deemed,
for all purposes hereunder, to be such portion of the principal thereof as shall
be due and payable as a result of such acceleration, and payment of such portion
of the principal thereof as shall be due and payable as a result of such
acceleration, together with interest, if any, thereon and all other amounts
owing thereunder, shall constitute payment in full of such Original Issue
Discount Securities.
SECTION 4.2 Payment of Securities on Default; Suit Therefor.
The Issuer covenants that (a) in case a default shall be made in the payment of
any installment of interest on any of the Securities of any series as and when
such interest shall have become due and payable, and such default shall have
continued for a period of 30 days, or (b) in case a default shall be made in the
payment of the principal of any of the Securities of any series as and when the
same shall have become due and payable, whether upon maturity of the Securities
of such series or upon re-
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demption or by declaration or otherwise, or (c) in case of a default in the
making or satisfaction of any sinking fund payment or analogous obligation when
the same becomes due by the terms of the Securities of any series, then, upon
demand of the Trustee, the Issuer will pay to the Trustee for the benefit of the
holders of the Securities of such series the whole amount then due and payable
on all Securities of such series for principal and interest, if any, as the case
may be (with interest to the date of such payment upon the overdue principal
and, to the extent that payment of such interest is enforceable under applicable
law, on overdue installments of interest, if any, at the Overdue Rate applicable
to Securities of such series); and in addition thereto, such further amount as
shall be sufficient to cover the costs and expenses of collection, and any
further amounts payable to the Trustee pursuant to Section 5.5.
Until such demand is made by the Trustee, the Issuer may pay
the principal of and interest, if any, on the Securities of any series to the
registered holders, whether or not the principal of and interest, if any, on the
Securities of such series be overdue.
In case the Issuer shall fail forthwith to pay such amounts
upon such demand, the Trustee, in its own name and as trustee of an express
trust, shall be entitled and empowered to institute any action or proceedings at
law or in equity for the collection of the sums so due and unpaid, and may
prosecute any such action or proceedings to judgment or final decree, and may
enforce any such judgment or final decree against the Issuer or other obligor
upon such Securities and collect in the manner provided by law out of the
property of the Issuer or other obligor upon such Securities, wherever situated,
the moneys adjudged or decreed to be payable.
In case there shall be pending proceedings for the bankruptcy
or for the reorganization of the Issuer or any other obligor upon the Securities
of any series under Title 11 of the United States Bankruptcy Code or any other
similar applicable Federal or state law, or in case a receiver, trustee in
bankruptcy or similar official shall have been appointed for the property of the
Issuer or such other obligor, or in case of any other similar judicial
proceedings relative to the Issuer or other obligor upon the Securities of any
series, or to the creditors or property of the Issuer or such other obligor, the
Trustee, irrespective of whether the principal of any 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 pursuant to the
provisions of this Section, shall be entitled and empowered, by intervention in
such proceedings or otherwise:
(a) to file a proof of claim or claims for the whole amount of
principal (or, if the Securities of any series are Original Issue
Discount Securities, such portion of the principal amount as may be due
and payable with respect to such series pursuant to a declaration in
accordance with Section 4.1) and interest, if any, owing and unpaid in
respect of the Securities of any series, and, in case of any judicial
proceedings, to file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for any amounts payable to the Trustee
pursuant to Section 5.5) and of the Securityholders allowed in any
judicial proceedings relating to the Issuer or other obligor upon the
Securities of any series, or to the creditors or property of the Issuer
or such other obligor;
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(b) unless prohibited by applicable law and regulations, to
vote on behalf of the holders of the Securities of any series in any
election of a trustee or a standby trustee in arrangement,
reorganization, liquidation or other bankruptcy or insolvency
proceedings or of a person performing similar functions in comparable
proceedings; and
(c) to collect and receive any moneys or other property
payable or deliverable on any such claims, and to distribute all
amounts received with respect to the claims of the Securityholders and
of the Trustee on their behalf (after deduction of costs and expenses
of collection, and any further amounts payable to the Trustee pursuant
to Section 5.5 and incurred by it up to the date of distribution); and
any trustee in bankruptcy, receiver, or other similar official is
hereby authorized by each of the Securityholders to make payments to
the Trustee, and, in the event that the Trustee shall consent to the
making of payments directly to the Securityholders, to pay to the
Trustee costs and expenses of collection, and any further amounts
payable to the Trustee pursuant to Section 5.5 and incurred by it up to
the date of distribution.
Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or vote for or accept or adopt on behalf of
any Securityholder any plan of reorganization, arrangement, adjustment or
composition affecting the Securities of any series or the rights of any holder
thereof, or to authorize the Trustee to vote in respect of the claim of any
Securityholder in any such proceeding except, as aforesaid, to vote for the
election of a trustee in bankruptcy or similar person.
All rights of action and of asserting claims under this
Indenture, or under the Securities of any series, may be enforced by the Trustee
without the possession of any of the Securities of such series or the production
thereof on any trial or other proceedings relative thereto, and any such action
or proceedings instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment, shall be for the
ratable benefit of the holders of the Securities in respect of which such action
was taken.
In any proceedings brought by the Trustee (and also any
proceedings in which a declaratory judgment of a court may be sought as to the
interpretation or construction of any provision of this Indenture to which the
Trustee shall be a party) the Trustee shall be held to represent all the holders
of the Securities to which such proceedings relate, and it shall not be
necessary to make any holders of such Securities parties to any such
proceedings.
SECTION 4.3 Application of Moneys Collected by Trustee. Any
moneys 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 the case of
distribution of such moneys on account of principal or interest, upon
presentation of the several Securities in respect of which moneys have been
collected and stamping (or otherwise noting) thereon the payment, or issuing
Securities in reduced principal amounts in exchange for the presented Securities
of like series and tenor if only partially paid, or upon surrender thereof if
fully paid:
FIRST: To the payment of amounts due to the Trustee pursuant
to Section 5.5;
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SECOND: In case the principal of the Outstanding Securities in
respect of which moneys have been collected shall not have become and
be then due and payable, to the payment of interest, if any, ratably,
on the Securities in default in the order of the maturity of the
installments of such interest, with interest (to the extent that such
interest has been collected by the Trustee and to the extent permitted
by applicable law) upon the overdue installments of interest at the
Overdue Rate applicable to such Securities, such payments to be made
ratably to the persons entitled thereto, without discrimination or
preference;
THIRD: In case the principal of the Outstanding Securities in
respect of which moneys have been collected shall have become and shall
be then due and payable by declaration or otherwise, to the payment of
the whole amount then owing and unpaid upon such Securities for
principal and interest, if any, with interest upon the overdue
principal, and (to the extent that such interest has been collected by
the Trustee and to the extent permitted by applicable law) upon overdue
installments of interest, if any, at the Overdue Rate applicable to
such Securities; and in case such moneys shall be insufficient to pay
in full the whole amount so due and unpaid upon such Securities, then
to the payment of such principal and interest, if any, without
preference or priority of any kind, according to the aggregate amounts
due and payable on such Securities for principal and interest; and
FOURTH: To the payment of the remainder, if any, to the Issuer
or any other person lawfully entitled thereto.
SECTION 4.4 Proceedings by Trustee. In case an Event of
Default hereunder has occurred, has not been waived and is continuing, the
Trustee may in its discretion proceed to protect and enforce the rights vested
in it by this Indenture by such appropriate judicial proceedings as the Trustee
shall deem most effectual to protect and enforce any of such rights, either at
law or in equity or in bankruptcy or otherwise, whether for the specific
enforcement of any covenant or agreement contained in this Indenture or in aid
of the exercise of any power granted in this Indenture or to enforce any other
legal or equitable right vested in the Trustee by this Indenture or by law.
SECTION 4.5 Restoration of Rights on Abandonment of
Proceedings. In case the Trustee or any Securityholder shall have proceeded to
enforce any right under this Indenture and such proceedings shall have been
discontinued or abandoned for any reason, or shall have been determined
adversely to the Trustee or to such Securityholder, then and in every such case
the Issuer, the Securityholder and the Trustee shall subject to any
determination in such Proceeding, be restored severally and respectively to
their former positions and rights hereunder, and all rights, remedies and powers
of the Issuer, the Trustee and the Securityholders shall continue as though no
such proceedings had been taken.
SECTION 4.6 Proceedings by Securityholders. No holder of any
Security of any series shall have any right by virtue or by availing of any
provision of this Indenture to institute any action or proceeding at law or in
equity or in bankruptcy or otherwise upon or under or with respect to this
Indenture, or for the appointment of a trustee in bankruptcy, receiver or other
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similar official or for any other remedy hereunder, unless such holder
previously shall have given to the Trustee written notice of an Event of Default
with respect to Securities of such series and of the continuance thereof, as
hereinbefore provided, and unless also the holders of not less than 25% in
aggregate principal amount of the Securities of such series then Outstanding
shall have made written request upon the Trustee to institute such action, suit
or proceedings in its own name as Trustee hereunder and shall have offered to
the Trustee such reasonable indemnity as it may require against the reasonable
costs, expenses and liabilities to be incurred therein or thereby and the
Trustee for 60 days after its receipt of such notice, request and offer of
indemnity shall have neglected or refused to institute any such action, suit or
proceeding and no direction inconsistent with such written request shall have
been given to the Trustee pursuant to Section 4.8; it being understood and
intended, and being expressly covenanted by the taker and holder of every
Security with every other taker and holder and the Trustee, that no one or more
holders of any Securities shall have any right in any manner whatever by virtue
or by availing of any provision of this Indenture to affect, disturb or
prejudice the rights of any other holder of Securities, or to obtain or seek to
obtain priority over or preference to any other holder or to enforce any right
under this Indenture, except in the manner herein provided and for the equal,
ratable and common benefit of all holders of Securities of the applicable
series. For the protection and enforcement of the provisions of this Section,
each and every Securityholder and the Trustee shall be entitled to such relief
as can be given either at law or in equity.
SECTION 4.7 Remedies Cumulative and Continuing. Except as
provided in Section 4.6, no right or remedy herein conferred upon or reserved to
the Trustee or to the Securityholders is intended to be exclusive of any other
right or remedy, and every right and remedy shall, to the extent permitted by
law, be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other appropriate
right or remedy.
No delay or omission of the Trustee or of any Securityholder
to exercise any right or power accruing upon any Event of Default occurring and
continuing as aforesaid shall impair any such right or power or shall be
construed to be a waiver of any such Event of Default or an acquiescence
therein; and, subject to Section 4.6, every power and remedy given by this
Indenture or by law to the Trustee or to the Securityholders of any or all
series, as the case may be, may be exercised from time to time, and as often as
shall be deemed expedient, by the Trustee or by the Securityholders of such
series or all series, as the case may be.
SECTION 4.8 Control by Securityholders. The holders of not
less than a majority in aggregate principal amount of the Securities of each
series affected at the time Outstanding (with each such series voting separately
as a class) 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 by this Indenture with respect to
Securities of such series. Notwithstanding any of the foregoing, no such
direction shall be otherwise than in accordance with law and the provisions of
this Indenture and (subject to the requirements of the Trust Indenture Act of
1939) the Trustee shall have the right to decline to follow any such direction
if the Trustee, being advised by counsel, shall determine that the action or
proceeding so directed may not lawfully be taken or if the Trustee in good faith
by its board of directors, the executive
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committee, or a trust committee of directors or Responsible Officers of the
Trustee shall determine that the action or proceedings so directed would involve
the Trustee in personal liability or may be unduly prejudicial to the
Securityholders not joining in the giving of such direction.
Nothing in this Indenture shall impair the right of the
Trustee in its discretion to take any action deemed proper by the Trustee and
which is not inconsistent with such direction or directions by Securityholders.
SECTION 4.9 Waiver of Past Defaults. Prior to the declaration
of the acceleration of the maturity of the Securities of any particular series
the holders of not less than a majority in aggregate principal amount of the
Securities of such particular series at the time Outstanding may on behalf of
the holders of all the Securities of such particular series waive any past
default or Event of Default with respect to such particular series and its
consequences, except a default in respect of a covenant or provision hereof
which cannot be modified or amended without the consent of the holder of each
Outstanding Security affected as provided in Section 7.2 hereof. In the case of
any such waiver, the Issuer, the Trustee and the holders of the Securities of
each series affected shall be restored to their former positions and rights
hereunder, respectively; but no such waiver shall extend to any subsequent or
other default or Event of Default or impair any right consequent thereon.
Upon any such waiver, such default shall cease to exist and be
deemed to have been cured and not to have occurred, and any Event of Default
arising therefrom shall be deemed to have been cured, and not to have occurred
for every purpose of this Indenture.
ARTICLE FIVE
CONCERNING THE TRUSTEE
SECTION 5.1 Reliance on Documents, Opinions, etc.; No
Requirement for Expenditure of Own Funds. Subject to the requirements of the
Trust Indenture Act of 1939:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, Officers' Certificate or
any other certificate, statement, instrument, opinion, report, notice,
request, consent, order, direction 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, direction, order or demand of the Issuer
mentioned herein shall be sufficiently evidenced by an Officers'
Certificate (unless other evidence in respect thereof be herein
specifically prescribed); and any Resolution may be evidenced to the
Trustee by a copy thereof certified by the secretary or an assistant
secretary or attesting secretary of the Issuer;
(c) the Trustee may consult with counsel and any Opinion of
Counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or
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omitted to be taken by it hereunder in good faith and in accordance
with such Opinion of Counsel;
(d) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request,
order or direction of any of the Securityholders pursuant to the
provisions of this Indenture, unless such Securityholders shall have
offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred therein or
thereby;
(e) the Trustee shall not be liable for any action taken 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;
(f) prior to the occurrence of an Event of Default hereunder
and after the curing or waiving of all Events of Default, (1) the
Trustee undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(2) 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, consent, order, bond,
direction, note, or other paper or document unless requested in writing
so to do by the holders of not less than a majority in aggregate
principal amount of the Securities of any series affected then
Outstanding; provided that, if the payment within a reasonable time to
the Trustee of the costs, expenses or liabilities likely to be incurred
by it in the making of such investigation is, in the opinion of the
Trustee, not reasonably assured to the Trustee by the security afforded
to it by the terms of this Indenture, the Trustee may require
reasonable indemnity against such expenses or liabilities as a
condition to proceeding; and the reasonable expenses of every such
investigation shall be paid by the Issuer or, if paid by the Trustee,
shall be repaid by the Issuer upon demand; and
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys not regularly in its employ and the Trustee
shall not be responsible for any misconduct or negligence on the part
of any such agent or attorney appointed with due care by it hereunder.
(h) notwithstanding the provisions of Section 315(d) of the
Trust Indenture Act of 1939, the Trustee shall not be liable for any
error of judgment made in good faith by a Responsible Officer;
provided, however, that the Trustee's conduct does not constitute
willful misconduct or negligence.
(i) the Trustee is not required to take notice or deemed to
have notice of any default or Event of Default, unless a Responsible
Officer of the Trustee has received notice in writing of such default
or Event of Default from the Issuer or from the holders of at least 25%
in aggregate principal amount of the Outstanding Securities of the
series so affected, and in absence of any such notice, the Trustee may
conclusively assume that no default or Event of Default exists.
(j) the Trustee is not required to give any bond or surety
with respect to the performance of its duties or the exercise of its
powers under this Indenture.
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(k) the Trustee's immunities and protections from liability and its
rights to compensation and indemnification in connection with the
performance of its duties under this Indenture shall extend to the
Trustee's officers, directors, agents and employees. Such immunities and
protections and right to indemnification, together with the Trustee's
right to compensation, shall survive the Trustee's resignation or removal
and final payment of the Securities.
(l) the Trustee shall have no responsibility for any information in
any offering memorandum or other disclosure material distributed with
respect to any series of Securities other than that information which it
provides in writing to the Issuer expressly for the purpose of being
included in any such offering memorandum or other disclosure material, and
the Trustee shall have no responsibility for compliance with any state or
federal securities laws in connection with the Securities, other than the
filing of any documents required to be filed by an indenture trustee
pursuant to the Trust Indenture Act.
(m) 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 sole discretion, may make such further
inquiry or investigations into such facts or matters as it may see fit,
and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and
premises of the Issuer and its Restricted Subsidiaries, personally or by
one or more agents and attorneys.
None of the provisions contained in this Indenture shall be
construed as requiring the Trustee to expend or risk its own funds or otherwise
incur personal financial liability in the performance of any of its duties or in
the exercise of any of its rights or powers if there shall be reasonable grounds
for believing that the repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. Whether or not therein
expressly so provided, every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Trustee shall be
subject to the requirements of the Trust Indenture Act of 1939.
SECTION 5.2 No Responsibility for Recitals, etc. The recitals
contained herein and in the Securities, except the Trustee's certificates of
authentication, shall be taken as the statements of the Issuer, and the Trustee
assumes no responsibility for the correctness of the same. The Trustee makes no
representation as to the validity or sufficiency of this Indenture or of the
Securities, provided that the Trustee shall not be relieved of its duty to
authenticate Securities only as authorized by this Indenture. The Trustee shall
not be accountable for the use or application by the Issuer of any of the
Securities or of the proceeds thereof.
SECTION 5.3 Trustee and Agents May Hold Securities. The Trustee or
any agent of the Issuer or the Trustee, in its individual or any other capacity,
may become the owner or pledgee of Securities with the same rights it would have
if it were not the Trustee or such agent and, subject to the requirements of the
Trust Indenture Act of 1939, may otherwise deal with the
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Issuer and receive, collect, hold and retain collections from the Issuer with
the same rights it would have if it were not the Trustee or such agent.
SECTION 5.4 Moneys to Be Held in Trust. Subject to the provisions of
Sections 9.3 and 9.4 hereof, all moneys received by the Trustee or any paying
agent, all money and U.S. Government Obligations deposited with the Trustee
pursuant to Section 11.2 or Section 11.3 and all money received by the Trustee
in respect of U.S. Government Obligations deposited with the Trustee pursuant to
Section 11.2 or Section 11.3, shall, until used or applied as herein provided,
be held in trust for the purposes for which they were received, but need not be
segregated from other funds except to the extent required by mandatory
provisions of law. Neither the Trustee nor any paying agent shall be under any
liability for interest on any moneys received by it hereunder, except such as it
may agree with the Issuer to pay thereon. So long as no Event of Default shall
have occurred and be continuing, all interest allowed on any such moneys shall
be paid from time to time upon the written order of the Issuer signed by one of
its officers, who is one of the officers who may sign an Officers' Certificate.
SECTION 5.5 Compensation and Expenses of Trustee. The Issuer
covenants and agrees to pay to the Trustee from time to time, and the Trustee
shall be entitled to, reasonable compensation (which shall not be limited by any
provision of law in regard to the compensation of a trustee of an express trust)
and, except as otherwise expressly provided, the Issuer will pay or reimburse
the Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by or on behalf of it pursuant to any of the
provisions of this Indenture (including the reasonable compensation and the
expenses and disbursements of its counsel and of all persons not regularly in
its employ) except any such expense, disbursement or advance as may arise from
its negligence or bad faith. The Issuer also covenants to indemnify the Trustee
for, and to hold it harmless against, any loss, liability or expense incurred
without negligence or bad faith on its part, arising out of or in connection
with the acceptance or administration of this Indenture or the trusts hereunder
and its duties hereunder, including the costs and expenses of defending itself
against any claim of liability in the premises. The obligations of the Issuer
under this Section to compensate and indemnify the Trustee and to pay or
reimburse the Trustee for reasonable expenses, disbursements and advances shall
constitute additional indebtedness hereunder and shall survive the satisfaction
and discharge of this Indenture. Such additional indebtedness, if any, shall be
secured by a lien prior 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
benefit of the holders of particular Securities.
SECTION 5.6 Right of Trustee to Rely on Officers' Certificate, etc..
Subject to the requirements of the Trust Indenture Act of 1939, whenever in the
administration of the trusts of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established prior to taking or
suffering or omitting any action to be taken hereunder, such matter (unless
other evidence in respect thereof be herein specifically prescribed) may, in the
absence of negligence or bad faith on the part of the Trustee, be deemed to be
conclusively proved and established by an Officers' Certificate delivered to the
Trustee, and such certificate, in the absence of negligence or bad faith on the
part of the Trustee, shall be full warrant to the Trustee for any action taken,
suffered or omitted by it under the provisions of this Indenture upon the faith
thereof.
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SECTION 5.7 Eligibility of Trustee. The Trustee for each series of
Securities hereunder shall at all times be a corporation which complies with the
requirements of the Trust Indenture Act of 1939, having a combined capital and
surplus of at least $10,000,000. If such corporation files reports of condition
at least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such corporation at any time shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so filed. In case at any time the Trustee shall cease to be eligible
in accordance with the provisions of this Section, the Trustee shall resign
immediately in the manner and with the effect specified in Section 5.8.
SECTION 5.8 Resignation or Removal of Trustee; Appointment of
Successor Trustee. (a) The Trustee, or any trustee or trustees hereafter
appointed, may at any time resign with respect to one or more or all series of
Securities by giving written notice of resignation to the Issuer and by mailing
notice thereof to holders of the applicable series of Securities at their last
addresses as they shall appear in the Register. Upon receiving such notice of
resignation, the Issuer shall promptly appoint a successor trustee or trustees
with respect to the applicable series by written instrument in duplicate,
executed by authority of the Board of Directors, one copy of which instrument
shall be delivered to the resigning Trustee and one copy to the successor
trustee or trustees. If no successor trustee shall have been so appointed with
respect to any series and have accepted appointment within 30 days after the
mailing of such notice of resignation, the resigning trustee may petition any
court of competent jurisdiction for the appointment of a successor trustee, or
any Securityholder who has been a bona fide holder of a Security or Securities
of the applicable series for at least six months may, subject to the
requirements of the Trust Indenture Act of 1939, on behalf of such
Securityholder and all others similarly situated, petition any such court for
the appointment of a successor trustee. Such court may thereupon, after such
notice, if any, as it may deem proper and prescribe, appoint a successor
trustee.
(b) In case at any time any of the following shall occur:
(i) the Trustee shall cease to be eligible in accordance with the
provisions of Section 5.7 with respect to any series of Securities and
shall fail to resign after written request therefor by the Issuer or by
any Securityholder; or
(ii) the Trustee shall become incapable of acting with respect to
any series of Securities, or shall be adjudged a bankrupt or insolvent, or
a receiver or liquidator 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, the Issuer may remove the Trustee with respect to the
applicable series of Securities (or all series, if required) and appoint a
successor trustee for such series by written instrument, in duplicate, executed
by authority of the Board of Directors, one copy of which instrument shall be
delivered to the Trustee so removed and one copy to the successor trustee, or,
subject to the requirements of the Trust Indenture Act of 1939, any
Securityholder who has been a bona fide holder of a Security or Securities of
such series for at least six months may on behalf of such Securityholder and all
others similarly situated, petition any court of competent jurisdiction
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for the removal of the Trustee and the appointment of a successor trustee with
respect to such series. Such court may thereupon, after such notice, if any, as
it may deem proper and prescribe, remove the Trustee and appoint a successor
trustee with respect to such series.
(c) The holders of a majority in aggregate principal amount of the
Securities of any series at the time Outstanding may at any time remove the
Trustee with respect to Securities of such series and appoint a successor
trustee with respect to the Securities of such series by delivering to the
Trustee so removed, to the successor trustee so appointed and to the Issuer the
evidence provided for in Section 6.1 of the action in that regard taken by the
Securityholders.
(d) Any resignation or removal of the Trustee with respect to any
series and any appointment of a successor trustee with respect to such series
pursuant to any of the provisions of this Section 5.8 shall become effective
upon acceptance of appointment by the successor trustee as provided in Section
5.9.
SECTION 5.9 Acceptance of Appointment by Successor Trustee. Any
successor trustee appointed as provided in Section 5.8 shall execute,
acknowledge and deliver to the Issuer and to its predecessor Trustee an
instrument accepting such appointment hereunder, and thereupon the resignation
or removal of the predecessor Trustee with respect to all or any applicable
series shall become effective and such successor trustee, without any further
act, deed or conveyance, shall become vested with all rights, powers, duties and
obligations with respect to such series of its predecessor hereunder, with like
effect as if originally named as trustee for such series hereunder; but,
nevertheless, on the written request of the Issuer or of the successor trustee,
upon payment (or due provision therefor) of any amounts then due it pursuant to
Section 5.5, the predecessor Trustee ceasing to act shall, subject to Section
9.4, pay over to the successor trustee all moneys at the time held by it
hereunder and shall execute and deliver an instrument transferring to such
successor trustee all such rights, powers, duties and obligations. Upon request
of any such successor trustee, the Issuer shall execute any and all instruments
in writing for more fully and certainly vesting in and confirming to such
successor trustee all such rights and powers. Any trustee ceasing to act shall,
nevertheless, retain a lien upon all property or funds held or collected by such
trustee to secure any amounts then due it pursuant to the provisions of Section
5.5.
If a successor trustee is appointed with respect to the Securities
of one or more (but not all) series, the Issuer, the predecessor Trustee and
each successor trustee with respect to the Securities of any applicable series
shall execute and deliver an indenture supplemental hereto which shall contain
such provisions as shall be deemed necessary or desirable to confirm that all
the rights, powers, trusts and duties of the predecessor Trustee with respect to
the Securities of any series as to which the predecessor Trustee is not retiring
shall continue to be vested in the predecessor Trustee, and 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 make 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.
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No successor trustee with respect to any series of Securities shall
accept appointment as provided in this Section 5.9 unless at the time of such
acceptance such successor trustee shall, with respect to such series, be
qualified under the provisions of the Trust Indenture Act of 1939 and eligible
under the provisions of Section 5.7.
Upon acceptance of appointment by any successor trustee as provided
in this Section 5.9, the Issuer shall mail notice thereof to the holders of
Securities of any series for which such successor trustee is acting as trustee
at their last addresses as they shall appear in the Register. If the acceptance
of appointment is substantially contemporaneous with the resignation, then the
notice called for by the preceding sentence may be combined with the notice
called for by Section 5.8. If the Issuer fails to mail such notice within ten
days after acceptance of appointment by the successor trustee, the successor
trustee shall cause such notice to be mailed at the expense of the Issuer.
SECTION 5.10 Merger, Conversion, Consolidation or Succession to
Business of Trustee. 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 of the
corporate trust business of the Trustee, shall be the successor of the Trustee
hereunder, provided that such corporation shall be qualified under the
provisions of the Trust Indenture Act of 1939 and eligible under the provisions
of Section 5.7, without the execution or filing of any paper or any further act
on the part of any of the parties hereto, anything herein to the contrary
notwithstanding.
In case at the time such successor to the Trustee shall succeed to
the trusts created by this Indenture any of the Securities of any series shall
have been authenticated but not delivered, any such successor to the Trustee by
merger, conversion, consolidation or succession may adopt the certificate of
authentication of any predecessor Trustee and deliver such Securities so
authenticated; and, in case at that time any of the Securities of any series
shall not have been authenticated, any successor to the Trustee may authenticate
such Securities either in the name of such successor to the Trustee or, if such
successor to the Trustee is a successor by merger, conversion, consolidation or
succession in the name of any predecessor hereunder; and in all such cases such
certificate shall have the full force which it is anywhere in the Securities of
such series or in this Indenture provided that the certificate of the Trustee
shall have.
SECTION 5.11 Reports by Trustee to Securityholders. Within 60 days
after March 15 in each year, beginning with the March 15 following the date of
this Indenture, the Trustee shall mail to the Securityholders a brief report
dated as of such reporting date in compliance with Section 313(a) of the Trust
Indenture Act of 1939, but only to the extent required by such Section 313(a).
The Trustee also shall comply with Section 313(b) of the Trust Indenture Act of
1939. The Trustee shall also transmit by mail all reports as required by Section
313(c) of the Trust Indenture Act of 1939. The Issuer shall promptly notify the
Trustee when the Securities are listed on any stock exchange.
SECTION 5.12 Compliance with Backup Withholding and Information
Reporting. Notwithstanding anything else herein contained, the Trustee, or its
agent, shall comply with all U.S. federal backup withholding and information
reporting requirements applicable to any payment under the Securities of any
series.
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ARTICLE SIX
CONCERNING THE SECURITYHOLDERS
SECTION 6.1 Action by Securityholders. Whenever in this Indenture it
is provided that the holders of a specified percentage in aggregate principal
amount of the Securities of any or all series may take any action (including the
making of any demand or request, the giving of any notice, consent or waiver or
the taking of any other action) the fact that at the time of taking any such
action the holders of such specified percentage have joined therein may be
evidenced (a) by any instrument or any number of instruments of similar tenor
executed by such Securityholders in person or by agent or proxy appointed in
writing, or (b) by the record of such holders of Securities voting in favor
thereof at any meeting of such Securityholders duly called and held in
accordance with the provisions of this Article, or (c) by a combination of such
instrument or instruments and any such record of such a meeting of such
Securityholders; and, except as herein otherwise expressly provided, such action
shall become effective when such instrument or instruments and/or such record
are delivered to the Trustee. Proof of execution of any instrument or of a
writing appointing any such agent or proxy shall be sufficient for any purpose
of this Indenture and (subject to the requirements of the Trust Indenture Act of
1939 and Section 5.1) conclusive in favor of the Trustee and the Issuer, if made
in the manner provided in this Article.
In determining whether the holders of the requisite principal amount
of Outstanding Securities of any or all series have taken any action (including
the making of any demand or request), the giving of any notice, consent or
waiver (or the taking of any other action) hereunder and in determining voting
rights of any holder of a Security hereunder (i) the principal amount of
Original Issue Discount Securities that shall be deemed to be Outstanding for
such purposes shall be the amount of the principal thereof that would be due and
payable as of the date of such determination upon a declaration of acceleration
of the maturity thereof pursuant to Section 4.1 and (ii) the principal amount of
any Security, the principal amount of which is denominated in a currency other
than U.S. dollars or in units of currencies or in a composite currency (the
"Specified Currency") shall be deemed to be that amount of U.S. dollars which
could have been obtained by the principal amount of such Specified Currency at
the Market Exchange Rate. For purposes of this Section 6.1, "Market Exchange
Rate" means, unless otherwise specified for a Specified Currency with respect to
any series of Securities pursuant to Section 2.5, the noon U.S. dollar buying
rate in the Borough of Manhattan, The City of New York for cable transfers of
the Specified Currency published by the Federal Reserve Bank of New York.
All decisions and determinations of the Trustee regarding the Market
Exchange Rate or any alternative determination provided for in the preceding
paragraph shall be in its sole discretion and shall, in the absence of manifest
error, be conclusive to the extent permitted by law for all purposes and
irrevocably binding upon the Issuer and all Securityholders.
If the Issuer shall solicit from the Securityholders any demand,
request, notice, consent, waiver or the taking of any other action (other than
in accordance with the Securityholders' voting provisions set forth in Sections
6.6 through 6.14 of this Article), the
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Issuer may, at its option, by a Resolution, fix in advance a record date for the
determination of holders entitled to give such demand, request, notice, consent,
or waiver or to take such other action, but the Issuer shall have no obligation
to do so. If such a record date is fixed, such demand, request, notice, consent,
waiver or such other action may be given before or after the record date, but
only the Securityholders of record at the close of business on the record date
shall be deemed to be holders for the purposes of determining whether holders of
the requisite percentage of Securities Outstanding have authorized or agreed or
consented to such demand, request, notice, consent, waiver or taking of any
other action, and for that purpose the Securities Outstanding shall be computed
as of the record date; provided, that no such demand, request, notice, consent,
waiver or taking of any other action by the holders on the record date shall be
deemed effective unless it shall become effective pursuant to the provisions of
this Indenture not later than six months after the record date.
SECTION 6.2 Proof of Execution by Securityholders. Subject to the
requirements of the Trust Indenture Act of 1939 and Sections 5.1 and 6.11, proof
of the execution of any instrument by a Securityholder or his or her agent or
proxy shall be sufficient if made in accordance with such reasonable rules and
regulations as may be prescribed by the Trustee or in such manner as shall be
satisfactory to the Trustee. The ownership of Securities shall be proved by the
Register or by a certificate of the Person designated by the Issuer to keep the
Register and to act as repository in accordance with the provisions of Section
2.10.
The record of any Securityholders' meeting shall be proved in the
manner provided in Section 6.12.
SECTION 6.3 Holders to Be Treated as Owners. The Issuer, the Trustee
and any agent of the Issuer or the Trustee may deem and treat the Person in
whose name any Security shall be registered in the Register for such series as
the absolute owner of such Security (whether or not such Security shall be
overdue and notwithstanding any notation of ownership or other writing thereon)
for the purpose of receiving payment of or on account of the principal of and,
subject to the provisions of this Indenture, interest, if any, on such Security
and for all other purposes; and neither the Issuer nor the Trustee nor any agent
of the Issuer or the Trustee shall be affected by any notice to the contrary.
All such payments so made to any such Person, or upon his order, shall be valid,
and, to the extent of the sum or sums so paid, effectual to satisfy and
discharge the liability for moneys payable upon any such Security.
SECTION 6.4 Securities Owned by Issuer Deemed Not Outstanding. In
determining whether the holders of the requisite aggregate principal amount of
Outstanding Securities of any or all series have concurred in any demand,
request, notice, direction, consent or waiver under this Indenture, Securities
which are owned by the Issuer or any other obligor on the Securities with
respect to which such determination is being made or by any Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Issuer or any other obligor on the Securities with respect to
which such determination is being made shall be disregarded and deemed not to be
Outstanding for the purpose of any such determination, except that for the
purpose of determining whether the Trustee shall be protected in relying on any
such demand, request, notice, direction, consent or waiver only Securities which
a Responsible Officer of the Trustee knows are so owned shall be so disregarded.
Securities so
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owned which have been pledged in good faith may be regarded as Outstanding for
purposes of this Section 6.4 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 Issuer or any other obligor upon the Securities or
any Person directly or indirectly controlling or controlled by or under direct
or indirect common control with the Issuer or any other obligor on the
Securities. In case of a dispute as to such right, the advice of counsel shall
be full protection in respect of any decision made by the Trustee in accordance
with such advice. Upon request of the Trustee, the Issuer shall furnish to the
Trustee promptly an Officers' Certificate listing and identifying all
Securities, if any, known by the Issuer to be owned or held by or for the
account of any of the above-described Persons; and, subject to the requirements
of the Trust Indenture Act of 1939 and Section 5.1, the Trustee shall, in the
absence of manifest error, accept such Officers' Certificate as conclusive
evidence of the facts therein set forth and of the fact that all Securities not
listed therein are Outstanding for the purpose of any such determination.
SECTION 6.5 Right of Revocation of Action Taken. At any time prior
to (but not after) the evidencing to the Trustee, as provided in Section 6.1, of
the taking of any action by the holders of the percentage in aggregate principal
amount of the Securities of any or all series, as the case may be, specified in
this Indenture in connection with such action, any holder of a Security the
serial number or other distinguishing symbol of which is shown by the evidence
to be included among the serial numbers or other distinguishing symbols of the
Securities the holders of which have consented to such action may, by filing
written notice at the Corporate Trust Office and upon proof of holding as
provided in this Article, revoke such action so far as concerns such Security.
Except as aforesaid any such action taken by the holder of any Security shall be
conclusive and binding upon such holder and upon all future holders and owners
of such Security and of any Securities issued in exchange or substitution
therefor, irrespective of whether or not any notation in regard thereto is made
upon any such Security. Any action taken by the holders of the percentage in
aggregate principal amount of the Securities of any or all series, as the case
may be, specified in this Indenture in connection with such action shall be
conclusively binding upon the Issuer, the Trustee and the holders of all the
Securities affected by such action.
SECTION 6.6 Securityholders' Meetings; Purposes. A meeting of
holders of Securities of any series or all series, as the case may be, may be
called at any time and from time to time pursuant to the provisions of this
Article Six for any of the following purposes:
(1) to give any notice to the Issuer or to the Trustee, or to give
any directions to the Trustee, or to consent to the waiving of any default
or Event of Default hereunder and its consequences, or to take any other
action authorized to be taken by Securityholders pursuant to any of the
provisions of Article Four;
(2) to remove the Trustee and nominate a successor trustee pursuant
to the provisions of Article Five;
(3) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to the provisions of Section 7.2; or
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(4) to take any other action authorized to be taken by or on behalf
of the holders of any specified aggregate principal amount of the
Securities of any series or all series, as the case may be, under any
other provision of this Indenture or under applicable law.
SECTION 6.7 Call of Meetings by Trustee. The Trustee may at any time
call a meeting of holders of Securities of any series or all series, as the case
may be, to take any action specified in Section 6.6, to be held at such time and
at such place in the Borough of Manhattan, The City of New York, as the Trustee
shall determine. Notice of every meeting of the holders of Securities of any
series or all series, as the case may be, setting forth the time and the place
of such meeting and in general terms the action proposed to be taken at such
meeting, shall be mailed to holders of Securities of each series affected at
their addresses as they shall appear in the Register as of a date not more than
15 days prior to the mailing of such notice. Such notice shall be mailed not
less than 20 nor more than 90 days prior to the date fixed for the meeting.
Any meeting of the holders of Securities of any series or all
series, as the case may be, shall be valid without notice if the holders of all
Securities of any series then Outstanding are present in person or by proxy, or,
if notice is waived before or after the meeting by the holders of all Securities
of any series outstanding, and if the Issuer and the Trustee are either present
by duly authorized representatives or have, before or after the meeting waived
notice.
SECTION 6.8 Call of Meetings by Issuer or Securityholders. In case
at any time the Issuer, pursuant to a Resolution, or the holders of at least 10%
in aggregate principal amount of the Securities then Outstanding of any or all
series, as the case may be, shall have requested the Trustee to call a meeting
of the holders of Securities of such series or all series, as the case may be,
by written request setting forth in reasonable detail the action proposed to be
taken at the meeting, and the Trustee shall not have mailed the notice of such
meeting within 20 days after receipt of such request, then the Issuer or such
Securityholders, in the amount specified above, may determine the time and the
place in the Borough of Manhattan, the City of New York, for such meeting and
may call such meeting to take any action authorized in Section 6.6, by mailing
notice thereof as provided in Section 6.7.
SECTION 6.9 Qualifications for Voting. To be entitled to vote at any
meeting of Securityholders a Person shall (a) be a holder of one or more
Securities with respect to which such meeting is being held or (b) be a Person
appointed by an instrument in writing as proxy by a holder of one or more of
such Securities. The only Persons who shall be entitled to be present or to
speak at any meeting of Securityholders shall be the Persons entitled to vote at
such meeting and their counsel and any representatives of the Trustee and its
counsel and any representatives of the Issuer and its counsel.
SECTION 6.10 Quorum; Adjourned Meetings. The Persons entitled to
vote a majority in aggregate principal amount of the Securities of the relevant
series at the time Outstanding shall constitute a quorum for the transaction of
all business specified in Section 6.6. No business shall be transacted in the
absence of a quorum (determined as provided in this Section 6.10). In the
absence of a quorum within 30 minutes after the time appointed for any such
meeting, the meeting shall, if convened at the request of the holders of
Securities (as provided in
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Section 6.8), be dissolved. In any other case, the meeting shall be adjourned
for a period of not less than ten days as determined by the chairman of the
meeting. In the absence of a quorum at any such adjourned meeting, such
adjourned meeting shall be further adjourned for a period of not less than ten
days as determined by the chairman of the meeting. Notice of the reconvening of
any adjourned meeting shall be given as provided in Section 6.7, except that
such notice must be mailed not less than five days prior to the date on which
the meeting is scheduled to be reconvened.
Any holder of a Security who has executed in person or by proxy and
delivered to the Trustee an instrument in writing complying with the provisions
of Section 6.2 shall be deemed to be present for the purposes of determining a
quorum and be deemed to have voted; provided that such holder of a Security
shall be considered as present or voting only with respect to the matters
covered by such instrument in writing.
SECTION 6.11 Regulations. Notwithstanding any other provisions of
this Indenture, the Trustee may make such reasonable regulations as it may deem
advisable for any meeting of Securityholders, in regard to proof of the holding
of Securities and of the appointment of proxies, and in regard to the
appointment and duties of inspectors of votes, the submission and examination of
proxies, certificates and other evidence of the right to vote, and such other
matters concerning the conduct of the meeting as it shall determine.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the Issuer
or by Securityholders as provided in Section 6.8, in which case the Issuer or
the Securityholders calling the meeting, as the case may be, shall in like
manner appoint a temporary chairman. A permanent chairman and a permanent
secretary of the meeting shall be elected by majority vote of the holders of a
majority of the principal amount of the Outstanding Securities present at the
meeting.
Subject to the provisions of Section 6.4, at any meeting each holder
of Securities, with respect to which such meeting is being held, or such
holder's representative by proxy, shall be entitled to one vote for each U.S.
$1,000 (or if any Securities are denominated in a currency other than U.S.
dollars or in a composite currency, the equivalent of U.S. $1,000 in the
applicable currency or composite currency) principal amount (in the case of
Original Issue Discount Securities, such principal amount to be determined as
provided in the definition of "Outstanding" in Section 1.1) of such Securities
held or represented by him or her; provided, however, that no vote shall be cast
or counted at any meeting in respect of any such Security challenged as not
Outstanding and ruled by the chairman of the meeting to be not Outstanding. The
chairman of the meeting shall have no right to vote other than by virtue of such
Securities held by him or her or instruments in writing as aforesaid duly
designating him or her as the Person to vote on behalf of other such
Securityholders. Any meeting of holders of Securities with respect to which a
meeting was duly called pursuant to the provisions of Section 6.7 or 6.8 may be
adjourned from time to time by a majority of those present, whether or not
constituting a quorum, and the meeting may be held as so adjourned without
further notice.
SECTION 6.12 Voting. The vote upon any resolution submitted to any
meeting of holders of Securities with respect to which such meeting is being
held shall be by written
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ballots on which shall be subscribed the signatures of such holders of
Securities or of their representatives by proxy and the principal amount (in the
case of Original Issue Discount Securities, such principal amount to be
determined as provided in the definition of "Outstanding" in Section 1.1) and
number or numbers or other distinguishing symbol or symbols of such Securities
held or represented by them. The permanent chairman of the meeting shall appoint
two inspectors of votes who shall count all votes cast at the meeting for or
against any resolution and who shall make and file with the secretary of the
meeting their verified written reports in duplicate of all votes cast at the
meeting. A record in duplicate of the proceedings of each meeting of
Securityholders shall be prepared by the secretary of the meeting and there
shall be attached to said record the original reports of the inspectors of votes
on any vote by ballot taken thereat and affidavits by one or more persons having
knowledge of the facts setting forth a copy of the notice of the meeting and
showing that said notice was mailed as provided in Section 6.7. The record shall
show the principal amount of the Securities (in the case of Original Issue
Discount Securities, such principal amount to be determined as provided in the
definition of "Outstanding" in Section 1.1) voting in favor of or against any
resolution. The record shall be signed and verified by the affidavits of the
permanent chairman and secretary of the meeting and one of the duplicates shall
be delivered to the Issuer and the other to the Trustee to be preserved by the
Trustee, the latter to have attached thereto the ballots voted at the meeting.
Any record so signed and verified shall be conclusive evidence of
the matters therein stated.
SECTION 6.13 No Delay of Rights by Meeting. Nothing in this Article
Six shall be deemed or construed to authorize or permit, by reason of any call
of a meeting of Securityholders of any or all series or any rights expressly or
impliedly conferred hereunder to make such call, any hindrance or delay in the
exercise of any right or rights conferred upon or reserved to the Trustee or to
the Securityholders of any or all such series under any of the provisions of
this Indenture or of the Securities.
SECTION 6.14 Written Consent in Lieu of Meeting. The written
authorization or consent by the holders of the requisite percentage in aggregate
principal amount of Outstanding Securities of one or more series herein
provided, entitled to vote at any such meeting, evidenced as provided in Section
6.1 and filed with the Trustee, shall be effective in lieu of a meeting of the
holders of Securities of such series, with respect to any matter provided for in
this Article Six.
ARTICLE SEVEN
SUPPLEMENTAL INDENTURES
SECTION 7.1 Supplemental Indentures Without Consent of
Securityholders. The Issuer, when authorized by, or pursuant to a Resolution,
and the Trustee may from time to time and at any time enter into an indenture or
indentures supplemental hereto (which shall conform to the provisions of the
Trust Indenture Act of 1939 as in force at the date of the execution thereof)
for one or more of the following purposes:
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(a) to convey, transfer, assign, mortgage or pledge to the Trustee
as security for the Securities of one or more series any property or
assets;
(b) to evidence the succession of another Person to the Issuer, or
successive successions, and the assumption by the successor Person of the
covenants, agreements and obligations of the Issuer pursuant to Article
Eight;
(c) to add to the covenants of the Issuer such further covenants,
restrictions, conditions or provisions as the Issuer and the Trustee shall
consider to be for the benefit of the holders of one or more series of
Securities (and if such covenants, restrictions, conditions or provisions
are to be for the benefit of less than all series of Securities, stating
that such covenants, restrictions, conditions or provisions are expressly
being included solely for the benefit of such series) or to surrender any
right or power herein conferred upon the Issuer;
(d) to add additional Events of Default and to provide with respect
thereto for any particular periods of grace after default (which may be
shorter or longer than that allowed in the case of other defaults) or for
immediate enforcement upon such default or for any limitation of the
remedies available to the Trustee upon such default;
(e) to provide for the issuance under this Indenture of Securities
in bearer form (including Securities registrable as to principal only)
with or without interest coupons and to provide for exchangeability of
such Securities with the Securities of the same series issued hereunder in
fully registered form and to make all appropriate changes for such
purpose;
(f) to cure any ambiguity or to correct or supplement any provision
contained herein or in any supplemental indenture which may be defective
or inconsistent with any other provision contained herein or in any
supplemental indenture; or to change or eliminate any provision or to make
such other provisions in regard to matters or questions arising under this
Indenture or under any supplemental indenture as the Issuer may deem
necessary or desirable and which shall not adversely affect the interests
of the holders of the Securities at the time Outstanding;
(g) to establish the form or terms of Securities of any series as
permitted by Sections 2.1 and 2.5; or
(h) to evidence and provide for the acceptance of appointment
hereunder by a successor trustee with respect to the Securities of one or
more series and to add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one trustee, pursuant
to the requirements of Section 5.9.
Upon the request of the Issuer, accompanied by a copy of a
Resolution certified by the secretary or an assistant secretary or attesting
secretary of the Issuer authorizing the execution of any such supplemental
indenture and an Officers' Certificate and Opinion of Counsel meeting
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the requirements of Section 12.5 hereof, the Trustee shall join with the Issuer
in the execution of any such supplemental indenture, to make any further
appropriate agreements and stipulations which may be therein contained and to
accept the conveyance, transfer, assignment, mortgage or pledge of any property
thereunder, but the Trustee shall not be obligated to (but may in its
discretion) enter into any such supplemental indenture which adversely affects
the Trustee's own rights, duties or immunities under this Indenture or
otherwise.
Any supplemental indenture authorized by the provisions of this
Section may be executed by the Issuer and the Trustee without the consent of the
holders of any of the Securities at the time Outstanding, notwithstanding any of
the provisions of Section 7.2.
SECTION 7.2 Supplemental Indentures With Consent of Securityholders.
With the consent (evidenced as provided in Article Six) of the holders of not
less than a majority in aggregate principal amount of the Securities of all
series affected by such supplemental indenture (all such series voting as a
single class) at the time Outstanding, the Issuer, when authorized by, or
pursuant to a Resolution, and the Trustee may, from time to time and at any
time, enter into an indenture or indentures supplemental hereto (which shall
conform to the provisions of the Trust Indenture Act of 1939 as in force at the
date of execution thereof) for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Indenture or
of any supplemental indenture or of modifying in any manner the rights and
obligations of the Issuer and the rights of the holders of the Securities of all
such series; provided that no such supplemental indenture shall (a) extend the
fixed maturity of any Security, or reduce the principal amount thereof, or
reduce the rate or change the manner of calculation of interest thereon or
extend the time of payment of interest thereon, change any obligation of the
Issuer to pay Additional Amounts pursuant to Section 3.7 or reduce any
Additional Amount payable thereon (except as contemplated by Section 10.6), or
reduce any amount payable on redemption or reduce the Overdue Rate thereof or
make the principal thereof or interest thereon payable in any coin or currency
other than that provided in the Security or reduce the amount of the principal
of an Original Issue Discount Security that would be due and payable upon an
acceleration of the maturity thereof pursuant to Section 4.1 or the amount
thereof provable in bankruptcy pursuant to Section 4.2, or impair, if the
Securities provide therefor, any right of repayment at the option of the
Securityholder, or impair the right of any Securityholder to institute suit for
the enforcement of any required payment in respect of any Security on or after
the fixed maturity thereof, without the consent of the holder of each Security
so affected, or (b) reduce the aforesaid percentage of Securities the consent of
the holders of which is required for any such supplemental indenture or for the
waiver of certain provisions of this Indenture or certain defaults under the
Indenture, without the consent of the holders of each Security so affected.
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 Securityholders of such series with respect to such covenant
or provision, shall be deemed not to affect the rights under this Indenture of
the Securityholders of any other series. The preceding sentence shall not,
however, raise any inference as to whether or not a particular series is
affected by any supplemental indenture not referred to in such sentence.
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Upon the request of the Issuer, accompanied by a copy of a
Resolution certified by the secretary or an assistant secretary or attesting
secretary of the Issuer authorizing the execution of any such supplemental
indenture, and upon the filing with the Trustee of evidence of the consent of
Securityholders as aforesaid and other documents, if any, required by Section
6.1, the Trustee shall join with the Issuer in the execution of such
supplemental indenture unless such supplemental indenture adversely affects the
Trustee's open rights, duties or immunities under this Indenture or otherwise,
in which case the Trustee may in its discretion, but shall not be obligated to,
enter into such supplemental indenture.
It shall not be necessary for the consent of the Securityholders
under this Section to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
Promptly after the execution by the Issuer and the Trustee of any
supplemental indenture pursuant to the provisions of this Section 7.2, the
Issuer shall mail a notice thereof to the holders of Securities of each series
affected thereby at their addresses as they shall appear in the Register,
setting forth in general terms the substance of such supplemental indenture. Any
failure of the Issuer to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such supplemental
indenture.
SECTION 7.3 Effect of Supplemental Indenture. Upon the execution of
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be and be deemed to be modified and amended in accordance therewith and
the respective rights, limitations of rights, obligations, duties and immunities
under this Indenture of the Trustee, the Issuer and the holders of Securities of
each series affected thereby shall thereafter be determined, exercised and
enforced hereunder subject in all respects to such modifications and amendments,
and all the terms and conditions of any such supplemental indenture shall be and
be deemed to be part of the terms and conditions of this Indenture for any and
all purposes.
SECTION 7.4 Certain Documents to Be Given to Trustee. The Trustee,
subject to the requirements of the Trust Indenture Act of 1939 and Section 5.1,
may request an Officers' Certificate and an Opinion of Counsel as a condition to
entering into any supplemental indenture pursuant to this Article 7 and the
delivery thereof to the Trustee shall constitute conclusive evidence that any
supplemental indenture to be executed pursuant to this Article Seven complies
with the requirements of this Article.
SECTION 7.5 Notation on Securities. Securities of any series
authenticated and delivered after the execution of any supplemental indenture
pursuant to the provisions of this Article may bear a notation in form approved
by the Trustee for such series as to any matter provided for by such
supplemental indenture or as to any action taken at any such meeting. If the
Issuer or the Trustee shall so determine, new Securities of any series so
modified as to conform, in the opinion of the Trustee and the Issuer, to any
modification of this Indenture contained in any such supplemental indenture may
be prepared and executed by the Issuer, authenticated by the Trustee and
delivered in exchange for the Securities of such series then Outstanding.
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ARTICLE EIGHT
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
SECTION 8.1 Issuer May Consolidate, etc., on Certain Terms. Nothing
contained in this Indenture or in any of the Securities shall prevent any
consolidation or merger of the Issuer with or into any other Person or Persons
(whether or not affiliated with the Issuer), or successive consolidations or
mergers in which the Issuer or its successor or successors shall be a party or
parties, or shall prevent any sale, conveyance, transfer or lease of all or
substantially all the property of the Issuer, to any other Person (whether or
not affiliated with the Issuer) authorized to acquire and operate the same;
provided, however, the Issuer hereby covenants and agrees, that upon any such
consolidation, merger, sale, conveyance, transfer or lease, (i) the due and
punctual payment of the principal of and interest, if any, on all of the
Securities, according to their tenor, and the due and punctual performance and
observance of all of the covenants and conditions of this Indenture to be
performed by the Issuer, shall be expressly assumed, by supplemental indenture
satisfactory in form to the Trustee, executed and delivered to the Trustee by
the Person (if other than the Issuer) formed by such consolidation, or into
which the Issuer shall have been merged, or by the Person which shall have
acquired or leased such property and (ii) after giving effect to 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 occurred and be
continuing.
SECTION 8.2 Successor Person to Be Substituted. (a) In case of any
consolidation, merger, sale, conveyance, transfer or lease referred to in
Section 8.l and upon the assumption by the successor Person, by supplemental
indenture, executed and delivered to the Trustee and satisfactory in form to the
Trustee, of, the due and punctual payment of the principal of and interest, if
any, on all of the Securities and the due and punctual performance of all of the
covenants and conditions of this Indenture to be performed by the Issuer, such
successor Person shall succeed to and be substituted for the Issuer with the
same effect as if it had been named herein as the party of the first part. Such
changes in phraseology and form (but not in substance) may be made in the
Securities thereafter to be issued as may be appropriate.
(b) In the case of a successor Person to the Issuer, such successor
Person thereupon may cause to be signed, and may issue either in its own name or
in the name of the Issuer any or all of the Securities issuable hereunder which
theretofore shall not have been signed by the Issuer and delivered to the
Trustee; and, upon the order of such successor Person instead of the Issuer and
subject to all the terms, conditions and limitations in this Indenture
prescribed, the Trustee shall authenticate and shall deliver any Securities
which previously shall have been signed and delivered by the officers of the
Issuer to the Trustee for authentication, and any Securities which such
successor Person thereafter shall cause to be signed and delivered to the
Trustee for that purpose. All the Securities so issued shall in all respects
have the same legal rank and benefit under this Indenture as the Securities
theretofore or thereafter issued in accordance with the terms of this Indenture
as though all of such Securities had been issued at the date of the execution
hereof. In the event of any such sale, conveyance or transfer, but not any such
lease, the Issuer or any successor Person which shall theretofore have become
such in the manner described in this Article Eight shall be discharged from all
obligations and covenants under this Indenture and the Securities and may be
dissolved and liquidated.
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SECTION 8.3 Opinion of Counsel and Officers' Certificate to Be Given
to Trustee. The Trustee, subject to the requirements of the Trust Indenture Act
of 1939 and Section 5.1, may require delivery of an Opinion of Counsel and
Officers' Certificate as conclusive evidence that any such consolidation,
merger, sale, conveyance, transfer or lease complies with the provisions of this
Article Eight.
ARTICLE NINE
SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS
SECTION 9.1 Satisfaction and Discharge of Indenture. If at any time
(a) the Issuer shall have paid or caused to be paid the principal of and
interest on all the Securities of any particular series Outstanding hereunder
(other than Securities which have been mutilated, defaced, destroyed, lost or
stolen and which have been replaced or paid as provided in Section 2.11 or in
lieu of or in substitution for which other Securities shall have been
authenticated and delivered) as and when the same shall have become due and
payable, or (b) the Issuer shall have delivered to the Trustee for cancellation
all Securities of such series theretofore authenticated (other than any
Securities of such series which shall have been mutilated, defaced, destroyed,
lost or stolen and which shall have been replaced or paid as provided in Section
2.11 or in lieu of or in substitution for which other Securities shall have been
authenticated and delivered) and not theretofore canceled, or (c)(i) all the
Securities of such series not theretofore canceled or delivered to the Trustee
for cancellation shall have become due and payable, or are by their terms to
become due and payable within one year or are to be called for redemption within
one year under arrangements satisfactory to the Trustee for the giving of notice
of redemption, and (ii) the Issuer shall have irrevocably deposited or caused to
be deposited with the Trustee as trust funds the entire amount in cash (other
than moneys repaid by the Trustee or any paying agent to the Issuer in
accordance with Section 9.4) sufficient to pay at maturity or upon redemption
all Securities of such series not theretofore delivered to the Trustee for
cancellation (other than any Securities of such series which shall have been
mutilated, defaced, destroyed, lost or stolen which have been replaced or paid
as provided in Section 2.11 or in lieu of or in substitution for which other
Securities shall have been authenticated and delivered), including principal and
interest, if any, due or to become due to such date of maturity or the date
fixed for redemption, as the case may be, and if, in any such case, the Issuer
shall also pay or make arrangements satisfactory in the reasonable opinion of
the Trustee for the payment thereof all other sums payable hereunder by the
Issuer with respect to Securities of such series, then this Indenture shall
cease to be of further effect with respect to Securities of such series (except
as to (i) rights of registration of transfer and exchange, and the Issuer's
right of optional redemption, (ii) substitution of mutilated, defaced,
destroyed, lost or stolen Securities, (iii) rights of Securityholders to receive
payments of principal thereof and interest, if any, thereon, and remaining
rights of the Securityholders to receive mandatory sinking fund payments, if
any, (iv) the rights, obligations and immunities of the Trustee hereunder,
including its rights under Section 5.5 and (v) the rights of the Securityholders
of such series as beneficiaries hereof with respect to the property so deposited
with the Trustee payable to all or any of them), and the Trustee, on demand of
the Issuer accompanied by an Officers' Certificate and an Opinion of Counsel and
at the cost and expense of the Issuer, shall
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execute proper instruments acknowledging such satisfaction of and discharging
this Indenture with respect to such series.
SECTION 9.2 Application by Trustee of Funds Deposited for Payment of
Securities. Subject to Section 9.4, all moneys deposited with the Trustee
pursuant to Section 9.1 shall be held in trust and applied by it to the payment,
either directly or through any paying agent (including the Issuer acting as its
own paying agent), to the holders of the particular Securities of such series
for the payment or redemption of which such moneys have been deposited with the
Trustee, of all sums due and to become due thereon for principal and interest,
if any.
SECTION 9.3 Repayment of Moneys Held by Paying Agent. In connection
with the satisfaction and discharge of this Indenture with respect to Securities
of any series, all moneys then held by any paying agent, other than the Trustee,
under the provisions of this Indenture with respect to such series of Securities
shall, upon demand of the Issuer, be repaid to it or paid to the Trustee and
thereupon such paying agent shall be released from all further liability with
respect to such moneys.
SECTION 9.4 Return of Moneys Held by Trustee and Paying Agent
Unclaimed for Two Years. Any moneys deposited with or paid to the Trustee or any
paying agent for the payment of the principal of or interest, if any, on any
Security of any series and not applied but remaining unclaimed for two years
after the date upon which such principal, premium or interest, as the case may
be, shall have become due and payable, shall, upon the written request of the
Issuer and unless otherwise required by mandatory provisions of applicable
escheat or abandoned or unclaimed property law, be repaid to the Issuer by the
Trustee for such series or such paying agent, and the holder of such Security of
such series shall, unless otherwise required by mandatory provisions of
applicable escheat or abandoned or unclaimed property laws, thereafter look only
to the Issuer for any payment which such holder may be entitled to collect.
ARTICLE TEN
REDEMPTION OF SECURITIES AND SINKING FUNDS
SECTION 10.1 Applicability of Article. The provisions of this
Article shall be applicable to the Securities of any series which are redeemable
before their maturity and to any sinking fund for the retirement of Securities
of a series except as otherwise specified as contemplated by Section 2.5 for
Securities of such series.
SECTION 10.2 Notice of Redemption; Selection of Securities. In case
the Issuer shall desire to exercise any right to redeem all or any part of the
Securities of any series in accordance with their terms, the Issuer shall fix a
date for redemption and the Issuer, or at the request and at the expense of the
Issuer, the Trustee, shall mail a notice of such redemption, at least 30 days
and not more than 60 days prior to the date fixed for redemption, to the holders
of Securities of such series so to be redeemed in whole or in part at their last
addresses as they shall appear in the Register. Any notice which is mailed in
the manner herein provided shall be conclusively presumed to have been duly
given, whether or not the holder receives the notice.
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Failure to give notice by mail, or any defect in the notice, to the holder of
any Security of a series designated for redemption as a whole or in part shall
not affect the validity of the proceedings for the redemption of any other
Security of such series.
The notice of redemption to each such holder shall specify the date
fixed for redemption, the redemption price, the place or places of payment, that
payment will be made upon presentation and surrender of such Securities, that
any interest accrued to the date fixed for redemption will be paid as specified
in such notice and that on and after said date any interest thereon or on the
portions thereof to be redeemed will cease to accrue. If less than all of the
Outstanding Securities of a series are to be redeemed, the notice of redemption
shall specify the number or numbers or distinguishing symbol or symbols of the
Securities to be redeemed. In case any Security of a series is to be redeemed in
part, only the notice of redemption shall state the portion of the principal
amount thereof to be redeemed and shall state that on and after the date fixed
for redemption, upon surrender of such Security, a new Security or Securities of
such series in principal amount equal to the unredeemed portion thereof will be
issued.
Prior to the redemption date specified in the notice of redemption
given as provided in this Section, the Issuer will deposit with the Trustee or
with one or more paying agents (or, if the Issuer is acting as its own paying
agent, segregate and hold in trust as required by the Trust Indenture Act of
1939) an amount of money (in the currency or units of currency in which the
Securities so called for redemption are denominated or an appropriate equivalent
thereof) sufficient to redeem on the redemption date all the Securities of such
series or portions thereof so called for redemption at the appropriate
redemption price, together with accrued interest to the date fixed for
redemption. If less than all the Outstanding Securities of a series are to be
redeemed (or less than the full principal amount of each Security in such series
is to be redeemed), the Issuer will deliver to the Trustee at least 60 days
prior to the date fixed for redemption (or such shorter period if acceptable to
the Trustee) an Officers' Certificate stating the aggregate principal amount of
Securities to be redeemed and, if the Trustee is not acting as the repository of
the Register for such series, a current list of all Outstanding Securities of
such series.
If less than all the Outstanding Securities of a series are to be
redeemed, the Trustee shall select, in such manner as it shall deem appropriate
and fair, Securities of such series to be redeemed in whole or in part. Except
as otherwise specified for Securities of a particular series pursuant to Section
2.5, Securities may be redeemed in part in amounts equal to the minimum
authorized denomination for Securities of such series or any multiple thereof.
The Trustee shall promptly notify the Issuer in writing of the Securities of
such series selected for redemption and, in the case of any Securities of such
series 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 of any series
shall relate, in the case of any Security redeemed or to be redeemed only in
part, to the portion of the principal amount of such Security which has been or
is to be redeemed.
SECTION 10.3 Payment of Securities Called for Redemption. If notice
of redemption has been given as provided in Section 10.2 above, the Securities
or portions of
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Securities specified in such notice shall become due and payable on the date and
at the place or places stated in such notice at the applicable redemption price,
together with interest accrued to the date fixed for redemption, and on and
after said date (unless the Issuer shall default in the payment of such
Securities or portions thereof at the redemption price, together with interest
accrued to said date) interest on the Securities or portions of Securities so
called for redemption shall cease to accrue and, except as provided in Sections
5.4 and 9.4, such Securities shall cease from and after the date fixed for
redemption to be entitled to any benefit or security under this Indenture, and
the holders of such Securities shall have no right in respect of such Securities
except the right to receive the redemption price thereof and unpaid interest to
the date fixed for redemption. On presentation and surrender of such Securities
at a place of payment specified in said notice, said Securities or the specified
portions thereof shall be paid and redeemed by the Issuer at the applicable
redemption price, together with interest accrued thereon to the date fixed for
redemption; provided that if the date fixed for redemption is an interest
payment date, the interest due on that date shall be payable to the holders of
such Securities registered as such on the relevant record date according to
their terms.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal thereof so to be redeemed shall,
until paid or duly provided for, bear interest from the date fixed for
redemption at the Overdue Rate applicable to such series.
Upon presentation of any Security redeemed in part only, the Issuer
shall execute and the Trustee shall authenticate and deliver to or on the order
of the holder thereof, at the expense of the Issuer, a new Security or
Securities of such series, of authorized denominations, in principal amount
equal to the unredeemed portion of the Security so presented.
SECTION 10.4 Exclusion of Certain Securities from Eligibility for
Selection for Redemption. Securities shall be excluded from eligibility for
selection for redemption if they are identified by registration and certificate
number or other distinguishing symbol in a written statement signed by an
authorized officer of the Issuer and delivered to the Trustee at least 10 days
prior to the date on which Securities are to be selected for redemption as being
owned of record and beneficially by, and not pledged or hypothecated by, either
(a) the Issuer or (b) an entity specifically identified in such written
statement directly or indirectly controlling or controlled by or under direct or
indirect common control with the Issuer.
SECTION 10.5 Mandatory and Optional Sinking Funds. 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". The
date on which a sinking fund payment is to be made is herein referred to as the
"sinking fund payment date".
In lieu of making all or any part of any mandatory sinking fund
payment with respect to any series of Securities in cash, the Issuer may at its
option (a) deliver to the Trustee Securities of such series theretofore
purchased or otherwise acquired (except upon redemption pursuant to the
mandatory sinking fund) by the Issuer or receive credit for Securities of such
series (not previously so credited) theretofore purchased or otherwise acquired
(except as
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aforesaid) by the Issuer and delivered to the Trustee for cancellation pursuant
to Section 2.12, (b) receive credit for optional sinking fund payments (not
previously so credited) made pursuant to this Section, or (c) receive credit for
Securities of such series (not previously so credited) redeemed by the Issuer
through any optional redemption provision contained in the terms of such series.
Securities so delivered or credited shall be received or credited by the Trustee
at the sinking fund redemption price specified in such Securities, and the
amount of such mandatory sinking fund payment shall be reduced accordingly.
On or before the sixtieth day next preceding each sinking fund
payment date for any series of Securities, the Issuer will deliver to the
Trustee a certificate of the Issuer (which need not contain the statements
required by the Trust Indenture Act of 1939) signed by an officer of the Issuer
who is one of the officers authorized to sign an Officers' Certificate (a)
specifying the portion, if any, of the mandatory sinking fund payment to be
satisfied by payment of cash and the portion, if any, to be satisfied by credit
of Securities of such series, (b) stating that none of such Securities has
theretofore been so credited, (c) stating that no Event of Default with respect
to such series has occurred (which has not been waived or cured) and is
continuing, and (d) stating whether or not the Issuer intends to exercise its
right to make an optional sinking fund payment with respect to such series and,
if so, specifying the amount of such optional sinking fund payment which the
Issuer intends to pay on or before the next succeeding sinking fund payment
date. Any Securities of such series to be credited and required to be delivered
to the Trustee in order for the Issuer to be entitled to credit therefor as
aforesaid which have not theretofore been delivered to the Trustee shall be
delivered for cancellation pursuant to Section 2.12 to the Trustee with such
certificate. Such certificate shall be irrevocable and upon its receipt by the
Trustee the Issuer shall become obligated to make all the cash payments or
payments therein referred to, if any (which cash may be deposited with the
Trustee or with one or more paying agents, or, if the Issuer is acting as its
own paying agent, segregated and held in trust as required by the Trust
Indenture Act of 1939), on or before the next succeeding sinking fund payment
date. Failure of the Issuer, on or before any such sixtieth day, to deliver such
certificate and securities specified in this paragraph, if any, shall not
constitute a default but shall constitute, on and as of such date, the
irrevocable election of the Issuer (i) that the mandatory sinking fund payment
for such series due on the next succeeding sinking fund payment date shall be
paid entirely in cash without the option to deliver or credit Securities of such
series in respect thereof, and (ii) that the Issuer will make no optional
sinking fund payment with respect to such series as provided in this Section.
If the sinking fund payment or payments (mandatory or optional or
both) to be made in cash on the next succeeding sinking fund payment date plus
any unused balance of any preceding sinking fund payments made in cash shall
exceed U.S.$100,000 or, if payments on Securities of such series are to be made
in a currency other than Dollars or in units or composites of two more
currencies, the equivalent thereof in the relevant currency or unit or composite
currency (or such other amount as is specified for a particular series of
Securities pursuant to Section 2.5), or a lesser sum if the Issuer shall so
request, with respect to the Securities of any particular series, such cash
shall be applied by the Trustee (or by the Issuer if the Issuer is acting as its
own paying agent) on the sinking fund payment date on which such payment is made
(or, if such payment is made before a sinking fund payment date, on the next
sinking fund payment date following the date of such payment) to the redemption
of such Securities at the sinking fund redemption price specified in such
Securities for operation of the sinking fund together with
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accrued interest, if any, to the date fixed for redemption. If such amount shall
be U.S.$100,000 or if payments on Securities of such series are to be made in a
currency other than Dollars or in units or composites of two more currencies,
the equivalent thereof in the relevant currency or unit or composite currency
(or such other amount as is specified for the particular series pursuant to
Section 2.5), or less and the Issuer makes no such request then it shall be
carried over until a sum in excess of U.S.$100,000, or the equivalent thereof in
the relevant currency or unit or composite currency, is available.
The Trustee shall select, in the manner provided in Section 10.2,
for redemption on such sinking fund payment date Securities of such series to
absorb said cash, as nearly as may be, and shall (if requested in writing by the
Issuer) inform the Issuer of the serial numbers or other distinguishing symbols
of the Securities of such series (or portions thereof) so selected. If the
Trustee shall be required to select Securities of any series for the sinking
fund and is not acting as repository of the Register for such series, at least
60 days prior to the sinking fund payment date, the Issuer shall furnish to the
Trustee a current list of all Outstanding Securities of such series. Securities
of any series which are (a) owned by the Issuer or an entity known by the
Trustee to be directly or indirectly controlling or controlled by or under
direct or indirect common control with the Issuer, as shown by the Register, and
not known to the Trustee to have been pledged or hypothecated by the Issuer or
any such entity, or (b) identified in an Officers' Certificate at least 60 days
prior to the sinking fund payment date as being beneficially owned by, and not
pledged or hypothecated by, the Issuer or an entity directly or indirectly
controlling or controlled by or under direct or indirect common control with the
Issuer, shall be excluded from Securities of such series eligible for selection
for redemption. The Trustee, in the name and at the expense of the Issuer (or
the Issuer, if it shall so request the Trustee in writing) shall cause notice of
redemption of the Securities of such series to be given in substantially the
manner provided in Section 10.2, except that the notice of redemption shall also
state that the Securities are being redeemed by operation of the sinking fund
(and with the effect provided in Section 10.3) for the redemption of Securities
of such series in part at the option of the Issuer. The amount of any sinking
fund payments not so applied or allocated by the Trustee (or by the Issuer if
the Issuer is acting as its own paying agent) to the redemption of Securities of
such series shall be added to the next cash sinking fund payment received by the
Trustee (or if the Issuer is acting as its own paying agent, segregated and held
in trust as required by the Trust Indenture Act of 1939) for such series and,
together with such payment (or such amount so segregated), shall be applied in
accordance with the provisions of this Section 10.5. Any and all sinking fund
moneys held by the Trustee (or if the Issuer is acting as its own paying agent,
segregated and held in trust as required by the Trust Indenture Act of 1939) on
the stated maturity date of the Securities of any particular series (or earlier,
if such maturity is accelerated), which are not held for the payment or
redemption of particular Securities of such series shall be applied by the
Trustee (or by the Issuer if the Issuer is acting as its own paying agent),
together with other moneys, if necessary, sufficient for the purpose, to the
payment of the principal of, and interest on, the Securities of such series at
maturity.
On or before each sinking fund payment date, the Issuer shall pay to
the Trustee in cash (or if the Issuer is acting as its own paying agent will
segregate and hold in trust as required by the Trust Indenture Act of 1939) or
shall otherwise provide for the payment of all interest accrued to the date
fixed for redemption on Securities (or portions thereof) to be redeemed on such
sinking fund payment date.
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Neither the Issuer nor the Trustee shall redeem or cause to be
redeemed any Securities of a series with sinking fund moneys or mail any notice
of redemption of Securities for such series by operation of the sinking fund
during the continuance of a default in payment of interest, if any, on such
Securities or of any Event of Default (other than an Event of Default occurring
as a consequence of this paragraph, with respect to such Securities) except
that, where the mailing of notice of redemption of any Securities shall
theretofore have been made, the Trustee (or the Issuer if the Issuer is acting
as its own paying agent) shall redeem or cause to be redeemed such Securities,
provided that it shall have received from the Issuer (or the Issuer shall have
segregated) a sum sufficient for such redemption. Except as aforesaid, any
moneys in the sinking fund for such series at the time when any such default or
Event of Default shall occur, and any moneys thereafter paid into the sinking
fund, shall, during the continuance of such default or Event of Default, be
deemed to have been collected under Article Four and held for the payment of all
such Securities. Notwithstanding anything in the foregoing to the contrary, in
case such default or Event of Default shall have been waived as provided in
Section 4.9 or the default or Event of Default cured on or before the sixtieth
day preceding the sinking fund payment date in any year, such moneys shall
thereafter be applied on the next succeeding sinking fund payment date in
accordance with this Section 10.5 to the redemption of such Securities.
SECTION 10.6 Redemption for Tax Reasons. If, with respect to
Securities of any series it is specified pursuant to Section 2.5 that Section
3.7 shall be applicable to Securities of such series, at any time after the date
of issuance of Securities of such series pursuant to this Indenture, as a result
of any change in, or amendment to, the laws, including any regulations or
rulings promulgated thereunder, of the United States or any political
subdivision thereof or any authority therein or thereof having power to tax or
as a result of any change in the application or official interpretation of such
laws, including any proposals for change, amendment or application or
interpretation of such laws, where the amendment or change becomes effective on
or after the date on which the underwriting, subscription, distribution, or
similar agreement (an "Issuance Agreement") is executed for such series of
Securities and if no such Issuance Agreement is executed, the date on which such
series of Securities are first offered for sale, or which proposal is made after
such date, or as a result of any action taken by any taxing authority of the
United States which action is taken or becomes generally known after such date,
or any commencement of a proceeding in a court of competent jurisdiction in the
United States after such date, whether or not such action was taken or such
proceeding was brought with respect to us, the Issuer becomes, or will become,
obligated to pay any Additional Amounts with respect to Securities of such
series, then the Securities of such series will be redeemable as a whole (but
not in part), at the option of the Issuer, at any time upon not less than thirty
(30) nor more than sixty (60) days' notice given to the holders at their
principal amount together with accrued interest thereon (and any Additional
Amounts payable with respect thereto) to the date fixed for redemption (the "Tax
Redemption Date"). The Issuer will also pay to the holders of Securities of such
series on the Tax Redemption Date any Additional Amounts which would otherwise
be payable. In order to effect a redemption of Securities of any such series as
described in this Section 10.6, the Issuer shall deliver to the Trustee at least
forty-five (45) days prior to the Tax Redemption Date: (i) a written notice
stating that the Securities of such series are to be redeemed as a whole,
specifying the redemption date and other pertinent information and (ii) an
Opinion of Counsel to the effect that the Issuer has or will become obligated to
pay Additional Amounts as a result of any such change or amendment. No notice of
redemption may be given earlier than ninety (90) days prior to the earliest date
on which the Issuer would be obligated to pay such
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Additional Amounts were a payment in respect of the Securities of such series
then due. The notice shall additionally specify the Tax Redemption Date and all
other information necessary to the mailing by the Trustee of notices of such
redemption. The Trustee shall be entitled to rely conclusively upon the
information so furnished by the Issuer in such notice and shall be under no duty
to check the accuracy or completeness thereof. Such notice shall be irrevocable
and upon its delivery the Issuer shall be obligated to make the payment or
payments referred to therein to the Trustee.
ARTICLE ELEVEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 11.1 Applicability of Article; Issuer's Option to Effect
Defeasance or Covenant Defeasance. The Issuer may at its option, by or pursuant
to a Resolution, at any time, with respect to the Securities of any series elect
to have either Section 11.2 or Section 11.3 be applied to the Outstanding
Securities of such series upon compliance with the conditions set forth below in
this Article Eleven.
SECTION 11.2 Defeasance and Discharge. Upon the Issuer's exercise of
the above option applicable to this Section, the Issuer shall be deemed to have
been discharged from its obligations with respect to the Outstanding Securities
of such series on the date the conditions set forth below are satisfied
(hereinafter, "defeasance"). For this purpose, such defeasance means that the
Issuer shall be deemed to have paid and discharged the entire indebtedness
represented by the Outstanding Securities of such series and to have satisfied
all its other obligations under such Securities and this Indenture insofar as
such Securities are concerned (and the Trustee, at the expense of the Issuer,
shall execute proper instruments acknowledging the same), except for the
following which shall survive until otherwise terminated or discharged
hereunder: (a) the rights of holders of Outstanding Securities of such series to
receive, solely from the trust fund described in Section 11.4 and as more fully
set forth in such Section, payments in respect of the principal of and interest
on such Securities when such payments are due, (b) the Issuer's obligations with
respect to such Securities under Sections 2.10, 2.11, 2.13, 3.2 and 3.3, (c) the
rights, powers, trusts, duties, and immunities of the Trustee under Sections
2.11, 2.12, 2.13, 4.3, 5.5 and Article 9, and otherwise the duty of the Trustee
to authenticate Securities of such series issued on registration of transfer or
exchange and (d) this Article Eleven. Subject to compliance with this Article
Eleven, the Issuer may exercise its option under this Section 11.2
notwithstanding the prior exercise of its option under Section 11.3 with respect
to the Securities of such series.
SECTION 11.3 Covenant Defeasance. Upon the Issuer's exercise of the
above option applicable to this Section, the Issuer shall be released from its
obligations under Section 3.4 and Section 4.1(c) with respect to the Outstanding
Securities of such series on and after the date the conditions set forth below
are satisfied (hereinafter, "covenant defeasance"). For this purpose, such
covenant defeasance means that, with respect to the Outstanding Securities of
such series, the Issuer may omit to comply with and shall have no liability in
respect of any term, condition or limitation set forth in any such Section with
respect to it, whether directly or indirectly by reason of any reference
elsewhere herein to any such Section or by reason of any
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reference in any such Section to any other provision herein or in any other
document, but the remainder of this Indenture and such Securities shall be
unaffected thereby.
SECTION 11.4 Conditions to Defeasance or Covenant Defeasance. The
following shall be the conditions to application of either Section 11.2 or
Section 11.3 to the Outstanding Securities of such series:
(a) the Issuer shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements
of Section 5.7 who shall agree to comply with the provisions of this
Article Eleven applicable to it) as trust funds in trust for the purpose
of making the following payments, specifically pledged as security for,
and dedicated solely to, the benefit of the holders of such Securities,
(A) money in an amount, or (B) U.S. Government Obligations which through
the scheduled payment of principal and interest in respect thereof in
accordance with their terms will provide, not later than one day before
the due date of any payment, money in an amount, or (C) a combination
thereof, sufficient, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge, and which shall be
applied by the Trustee (or other qualifying trustee) to pay and discharge,
(i) the principal of and each installment of principal of and interest on
the Outstanding Securities of such series on the stated maturity of such
principal or installment of principal or interest, and (ii) any mandatory
sinking fund payments or analogous payments applicable to the Outstanding
Securities of such series on the day on which such payments are due and
payable in accordance with the terms of this Indenture and of such
Securities. For this purpose, "U.S. Government Obligations" means
securities that are (x) direct obligations of the United States of America
for the payment of which its full faith and credit is pledged or (y)
obligations of a Person controlled or supervised by and acting as an
agency or instrumentality of the United States of America the payment of
which is unconditionally guaranteed, as a full faith and credit obligation
by the United States of America, which, in either case, are not callable
or redeemable at the option of the issuer thereof, and shall also include
a depositary receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act of 1933, as amended) as custodian with respect to any
such U.S. Government Obligation or a specific payment of principal of or
interest on any such U.S. Government Obligation held by such custodian for
the account of the holder of such depositary receipt, provided that
(except as required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such depositary receipt
from any amount received by the custodian in respect of the U.S.
Government Obligation or the specific payment of principal of or interest
on the U.S. Government Obligation evidenced by such depositary receipt.
(b) No Event of Default or event which with notice or lapse of time
or both would become an Event of Default with respect to the Securities of
such series shall have occurred and be continuing on the date of such
deposit.
(c) Such defeasance or covenant defeasance shall not cause the
Trustee for the Securities of such series to have a conflicting interest
for purposes of the Trust Indenture Act of 1939 with respect to any
securities of the Issuer.
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(d) Such defeasance or covenant defeasance shall not result in a
breach or violation of, or constitute a default under, this Indenture or
any other agreement or instrument to which the Issuer is a party or by
which it is bound.
(e) Such defeasance or covenant defeasance shall not cause any
Securities of such series then listed on any registered national
securities exchange under the Securities Exchange Act of 1934, as amended,
to be delisted.
(f) In the case of an election under Section 11.2, the Issuer shall
have delivered to the Trustee an Opinion of Counsel stating that (x) the
Issuer has received from, or there has been published by, the Internal
Revenue Service a ruling, or (y) since the date of this Indenture there
has been a change in the applicable Federal income tax law, in either case
to the effect that, and based thereon such opinion shall confirm that, the
holders of the Outstanding Securities of such series will not recognize
income, gain or loss for Federal income tax purposes as a result of such
defeasance and will be subject to Federal income tax on the same amounts,
in the same manner and at the same times as would have been the case if
such defeasance had not occurred.
(g) In the case of an election under Section 11.3, the Issuer shall
have delivered to the Trustee an Opinion of Counsel to the effect that the
holders of the Outstanding Securities of such series will not recognize
income, gain or loss for Federal income tax purposes as a result of such
covenant defeasance and will be subject to Federal income tax on the same
amounts, in the same manner and at the same times as would have been the
case if such covenant defeasance had not occurred.
(h) The Issuer shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to either the defeasance under Section
11.2 or the covenant defeasance under Section 11.3 (as the case may be)
have been complied with, and shall have paid (or made arrangements
satisfactory to the Trustee for the payment thereof) of all amounts
payable to the Trustee hereunder which have accrued or will accrue until
the Securities have been paid in full.
SECTION 11.5 Deposited Money and U.S. Government Obligations to Be
Held in Trust; Other Miscellaneous Provisions. Subject to the provisions of
Section 9.4, all money and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee (or other qualifying trustee --
collectively, for purposes of this Section 11.5, the "Trustee") pursuant to
Section 11.4 in respect of the Outstanding Securities of such series shall be
held in trust and applied by the Trustee, in accordance with the provisions of
such Securities and this Indenture, to the payment, either directly or through
any paying agent (including the Issuer acting as its own paying agent) as the
Trustee may determine, to the holders of such Securities, of all sums due and to
become due thereon in respect of principal and interest, but such money need not
be segregated from other funds except to the extent required by law.
The Issuer shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section
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11.4 or the principal and interest received in respect thereof other than any
such tax, fee or other charge which by law is for the account of the holders of
the Outstanding Securities of such series.
Anything in this Article Eleven to the contrary notwithstanding, the
Trustee shall deliver or pay to the Issuer from time to time upon the Issuer's
request any money or U.S. Government Obligations held by it as provided in
Section 11.4 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect an equivalent defeasance or covenant
defeasance.
ARTICLE TWELVE
MISCELLANEOUS PROVISIONS
SECTION 12.1 Incorporators, Stockholders, Officers and Directors of
Issuer Exempt from Individual Liability. No recourse under or upon any
obligation, covenant or agreement contained in this Indenture, or in any
Security, or because of any indebtedness evidenced thereby, shall be had against
any incorporator, as such or against any past, present or future stockholder,
official or director, as such, of the Issuer or of any successor, either
directly or through the Issuer or any successor, under any rule of law, statute
or constitutional provision or by the enforcement of any assessment or by any
legal or equitable proceeding or otherwise, all such liability being expressly
waived and released by the acceptance of the Securities by the holders thereof
and as part of the consideration for the issue of the Securities.
SECTION 12.2 Provisions of Indenture for the Sole Benefit of Parties
and Securityholders. Nothing in this Indenture or in the Securities, expressed
or implied, shall give or be construed to give to any Person, firm or
corporation, other than the parties hereto and their successors and assigns and
the holders of the Securities, any legal or equitable right, remedy or claim
under this Indenture or under any covenant, condition or provision herein
contained, all such covenants and provisions being for the sole benefit of the
parties hereto and their successors and of the holders of the Securities.
SECTION 12.3 Successors and Assigns of Issuer Bound by Indenture.
All the covenants, stipulations, promises and agreements contained in this
Indenture by the Issuer shall bind its successors and assigns, whether so
expressed or not.
SECTION 12.4 Notices and Demands on Issuer, Trustee and
Securityholders. Any notice or demand which by any provision of this Indenture
is required or permitted to be given or served by the Trustee or by the holders
of Securities to or on the Issuer may be given or served by being deposited
postage prepaid, first-class mail, in a post office letter box (except as
otherwise specifically provided herein) addressed (until another address of the
Issuer is furnished by the Issuer to the Trustee) to Textron Financial
Corporation, 40 Westminster Street, P.O. Box 6687, Providence, Rhode Island
02940-6687, Attention: Treasurer and General Counsel. Any notice, direction,
request or demand by the Issuer or any Securityholder to or upon
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the Trustee shall be deemed to have been sufficiently given or made, for all
purposes, if given or made in writing at the Corporate Trust Office.
Where this Indenture provides for notice to Securityholders, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Securityholder
entitled thereto, at his last address as it appears in the Register. In any case
where notice to Securityholders is given by mail, neither the failure to mail
such notice, nor any defect in any notice so mailed, to any particular
Securityholder shall affect the sufficiency of such notice with respect to other
Securityholders. 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 Securityholders 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. Notwithstanding anything to the
contrary elsewhere in this Indenture as to the giving of notice, any other form
of written notice is sufficient, if received.
In case, by reason of the suspension of or irregularities in regular
mail service, it shall be impracticable to mail notice to the Issuer and
Securityholders when such notice is required to be given pursuant to any
provision of this Indenture, then notwithstanding anything to the contrary
elsewhere in this Indenture as to the giving of notice, any manner of giving
such notice as shall be satisfactory to the Trustee shall be deemed to be a
sufficient giving of such notice.
SECTION 12.5 Officers' Certificates and Opinions of Counsel;
Statements to Be Contained Therein. Upon any application or demand by the Issuer
to the Trustee to take any action under any of the provisions of this Indenture,
the Issuer 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 have been complied
with, except that in the case of any such application or demand as to which the
furnishing of such documents is specifically required by any provision of this
Indenture relating to such particular application or demand, no additional
certificate or opinion need be furnished.
Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or covenant
provided for in this Indenture shall include (a) a statement that the Person
making such certificate or opinion has read such covenant or condition, (b) 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, (c) a statement that, in the opinion of such Person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with, and (d) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been complied with.
Any certificate, statement or opinion of an officer of the Issuer
may be based, insofar as it relates to legal matters, upon a certificate or
opinion of or representations by counsel, unless such officer knows that the
certificate or opinion or representations with respect to the
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matters upon which his certificate, statement or opinion may be based as
aforesaid are erroneous. Any certificate, statement or Opinion of Counsel may be
based, insofar as it relates to factual matters or information in the possession
of the Issuer, upon the certificate, statement or opinion of or representations
by an officer or officers of the Issuer, unless such counsel knows that the
certificate, statement or opinion or representations with respect to the matters
upon which his or her certificate, statement or opinion may be based as
aforesaid are erroneous.
Any certificate, statement or opinion of an officer of the Issuer or
of counsel may be based, insofar as it relates to accounting matters, upon a
certificate or opinion of or representations by an accountant or firm of
accountants in the employ of the Issuer, unless such officer or counsel, as the
case may be, knows that the certificate or opinion or representations with
respect to the accounting matters upon which his or her certificate, statement
or opinion may be based as aforesaid are erroneous.
Any certificate or opinion of any independent firm of public
accountants filed with the Trustee shall contain a statement that such firm is
independent.
All such certificates, statements or opinions shall otherwise be in
form and substance reasonably satisfactory to the Trustee.
SECTION 12.6 Official Acts by Successor Entity. Any act or
proceeding by any provision of this Indenture authorized or required to be done
or performed by any board, committee or officer of the Issuer shall and may be
done and performed with like force and effect by the like board, committee or
officer of any entity that shall at the time be the lawful sole successor of the
Issuer.
SECTION 12.7 Payments Due on Saturdays, Sundays and Legal Holidays.
If the date of maturity of interest on or principal of the Securities of any
series or the date fixed for redemption or repayment of any such Security shall
not be a Business Day, then payment of such interest, if any, or principal need
not be made on such date, but may be made on the next succeeding Business Day
with the same force and effect as if made on the date of maturity or the date
fixed for redemption or repayment, and no interest shall accrue for the period
from and after such date.
SECTION 12.8 New York Law to Govern. This Indenture and each
Security shall be governed by and construed in accordance with the laws of the
State of New York, without regard to conflict of law principles.
SECTION 12.9 Counterparts. This Indenture may be executed in any
number of counterparts, each of which shall be an original; but such
counterparts shall together constitute but one and the same instrument.
SECTION 12.10 Effect of Headings. The Article and Section headings
herein and the Table of Contents are for convenience of reference only, are not
to be considered a part hereof and shall not affect the construction hereof.
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SECTION 12.11 Conflict with Trust Indenture Act. If any provision
hereof limits, qualifies or conflicts with a provision of the Trust Indenture
Act of 1939 that is required under such Act to be a part of and govern this
Indenture, the latter provisions shall control. If any provision of this
Indenture modifies or excludes any provision of the Trust Indenture Act of 1939
that may be so modified or excluded, the latter provision shall be deemed to
apply to this Indenture as so modified or excluded, as the case may be.
SECTION 12.12 Severability. 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.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, as of the date first written above.
TEXTRON FINANCIAL CORPORATION,
as Issuer
By:___________________________
Name:
Title:
SUNTRUST BANK, ATLANTA,
as Trustee
By:____________________________
Name:
Title:
(1)
