<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): OCTOBER 28, 1994
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SANTA FE PACIFIC CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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DELAWARE
(STATE OR OTHER JURISDICTION OF INCORPORATION)
1-8627 36-3258709
(COMMISSION FILE NUMBER) (I.R.S. EMPLOYER IDENTIFICATION NO.)
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1700 EAST GOLF ROAD, SCHAUMBURG, 60173-5860
ILLINOIS (ZIP CODE)
(ADDRESS OF PRINCIPAL EXECUTIVE
OFFICES)
(708) 995-6000
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
(NOT APPLICABLE)
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
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<PAGE>
INFORMATION TO BE INCLUDED IN THE REPORT
ITEM 5. OTHER EVENTS.
On June 29, 1994, the Board of Directors of the registrant declared a special
dividend to holders of its common stock as of September 12, 1994, consisting of
a distribution, on a pro rata basis, of its interests in its subsidiary, Santa
Fe Pacific Gold Corporation. The distribution became effective September 30,
1994.
On June 29, 1994, Santa Fe Pacific Corporation (herein referred to as "SFP"
or the "Company") and Burlington Northern Inc. ("BNI") entered into a
definitive Agreement and Plan of Merger (the "Merger Agreement") which calls
for SFP to merge with and into BNI, with BNI being the surviving corporation
(the "Merger"). On October 26, 1994, after Union Pacific Corporation ("UPC")
announced its competing bid (discussed below) for the acquisition of the
Company, the Company and BNI amended the Merger Agreement to increase the
exchange ratio in the Merger from 0.27 shares of BNI common stock for each
share of Company common stock to 0.34 shares of BNI common stock for each share
of Company common stock.
The Merger has been approved by the boards of directors of the Company and
BNI, but is still subject to a number of conditions, including approval by the
stockholders of both the Company and BNI and approval by the Interstate
Commerce Commission (the "ICC").
Under existing law, the ICC is required to enter a final order with respect
to the merger within 31 months after BNI's and the Company's application for
approval is filed. BNI and the Company have requested the ICC to decide the
case on an expedited basis and the parties expect that the ICC decision will be
made on a time frame significantly shorter than the 31-month period required by
law. On October 5, 1994, the ICC served an order establishing a schedule that
would result in a final ICC decision within 535 days from the filing of the
application. The parties filed the application on October 13, 1994.
Notwithstanding this schedule, there can be no assurance that the ICC will
issue a decision any sooner than the 31-month period permitted the ICC by law.
If approved and all conditions to the Merger are satisfied or waived,
consummation of the Merger may not occur for two or more years in the future.
On October 5, 1994, UPC provided the Company with an unsolicited non-binding
written proposal (the "UPC Proposal") to acquire SFP in a tax-free merger in
which SFP stockholders would receive, for each share of SFP common stock, .344
of a share of UPC common stock, having a value of $18 per SFP share based on
the closing price on October 4, 1994 of UPC common stock. On October 27, 1994,
.344 of a share of UPC common stock (based on the closing price on that date)
had a value of $16.73. The transaction contemplated in the UPC Proposal is
subject to ICC approval, the termination of the Merger Agreement, execution of
a definitive agreement and the approval of the Board of Directors and the
stockholders of both SFP and UPC. The UPC Proposal is also conditioned upon the
satisfactory completion of a due diligence review of SFP. The UPC Proposal
stated that UPC is prepared to grant conditions to Southern Pacific, BNI or
other railroads, including access to points that would otherwise change from
two serving railroads to one, rights to handle service-sensitive business
moving between California, Chicago and the Midwest, and access to the Kansas
and Oklahoma grain markets. The UPC Proposal further stated that UPC envisions
that certain members of the SFP Board would be invited to serve on UPC's Board.
The UPC Proposal further stated that UPC was prepared to immediately commence
negotiation of a definitive merger agreement containing mutually agreeable
terms and conditions. After discussions at board meetings and consultations
with its financial and legal advisors, the SFP Board unanimously decided to
reject the UPC Proposal and reaffirm its recommendation to SFP's stockholders
that they approve the Merger Agreement and the Merger. On October 13, 1994, UPC
announced that it intended to solicit proxies from the Company's stockholders
to vote against approval of the Merger.
Various lawsuits have been filed with respect to the Merger, including by UPC
and certain shareholders seeking to enjoin consummation of the Merger. The
Company believes that all of these lawsuits are meritless and intends to oppose
them vigorously.
<PAGE>
The following documents previously filed with the Commission by BNI pursuant
to the Exchange Act are incorporated herein by reference:
1. BNI's Annual Report on Form 10-K for the year ended December 31, 1993
(which incorporates by reference certain information from BNI's Proxy
Statement relating to the 1994 Annual Meeting of Stockholders and
includes Amendment No. 1 on Form 10-K/A dated October 5, 1994);
2. BNI's Quarterly Reports on Form 10-Q for the quarters ended March 31 and
June 30, 1994 (including Amendment No. 1 on Form 10-Q/A each dated
October 5, 1994, respectively); and
3. BNI's Current Reports on Form 8-K dated June 29, 1994 and October 6,
1994.
In connection with a Special Meeting of Stockholders of SFP to be held on
November 18, 1994, for stockholders to consider and vote upon a proposal to
approve and adopt the Merger Agreement, the Registrant has sent stockholders of
record as of October 19, 1994 a Joint Proxy Statement/Prospectus dated October
12, 1994 (the "Original Joint Proxy Statement/Prospectus") and a Supplemental
Joint Proxy Statement/Prospectus, dated October 27, 1994. The following
information is among that included in the Supplemental Joint Proxy
Statement/Prospectus.
UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
The following unaudited pro forma combined financial statements give effect
to the exchange of 0.34 shares of BNI common stock for each share of SFP common
stock pursuant to the Merger Agreement, with the Merger accounted for under the
pooling of interests method. The pro forma adjustments do not reflect any
potential synergies which may arise from the Merger or adjustments to conform
BNI and SFP accounting practices. See Note 3--Conforming accounting practices
and "Other Matters--Additional Financial Considerations."
The unaudited pro forma combined balance sheet as of June 30, 1994 combines
the historical consolidated balance sheets of BNI and SFP giving effect to the
Merger as if it had been consummated on that date. The unaudited pro forma
combined statements of operations for the six months ended June 30, 1994 and
1993, and for each of the three years in the period ended December 31, 1993,
combine the historical consolidated statements of operations of BNI and SFP
giving effect to the Merger as if it had been consummated on January 1, 1991.
The unaudited pro forma combined financial statements are prepared for
illustrative purposes only and are not necessarily indicative of the financial
position or results of operations that might have occurred had the Merger
actually taken place on the dates indicated, or of future results of operations
or financial position of the combined company. Consummation of the Merger is
conditioned upon, among other things, approval of both BNI and SFP stockholders
and the approval of the ICC. See "Other Matters--ICC Approval."
The unaudited pro forma combined financial statements are based on the
historical consolidated financial statements of BNI and SFP and should be read
in conjunction with such historical financial statements and the notes thereto,
including those of BNI which are incorporated by reference in this Current
Report on Form 8-K.
2
<PAGE>
UNAUDITED PRO FORMA COMBINED BALANCE SHEET
AS OF JUNE 30, 1994
(DOLLARS IN MILLIONS)
<TABLE>
<CAPTION>
HISTORICAL AMOUNTS
---------------------- BURLINGTON NORTHERN
BURLINGTON SANTA FE PRO FORMA SANTA FE
NORTHERN PACIFIC ADJUSTMENTS CORPORATION
INC. CORPORATION (NOTE 2) PRO FORMA
---------- ----------- ----------- -------------------
<S> <C> <C> <C> <C>
ASSETS
Current assets
Cash and cash
equivalents.......... $ 18 $ 15 $ -- $ 33
Accounts receivable,
net.................. 569 94 -- 663
Net assets of
discontinued
operations........... -- 504 (504)(A) --
Other current assets.. 449 292 -- 741
------ ------ ----- -------
Total current
assets............. 1,036 905 (504) 1,437
Property and equipment,
net.................... 6,074 4,542 -- 10,616
Other assets............ 284 270 -- 554
------ ------ ----- -------
Total assets........ $7,394 $5,717 $(504) $12,607
====== ====== ===== =======
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities
Accounts payable...... $ 509 $ 266 $ 48 (C) $ 823
Dividend payable--gold
distribution......... -- 504 (504)(A) --
Other current
liabilities.......... 791 431 (23)(C) 1,199
Current portion of
long-term debt and
commercial paper..... 240 173 -- 413
------ ------ ----- -------
Total current
liabilities........ 1,540 1,374 (479) 2,435
Long-term debt.......... 1,694 932 -- 2,626
Deferred income taxes... 1,388 1,148 5 (C) 2,541
Other liabilities....... 742 1,107 -- 1,849
------ ------ ----- -------
Total liabilities... 5,364 4,561 (474) 9,451
------ ------ ----- -------
Stockholders' equity
Convertible preferred
stock................ 337 -- -- 337
Common stock.......... 1 190 (189)(B) 2
Paid-in capital....... 1,442 858 91 (B),(C) 2,391
Retained earnings..... 293 212 (61)(C) 444
Treasury stock........ (5) (104) 104 (B) (5)
Other................. (38) -- 25 (C) (13)
------ ------ ----- -------
Total stockholders'
equity............... 2,030 1,156 (30) 3,156
------ ------ ----- -------
Total liabilities
and stockholders'
equity............. $7,394 $5,717 $(504) $12,607
====== ====== ===== =======
</TABLE>
(See accompanying notes to unaudited pro forma combined financial statements)
3
<PAGE>
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 1994
(DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
HISTORICAL AMOUNTS
---------------------- BURLINGTON NORTHERN
BURLINGTON SANTA FE SANTA FE
NORTHERN PACIFIC CORPORATION
INC. CORPORATION PRO FORMA
---------- ----------- -------------------
<S> <C> <C> <C>
Revenues...................... $2,402 $1,290 $3,692
Operating expenses
Compensation and benefits... 873 417 1,290
Fuel........................ 172 120 292
Materials................... 155 65 220
Equipment rents............. 217 122 339
Purchased services.......... 232 178 410
Depreciation................ 176 99 275
Other....................... 217 101 318
------ ------- -------
Total operating expenses.. 2,042 1,102 3,144
------ ------- -------
Operating income.............. 360 188 548
Interest expense.............. 78 60 138
Other income (expense), net... (6) 50 44
------ ------- -------
Income before income taxes.... 276 178 454
Income tax expense............ 107 75 182
------ ------- -------
Income from continuing
operations................... $ 169 $ 103 $ 272
====== ======= =======
Earnings per common share
Income from continuing
operations................. $ 1.75 $ .54 $ 1.69 Note 2 (D)
====== ======= =======
Number of shares used in
computation of earnings per
common share (in thousands).. 90,286 189,800 154,818 Note 2 (D)
</TABLE>
(See accompanying notes to unaudited pro forma combined financial statements)
4
<PAGE>
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 1993
(DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
HISTORICAL AMOUNTS
---------------------- BURLINGTON NORTHERN
BURLINGTON SANTA FE SANTA FE
NORTHERN PACIFIC CORPORATION
INC. CORPORATION PRO FORMA
---------- ----------- -------------------
<S> <C> <C> <C>
Revenues...................... $2,312 $1,192 $3,504
Operating expenses
Compensation and benefits... 857 405 1,262
Fuel........................ 177 119 296
Materials................... 154 64 218
Equipment rents............. 188 105 293
Purchased services.......... 222 154 376
Depreciation................ 172 93 265
Other....................... 226 99 325
------ ------- -------
Total operating expenses.. 1,996 1,039 3,035
------ ------- -------
Operating income.............. 316 153 469
Interest expense.............. 69 70 139
Gain on sale of California
lines........................ -- 145 145
Other income, net............. -- 2 2
------ ------- -------
Income before income taxes.... 247 230 477
Income tax expense............ 93 95 188
------ ------- -------
Income from continuing
operations................... $ 154 $ 135 $ 289
====== ======= =======
Earnings per common share
Income from continuing
operations................. $ 1.60 $ .72 $ 1.82 Note 2 (D)
====== ======= =======
Number of shares used in
computation of earnings per
common share (in thousands).. 89,439 186,300 152,781 Note 2 (D)
</TABLE>
(See accompanying notes to unaudited pro forma combined financial statements)
5
<PAGE>
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1993
(DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
HISTORICAL AMOUNTS
---------------------- BURLINGTON NORTHERN
BURLINGTON SANTA FE SANTA FE
NORTHERN PACIFIC CORPORATION
INC. CORPORATION PRO FORMA
---------- ----------- -------------------
<S> <C> <C> <C>
Revenues...................... $4,699 $ 2,409 $ 7,108
Operating expenses
Compensation and benefits... 1,709 800 2,509
Fuel........................ 362 239 601
Materials................... 300 128 428
Equipment rents............. 395 229 624
Purchased services.......... 457 322 779
Depreciation................ 352 188 540
Other....................... 463 185 648
------ ------- -------
Total operating expenses.. 4,038 2,091 6,129
------ ------- -------
Operating income.............. 661 318 979
Interest expense.............. 145 133 278
Gain on sale of California
lines........................ -- 145 145
Other income, net............. 5 24 29
------ ------- -------
Income before income taxes.... 521 354 875
Income tax expense............ 225 177 402
------ ------- -------
Income from continuing
operations................... $ 296 $ 177 $ 473
====== ======= =======
Earnings per common share
Income from continuing
operations................. $ 3.06 $ .95 $ 2.94 Note 2 (D)
====== ======= =======
Number of shares used in
computation of earnings per
common share (in thousands).. 89,672 187,200 153,320 Note 2 (D)
</TABLE>
(See accompanying notes to unaudited pro forma combined financial statements)
6
<PAGE>
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1992
(DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
HISTORICAL AMOUNTS
----------------------
BURLINGTON NORTHERN
BURLINGTON SANTA FE SANTA FE
NORTHERN PACIFIC CORPORATION
INC. CORPORATION PRO FORMA
---------- ----------- -------------------
<S> <C> <C> <C>
Revenues...................... $4,630 $ 2,252 $ 6,882
Operating expenses
Compensation and benefits... 1,709 799 2,508
Fuel........................ 348 206 554
Materials................... 295 128 423
Equipment rents............. 389 186 575
Purchased services.......... 449 277 726
Depreciation................ 338 181 519
Other....................... 505 178 683
Special charge.............. -- 320 320
------ ------- -------
Total operating expenses.. 4,033 2,275 6,308
------ ------- -------
Operating income (loss)....... 597 (23) 574
Interest expense.............. 186 165 351
Gain on sale of California
lines........................ -- 205 205
Other income, net............. 41 24 65
------ ------- -------
Income before income taxes.... 452 41 493
Income tax expense............ 153 20 173
------ ------- -------
Income from continuing
operations................... $ 299 $ 21 $ 320
====== ======= =======
Earnings per common share
Income from continuing
operations................. $ 3.35 $ .11 $ 2.09 Note 2 (D)
====== ======= =======
Number of shares used in
computation of earnings per
common share (in thousands).. 88,617 184,800 151,449 Note 2 (D)
</TABLE>
(See accompanying notes to unaudited pro forma combined financial statements)
7
<PAGE>
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1991
(DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
HISTORICAL AMOUNTS
----------------------
BURLINGTON NORTHERN
BURLINGTON SANTA FE SANTA FE
NORTHERN PACIFIC CORPORATION
INC. CORPORATION PRO FORMA
---------- ----------- -------------------
<S> <C> <C> <C>
Revenues...................................... $4,559 $ 2,154 $ 6,713
Operating expenses
Compensation and benefits................... 1,756 782 2,538
Fuel........................................ 368 207 575
Materials................................... 283 135 418
Equipment rents............................. 401 162 563
Purchased services.......................... 442 232 674
Depreciation................................ 347 184 531
Other....................................... 493 197 690
Special charge.............................. 708 -- 708
------ ------- -------
Total operating expenses.................. 4,798 1,899 6,697
------ ------- -------
Operating income (loss)....................... (239) 255 16
Interest expense.............................. 226 209 435
Other income (expense), net................... (25) 53 28
------ ------- -------
Income (loss) before income taxes............. (490) 99 (391)
Income tax expense (benefit).................. (184) 37 (147)
------ ------- -------
Income (loss) from continuing operations...... $ (306) $ 62 $ (244)
====== ======= =======
Earnings (loss) per common share
Income (loss) from continuing operations.... $(3.96) $ .35 $ (1.77) Note 2 (D)
====== ======= =======
Number of shares used in computation of
earnings
(loss) per common share (in thousands)....... 77,462 178,000 137,982 Note 2 (D)
</TABLE>
(See accompanying notes to unaudited pro forma combined financial statements)
8
<PAGE>
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
NOTE 1. BASIS OF PRESENTATION
Pursuant to the Merger Agreement, each share of SFP common stock outstanding
at the Effective Time will be converted into 0.34 shares of BNI common stock.
The Merger will be accounted for under the pooling of interests method.
Accordingly, recorded assets and liabilities are carried forward to the
combined company at their historical values.
The accompanying unaudited pro forma combined financial statements are
presented for illustrative purposes only and do not give effect to any
potential increases in operating income which may arise from the Merger. See
"Other Matters--Additional Financial Considerations". Additionally, the
unaudited pro forma combined financial statements exclude the nonrecurring
costs and expenses associated with integrating the operations of the
businesses. Such nonrecurring costs are expected to relate to the elimination
of duplicate facilities, computer systems and other assets, as well as employee
related payments. Additionally, no provision has been made for any make-whole
premium payable in connection with certain of SFP's debt securities upon
consummation of the Merger. See "Other Matters--Prepayment Offer for Certain
Debt Obligations of SFP."
For consistency of presentation, certain amounts in the historical financial
statements have been reclassified in the unaudited pro forma combined financial
statements.
NOTE 2. PRO FORMA ADJUSTMENTS
(A) Discontinued operations
Net assets of discontinued operations and dividend payable--gold distribution
have been eliminated to reflect SFP's distribution of the common stock of Santa
Fe Pacific Gold Corporation held by SFP to SFP stockholders, effective
September 30, 1994.
(B) Stockholders' equity
Common stock has been reduced by $189 million, paid-in capital has been
increased by $85 million and treasury stock has been decreased by $104 million
to reflect the combination of BNI and SFP through the exchange of approximately
65 million shares of BNI common stock for all outstanding shares of SFP common
stock at an exchange ratio of 0.34 shares of BNI common stock for each share of
SFP common stock.
(C) Costs of the Merger and accelerated vesting of restricted stock
Accounts payable have been increased by $48 million for the cost of the
Merger as if they have been accrued. Additionally, paid-in capital and other
equity have been increased by $6 million and $25 million, respectively, as if
compensation expense totaling $31 million had been recorded for the lapse of
restrictions on restricted stock of BNI and SFP. Deferred income taxes and
current tax liabilities have been adjusted by $18 million for the tax effects
of these entries. The result is a net reduction in retained earnings of $61
million.
Compensation expense related to restricted stock, as well as certain other
costs of the Merger, will be charged to operations upon stockholder approval of
the Merger. Other costs of the Merger will be recorded periodically as charges
to operations between stockholder approval and the consummation of the Merger.
(D) Earnings (loss) per common share
Pro forma weighted average shares outstanding represent the conversion at an
exchange ratio of 0.34 of SFP common shares to BNI common shares. Earnings
(loss) per common share are determined by dividing income (loss) from
continuing operations, after deduction of preferred stock dividends, by the
weighted average number of common shares outstanding and common share
equivalents.
NOTE 3. CONFORMING ACCOUNTING PRACTICES
No adjustments to conform the accounting practices of BNI and SFP have been
made in these unaudited pro forma combined financial statements for
capitalization of assets, depreciation and other areas. The effects of these
changes are not presently determinable but will be recorded after the
consummation date.
9
<PAGE>
OTHER MATTERS
ICC APPROVAL
The approval of the ICC on several issues must be obtained to consummate the
Merger. Under the Interstate Commerce Act, the ICC is required to approve the
Merger if it finds that the Merger is consistent with the public interest. In
making that determination, the ICC must consider at least the following
factors:
(A) the effect of the proposed transaction on the adequacy of
transportation to the public;
(B) the effect on the public interest of including, or failing to
include, other rail carriers in the area involved in the proposed
transaction;
(C) the total fixed charges that result from the proposed transaction;
(D) the interest of carrier employees affected by the proposed
transaction; and
(E) whether the proposed transaction would have an adverse effect on
competition among rail carriers in the affected region.
The ICC is required to enter a final order with respect to the Merger within
31 months after the application for such approval is filed by BNI and SFP.
However, BNI and SFP have requested the ICC to decide the case on an expedited
basis and the parties expect that the final ICC decision will be made on a time
frame significantly shorter than the 31-month period required by law. On
October 5, 1994, the ICC served an order establishing a schedule that would
result in a final ICC decision with 535 days from the filing of the
application. The parties filed the application on October 13, 1994.
Notwithstanding this schedule, there can be no assurance that the ICC will
issue a decision any sooner than the 31-month period permitted the ICC by law.
Interested parties, including other railroads, shippers, state and federal
agencies, and BNI or SFP stockholders may seek to participate in the ICC
proceeding on the Merger, consistent with applicable ICC rules, regulations,
decisions and orders, and may participate to support, oppose, or seek to have
conditions imposed on the transaction or, in the case of other railroads, to be
included in the Merger. Under applicable statutory provisions, interested
parties have 45 days from the date on which the ICC publishes its notice of
acceptance of the application in the Federal Register to submit their comments
in order to participate in the ICC proceeding. An ICC approval order exempts
the parties from Federal, state and local law, including laws governing
contract rights, as necessary to permit them to carry out the transaction.
An ICC approval order may be appealed by certain persons and the
effectiveness of the order could be stayed by the ICC or by an appellate court
while such an appeal is pending. Any appeals from the ICC order might not be
resolved for a substantial period of time after the entry of the order by the
ICC. ICC approval is not automatically stayed if a party seeks judicial review
of the decision; however, it is possible that the approval could be stayed by
the ICC or a reviewing court. If the approval is stayed, consummation of the
Merger would be delayed. Consummation of the Merger, which will occur after
stockholder approval, receipt of required regulatory approvals and satisfaction
or waiver of all of the other conditions set forth in the Merger Agreement, may
not occur for two or more years in the future.
Either BNI or SFP may terminate the Agreement if the ICC disapproves the
Merger, changes the Exchange Ratio, requires the inclusion of other rail
carriers or properties, or imposes other terms and conditions, including but
not limited to, employee protective conditions other than those which are now
currently standard, that, in the reasonable opinion of either BNI or SFP,
significantly and adversely affect the economic benefits of the Merger.
OTHER REGULATORY APPROVALS
The consummation of the Merger, as it relates to SFP's pipeline operations,
is also subject to the expiration or termination of any applicable waiting
period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended.
10
<PAGE>
Certain aspects of the Merger will require notification to, and filings with,
various securities and other authorities in certain states, including
jurisdictions where SFP and BNI currently operate.
ADDITIONAL FINANCIAL CONSIDERATIONS
BNI and SFP filed an application for approval of the Merger with the ICC on
October 13, 1994. See "Other Matters--ICC Approval." As part of that
application, BNI and SFP indicate to the ICC that, in their views, the Merger
will yield a significant increase in operating income. This anticipated
increase in operating income from the Merger is expected to result from both
operating efficiencies and increased revenues. The ICC application also states
that significant savings will be achieved in the general and administrative,
overhead and support functions of the merged company by eliminating duplicative
activities and improving productivity through rationalization and
specialization of functions. The ICC application also states that a number of
opportunities for significant reduction in operating costs exist. These
operating efficiencies are expected to be achieved through operations and
transportation savings, reduced costs and delays at interchange, maintenance of
way and equipment savings, and shorter routing of cars. The ICC application
also states that freight revenues will increase as a result of the Merger.
Studies in support of the ICC application demonstrate significant opportunities
for increased traffic that the new system expects to attract from shippers
currently using other railroads and from trucks. The ICC application also
projects increased traffic as a result of extending the hauls of shippers
currently using either The Atchison, Topeka and Santa Fe Railway Company or
Burlington Northern Railroad Company. In order to achieve these increases in
operating revenue, it is expected that certain nonrecurring cash costs would be
incurred, which would include relocation, employee separation and retraining
and capital improvement costs.
The ICC application is available for public inspection at the ICC Records
Control Branch, Room 1221, 12th Street and Constitution Avenue, N.W. Washington
D.C. 20423.
PREPAYMENT OFFER FOR CERTAIN DEBT OBLIGATIONS OF SFP
The consummation of the Merger will be a "change in control event" within the
meaning of the indenture relating to SFP's $200 million aggregate principal
amount of 12.65% Senior Notes due October 1, 2000 (the "Notes"). Upon the
occurrence of a change in control event, SFP must offer to prepay all the
outstanding Notes in full, together with accrued interest and a make-whole
premium based on market interest rates at the time of the Merger and the then-
remaining weighted average life of the Notes. Each holder of Notes (each a
"Noteholder") has the right to accept or reject SFP's offer, without regard to
whether any other Noteholder accepts or rejects the offer.
It is not possible at this time to calculate the amount of the make-whole
premium or to determine whether any of the Noteholders will accept SFP's offer
to prepay the Notes. However, based upon the assumptions that the Merger occurs
March 31, 1996 (based on the 535 day schedule established by the ICC), all
Noteholders accept the prepayment offer and interest rates do not change until
the Merger, the amount of the make-whole premium would be approximately $26
million.
CERTAIN PENDING LITIGATION
Four purported stockholder class action suits have been filed arising out of
SFP's proposed participation in the Merger with BNI. On June 30, 1994, shortly
after announcement of the proposed merger, two purported stockholder class
action suits were filed in the Court of Chancery of the State of Delaware
(Miller v. Santa Fe Pacific Corporation, C.A. No. 13587; Cosentino v. Santa Fe
Pacific Corporation, C.A. No. 13588). On July 1, 1994, two additional purported
stockholder class action suits were filed in the Court of Chancery of the State
of Delaware (Fielding v. Santa Fe Pacific Corporation, C.A. No. 13591;
Wadsworth v. Santa Fe Pacific Corporation, C.A. No. 13597).
The actions name as defendants SFP, the individual members of the SFP Board
of Directors and BNI. In general, the actions variously allege that SFP's
directors breached their fiduciary duties to the stockholders
11
<PAGE>
by agreeing to the proposed merger for allegedly "grossly inadequate"
consideration in light of recent operating results of SFP, recent trading
prices of SFP's common stock and other alleged factors, by allegedly failing to
take all necessary steps to ensure that stockholders will receive the maximum
value realizable for their shares (including allegedly failing to actively
pursue the acquisition of SFP by other companies or conducting an adequate
"market check") and by allegedly failing to disclose to stockholders the full
extent of the future earnings potential of SFP, as well as the current value of
its assets. The Miller and Fielding cases further allege that the proposed
merger is unfairly timed and structured and, if consummated, would allegedly
unfairly deprive the stockholders of standing to pursue certain pending
stockholder derivative litigation. Plaintiffs also have alleged that BNI is
responsible for aiding and abetting the alleged breach of fiduciary duty
committed by the SFP Board. The actions seek certification of a class action on
behalf of SFP's stockholders. In addition, the actions seek injunctive relief
against consummation of the Merger and, in the event that the Merger is
consummated, the rescission of the Merger, an award of compensatory or
rescissory damages and other damages, including court costs and attorneys'
fees, an accounting by defendants of all profits realized by them as a result
of the Merger and various other forms of relief.
On October 6, 1994, shortly after UPC issued a press release in which it
announced the UPC Proposal, plaintiffs in the four lawsuits described above
filed in the Court of Chancery of the State of Delaware a Consolidated Amended
Complaint. (Miller v. Santa Fe Pacific Corporation, C.A. No. 13587). In their
Consolidated Amended Complaint, plaintiffs repeat the allegations contained in
their earlier lawsuits and further allege that, in light of the UPC Proposal,
SFP's directors have breached their fiduciary duties by failing to fully inform
themselves about and to adequately explore available alternatives to the
Merger, including the alternative of a merger transaction with UPC, and by
failing to fully inform themselves about the value of SFP. The Consolidated
Amended Complaint seeks the same relief sought in plaintiffs' earlier lawsuits
and, in addition, requests that SFP's directors be ordered to explore
alternative transactions and to negotiate in good faith with all interested
persons, including UPC.
Also on October 6, 1994, UPC filed in the Court of Chancery of the State of
Delaware a lawsuit against SFP, SFP's directors and BNI (Union Pacific
Corporation v. Santa Fe Pacific Corporation, C.A. No. 13778). In its Complaint,
UPC alleges that SFP's management purportedly rejected the UPC Proposal "out-
of-hand" without regard to the facts of the UPC Proposal, and that SFP's
directors have breached their fiduciary duties by purportedly refusing to
negotiate with UPC regarding the UPC Proposal, by refusing to terminate the
Merger Agreement and by failing to include in the Merger Agreement a provision
allowing SFP to terminate the Merger Agreement in order to enter into an
agreement with UPC. UPC seeks injunctive relief mandating SFP to negotiate with
UPC regarding the UPC Proposal, a declaration that UPC has not tortiously
interfered with defendants' contractual or other legal rights, an injunction
against defendants from bringing or maintaining any action against UPC alleging
that UPC has tortiously interfered with defendants' contractual or other legal
rights, a declaration that the Merger Agreement permits SFP to terminate the
Merger Agreement in order to accept the UPC Proposal or, in the alternative,
that the Merger Agreement is invalid and unenforceable for failing to include
such a provision, and an award of UPC's costs in bringing its lawsuit,
including reasonable attorneys' fees.
Also, on October 6, 1994, five additional purported stockholder class action
suits relating to SFP's proposed participation in the Merger were filed in the
Court of Chancery of the State of Delaware (Weiss v. Santa Fe Pacific
Corporation, C.A. No. 13779; Lifshitz v. Krebs, C.A. No 13780; Stein v. Santa
Fe Pacific Corporation, C.A. No. 13782; Lewis v. Santa Fe Pacific Corporation,
C.A. No. 13783; Abramson v. Lindig, C.A. No. 13784). On October 7, 1994, three
more purported stockholder class action suits relating to SFP's proposed
participation in the Merger were filed in the Court of Chancery of the State of
Delaware (Graulich v. Santa Fe Pacific Corporation, C.A. No. 13786; Anderson v.
Santa Fe Pacific Corporation, C.A. No. 13787; Green v. Santa Fe Pacific
Corporation, C.A. No. 13788). All of these lawsuits name as defendants SFP and
the individual members of the SFP Board of Directors; the Lifshitz case further
names BNI as a defendant. In general, these actions variously allege that, in
light of SFP's recent operating results and the UPC Proposal, SFP's directors
have breached their fiduciary duties to stockholders by purportedly not taking
the necessary
12
<PAGE>
steps to ensure that SFP's stockholders will receive "maximum value" for their
shares of SFP stock, including purportedly refusing to negotiate with UPC or to
"seriously consider" the UPC Proposal and failing to announce any active
auction or open bidding procedures. The actions generally seek relief that is
materially identical to the relief sought in the Miller case, and in addition
seek entry of an order requiring SFP's directors to immediately undertake an
evaluation of SFP's worth as a merger/acquisition candidate and to establish a
process designed to obtain the highest possible price for SFP, including taking
steps to "effectively expose" SFP to the marketplace in an effort to create an
"active auction" in SFP. The Weiss case further seeks entry of an order
enjoining SFP's directors from implementing any poison pill or other device
designed to thwart the UPC Proposal or any other person's proposal to acquire
SFP.
The Anderson lawsuit was subsequently withdrawn. On October 14, 1994, the
Chancery Court entered an order consolidating the remaining eleven purported
stockholder class action suits under the heading In Re Santa Fe Pacific
Corporation Shareholder Litigation, C.A. No. 13587.
Also, on October 14, 1994, plaintiffs in the consolidated case filed a
Consolidated and Amended Complaint, which supersedes the previously filed
stockholder complaints. The Consolidated and Amended Complaint generally
repeats the allegations of, and requests the same relief as, the plaintiffs'
earlier complaints and, in addition, alleges that SFP's directors have breached
their fiduciary duties by approving and recommending to SFP stockholders the
Merger, by failing to fully inform themselves about, or to provide information
to, possible alternative merger candidates such as UPC, and by issuing the
Original Joint Proxy Statement/Prospectus, which purportedly fails to disclose
all material information relevant to SFP stockholders' consideration of the
proposed Merger, including failure to disclose that SFP's directors purportedly
have an implied right to terminate the Merger Agreement as a result of the
allegedly superior UPC Proposal, failure to disclose the facts considered by
SFP's directors in allegedly determining that the UPC Proposal does not
represent a fair price, failure to disclose sufficient facts relating to, and
the relative risks of obtaining, ICC approval of a Merger and a UPC-SFP merger
to enable SFP stockholders to weigh and compare the likelihood of obtaining ICC
approval of those transactions, failure to disclose the substance of
negotiations in late June 1994 between BNI and SFP leading to the Merger
Agreement, failure to disclose advice provided to SFP's directors regarding the
background of negotiations between BNI and SFP that had occurred since 1993 and
the significance of that advice to the directors' approval of the Merger
Agreement, failure to disclose facts regarding the SFP directors' consideration
of a possible combination transaction with Kansas City Southern Industries,
Inc. ("KCSI"), including the anticipated terms and potential value and benefits
to SFP of such a transaction and the reasons why SFP concluded that the BNI
transaction was superior and withdrew its bid submitted to KCSI in late June
1994, and failure to disclose that SFP did not provide any confidential
information to UPC in response to an October 11, 1994 letter from Drew Lewis,
UPC's Chairman and CEO, to Mr. Krebs. The Consolidated and Amended Complaint
seeks, in addition to the relief requested in the prior stockholder complaints,
an order requiring SFP to provide access to information concerning SFP or the
Merger to any bona fide bidder, including UPC.
On October 18, 1994, the Chancery Court entered an order denying two motions,
one filed by UPC and one filed by the stockholder plaintiffs seeking the
establishment of an expedited schedule that would have included a preliminary
injunction hearing prior to the scheduled November 18, 1994 meeting of SFP
stockholders. The Chancery Court concluded that an expedited schedule was
unnecessary because, if plaintiffs prevailed on their claims, it could
subsequently enter appropriate relief after SFP stockholder approval but before
consummation of the Merger.
On October 19, 1994, UPC filed an Amended and Supplemental Complaint. In
addition to repeating the allegations and requested relief of UPC's earlier
Complaint, the Amended and Supplemental Complaint adds James A. Shattuck as an
additional plaintiff, alleges that SFP has made purportedly false and
misleading statements in the Original Joint Proxy Statement/Prospectus and
elsewhere regarding the UPC Proposal and the Merger, including statements
denying that SFP's directors have the purported right to terminate the Merger
Agreement in order to enter into a merger agreement with UPC based upon the UPC
Proposal and
13
<PAGE>
denying that the Merger Agreement is allegedly void for failing to include such
a right, statements failing to disclose the purportedly preclusive effect of
the Merger Agreement on the SFP directors' consideration of other combination
proposals, including the UPC Proposal, statements allegedly suggesting that the
UPC Proposal does not represent a fair price, and statements allegedly
misrepresenting UPC's objectives in proposing a UPC-SFP merger and the
likelihood of obtaining ICC approval of such a merger. The Amended and
Supplemental Complaint seeks, in addition to the relief requested in UPC's
original Complaint, further declaratory and injunctive relief consisting of a
declaration that the Original Joint Proxy Statement/Prospectus is false and
misleading, an injunction preventing SFP from making any further allegedly
materially false and misleading statements regarding the UPC Proposal or the
Merger and an injunction against the November 18, 1994 SFP stockholder meeting.
The Company believes that all of these lawsuits are meritless and intends to
oppose them vigorously.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits:
See Exhibit Index included herewith.
14
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THE
REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED HEREUNTO DULY AUTHORIZED.
Santa Fe Pacific Corporation
(Registrant)
By: /s/ Thomas N. Hund
__________________________________
Thomas N. Hund
Vice President and Controller
Date: October 28, 1994
15
<PAGE>
EXHIBIT INDEX
<TABLE>
<C> <S>
1 Form of Underwriting Agreement (Registration Statement No. 33-
51435).
10.1 Restated Indenture, dated as of November 1, 1994, between the
Company and The First National Bank of Chicago.
10.2 Amendment to Agreement and Plan of Merger, dated October 26, 1994
between the Company and BNI.
12 Statement regarding computation of ratio of earnings to fixed
charges (for the six months ended June 30, 1993, and for the years
ended December 31, 1993-1989).
23 Consent of Coopers & Lybrand L.L.P. to the incorporation by
reference of their report regarding the consolidated financial
statements of BNI as of December 31, 1993 and 1992 and for each of
the three years in the period ended December 31, 1993 in this Report
on Form 8-K and in the Company's Registration Statement (No. 33-
51435).
</TABLE>
<PAGE>
EXHIBIT 1
SANTA FE PACIFIC CORPORATION
DEBT SECURITIES
---------------
UNDERWRITING AGREEMENT
----------------------
October __, 1994
J.P. Morgan Securities Inc.
Goldman, Sachs & Co.
Salomon Brothers Inc
c/o J.P. Morgan Securities Inc.
60 Wall Street
New York, New York 10260
Dear Sirs:
From time to time Santa Fe Pacific Corporation, a Delaware corporation
(the "Company"), proposes to enter into one or more Pricing Agreements in the
form of Annex I hereto, with such additions and deletions as the parties thereto
may determine, and, subject to the terms and conditions stated herein and
therein, to issue and sell to the firms named in Schedule I to the applicable
Pricing Agreement (such firms constituting the "Underwriters" with respect to
such Pricing Agreement and the securities specified therein) certain of its debt
securities (the "Securities") specified in Schedule II to such Pricing Agreement
(with respect to such Pricing Agreement, the "Designated Securities").
The terms and rights of any particular issuance of Designated
Securities shall be as specified in the Pricing Agreement relating thereto and
in or pursuant to the indenture (the "Indenture") identified in such Pricing
Agreement.
1. Particular sales of Designated Securities may be made from time to
time to the Underwriters of such Securities, for whom the firms designated as
representatives of the Underwriters of such Securities in the Pricing Agreement
relating thereto will act as representatives (the "Representatives"). The term
"Representatives" also refers to a single firm acting as sole representative of
the Underwriters and to Underwriters who act without any firm being designated
as their representative. This Underwriting Agreement shall not be construed as
an obligation of the Company to sell any of the Securities or as an obligation
of any of the Underwriters to purchase the Securities. The obligation of the
Company to issue and sell any of the Securities and the obligation of any of the
Underwriters to purchase any of the Securities shall be evidenced by the Pricing
Agreement with respect to the Designated Securities specified therein. Each
Pricing Agreement shall specify the aggregate principal amount of such
Designated Securities, the initial public offering price of such Designated
Securities, the purchase price to the Underwriters of such Designated
Securities, the names of the Underwriters of such Designated Securities, the
names of the Representatives of such Underwriters and the principal amount of
such Designated Securities to be purchased by each Underwriter and shall set
forth the date, time and manner of delivery of such Designated Securities and
payment therefor. The Pricing Agreement shall also specify (to the extent not
set forth in the Indenture and the registration statement and prospectus with
respect thereto) the terms of such Designated Securities. A Pricing Agreement
shall be in the form of an
<PAGE>
executed writing (which may be in counterparts), and may be evidenced by an
exchange of telegraphic communications or any other rapid transmission device
designed to produce a written record of communications transmitted. The
obligations of the Underwriters under this Agreement and each Pricing Agreement
shall be several and not joint.
2. The Company represents and warrants to, and agrees with, each of
the Underwriters that:
(a) A registration statement in respect of the Securities has been
filed with the Securities and Exchange Commission (the "Commission"); such
registration statement and any post-effective amendment thereto, each in
the form heretofore delivered or to be delivered to the Representatives
and, excluding exhibits to such registration statement, but including all
documents incorporated by reference in the prospectus contained therein, to
the Representatives for each of the other Underwriters, have been declared
effective by the Commission in such form; no other document with respect to
such registration statement or document incorporated by reference therein
has heretofore been filed or transmitted for filing with the Commission;
and no stop order suspending the effectiveness of such registration
statement has been issued and no proceeding for that purpose has been
initiated or threatened by the Commission (any preliminary prospectus
included in such registration statement or filed with the Commission
pursuant to Rule 424(a) of the rules and regulations of the Commission
under the Securities Act of 1933, as amended (the "Act"), being hereinafter
called a "Preliminary Prospectus"; the various parts of such registration
statement, including all exhibits thereto and the documents incorporated by
reference in the prospectus contained in the registration statement at the
time such part of the registration statement became effective but excluding
Form T-1, each as amended at the time such part of the registration
statement becomes effective, being hereinafter called the "Registration
Statement"; the prospectus relating to the Securities, in the form in which
it has most recently been filed, or transmitted for filing, with the
Commission on or prior to the date of this Agreement, being hereinafter
called the "Prospectus"; any reference herein to any Preliminary Prospectus
or the Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to the applicable form under the
Act, as of the date of such Preliminary Prospectus or Prospectus, as the
case may be; any reference to any amendment or supplement to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include any documents filed after the date of such Preliminary Prospectus
or Prospectus, as the case may be, under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and incorporated by reference in
such Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment to the Registration Statement shall be deemed to
refer to and include any annual report of the Company filed pursuant to
Section 13(a) or 15(d) of the Exchange Act after the effective date of the
Registration Statement that is incorporated by reference in the
Registration Statement; and any reference to the Prospectus as amended or
supplemented shall be deemed to refer to the Prospectus as amended or
supplemented in relation to the applicable Designated Securities in the
form in which it is filed with the Commission pursuant to Rule 424(b) under
the Act in accordance with Section 5(a) hereof, including any documents
incorporated by reference therein as of the date of such filing);
(b) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary
Prospectus, at the time of filing thereof, conformed in all material
respects to the requirements of the Act and the rules and regulations of
the Commission thereunder, and did not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
2
<PAGE>
information furnished in writing to the Company by an Underwriter expressly
for use therein;
(c) The documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case may
be, conformed in all material respects to the requirements of the Act or
the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder, and none of such documents 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; and any further documents so filed and incorporated by
reference in the Prospectus or any further amendment or supplement thereto,
when such documents become effective or are filed with the Commission, as
the case may be, will conform in all material respects to the requirements
of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder and will not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading; provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter of Designated Securities through the Representatives expressly
for use in the Prospectus as amended or supplemented relating to such
Securities;
(d) The Registration Statement and the Prospectus conform, and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of
the Act and the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act") and the rules and regulations of the Commission thereunder
and do not and will not, as of the applicable effective date as to the
Registration Statement and any amendment thereto and as of the applicable
filing date as to the Prospectus and any amendment or supplement thereto,
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading; provided, however, that this representation and
warranty shall not apply to any statements or omissions made in reliance
upon and in conformity with information furnished in writing to the Company
by an Underwriter of Designated Securities through the Representatives
expressly for use in the Prospectus as amended or supplemented relating to
such Securities;
(e) Neither the Company nor any of its subsidiaries has sustained
since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, which is material to the
Company and its subsidiaries taken as a whole, otherwise than as set forth
or contemplated in the Prospectus; and, since the respective dates as of
which information is given in the Registration Statement and the
Prospectus, there has not been any change in the capital stock (other than
increases in the stock of the Company as the result of the issuance of
shares pursuant to any of the Company's stock option plans) or long-term
debt of the Company and its subsidiaries or any material adverse change, or
any development that the Company has a reasonable cause to believe involves
a prospective material adverse change, in or affecting the business,
financial position, shareholders' equity or results of operations of the
Company and its subsidiaries taken as a whole, otherwise than as set forth
or contemplated in the Prospectus;
(f) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Delaware,
with power and authority (corporate and other) to own its properties and
conduct its business as described in the Prospectus, and has been duly
qualified as a foreign corporation for the transaction of business and is
in good standing in each jurisdiction in which the conduct of its business
3
<PAGE>
or the ownership or leasing of its property requires such qualification,
except where failure to qualify would not in the aggregate have a material
adverse effect upon the Company and its subsidiaries taken as a whole; and
each of The Atchison, Topeka and Santa Fe Railway Company and Santa Fe
Pacific Pipelines, Inc. (each hereinafter referred to as a "Significant
Subsidiary" or collectively as the "Significant Subsidiaries") has been
duly incorporated and is validly existing as a corporation in good standing
under the laws of its jurisdiction of incorporation;
(g) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company
have been duly and validly authorized and issued, are fully paid and non-
assessable; and all of the issued shares of capital stock of each
Significant Subsidiary of the Company have been duly and validly authorized
and issued, are fully paid and non-assessable and except as set forth in
the Prospectus are owned directly or indirectly by the Company, free and
clear of all liens, encumbrances, equities or claims;
(h) The Securities have been duly authorized, and, when Designated
Securities are issued and delivered pursuant to this Agreement and the
Pricing Agreement with respect to such Designated Securities, such
Designated Securities will have been duly executed, authenticated, issued
and delivered and will constitute valid and legally binding obligations to
the Company entitled to the benefits provided by the Indenture, which will
be substantially in the form filed as an exhibit to the Registration
Statement; assuming the due authorization and execution by the Trustee, the
Indenture has been duly authorized and duly qualified under the Trust
Indenture Act and, at the Time of Delivery for such Designated Securities
(as defined in Section 4 hereof), the Indenture will constitute a valid and
legally binding instrument, enforceable in accordance with its terms,
subject, as to enforcement, to bankruptcy, insolvency, reorganization and
other laws of general applicability relating to or affecting creditors'
rights and to general equity principles; and the Indenture conforms, and
the Designated Securities will conform, to the descriptions thereof
contained in the Prospectus as amended or supplemented with respect to such
Designated Securities;
(i) The issue and sale of the Securities and the compliance by the
Company with all of the provisions of the Securities, the Indenture, this
Agreement and any Pricing Agreement and the consummation of the
transactions herein and therein contemplated will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company or any of
its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject except for such conflicts,
breaches, violations or defaults that will not individually or in the
aggregate have a material adverse effect on the business, financial
position, shareholders' equity or results of operations of the Company and
its subsidiaries taken as a whole, nor will such action result in any
violation of the provisions of the Certificate of Incorporation or By-laws
of the Company or any statute or any order, rule or regulation of any court
or governmental agency or body having jurisdiction over the Company or any
of its subsidiaries or any of their properties except for such violations
(other than with respect to the Company's Certificate of Incorporation or
By-laws) that will not individually or in the aggregate have a material
adverse effect on the business, financial position, shareholders' equity or
results of operations of the Company and its subsidiaries taken as a whole;
and no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required for the issue and sale of the Securities or the consummation by
the Company of the transactions contemplated by this Agreement or any
Pricing Agreement or the Indenture, except such as have been, or will have
been prior to the Time of Delivery, obtained under the Act and the Trust
Indenture Act and such
4
<PAGE>
consents, approvals, authorizations, registrations or qualifications as may
be required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Securities by the Underwriters;
(j) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property of the Company or any of
its subsidiaries is the subject which the Company has reasonable cause to
believe will individually or in the aggregate have a material adverse
effect on the financial position, shareholders' equity or results of
operations of the Company and its subsidiaries taken as a whole; and, to
the best of the Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others; and
(k) Price Waterhouse, who have certified certain financial statements
of the Company and its subsidiaries, are independent public accountants as
required by the Act and the rules and regulations of the Commission
thereunder.
3. Upon the execution of the Pricing Agreement applicable to any
Designated Securities and authorization by the Representatives of the release of
such Designated Securities, the several Underwriters propose to offer such
Designated Securities for sale upon the terms and conditions set forth in the
Prospectus as amended or supplemented.
4. Designated Securities to be purchased by each Underwriter pursuant
to the Pricing Agreement relating thereto, in definitive form to the extent
practicable, and in such authorized denominations and registered in such names
as the Representatives may request upon at least forty-eight hours' prior notice
to the Company, shall be delivered by or on behalf of the Company to the
Representatives for the account of such Underwriter, against payment by such
Underwriter or on its behalf of the purchase price therefor by certified or
official bank check or checks or such funds as may be designated in the Pricing
Agreement, payable to the order of the Company in the funds specified in such
Pricing Agreement, all at the place and time and date specified in such Pricing
Agreement or at such other place and time and date as the Representatives and
the Company may agree upon in writing, such time and date being herein called
the "Time of Delivery" for such Securities.
5. The Company agrees with each of the Underwriters of any Designated
Securities:
(a) To prepare the Prospectus as amended and supplemented in relation
to the applicable Designated Securities in a form approved by the
Representatives and to file such Prospectus pursuant to Rule 424(b) under
the Act not later than the Commission's close of business on the second
business day following the execution and delivery of the Pricing Agreement
relating to the applicable Designated Securities or, if applicable, such
earlier time as may be required by Rule 424(b); to make no further
amendment or any supplement to the Registration Statement or Prospectus as
amended or supplemented after the date of the Pricing Agreement relating to
such Securities and prior to the Time of Delivery for such Securities
without giving you advance notice thereof and an opportunity to comment
thereon; to advise the Representatives promptly of any such amendment or
supplement after such Time of Delivery and furnish the Representatives with
copies thereof; to file promptly all reports and any definitive proxy or
information statements required to be filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange
Act for so long as the delivery of a prospectus is required in connection
with the offering or sale of such Securities, and during such same period
to advise the Representatives, promptly after it receives notice thereof,
of the time when any amendment to the Registration Statement has been filed
or becomes effective or any supplement to the Prospectus or any amended
Prospectus has been filed with the Commission, of the issuance by the
Commission of any stop order or of any order preventing or suspending the
use of any prospectus relating to the Securities, of the suspension of the
qualification of such
5
<PAGE>
Securities for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any request by
the Commission for the amending or supplementing of the Registration
Statement or Prospectus or for additional information; and, in the event of
the issuance of any such stop order or of any such order preventing or
suspending the use of any prospectus relating to the Securities or
suspending any such qualification, to use promptly its best efforts to
obtain its withdrawal;
(b) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify such Securities for
offering and sale under the securities laws of such jurisdictions in the
United States as the Representatives may request and to comply with such
laws so as to permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the distribution
of such Securities, provided that in connection therewith the Company shall
not be required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction;
(c) To furnish the Underwriters with copies of the Prospectus as
amended or supplemented in such quantities as the Representatives may from
time to time reasonably request, and, if the delivery of a prospectus is
required at any time prior to the expiration of nine months after the date
of the Prospectus, as amended or supplemented, in connection with the
offering or sale of the Securities and if at such time any event (which the
Company and the Representatives acknowledge could include the filing by
Burlington Northern Inc. ("BNI") of a document under the Exchange Act)
shall have occurred as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made when
such Prospectus is delivered, not misleading, or, if for any other reason
it shall be necessary during such same period to amend or supplement the
Prospectus or to file under the Exchange Act any document incorporated by
reference in the Prospectus in order to comply with the Act, the Exchange
Act or the Trust Indenture Act, to notify the Representatives and upon
their request to file such document and to prepare and furnish without
charge to each Underwriter and to any dealer in securities as many copies
as the Representatives may from time to time reasonably request of an
amended Prospectus or a supplement to the Prospectus which will correct
such statement or omission or effect such compliance; and in case any
Underwriter is required to deliver a prospectus in connection with sales of
any of the Securities at any time nine months or more after the date of the
Prospectus as amended or supplemented, upon your request but at the expense
of such Underwriter, to prepare and deliver to such Underwriter as many
copies as you may request of an amended or supplemented Prospectus
complying with Section 10(a)(3) of the Act;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule 158(c)),
an earning statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Act and the rules and
regulations of the Commission thereunder (including at the option of the
Company Rule 158); and
(e) During the period beginning from the date of the Pricing
Agreement for such Designated Securities and continuing to and including
the Time of Delivery for such Designated Securities, not to offer, sell,
contract to sell or otherwise dispose of any debt securities of the Company
which mature more than one year after such Time of Delivery and which are
substantially similar to such Designated Securities, without the prior
written consent of the Representatives.
6. The Company covenants and agrees with the several Underwriters
that the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of
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the Company's counsel and accountants in connection with the registration of the
Securities under the Act and all other expenses in connection with the
preparation, printing and filing of the Registration Statement, any Preliminary
Prospectus and the Prospectus and amendments and supplements thereto and the
mailing and delivering of copies thereof to the Underwriters and dealers; (ii)
the cost of printing or reproducing this Agreement, any Pricing Agreement, any
Indenture, and the Blue Sky Memorandum and any other documents in connection
with the offering, purchase, sale and delivery of the Securities; (iii) all
expenses in connection with the qualification of the Securities for offering and
sale under state securities laws as provided in Section 5(b) hereof, including
the reasonable fees and disbursements of counsel for the Underwriters in
connection with such qualification and in connection with the Blue Sky survey;
(iv) any fees charged by securities rating services for rating the Securities;
(v) any filing fees incident to any required review by the National Association
of Securities Dealers, Inc. of the terms of the sale of the Securities; (vi) the
cost of preparing the Securities; (vii) the fees and expenses of any Trustee and
any agent of any Trustee and the fees and disbursements of counsel for any
Trustee in connection with any Indenture and the Securities (to the extent the
Trustee does not pay such fees); and (viii) all other costs and expenses
incident to the performance of its obligations hereunder which are not otherwise
specifically provided for in this Section. It is understood, however, that,
except as provided in this Section, Section 8 and Section 11 hereof, the
Underwriters will pay all of their own costs and expenses, including the fees of
their counsel, transfer taxes on resale of any of the Securities by them, and
any advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters of any Designated Securities
under the Pricing Agreement relating to such Designated Securities shall be
subject, in the discretion of the Representatives, to the condition that all
representations and warranties and other statements of the Company in or
incorporated by reference in the Pricing Agreement relating to such Designated
Securities are, at and as of the Time of Delivery for such Designated
Securities, true and correct in all material respects, the condition that the
Company shall have performed all of its obligations hereunder theretofore to be
performed and the following additional conditions:
(a) The Prospectus as amended or supplemented in relation to the
applicable Designated Securities shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed for
such filing by the rules and regulations under the Act and in accordance
with Section 5(a) hereof; no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by the
Commission; and all requests for additional information on the part of the
Commission shall have been complied with to the Representatives' reasonable
satisfaction;
(b) Sullivan & Cromwell, counsel for the Underwriters, using
reasonable efforts, shall have furnished to the Representatives such
opinion or opinions, dated the Time of Delivery for such Designated
Securities, with respect to the incorporation of the Company, the validity
of the Securities being delivered at such Time of Delivery, the
Registration Statement, the Prospectus, and other related matters as the
Representatives may reasonably request, and such counsel shall have
received such papers and information as they may reasonably request to
enable them to pass upon such matters;
(c) Mayer, Brown & Platt, counsel for the Company, shall have
furnished to the Representatives their written opinion, which may be
subject to reasonable and customary assumptions, qualifications and
limitations and shall be dated such Time of Delivery, in form and substance
reasonably satisfactory to the Representatives, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with corporate power and authority to own its properties
and conduct its business as described in the Prospectus as amended or
supplemented;
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(ii) The Company has an authorized capitalization as set forth in
the Prospectus as amended or supplemented, and all of the issued
shares of capital stock of the Company have been duly and validly
authorized and issued and are fully paid and non-assessable;
(iii) The Company has been duly qualified as a foreign
corporation for the transaction of 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, except
where failure to qualify would not in the aggregate have a material
adverse effect upon the Company and its subsidiaries taken as a whole;
(iv) Each Significant Subsidiary of the Company has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of its jurisdiction of incorporation; and all of the
issued shares of capital stock of each such subsidiary have been duly
and validly authorized and issued, are fully paid and non-assessable,
and (except for directors' qualifying shares and except as otherwise
set forth in the Prospectus) are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, equities or
claims;
(v) To such counsel's knowledge and other than as set forth in
the Prospectus, there are no legal or governmental proceedings pending
to which the Company or any of its subsidiaries is a party or of which
any property of the Company or any of its subsidiaries is the subject
which the Company has reasonable cause to believe will individually or
in the aggregate have a material adverse effect on the financial
position, shareholders' equity or results of operations of the Company
and its subsidiaries, taken as a whole; and, to such counsel's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(vi) This Agreement and the Pricing Agreement with respect to
the Designated Securities have been duly authorized, executed and
delivered by the Company;
(vii) The Designated Securities have been duly authorized,
executed, authenticated, issued and delivered and constitute valid and
legally binding obligations of the Company entitled to the benefits
provided by the Indenture, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles; and the Designated Securities and the Indenture conform to
the descriptions thereof in the Prospectus as amended or supplemented;
(viii) Assuming due authorization and execution by the Trustee,
the Indenture has been duly authorized, executed and delivered by the
parties thereto and constitutes a valid and legally binding
instrument, enforceable in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other laws
of general applicability relating to or affecting creditors' rights
and to general equity principles; and the Indenture has been duly
qualified under the Trust Indenture Act;
(ix) The issue and sale of the Designated Securities and the
compliance by the Company with all of the provisions of this Agreement
and the Pricing Agreement with respect to the Designated Securities
and the consummation of the transactions herein and therein
contemplated will not conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument known to such counsel to which the Company or
any of its subsidiaries is a party or by which the Company or any of
its subsidiaries is bound or to which
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any of the property or assets of the Company or any of its
subsidiaries is subject, the effects of which would, in the aggregate,
be materially adverse to the Company and its subsidiaries taken as a
whole, nor will such action result in any violation of the provisions
of the Certificate of Incorporation or By-laws of the Company or any
statute, order, rule or regulation known to such counsel of any court
or governmental agency or body having jurisdiction over the Company or
any of its subsidiaries or any of their properties;
(x) No consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body
is required for the issue and sale of the Designated Securities or the
consummation by the Company of the transactions contemplated by this
Agreement or such Pricing Agreement or the Indenture with respect to
the Designated Securities, except as have been obtained under the Act
and the Trust Indenture Act, and such consents, approvals,
authorizations, registrations or qualifications as may be required
under state securities or Blue Sky laws in connection with the
purchase and distribution of the Securities by the Underwriters;
(xi) The documents incorporated by reference in the Prospectus
as amended or supplemented (other than the financial statements and
other financial data therein, as to which such counsel need express no
opinion or belief), when they became effective or were filed with the
Commission, as the case may be, complied as to form in all material
respects with the requirements of the Act, or the Exchange Act, as
applicable, and the rules and regulations of the Commission
thereunder; and such counsel shall also state that no facts have come
to their attention that lead them to believe that any of such
documents, when such documents became effective or were so filed, as
the case may be, contained, in the case of a registration statement
which became effective under the Act, 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, in the case of other documents which were filed under
the Act or the Exchange Act with the Commission, an untrue statement
of a material fact or omitted to state a material fact necessary in
order to make the statements therein, in the light of the
circumstances under which they were made when such documents were so
filed, not misleading; and
(xii) The Registration Statement and the Prospectus as amended
or supplemented and any further amendments and supplements thereto
made by the Company prior to the Time of Delivery for the Designated
Securities (other than the financial statements and other financial
data therein, as to which such counsel need express no opinion or
belief) comply as to form in all material respects with the
requirements of the Act and the rules and regulations thereunder; such
counsel shall also state that no facts have come to their attention
that lead them to believe that, as of its effective date, the
Registration Statement or any further amendment thereto made by the
Company prior to the Time of Delivery (other than the financial
statements and other financial data therein, as to which such counsel
need express no opinion or belief) contained an untrue statement of a
material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading or that, as of its date, the Prospectus as amended or
supplemented or any further amendment or supplement thereto made by
the Company prior to the Time of Delivery (other than the financial
statements and other financial data therein, as to which such counsel
need express no opinion or belief) contained an untrue statement of a
material fact or omitted to state a material fact necessary to make
the statements therein, in light of the
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<PAGE>
circumstances in which they were made, not misleading or that, as of
the Time of Delivery, either the Registration Statement or the
Prospectus as amended or supplemented or any other amendment or
supplement thereto made by the Company prior to such Time of Delivery
(other than the financial statements and other financial data therein,
as to which such counsel need express no opinion or belief) contains
an untrue statement of a material fact or omits to state a material
fact necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading; and they do not
know of any amendment to the Registration Statement required to be
filed or any contracts or other documents of a character required to
be filed as an exhibit to the Registration Statement or required to be
incorporated by reference into the Prospectus as amended or
supplemented or required to be described in the Registration Statement
or the Prospectus as amended or supplemented which are not filed or
incorporated by reference or described as required.
In rendering such opinion, such counsel may state that they express no
opinion as to the laws of any jurisdiction other than the federal laws of
the United States and the General Corporation Law of the State of Delaware
and shall be entitled to rely in respect of the opinion in this clause upon
opinions of local counsel and in respect of matters of fact upon
certificates of officers of the Company or its transfer agent, provided
that such counsel shall state that they believe that both the Underwriters
and the Company or its transfer agent are justified in relying upon such
opinions and certificates;
(d) At the Time of Delivery for such Designated Securities, (i) the
independent accountants of the Company who have certified the financial
statements of the Company and its subsidiaries included or incorporated by
reference in the Registration Statement shall have furnished to the
Representatives a letter, dated such Time of Delivery, to the effect set
forth Part (i) of in Annex II hereto, and as to such other matters as the
Representatives may reasonably request and in form and substance
satisfactory to the Representatives, and (ii) the independent accountants
of BNI who have certified the financial statements of BNI and its
subsidiaries shall have furnished to the Representatives a letter, dated
such Time of Delivery, to the effect set forth in Part (ii) of Annex II
hereto, and as to such other matters as the Representatives may reasonably
request and in form and substance satisfactory to the Representatives;
(e) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus as amended or
supplemented any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or
from any labor dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the Prospectus as amended or
supplemented, and (ii) since the respective dates as of which information
is given in the Prospectus as amended or supplemented there shall not have
been any change in the capital stock or long-term debt of the Company or
any of its subsidiaries or any change, or any development involving a
prospective change, in or affecting the business, financial position,
shareholders' equity or results of operations of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the Prospectus
as amended or supplemented, the effect of which, in any such case described
in Clause (i) or (ii), is in the reasonable judgment of the Representatives
so material and adverse as to make it impracticable or inadvisable to
proceed with the public offering or the delivery of the Designated
Securities on the terms and in the manner contemplated in the Prospectus as
amended or supplemented;
(f) On or after the date of the Pricing Agreement relating to the
Designated Securities (i) no downgrading shall have occurred in the rating
accorded the Company's debt securities by any "nationally recognized
statistical rating organization," as that term is
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<PAGE>
defined by the Commission for purposes of Rule 436(g)(2) under the Act and
(ii) no such organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating of
any of the Company's debt securities;
(g) On or after the date of the Pricing Agreement relating to the
Designated Securities there shall not have occurred any of the following:
(i) a suspension or material limitation in trading in securities generally
on the New York Stock Exchange; (ii) a general moratorium on commercial
banking activities in New York declared by either Federal or New York State
authorities; or (iii) the outbreak or escalation of hostilities involving
the United States or the declaration by the United States of a National
Emergency or war, if the effect of any such event specified in this clause
(iii) in the reasonable judgment of the Representatives makes it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Designated Securities on the terms and in the manner
contemplated by the Prospectus as amended and supplemented; and
(h) The Company shall have furnished or caused to be furnished to the
Representatives at the Time of Delivery for the Designated Securities a
certificate or certificates of officers of the Company satisfactory to the
Representatives as to the accuracy in all material respects of the
representations and warranties of the Company herein at and as of such Time
of Delivery, as to the performance by the Company of all of its obligations
hereunder to be performed at or prior to such Time of Delivery, as to the
matters set forth in subsections (a) and (e) of this Section.
8. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities to which such Underwriter may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, any preliminary prospectus supplement,
the Registration Statement, the Prospectus as amended or supplemented and any
other prospectus relating to the Securities, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and will reimburse each Underwriter for
any legal or other expenses reasonably incurred by such Underwriter in
connection with investigating or defending any such action or claim as such
expenses are incurred; provided, however, that the Company shall not be liable
in any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in any Preliminary Prospectus, Prospectus
or the Registration Statement, or any such amendment or supplement thereto, in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter of Designated Securities through the Representatives
expressly for use in the Prospectus as amended or supplemented relating to such
Securities,
and provided, further, that the Company shall not be liable to any Underwriter
under this subsection (a) with respect to any Preliminary Prospectus or the
Prospectus to the extent that any such loss, claim, damage or liability of such
Underwriter results from the fact that such Underwriter sold Securities to a
person to whom there was not sent or given, at or prior to the written
confirmation of such sale, a copy of the Prospectus (excluding documents
incorporated by reference) or the Prospectus as then amended or supplemented
(excluding documents incorporated by reference), in any case where such delivery
is required by the Act if the Company has previously furnished copies thereof to
such Underwriter and the loss, claim, damage or liability of such Underwriter
results from an untrue statement or omission of a material fact contained in the
Preliminary Prospectus or the Prospectus which was corrected in the Prospectus
(or the Prospectus as amended or supplemented).
(b) Each Underwriter will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company may
become subject, under the Act or
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otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus, any
preliminary prospectus supplement, the Registration Statement, the Prospectus as
amended or supplemented and any other prospectus relating to the Securities, or
any amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in any
Preliminary Prospectus, any preliminary prospectus supplement, the Registration
Statement, the Prospectus as amended or supplemented and any other prospectus
relating to the Securities, or any such amendment or supplement in reliance upon
and in conformity with written information furnished to the Company by such
Underwriter through the Representatives expressly for use therein; and will
reimburse the Company for any legal or other expenses reasonably incurred by the
Company in connection with investigating or defending any such action or claim
as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party (who
shall not, except with the consent of the indemnified party, be counsel to the
indemnifying party), and, after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party under such
subsection 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 no event shall more than one such separate
counsel in each jurisdiction where an action is commenced be retained for all
Indemnified Parties together and neither the Indemnified Party nor the
Indemnifying Party, in the instance where the Indemnifying Party has assumed the
defense of the Indemnified Party, shall settle any action, proceeding or
investigation with respect to the Indemnified Party without the written consent
of the other, which consent shall not be unreasonably withheld.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Underwriters
of the Designated Securities on the other from the offering of the Designated
Securities to which such loss, claim, damage or liability (or action in respect
thereof) relates. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law or if the indemnified
party failed to give the notice required under subsection (c) above, then each
indemnifying party shall contribute to such amount paid or payable by such
indemnified party in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company on the one hand and
the Underwriters of the Designated Securities on the other in connection with
the statements or omissions which resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and such
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Underwriters on the other shall be deemed to be in the same proportion as the
total net proceeds from such offering (before deducting expenses) received by
the Company bear to the total underwriting discounts and commissions received by
such Underwriters. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company on the one hand or such Underwriters on the
other and the parties' relative intent, prejudice resulting from any failure to
give notice of any action under subsection (c) above, 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 subsection (d) were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this subsection (d). The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages or liabilities (or actions in respect thereof) referred to above in this
subsection (d) shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
any such action or claim. Notwithstanding the provisions of this subsection
(d), no Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the applicable Designated Securities
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages which such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
obligations of the Underwriters of Designated Securities in this subsection (d)
to contribute are several in proportion to their respective underwriting
obligations with respect to such Securities and not joint.
(e) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section 8 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each officer and director of the Company and to each
person, if any, who controls the Company within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to
purchase the Designated Securities which it has agreed to purchase under the
Pricing Agreement relating to such Designated Securities, the Representatives
may in their discretion arrange for themselves or another party or other parties
to purchase such Designated Securities on the terms contained herein. If within
thirty-six hours after such default by any Underwriter the Representatives do
not arrange for the purchase of such Designated Securities, then the Company
shall be entitled to a further period of thirty-six hours within which to
procure another party or other parties reasonably satisfactory to the
Representatives to purchase such Designated Securities on such terms. In the
event that, within the respective prescribed period, the Representatives notify
the Company that they have so arranged for the purchase of such Designated
Securities, or the Company notifies the Representatives that it has so arranged
for the purchase of such Designated Securities, the Representatives or the
Company shall have the right to postpone the Time of Delivery for such
Designated Securities for a period of not more than seven days, in order to
effect whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus as amended or supplemented, or in any other
documents or arrangements, and the Company agrees to file promptly any
amendments or supplements to the Registration Statement or the Prospectus which
in the opinion of the Representatives may thereby be made necessary. The term
"Underwriter" as used in this Agreement shall include any person substituted
under this Section with like effect as if such person had originally been a
party to the Pricing Agreement with respect to such Designated Securities.
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(b) If, after giving effect to any arrangements for the purchase of
the Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Company as provided in subsection (a) above, the
aggregate principal amount of such Designated Securities which remains
unpurchased does not exceed one-eleventh of the aggregate principal amount of
the Designated Securities, then the Company shall have the right to require each
non-defaulting Underwriter to purchase the principal amount of Designated
Securities which such Underwriter agreed to purchase under the Pricing Agreement
relating to such Designated Securities and, in addition, to require each non-
defaulting Underwriter to purchase its pro rata share (based on the principal
amount of Designated Securities which such Underwriter agreed to purchase under
such Pricing Agreement) of the Designated Securities of such defaulting
Underwriter or Underwriters for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
(c) If, after giving effect to any arrangements for the purchase of
the Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Company as provided in subsection (a) above, the
aggregate principal amount of Designated Securities which remains unpurchased
exceeds one-eleventh of the aggregate principal amount of the Designated
Securities, as referred to in subsection (b) above, or if the Company shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Designated Securities of a defaulting Underwriter or
Underwriters, then the Pricing Agreement relating to such Designated Securities
shall thereupon terminate, without liability on the part of any non-defaulting
Underwriter or the Company, except for the expenses to be borne by the Company
and the Underwriters as provided in Section 6 hereof and the indemnity and
contribution agreements in Section 8 hereof; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations,
warranties and other statements of the Company and the several Underwriters, as
set forth in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless of
any investigation (or any statement as to the results thereof) made by or on
behalf of any Underwriter or any controlling person of any Underwriter, or the
Company, or any officer or director or controlling person of the Company, and
shall survive delivery of and payment for the Securities.
11. If any Pricing Agreement shall be terminated pursuant to Section
9 hereof, the Company shall not then be under any liability to any Underwriter
with respect to the Designated Securities covered by such Pricing Agreement
except as provided in Section 6 and Section 8 hereof; but, if for any other
reason Designated Securities are not delivered by or on behalf of the Company as
provided herein, the Company will reimburse the Underwriters through the
Representatives for all out-of-pocket expenses approved in writing by the
Representatives, including reasonable fees and disbursements of counsel,
reasonably incurred by the Underwriters in making preparations for the purchase,
sale and delivery of such Designated Securities, but the Company shall then be
under no further liability to any Underwriter with respect to such Designated
Securities except as provided in Section 6 and Section 8 hereof.
12. In all dealings hereunder, the Representatives of the
Underwriters of Designated Securities shall act on behalf of each of such
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by such Representatives jointly or by such of the Representatives, if any,
as may be designated for such purpose in the Pricing Agreement.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Representatives as set forth in the
Pricing Agreement; and if to the Company, shall be delivered or sent by mail,
telex or facsimile transmission to the address of the Company set forth
14
<PAGE>
in the Registration Statement: Attention: Corporate Secretary; provided,
however, that any notice to an Underwriter pursuant to Section 8(c) hereof shall
be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its Underwriters' Questionnaire or telex
constituting such Questionnaire, which address will be supplied to the Company
by the Representatives upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. This Agreement and each Pricing Agreement shall be binding upon,
and inure solely to the benefit of, the Underwriters, the Company and, to the
extent provided in Section 8 and Section 10 hereof, the officers and directors
of the Company and each person who controls the Company or any Underwriter, and
their respective heirs, executors, administrators, successors and assigns, and
no other person shall acquire or have any right under or by virtue of this
Agreement or any such Pricing Agreement. No purchaser of any of the Securities
from any Underwriter shall be deemed a successor or assign by reason merely of
such purchase.
14. Time shall be of the essence of each Pricing Agreement. As used
herein, "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. THIS AGREEMENT AND EACH PRICING AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
16. This Agreement and each Pricing Agreement may be executed by any
one or more of the parties hereto and thereto in any number of counterparts,
each of which shall be deemed to be an original, but all such respective
counterparts shall together constitute one and the same instrument.
If the foregoing is in accordance with your understanding, please sign
and return to us seven counterparts hereof.
Very truly yours,
SANTA FE PACIFIC CORPORATION
By:_______________________________
Name:
Title:
Accepted as of the date hereof:
J.P. MORGAN SECURITIES INC.
GOLDMAN, SACHS & CO.
SALOMON BROTHERS INC
By: J.P. MORGAN SECURITIES INC.
By:_______________________________
Name:
Title:
15
<PAGE>
ANNEX I
PRICING AGREEMENT
-----------------
J.P. Morgan Securities Inc.
Goldman, Sachs & Co.
Salomon Brothers Inc
As Representatives of the several
Underwriters named in Schedule I hereto
c/o J.P. Morgan Securities Inc.
60 Wall Street
New York, New York 10260
____________, 19__
Dear Sirs:
Santa Fe Pacific Corporation, a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein and in the
Underwriting Agreement, dated October __, 1994 (the "Underwriting Agreement"),
between the Company on the one hand and J.P. Morgan Securities Inc., Goldman,
Sachs & Co. and Salomon Brothers Inc, as Co-Representatives, on the other hand,
to issue and sell to the Underwriters named in Schedule I hereto (the
"Underwriters") the Securities specified in Schedule II hereto (the "Designated
Securities"). Each of the provisions of the Underwriting Agreement is
incorporated herein by reference in its entirety, and shall be deemed to be a
part of this Agreement to the same extent as if such provisions had been set
forth in full herein; and each of the representations and warranties set forth
therein shall be deemed to have been made at and as of the date of this Pricing
Agreement, except that each representation and warranty which refers to the
Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be a
representation or warranty as of the date of the Underwriting Agreement in
relation to the Prospectus (as therein defined), and also a representation and
warranty as of the date of this Pricing Agreement in relation to the Prospectus
as amended or supplemented relating to the Designated Securities which are the
subject of this Pricing Agreement. Each reference to the Representatives herein
and in the provisions of the Underwriting Agreement so incorporated by reference
shall be deemed to refer to you. Unless otherwise defined herein, terms defined
in the Underwriting Agreement are used herein as therein defined. The
Representatives designated to act on behalf of the Representatives and on behalf
of each of the Underwriters of the Designated Securities pursuant to Section 12
of the Underwriting Agreement and the address of the Representatives referred to
in such Section 12 are set forth at the end of Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Company agrees to
issue and sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at the time and place
and at the purchase price to the Underwriters set forth in
<PAGE>
Schedule II hereto, the principal amount of Designated Securities set forth
opposite the name of such Underwriter in Schedule I hereto.
If the foregoing is in accordance with your understanding, please sign
and return to us seven counterparts hereof, and upon acceptance hereof by you,
on behalf of each of the Underwriters, this letter and such acceptance hereof,
including the provisions of the Underwriting Agreement incorporated herein by
reference, shall constitute a binding agreement between each of the Underwriters
and the Company. It is understood that your acceptance of this letter on behalf
of each of the Underwriters is or will be pursuant to the authority set forth in
a form of Agreement among Underwriters, the form of which shall be submitted to
the Company for examination upon request, but without warranty on the part of
the Representatives as to the authority of the signers thereof.
Very truly yours,
SANTA FE PACIFIC CORPORATION
By:__________________________
Name:
Title:
Accepted as of the date hereof:
J.P. Morgan Securities Inc.
Goldman, Sachs & Co.
Salomon Brothers Inc
By:_____________________________
Name:
Title:
On behalf of each of the Underwriters
2
<PAGE>
SCHEDULE I
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OF
DESIGNATED
SECURITIES
TO BE
UNDERWRITER PURCHASED
----------- ---------
<S> <C>
J.P. Morgan Securities Inc.................... $
Goldman, Sachs & Co...........................
Salomon Brothers Inc..........................
[NAMES OF OTHER UNDERWRITERS].................
-----------
Total.............................. $
===========
</TABLE>
3
<PAGE>
SCHEDULE II
TITLE OF DESIGNATED SECURITIES:
[ %] [Floating Rate] [Zero Coupon] [Notes]
[Debentures] due
AGGREGATE PRINCIPAL AMOUNT:
[$]
PRICE TO PUBLIC:
__% of the principal amount of the Designated
Securities, plus accrued interest from to [and accrued
amortization, if any, from to ]
PURCHASE PRICE BY UNDERWRITERS:
__% of the principal amount of the Designated
Securities, plus accrued interest from to [and accrued
amortization, if any, from to ]
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:
[By certified or official bank check or checks, payable to the order of the
Company in [[New York] Clearing House] [immediately available] funds]
[By wire transfer to a bank account specified by the Company in [next day]
[immediately available] funds]
INDENTURE:
Indenture dated , 19 , between the Company
and , as Trustee
MATURITY:
INTEREST RATE:
[ %] [Zero Coupon] [See Floating Rate Provisions]
INTEREST PAYMENT DATES:
[months and dates]
REDEMPTION PROVISIONS:
[No provisions for redemption]
4
<PAGE>
[The Designated Securities may be redeemed, otherwise
than through the sinking fund, in whole or in part at the option of the
Company, in the amount of [$] or an integral multiple thereof,
[on or after , at the following redemption prices (expressed in percentages
of principal amount). If [redeemed on or before , %, and if] redeemed
during the 12-month period beginning ,
<TABLE>
<CAPTION>
REDEMPTION
YEAR PRICE
---- -------
<S> <C>
</TABLE>
and thereafter at 100% of their principal amount, together in each case
with accrued interest to the redemption date.]
[on any interest payment date falling in or after , , at
the election of the Company, at a redemption price equal to the principal
amount thereof, plus accrued interest to the date of redemption.]
[Other possible redemption provisions, such as mandatory redemption upon
occurrence of certain events or redemption for changes in tax law]
[Restriction on refunding]
SINKING FUND PROVISIONS:
[No sinking fund provisions]
[The Designated Securities are entitled to the benefit of a sinking fund to
retire [$] principal amount of Designated Securities on
in each of the years through at 100% of their principal
amount plus accrued interest][,together with [cumulative] [noncumulative]
redemptions at the option of the Company to retire an additional [$]
principal amount of Designated Securities in the years through at
100% of their principal amount plus accrued interest].
[If Securities are extendable debt Securities, insert--
EXTENDABLE PROVISIONS:
Securities are repayable on , [insert date and years], at the
option of the holder, at their principal amount with accrued interest.
Initial annual interest rate will be %, and thereafter annual interest
rate will be adjusted on , and to a rate not
less than % of the effective annual interest rate on U.S. Treasury
obligations with -year maturities as of the [insert date 15 days
prior to maturity date] prior to such [insert maturity date].]
5
<PAGE>
[If Securities are Floating Rate debt Securities, insert--
FLOATING RATE PROVISIONS:
Initial annual interest rate will be % through and thereafter will
be adjusted [monthly] [on each , , ________________ and
] [to an annual rate of % above the average rate for -year
[month] [securities] [certificates of deposit] issued by
and [insert names of banks].] [and the annual interest rate
[thereafter] [from through ] will be the interest
yield equivalent of the weekly average per annum market discount rate
for -month Treasury bills plus % of Interest Differential
(the excess, if any, of (i) then current weekly average per annum
secondary market yield for -month certificates of deposit over
(ii) then current interest yield equivalent of the weekly average per annum
market discount rate for -month Treasury bills); [from and
thereafter the rate will be the then current interest yield equivalent plus
% of Interest Differential].]
DEFEASANCE PROVISIONS:
TIME OF DELIVERY:
CLOSING LOCATION:
NAMES AND ADDRESSES OF REPRESENTATIVES:
Designated Representatives:
Address for Notices, etc.:
[OTHER TERMS]:
6
<PAGE>
EXHIBIT 10.1
===============================================================================
SANTA FE PACIFIC CORPORATION
Issuer
THE FIRST NATIONAL BANK OF CHICAGO
Trustee
______________
RESTATED INDENTURE
Dated as of November __, 1994
______________
===============================================================================
<PAGE>
..............................................................
CERTAIN SECTIONS OF THIS INDENTURE RELATING TO SECTIONS 310 THROUGH 318,
INCLUSIVE, OF THE TRUST INDENTURE ACT OF 1939:
<TABLE>
<CAPTION>
TRUST INDENTURE
ACT SECTION INDENTURE SECTION
<S> <C>
(S) 310(a)(1)............................................... 609
(a)(2)............................................... 609
(a)(3)............................................... Not Applicable
(a)(4)............................................... Not Applicable
(b).................................................. 608
610
(S) 311(a).................................................. 613
(b).................................................. 613
(S) 312(a).................................................. 701
702
(b).................................................. 702
(c).................................................. 702
(S) 313(a).................................................. 703
(b).................................................. 703
(c).................................................. 703
(d).................................................. 703
(S) 314(a).................................................. 704
(a)(4)............................................... 101
1004
(b).................................................. Not Applicable
(c)(1)............................................... 102
(c)(2)............................................... 102
(c)(3)............................................... Not Applicable
(d).................................................. Not Applicable
(e).................................................. 102
(S) 315(a).................................................. 601
(b).................................................. 602
(c).................................................. 601
(d).................................................. 601
(e).................................................. 514
(S) 316(a).................................................. 101
(a)(1)(A)............................................ 502
512
(a)(1)(B)............................................ 513
(a)(2)............................................... Not Applicable
(b).................................................. 508
(c).................................................. 104
(S) 317(a)(1)............................................... 503
(a)(2)............................................... 504
(b).................................................. 1003
(S) 318(a).................................................. 107
</TABLE>
___________________
Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Indenture.
<PAGE>
TABLE OF CONTENTS
__________
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
Parties............................................................... 1
Recitals of the Company............................................... 1
ARTICLE ONE
Definitions and Other Provisions of General Application
Section 101. Definitions:
Act................................................... 2
Affiliate; control.................................... 2
Authenticating Agent.................................. 2
Board of Directors.................................... 2
Board Resolution...................................... 2
Business Day.......................................... 2
Commission............................................ 2
Company............................................... 2
Company Request; Company Order........................ 2
Consolidated Net Tangible Assets...................... 3
Corporate Trust Office................................ 3
corporation........................................... 3
Covenant Defeasance................................... 3
Defaulted Interest.................................... 3
Defeasance............................................ 3
Depositary............................................ 3
Debt.................................................. 3
Event of Default...................................... 3
Exchange Act.......................................... 3
Expiration Date....................................... 3
Global Security....................................... 3
Holder................................................ 3
Indenture............................................. 3
interest.............................................. 4
Interest Payment Date................................. 4
Investment Company Act................................ 4
Lien.................................................. 4
Material Subsidiary................................... 4
Maturity.............................................. 4
Notice of Default..................................... 4
Officers' Certificate................................. 4
</TABLE>
- ---------------
Note: This table of contents shall not, for any purpose, be deemed to be a part
of the Indenture.
<PAGE>
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
Opinion of Counsel.................................... 4
Original Issue Discount Security...................... 4
Outstanding........................................... 5
Paying Agent.......................................... 6
Person................................................ 6
Place of Payment...................................... 6
Predecessor Security.................................. 6
Redemption Date....................................... 6
Redemption Price...................................... 6
Regular Record Date................................... 6
Responsible Officer................................... 6
Restricted Subsidiary................................. 6
Securities............................................ 6
Securities Act........................................ 7
Security Register and Security Registrar.............. 7
Special Record Date................................... 7
Stated Maturity....................................... 7
Subsidiary............................................ 7
Trust Indenture Act................................... 7
Trustee............................................... 7
U.S. Government Obligation............................ 7
Vice President........................................ 7
Section 102. Compliance Certificates and Opinions.................. 7
Section 103. Form of Documents Delivered to Trustee................ 8
Section 104. Acts of Holders; Record Dates......................... 9
Section 105. Notices, Etc., to Trustee and Company................. 11
Section 106. Notice to Holders; Waiver............................. 11
Section 107. Conflict with Trust Indenture Act..................... 12
Section 108. Effect of Headings and Table of Contents.............. 12
Section 109. Successors and Assigns................................ 12
Section 110. Separability Clause................................... 12
Section 111. Benefits of Indenture................................. 12
Section 112. Governing Law......................................... 12
Section 113. Legal Holidays........................................ 12
ARTICLE TWO
Security Forms
Section 201. Forms Generally....................................... 13
Section 202. Form of Face of Security.............................. 13
</TABLE>
-ii-
<PAGE>
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
Section 203. Form of Reverse of Security........................... 15
Section 204. Form of Legend for Global Securities.................. 19
Section 205. Form of Trustee's Certificate of Authentication....... 20
ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series.................. 20
Section 302. Denominations......................................... 23
Section 303. Execution, Authentication, Delivery and Dating........ 23
Section 304. Temporary Securities.................................. 24
Section 305. Registration, Registration of Transfer and Exchange... 25
Section 306. Mutilated, Destroyed, Lost and Stolen Securities...... 26
Section 307. Payment of Interest; Interest Rights Preserved........ 27
Section 308. Persons Deemed Owners................................. 28
Section 309. Cancellation.......................................... 29
Section 310. Computation of Interest............................... 29
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture............... 29
Section 402. Application of Trust Money............................ 30
ARTICLE FIVE
Remedies
Section 501. Events of Default..................................... 31
Section 502. Acceleration of Maturity; Rescission and Annulment.... 33
Section 503. Collection of Indebtedness and Suits for
Enforcement by Trustee................................ 34
Section 504. Trustee May File Proofs of Claim...................... 34
Section 505. Trustee May Enforce Claims Without Possession
of Securities......................................... 35
Section 506. Application of Money Collected........................ 35
Section 507. Limitation on Suits................................... 36
</TABLE>
-iii-
<PAGE>
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
Section 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest.................................. 36
Section 509. Restoration of Rights and Remedies.................... 36
Section 510. Rights and Remedies Cumulative........................ 37
Section 511. Delay or Omission Not Waiver.......................... 37
Section 512. Control by Holders.................................... 37
Section 513. Waiver of Past Defaults............................... 37
Section 514. Undertaking for Costs................................. 38
Section 515. Waiver of Usury, Stay or Extension Laws............... 38
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities................... 39
Section 602. Notice of Defaults.................................... 39
Section 603. Certain Rights of Trustee............................. 39
Section 604. Not Responsible for Recitals or Issuance of Securities 40
Section 605. May Hold Securities................................... 40
Section 606. Money Held in Trust................................... 40
Section 607. Compensation and Reimbursement........................ 41
Section 608. Conflicting Interests................................. 41
Section 609. Corporate Trustee Required; Eligibility............... 41
Section 610. Resignation and Removal; Appointment of Successor..... 42
Section 611. Acceptance of Appointment by Successor................ 43
Section 612. Merger, Conversion, Consolidation or Succession
to Business........................................... 44
Section 613. Preferential Collection of Claims Against Company..... 44
Section 614. Appointment of Authenticating Agent................... 45
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee Names and Addresses
of Holders.......................................... 46
Section 702. Preservation of Information; Communications
to Holders.......................................... 47
Section 703. Reports by Trustee.................................... 47
Section 704. Reports by Company.................................... 47
</TABLE>
-iv-
<PAGE>
ARTICLE EIGHT
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. Company May Consolidate, Etc., Only on
Certain Terms....................................... 48
Section 802. Successor Substituted................................. 49
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of Holders.... 49
Section 902. Supplemental Indentures With Consent of Holders....... 50
Section 903. Execution of Supplemental Indentures.................. 51
Section 904. Effect of Supplemental Indentures..................... 52
Section 905. Conformity with Trust Indenture Act................... 52
Section 906. Reference in Securities to Supplemental Indentures.... 52
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest............ 52
Section 1002. Maintenance of Office or Agency....................... 52
Section 1003. Money for Securities Payments to Be Held in Trust..... 53
Section 1004. Statement by Officers as to Default................... 54
Section 1005. Existence............................................. 54
Section 1006. Maintenance of Properties............................. 54
Section 1007. Payment of Taxes and Other Claims..................... 55
Section 1008. Limitation on Liens................................... 55
Section 1009. Waiver of Certain Covenants........................... 55
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article.............................. 56
Section 1102. Election to Redeem; Notice to Trustee................. 56
</TABLE>
-v-
<PAGE>
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
Section 1103. Selection by Trustee of Securities to Be Redeemed..... 56
Section 1104. Notice of Redemption.................................. 57
Section 1105. Deposit of Redemption Price........................... 58
Section 1106. Securities Payable on Redemption Date................. 58
Section 1107. Securities Redeemed in Part........................... 58
ARTICLE TWELVE
Sinking Funds
Section 1201. Applicability of Article.............................. 59
Section 1202. Satisfaction of Sinking Fund Payments with Securities. 59
Section 1203. Redemption of Securities for Sinking Fund............. 59
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Company's Option to Effect Defeasance or
Covenant Defeasance................................. 60
Section 1302. Defeasance and Discharge.............................. 60
Section 1303. Covenant Defeasance................................... 61
Section 1304. Conditions to Defeasance or Covenant Defeasance....... 61
Section 1305. Deposited Money and U.S. Government Obligations
to Be Held in Trust; Miscellaneous Provisions....... 63
Section 1306. Reinstatement......................................... 64
ARTICLE FOURTEEN
Immunity of Incorporators, Stockholders,
Officers, Directors and Employees
Section 1401. Exemption from Individual Liability................... 64
</TABLE>
-vi-
<PAGE>
INDENTURE, dated as of November __, 1994, between Santa Fe Pacific
Corporation, a corporation duly organized and existing under the laws of the
State of Delaware (herein called the "Company"), having its principal office at
1700 East Golf Road, Schaumburg, Illinois 60173-5860, and The First National
Bank of Chicago, a national banking association duly organized and existing
under the laws of the United States of America, as Trustee (herein called the
"Trustee").
Recitals of the Company
The Company has duly authorized the execution and delivery of this Indenture
to provide for the issuance from time to time of its unsecured debentures, notes
or other evidences of indebtedness (herein called the "Securities"), to be
issued in one or more series as in this Indenture provided.
All things necessary to make this Indenture a valid agreement of the Company,
in accordance with its terms, have been done.
Now, Therefore, This Indenture Witnesseth:
For and in consideration of the premises and the purchase of the Securities
by the Holders thereof, it is mutually agreed, for the equal and proportionate
benefit of all Holders of the Securities or of series thereof, as follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly provided or
unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to them
in this Article and include the plural as well as the singular;
(2) all other terms used herein which are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to
them therein;
(3) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles,
and, except as otherwise herein expressly provided, the term "generally
accepted accounting principles" with respect to any computation required or
permitted hereunder shall mean such accounting principles as are generally
accepted at the date of such computation;
<PAGE>
(4) unless the context otherwise requires, any reference to an "Article" or
a "Section" refers to an Article or a Section, as the case may be, of this
Indenture; and
(5) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
"Act", when used with respect to any Holder, has the meaning specified in
Section 104.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Authenticating Agent" means any Person authorized by the Trustee pursuant to
Section 614 to act on behalf of the Trustee to authenticate Securities of one or
more series.
"Board of Directors" means either the board of directors of the Company or
any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the Secretary or
an Assistant Secretary of the Company to have been duly adopted by the Board of
Directors and to be in full force and effect on the date of such certification,
and delivered to the Trustee.
"Business Day", when used with respect to any Place of Payment, means each
Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions in that Place of Payment are authorized or obligated by law
or executive order to close.
"Commission" means the Securities and Exchange Commission, from time to time
constituted, created under the Exchange Act, or, if at any time after the
execution of this instrument such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Company" means the Person named as the "Company" in the first paragraph of
this instrument until a successor Person shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor Person.
"Company Request" or "Company Order" means a written request or order signed
in the name of the Company by its Chairman of the Board, its Vice Chairman of
the
-2-
<PAGE>
Board, its President or a Vice President, and by its Treasurer, an Assistant
Treasurer, its Secretary or an Assistant Secretary, and delivered to the
Trustee.
"Consolidated Net Tangible Assets" means the aggregate amount of total assets
after deducting therefrom (i) all current liabilities, including the current
portion of long-term debt and (ii) all goodwill, trade names, trademarks,
patents, unamortized debt discount and expense, and other like intangibles, of
the Company and its Restricted Subsidiaries as included in the most recent
balance sheet of the Company and its consolidated subsidiaries prepared in
accordance with generally accepted accounting principles.
"Corporate Trust Office" means the principal office of the Trustee in
Chicago, Illinois at which at any particular time its corporate trust business
shall be administered, which office is currently located at One First National
Plaza, Suite 1026, Chicago, Illinois 60670-0126.
"corporation" means a corporation, association, company, joint-stock company
or business trust.
"Covenant Defeasance" has the meaning specified in Section 1303.
"Defaulted Interest" has the meaning specified in Section 307.
"Defeasance" has the meaning specified in Section 1302.
"Depositary" means, with respect to Securities of any series issuable in
whole or in part in the form of one or more Global Securities, a clearing agency
registered under the Exchange Act that is designated to act as Depositary for
such Securities as contemplated by Section 301.
"Debt" means indebtedness for money borrowed.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934 and any statute
successor thereto, in each case as amended from time to time.
"Expiration Date" has the meaning specified in Section 104.
"Global Security" means a Security that evidences all or part of the
Securities of any series and bears the legend set forth in Section 204 (or such
legend as may be specified as contemplated by Section 301 for such Securities).
"Holder" means a Person in whose name a Security is registered in the
Security Register.
"Indenture" means this instrument as originally executed and as it may from
time to time be supplemented or amended by one or more indentures supplemental
hereto
-3-
<PAGE>
entered into pursuant to the applicable provisions hereof, including, for all
purposes of this instrument and any such supplemental indenture, the provisions
of the Trust Indenture Act that are deemed to be a part of and govern this
instrument and any such supplemental indenture, respectively. The term
"Indenture" shall also include the terms of particular series of Securities
established as contemplated by Section 301.
"interest", when used with respect to an Original Issue Discount Security
which by its terms bears interest only after Maturity, means interest payable
after Maturity.
"Interest Payment Date", when used with respect to any Security, means the
Stated Maturity of an instalment of interest on such Security.
"Investment Company Act" means the Investment Company Act of 1940 and any
statute successor thereto, in each case as amended from time to time.
"Lien" means any mortgage, pledge, lien or any other encumbrances.
"Material Subsidiary" means any Subsidiary, the operating assets and
principal businesses of which are located or carried on within the United States
or Canada, the consolidated assets of which, as shown by its most recent year-
end consolidated balance sheet, are equal to or in excess of 3% of the
Consolidated Net Tangible Assets of the Company.
"Maturity", when used with respect to any Security, means the date on which
the principal of such Security or an instalment of principal becomes due and
payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, call for redemption or otherwise.
"Notice of Default" means a written notice of the kind specified in Section
501(4) or 501(5).
"Officers' Certificate" means a certificate signed by the Chairman of the
Board, a Vice Chairman of the Board, the President or a Vice President, and by
the Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary,
of the Company, and delivered to the Trustee. One of the officers signing an
Officers' Certificate given pursuant to Section 1004 shall be the principal
executive, financial or accounting officer of the Company.
"Opinion of Counsel" means a written opinion of counsel, who may be counsel
for the Company, and who shall be acceptable to the Trustee.
"Original Issue Discount Security" means any Security which provides for an
amount less than the principal amount thereof to be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to Section 502.
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<PAGE>
"Outstanding", when used with respect to Securities, means, as of the date of
determination, all Securities theretofore authenticated and delivered under this
Indenture, except:
(1) Securities theretofore cancelled by the Trustee or delivered to the
Trustee for cancellation;
(2) Securities for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Trustee or any Paying Agent
(other than the Company) in trust or set aside and segregated in trust by the
Company (if the Company shall act as its own Paying Agent) for the Holders of
such Securities; provided that, if such Securities are to be redeemed, notice
of such redemption has been duly given pursuant to this Indenture or provision
therefor satisfactory to the Trustee has been made;
(3) Securities as to which Defeasance has been effected pursuant to
Section 1302; and
(4) Securities which have been paid pursuant to Section 306 or in exchange
for or in lieu of which other Securities have been authenticated and delivered
pursuant to this Indenture, other than any such Securities in respect of which
there shall have been presented to the Trustee proof satisfactory to it that
such Securities are held by a bona fide purchaser in whose hands such
Securities are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given, made or taken any
request, demand, authorization, direction, notice, consent, waiver or other
action hereunder as of any date, (A) the principal amount of an Original Issue
Discount Security which shall be deemed to be Outstanding shall be the amount of
the principal thereof which would be due and payable as of such date upon
acceleration of the Maturity thereof to such date pursuant to Section 502, (B)
if, as of such date, the principal amount payable at the Stated Maturity of a
Security is not determinable, the principal amount of such Security which shall
be deemed to be Outstanding shall be the amount as specified or determined as
contemplated by Section 301, (C) the principal amount of a Security denominated
in one or more foreign currencies or currency units which shall be deemed to be
Outstanding shall be the U.S. dollar equivalent, determined as of such date in
the manner provided as contemplated by Section 301, of the principal amount of
such Security (or, in the case of a Security described in Clause (A) or (B)
above, of the amount determined as provided in such Clause), and (D) Securities
owned by the Company or any other obligor upon the Securities or any Affiliate
of the Company or of such other obligor shall be disregarded and deemed not to
be Outstanding, except that, in determining whether the Trustee shall be
protected in relying upon any such request, demand, authorization, direction,
notice, consent, waiver or other action, only Securities which the Trustee knows
to be so owned shall be so disregarded. Securities so owned which have been
pledged in good faith may be regarded as Outstanding if the pledgee establishes
to the satisfaction of the Trustee the pledgee's right so to act with respect to
such Securities and that the pledgee is not the
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<PAGE>
Company or any other obligor upon the Securities or any Affiliate of the Company
or of such other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal of or any premium or interest on any Securities on behalf of the
Company.
"Person" means any individual, corporation, partnership, joint venture,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"Place of Payment", when used with respect to the Securities of any series,
means the place or places where the principal of and any premium and interest on
the Securities of that series are payable as specified as contemplated by
Section 301.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 306 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.
"Redemption Date", when used with respect to any Security to be redeemed,
means the date fixed for such redemption by or pursuant to this Indenture.
"Redemption Price", when used with respect to any Security to be redeemed,
means the price at which it is to be redeemed pursuant to this Indenture.
"Regular Record Date" for the interest payable on any Interest Payment Date
on the Securities of any series means the date specified for that purpose as
contemplated by Section 301.
"Responsible Officer", when used with respect to the Trustee, means the
chairman or any vice-chairman of the board of directors, the chairman or any
vice-chairman of the executive committee of the board of directors, the chairman
of the trust committee, the president, any vice president, the secretary, any
assistant secretary, the treasurer, any assistant treasurer, the cashier, any
assistant cashier, any trust officer or assistant trust officer, the controller
or any assistant controller or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"Restricted Subsidiary" means the Atchison, Topeka and Santa Fe Railway
Company and any successor or assign thereof whether by merger or otherwise.
"Securities" has the meaning stated in the first recital of this Indenture
and more particularly means any Securities authenticated and delivered under
this Indenture.
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<PAGE>
"Securities Act" means the Securities Act of 1933 and any statute successor
thereto, in each case as amended from time to time.
"Security Register" and "Security Registrar" have the respective meanings
specified in Section 305.
"Special Record Date" for the payment of any Defaulted Interest means a date
fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Security or any instalment
of principal thereof or interest thereon, means the date specified in such
Security as the fixed date on which the principal of such Security or such
instalment of principal or interest is due and payable.
"Subsidiary" means a corporation more than 50% of the outstanding voting
stock of which is owned, directly or indirectly, by the Company or by one or
more other Subsidiaries, or by the Company and one or more other Subsidiaries.
For the purposes of this definition, "voting stock" means stock which ordinarily
has voting power for the election of directors, whether at all times or only so
long as no senior class of stock has such voting power by reason of any
contingency.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trustee" means the Person named as the "Trustee" in the first paragraph of
this instrument until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Trustee" shall mean or
include each Person who is then a Trustee hereunder, and if at any time there is
more than one such Person, "Trustee" as used with respect to the Securities of
any series shall mean the Trustee with respect to Securities of that series.
"U.S. Government Obligation" has the meaning specified in Section 1304.
"Vice President", when used with respect to the Company or the Trustee, means
any vice president, whether or not designated by a number or a word or words
added before or after the title "vice president".
Section 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to take any
action under any provision of this Indenture, the Company shall furnish to the
Trustee such certificates and opinions as may be required under the Trust
Indenture Act. Each such certificate or opinion shall be given in the form of an
Officers' Certificate, if to be given by an officer of the Company, or an
Opinion of Counsel, if to be given by counsel, and
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<PAGE>
shall comply with the requirements of the Trust Indenture Act and any other
requirements set forth in this Indenture.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture shall include,
(1) a statement that each individual signing such certificate or opinion
has read such covenant or condition and the definitions herein relating
thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he has made
such examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(4) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
Section 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or covered
by an opinion of, any specified Person, it is not necessary that all such
matters be certified by, or covered by the opinion of, only one such Person, or
that they be so certified or covered by only one document, but one such Person
may certify or give an opinion with respect to some matters and one or more
other such Persons as to other matters, and any such Person may certify or give
an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based, insofar
as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
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Section 104. Acts of Holders; Record Dates.
Any request, demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Indenture to be given, made or taken
by Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 601) conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such instrument or
writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is by
a signer acting in a capacity other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or writing,
or the authority of the Person executing the same, may also be proved in any
other manner which the Trustee deems sufficient.
The ownership of Securities shall be proved by the Security Register.
Any request, demand, authorization, direction, notice, consent, waiver or
other Act of the Holder of any Security shall bind every future Holder of the
same Security and the Holder of every Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or the Company in
reliance thereon, whether or not notation of such action is made upon such
Security.
The Company may set any day as a record date for the purpose of determining
the Holders of Outstanding Securities of any series entitled to give, make or
take any request, demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Indenture to be given, made or taken
by Holders of Securities of such series, provided that the Company may not set a
record date for, and the provisions of this paragraph shall not apply with
respect to, the giving or making of any notice, declaration, request or
direction referred to in the next paragraph. If any record date is set pursuant
to this paragraph, the Holders of Outstanding Securities of the relevant series
on such record date, and no other Holders, shall be entitled to take the
relevant action, whether or not such Holders remain Holders after such record
date; provided that no such action shall be effective hereunder unless taken on
or prior to the applicable Expiration Date by Holders of the requisite principal
amount of Outstanding Securities of such series on such record date. Nothing in
this paragraph shall be construed to prevent the
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<PAGE>
Company from setting a new record date for any action for which a record date
has previously been set pursuant to this paragraph (whereupon the record date
previously set shall automatically and with no action by any Person be cancelled
and of no effect), and nothing in this paragraph shall be construed to render
ineffective any action taken by Holders of the requisite principal amount of
Outstanding Securities of the relevant series on the date such action is taken.
Promptly after any record date is set pursuant to this paragraph, the Company,
at its own expense, shall cause notice of such record date, the proposed action
by Holders and the applicable Expiration Date to be given to the Trustee in
writing and to each Holder of Securities of the relevant series in the manner
set forth in Section 106.
The Trustee may set any day as a record date for the purpose of determining
the Holders of Outstanding Securities of any series entitled to join in the
giving or making of (i) any Notice of Default, (ii) any declaration of
acceleration referred to in Section 502, (iii) any request to institute
proceedings referred to in Section 507(2) or (iv) any direction referred to in
Section 512, in each case with respect to Securities of such series. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of such series on such record date, and no other Holders, shall be
entitled to join in such notice, declaration, request or direction, whether or
not such Holders remain Holders after such record date; provided that no such
action shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date. Nothing in this paragraph shall
be construed to prevent the Trustee from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities of the relevant
series on the date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Trustee, at the Company's expense, shall cause
notice of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Company in writing and to each Holder of
Securities of the relevant series in the manner set forth in Section 106.
With respect to any record date set pursuant to this Section, the party
hereto which sets such record dates may designate any day as the "Expiration
Date" and from time to time may change the Expiration Date to any earlier or
later day; provided that no such change shall be effective unless notice of the
proposed new Expiration Date is given to the other party hereto in writing, and
to each Holder of Securities of the relevant series in the manner set forth in
Section 106, on or prior to the existing Expiration Date. If an Expiration Date
is not designated with respect to any record date set pursuant to this Section,
the party hereto which set such record date shall be deemed to have initially
designated the 180th day after such record date as the Expiration Date with
respect thereto, subject to its right to change the Expiration Date as provided
in this paragraph. Notwithstanding the foregoing, no Expiration Date shall be
later than the 180th day after the applicable record date.
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<PAGE>
Without limiting the foregoing, a Holder entitled hereunder to take any
action hereunder with regard to any particular Security may do so with regard to
all or any part of the principal amount of such Security or by one or more duly
appointed agents each of which may do so pursuant to such appointment with
regard to all or any part of such principal amount.
Section 105. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice, consent, waiver or Act
of Holders or other document provided or permitted by this Indenture to be made
upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient for
every purpose hereunder if made, given, furnished or filed in writing to or
with the Trustee at its Corporate Trust Office, Attention: Corporate Trust
Administration, or
(2) the Company by the Trustee or by any Holder shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to the Company addressed to it
at the address of its principal office specified in the first paragraph of this
instrument or at any other address previously furnished in writing to the
Trustee by the Company.
Section 106. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, such notice
shall be sufficiently given (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to each Holder affected by such
event, at his address as it appears in the Security Register, not later than the
latest date (if any), and not earlier than the earliest date (if any),
prescribed for the giving of such notice. In any case where notice to Holders is
given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. Where this Indenture provides for notice
in any manner, such notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and such waiver shall be
the equivalent of such notice. Waivers of notice by Holders shall be filed with
the Trustee, but such filing shall not be a condition precedent to the validity
of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by reason of
any other cause it shall be impracticable to give such notice by mail, then such
notification as shall be made with the approval of the Trustee shall constitute
a sufficient notification for every purpose hereunder.
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Section 107. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a provision of
the Trust Indenture Act which is required under such Act to be a part of and
govern this Indenture, the latter provision shall control. If any provision of
this Indenture modifies or excludes any provision of the Trust Indenture Act
which may be so modified or excluded, the latter provision shall be deemed to
apply to this Indenture as so modified or to be excluded, as the case may be.
Section 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
Section 109. Successors and Assigns.
All covenants and agreements in this Indenture by the Company shall bind its
successors and assigns, whether so expressed or not.
Section 110. Separability Clause.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 111. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied, shall
give to any Person, other than the parties hereto and their successors hereunder
and the Holders, any benefit or any legal or equitable right, remedy or claim
under this Indenture.
Section 112. Governing Law.
This Indenture and the Securities shall be governed by and construed in
accordance with the law of the State of New York.
Section 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security shall not be a Business Day at any Place of Payment,
then (notwithstanding any other provision of this Indenture or of the Securities
(other than a provision
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<PAGE>
of any Security which specifically states that such provision shall apply in
lieu of this Section)) payment of interest or principal (and premium, if any)
need not be made at such Place of Payment on such date, but may be made on the
next succeeding Business Day at such Place of Payment with the same force and
effect as if made on the Interest Payment Date or Redemption Date, or at the
Stated Maturity.
ARTICLE TWO
Security Forms
Section 201. Forms Generally.
The Securities of each series shall be in substantially the form set forth in
this Article, or in such other form as shall be established by or pursuant to a
Board Resolution or in one or more indentures supplemental hereto, in each case
with such appropriate insertions, omissions, substitutions and other variations
as are required or permitted by this Indenture, and may have such letters,
numbers or other marks of identification and such legends or endorsements placed
thereon as may be required to comply with the rules of any securities exchange
or Depositary therefor or as may, consistently herewith, be determined by the
officers executing such Securities, as evidenced by their execution thereof. If
the form of Securities of any series is established by action taken pursuant to
a Board Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Company Order
contemplated by Section 303 for the authentication and delivery of such
Securities.
The definitive Securities shall be printed, lithographed or engraved on steel
engraved borders or may be produced in any other manner, all as determined by
the officers executing such Securities, as evidenced by their execution of such
Securities.
Section 202. Form of Face of Security.
[Insert any legend required by the Internal Revenue Code and the regulations
thereunder.]
..........................................
...............................................................
No. ......... $ ........
.........................., a corporation duly organized and existing under
the laws of ............... (herein called the "Company", which term includes
any successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay
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to ..............................................., or registered assigns, the
principal sum of ...................................... Dollars on
........................................................ [if the Security is to
bear interest prior to Maturity, insert -- , and to pay interest thereon from
............. or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, semi-annually on ............ and
............ in each year, commencing ........., at the rate of ....% per annum,
until the principal hereof is paid or made available for payment [if applicable,
insert -- , provided that any principal and premium, and any such instalment of
interest, which is overdue shall bear interest at the rate of ...% per annum (to
the extent that the payment of such interest shall be legally enforceable), from
the dates such amounts are due until they are paid or made available for
payment, and such interest shall be payable on demand]. The interest so payable,
and punctually paid or duly provided for, on any Interest Payment Date will, as
provided in such Indenture, be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest, which shall be the ....... or
....... (whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date. Any such interest not so punctually paid or duly provided
for will forthwith cease to be payable to the Holder on such Regular Record Date
and may either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in said Indenture].
[If the Security is not to bear interest prior to Maturity, insert -- The
principal of this Security shall not bear interest except in the case of a
default in payment of principal upon acceleration, upon redemption or at Stated
Maturity and in such case the overdue principal and any overdue premium shall
bear interest at the rate of ....% per annum (to the extent that the payment of
such interest shall be legally enforceable), from the dates such amounts are due
until they are paid or made available for payment. Interest on any overdue
principal or premium shall be payable on demand. [Any such interest on overdue
principal or premium which is not paid on demand shall bear interest at the rate
of ......% per annum (to the extent that the payment of such interest on
interest shall be legally enforceable), from the date of such demand until the
amount so demanded is paid or made available for payment. Interest on any
overdue interest shall be payable on demand.]]
Payment of the principal of (and premium, if any) and [if applicable, insert
- -- any such] interest on this Security will be made at the office or agency of
the Company maintained for that purpose in ............, in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts [if applicable, insert -- ;
provided, however, that at the option of the Company payment of interest may be
made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register].
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<PAGE>
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 Company has caused this instrument to be duly
executed under its corporate seal.
Dated:
........................................
By......................................
Attest:
............................
Section 203. Form of Reverse of Security.
This Security is one of a duly authorized issue of securities of the Company
(herein called the "Securities"), issued and to be issued in one or more series
under an Indenture, dated as of ............... (herein called the "Indenture",
which term shall have the meaning assigned to it in such instrument), between
the Company and ..................., as Trustee (herein called the "Trustee",
which term includes any successor trustee under the Indenture), and reference is
hereby made to the Indenture for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Trustee and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered. This Security is one
of the series designated on the face hereof [if applicable, insert -- , limited
in aggregate principal amount to $...........].
[If applicable, insert -- The Securities of this series are subject to
redemption upon not less than 30 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 at a
Redemption Price equal to 100% of the principal amount, and (2)] at any time [if
applicable, insert -- on or after .........., 19..], as a whole or in part, at
the election of the Company, at the following Redemption Prices (expressed as
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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,
<TABLE>
<CAPTION>
Redemption Redemption
Year Price Year Price
- ------ ----------- ---- ----------
<S> <C> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to .....% of the principal amount,
together in the case of any such redemption [if applicable, insert -- (whether
through operation of the sinking fund or otherwise)] with accrued interest to
the Redemption Date, but interest instalments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such Securities,
or one or more Predecessor Securities, of record at the close of business on the
relevant Record Dates referred to on the face hereof, all as provided in the
Indenture.]
[If applicable, insert -- The Securities of this series are subject to
redemption upon not less than 30 days' notice by mail, (1) on ............ in
any year commencing with the year .... and ending with the year .... through
operation of the sinking fund for this series at the Redemption Prices for
redemption through operation of the sinking fund (expressed as percentages of
the principal amount) set forth in the table below, and (2) at any time [if
applicable, insert -- on or after ............], as a whole or in part, at the
election of the Company, at the Redemption Prices for redemption otherwise than
through operation of the sinking fund (expressed as percentages of the principal
amount) set forth in the table below: If redeemed during the 12-month period
beginning ............ of the years indicated,
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<TABLE>
<CAPTION>
Redemption Price
For Redemption Redemption Price For
Through Operation Redemption Otherwise
of the Than Through Operation
Year Sinking Fund of the Sinking Fund
- ---- ----------------- ----------------------
<S> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to .....% of the principal amount,
together in the case of any such redemption (whether through operation of the
sinking fund or otherwise) with accrued interest to the Redemption Date, but
interest instalments whose Stated Maturity is on or prior to such Redemption
Date will be payable to the Holders of such Securities, or one or more
Predecessor Securities, of record at the close of business on the relevant
Record Dates referred to on the face hereof, all as provided in the Indenture.]
[If applicable, insert -- Notwithstanding the foregoing, the Company may not,
prior to ............., redeem any Securities of this series as contemplated by
[if applicable, insert -- Clause (2) of] the preceding paragraph as a part of,
or in anticipation of, any refunding operation by the application, directly or
indirectly, of moneys borrowed having an interest cost to the Company
(calculated in accordance with generally accepted financial practice) of less
than .....% per annum.]
[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 [if applicable, insert -- not less than
$.......... ("mandatory sinking fund") and not more than] $......... aggregate
principal amount of Securities of this series. Securities of this series
acquired or redeemed by the Company otherwise than through [if applicable,
insert -- mandatory] sinking fund payments may be credited against subsequent
[if applicable, insert -- mandatory] sinking fund payments otherwise required to
be made [if applicable, insert -- , in the inverse order in which they become
due].]
[If the Security is subject to redemption of any kind, insert -- In the event
of redemption of this Security in part only, a new Security or Securities of
this series and of like tenor for the unredeemed portion hereof will be issued
in the name of the Holder hereof upon the cancellation hereof.]
[If applicable, insert -- The Indenture contains provisions for defeasance at
any time of [the entire indebtedness of this Security] [or] [certain restrictive
covenants and Events of Default with respect to this Security] [, in each case]
upon compliance with certain conditions set forth in the Indenture.]
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[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, the principal of the Securities of this series may be declared due
and payable in the manner and with the effect provided in the Indenture.]
[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, an amount of principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture. Such amount shall be equal to -- insert formula for determining the
amount. Upon payment (i) of the amount of principal so declared due and payable
and (ii) of interest on any overdue principal, premium and interest (in each
case to the extent that the payment of such interest shall be legally
enforceable), all of the Company's obligations in respect of the payment of the
principal of and premium and interest, if any, on the Securities of this series
shall terminate.]
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of a majority in principal amount of the Securities at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Securities of each series at the time Outstanding, on behalf of the
Holders of all Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture, the Holder of
this Security shall not have the right to institute any proceeding with respect
to the Indenture or for the appointment of a receiver or trustee or for any
other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 25% in principal amount
of the Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable indemnity, and the Trustee
shall not have received from the Holders of a majority in principal amount of
Securities of this series at the time Outstanding a direction inconsistent with
such request, and shall have failed to institute any such proceeding, for 60
days after receipt of such notice, request and offer of indemnity. The foregoing
shall not apply to any suit instituted by the Holder of this Security for the
enforcement of any payment of principal hereof or any premium or interest hereon
on or after the respective due dates expressed herein.
No reference herein to the Indenture and no provision of this Security or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and
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unconditional, to pay the principal of and any premium and interest on this
Security at the times, place and rate, and in the coin or currency, herein
prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Security is registrable in the Security Register,
upon surrender of this Security for registration of transfer at the office or
agency of the Company in any place where the principal of and any premium and
interest on this Security are payable, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities of this series
and of like tenor, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered form without
coupons in denominations of $....... and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities of this series are exchangeable for a like aggregate principal amount
of Securities of this series and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
All terms used in this Security which are defined in the Indenture shall have
the meanings assigned to them in the Indenture.
Section 204. Form of Legend for Global Securities.
Unless otherwise specified as contemplated by Section 301 for the Securities
evidenced thereby, every Global Security authenticated and delivered hereunder
shall bear a legend in substantially the following form:
This Security is a Global Security within the meaning of the Indenture
hereinafter referred to and is registered in the name of a Depositary or a
nominee thereof. This Security may not be exchanged in whole or in part for a
Security registered, and no transfer of this Security in whole or in part may be
registered, in the name of any Person other than such Depositary or a nominee
thereof, except in the limited circumstances described in the Indenture.
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Section 205. Form of Trustee's Certificate of Authentication.
The Trustee's certificates of authentication shall be in substantially the
following form:
This is one of the Securities of the series designated therein referred to in
the within-mentioned Indenture.
...............................,
As Trustee
By..............................
Authorized Officer
ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution and, subject to Section 303,
set forth, or determined in the manner provided, in an Officers' Certificate, or
established in one or more indentures supplemental hereto, prior to the issuance
of Securities of any series,
(1) the title of the Securities of the series (which shall distinguish the
Securities of the series from Securities of any other series);
(2) any limit upon the aggregate principal amount of the Securities of the
series which may be authenticated and delivered under this Indenture (except
for Securities authenticated and delivered upon registration of transfer of, or
in exchange for, or in lieu of, other Securities of the series pursuant to
Section 304, 305, 306, 906 or 1107 and except for any Securities which,
pursuant to Section 303, are deemed never to have been authenticated and
delivered hereunder);
(3) the date or dates on which the principal of any Securities of the
series is payable;
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(4) the rate or rates at which any Securities of the series shall bear
interest, if any, the date or dates from which any such interest shall accrue,
the Interest Payment Dates on which any such interest shall be payable and the
Regular Record Date for any such interest payable on any Interest Payment Date;
(5) the place or places where the principal of and any premium and interest
on any Securities of the series shall be payable;
(6) the period or periods within which, the price or prices at which and
the terms and conditions upon which any Securities of the series may be
redeemed, in whole or in part, at the option of the Company and, if other than
by a Board Resolution, the manner in which any election by the Company to
redeem the Securities shall be evidenced;
(7) the obligation, if any, of the Company to redeem or purchase any
Securities of the series pursuant to any sinking fund or analogous provisions
or at the option of the Holder thereof and the period or periods within which,
the price or prices at which and the terms and conditions upon which any
Securities of the series shall be redeemed or purchased, in whole or in part,
pursuant to such obligation;
(8) if other than denominations of $1,000 and any integral multiple
thereof, the denominations in which any Securities of the series shall be
issuable;
(9) if the amount of principal of or any premium or interest on any
Securities of the series may be determined with reference to an index or
pursuant to a formula, the manner in which such amounts shall be determined;
(10) if other than the currency of the United States of America, the
currency, currencies or currency units in which the principal of or any premium
or interest on any Securities of the series shall be payable and the manner of
determining the equivalent thereof in the currency of the United States of
America for any purpose, including for purposes of the definition of
"Outstanding" in Section 101;
(11) if the principal of or any premium or interest on any Securities of
the series is to be payable, at the election of the Company or the Holder
thereof, in one or more currencies or currency units other than that or those
in which such Securities are stated to be payable, the currency, currencies or
currency units in which the principal of or any premium or interest on such
Securities as to which such election is made shall be payable, the periods
within which and the terms and conditions upon which such election is to be
made and the amount so payable (or the manner in which such amount shall be
determined);
(12) if other than the entire principal amount thereof, the portion of the
principal amount of any Securities of the series which shall be payable upon
declaration of acceleration of the Maturity thereof pursuant to Section 502;
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(13) if the principal amount payable at the Stated Maturity of any
Securities of the series will not be determinable as of any one or more dates
prior to the Stated Maturity, the amount which shall be deemed to be the
principal amount of such Securities as of any such date for any purpose
thereunder or hereunder, including the principal amount thereof which shall be
due and payable upon any Maturity other than the Stated Maturity or which shall
be deemed to be Outstanding as of any date prior to the Stated Maturity (or, in
any such case, the manner in which such amount deemed to be the principal
amount shall be determined);
(14) if applicable, that the Securities of the series, in whole or any
specified part, shall be defeasible pursuant to Section 1302 or Section 1303 or
both such Sections and, if other than by a Board Resolution, the manner in
which any election by the Company to defease such Securities shall be
evidenced;
(15) if applicable, that any Securities of the series shall be issuable in
whole or in part in the form of one or more Global Securities and, in such
case, the respective Depositaries for such Global Securities, the form of any
legend or legends which shall be borne by any such Global Security in addition
to or in lieu of that set forth in Section 204 and any circumstances in
addition to or in lieu of those set forth in Clause (2) of the last paragraph
of Section 305 in which any such Global Security may be exchanged in whole or
in part for Securities registered, and any transfer of such Global Security in
whole or in part may be registered, in the name or names of Persons other than
the Depositary for such Global Security or a nominee thereof;
(16) any addition to or change in the Events of Default which applies to
any Securities of the series and any change in the right of the Trustee or the
requisite Holders of such Securities to declare the principal amount thereof
due and payable pursuant to Section 502;
(17) any addition to or change in the covenants set forth in Article Ten
which applies to Securities of the series; and
(18) any other terms of the series (which terms shall not be inconsistent
with the provisions of this Indenture, except as permitted by Section 901(5)).
All Securities of any one series shall be substantially identical except as
to denomination and except as may otherwise be provided in or pursuant to the
Board Resolution referred to above and (subject to Section 303) set forth, or
determined in the manner provided, in the Officers' Certificate referred to
above or in any such indenture supplemental hereto.
If any of the terms of the series are established by action taken pursuant to
a Board Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
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Section 302. Denominations.
The Securities of each series shall be issuable only in registered form
without coupons and only in such denominations as shall be specified as
contemplated by Section 301. In the absence of any such specified denomination
with respect to the Securities of any series, the Securities of such series
shall be issuable in denominations of $1,000 and any integral multiple thereof.
Section 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its Chairman of
the Board, its Vice Chairman of the Board, its President or one of its Vice
Presidents, under its corporate seal reproduced thereon attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals who were
at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities of any series executed by the
Company to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities, and the Trustee in accordance
with the Company Order shall authenticate and deliver such Securities. If the
form or terms of the Securities of the series have been established by or
pursuant to one or more Board Resolutions as permitted by Sections 201 and 301,
in authenticating such Securities, and accepting the additional responsibilities
under this Indenture in relation to such Securities, the Trustee shall be
entitled to receive, and (subject to Section 601) shall be fully protected in
relying upon, an Opinion of Counsel stating,
(1) if the form of such Securities has been established by or pursuant to
Board Resolution as permitted by Section 201, that such form has been
established in conformity with the provisions of this Indenture;
(2) if the terms of such Securities have been established by or pursuant to
Board Resolution as permitted by Section 301, that such terms have been
established in conformity with the provisions of this Indenture; and
(3) that such Securities, when authenticated and delivered by the Trustee
and issued by the Company in the manner and subject to any conditions specified
in such Opinion of Counsel, will constitute valid and legally binding
obligations of the Company enforceable in accordance with their terms, subject
to bankruptcy,
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<PAGE>
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and to general
equity principles.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 301 and of the preceding paragraph,
if all Securities of a series are not to be originally issued at one time, it
shall not be necessary to deliver the Officers' Certificate otherwise required
pursuant to Section 301 or the Company Order and Opinion of Counsel otherwise
required pursuant to such preceding paragraph at or prior to the authentication
of each Security of such series if such documents are delivered at or prior to
the authentication upon original issuance of the first Security of such series
to be issued.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or be valid
or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such Security
has been duly authenticated and delivered hereunder. Notwithstanding the
foregoing, if any Security shall have been authenticated and delivered hereunder
but never issued and sold by the Company, and the Company shall deliver such
Security to the Trustee for cancellation as provided in Section 309, for all
purposes of this Indenture such Security shall be deemed never to have been
authenticated and delivered hereunder and shall never be entitled to the
benefits of this Indenture.
Section 304. Temporary Securities.
Pending the preparation of definitive Securities of any series, the Company
may execute, and upon Company Order the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed, typewritten, mimeographed
or otherwise produced, in any authorized denomination, substantially of the
tenor of the definitive Securities in lieu of which they are issued and with
such appropriate insertions, omissions, substitutions and other variations as
the officers executing such Securities may determine, as evidenced by their
execution of such Securities.
If temporary Securities of any series are issued, the Company will cause
definitive Securities of that series to be prepared without unreasonable delay.
After the preparation of definitive Securities of such series, the temporary
Securities of such series shall be exchangeable for definitive Securities of
such series upon surrender of the temporary Securities of such series at the
office or agency of the Company in a Place of Payment for that series, without
charge to the Holder. Upon surrender for cancellation of any one
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<PAGE>
or more temporary Securities of any series, the Company shall execute and the
Trustee shall authenticate and deliver in exchange therefor one or more
definitive Securities of the same series, of any authorized denominations and of
like tenor and aggregate principal amount. Until so exchanged, the temporary
Securities of any series shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities of such series and tenor.
Section 305. Registration, Registration of Transfer and Exchange.
The Company shall cause to be kept at the Corporate Trust Office of the
Trustee a register (the register maintained in such office and in any other
office or agency of the Company in a Place of Payment being herein sometimes
collectively referred to as the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Securities and of transfers of Securities. The Trustee is hereby
appointed "Security Registrar" for the purpose of registering Securities and
transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security of a series at
the office or agency of the Company in a Place of Payment for that series, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Securities of
the same series, of any authorized denominations and of like tenor and aggregate
principal amount.
At the option of the Holder, Securities of any series may be exchanged for
other Securities of the same series, of any authorized denominations and of like
tenor and aggregate principal amount, upon surrender of the Securities to be
exchanged at such office or agency. Whenever any Securities are so surrendered
for exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Holder making the exchange is entitled to
receive.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of transfer or for
exchange shall (if so required by the Company or the Trustee) be duly endorsed,
or be accompanied by a written instrument of transfer in form satisfactory to
the Company and the Security Registrar duly executed, by the Holder thereof or
his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or exchange
of Securities, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection with any
registration of transfer or exchange of Securities, other than exchanges
pursuant to Section 304, 906 or 1107 not involving any transfer.
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If the Securities of any series (or of any series and specified tenor) are to
be redeemed in part, the Company shall not be required (A) to issue, register
the transfer of or exchange any Securities of that series (or of that series and
specified tenor, as the case may be) during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of any
such Securities selected for redemption under Section 1103 and ending at the
close of business on the day of such mailing, or (B) to register the transfer of
or exchange any Security so selected for redemption in whole or in part, except
the unredeemed portion of any Security being redeemed in part.
The provisions of Clauses (1), (2), (3) and (4) below shall apply only to
Global Securities:
(1) Each Global Security authenticated under this Indenture shall be
registered in the name of the Depositary designated for such Global Security or
a nominee thereof and delivered to such Depositary or a nominee thereof or
custodian therefor, and each such Global Security shall constitute a single
Security for all purposes of this Indenture.
(2) Notwithstanding any other provision in this Indenture, 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 unless (A) such Depositary (i) has notified the Company that it
is unwilling or unable to continue as Depositary for such Global Security or
(ii) has ceased to be a clearing agency registered under the Exchange Act, (B)
there shall have occurred and be continuing an Event of Default with respect to
such Global Security or (C) there shall exist such circumstances, if any, in
addition to or in lieu of the foregoing as have been specified for this purpose
as contemplated by Section 301.
(3) Subject to Clause (2) above, any exchange of a Global Security for
other Securities may be made in whole or in part, and all Securities issued in
exchange for a Global Security or any portion thereof shall be registered in
such names as the Depositary for such Global Security shall direct.
(4) 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 Section, Section 304, 306, 906 or 1107 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.
Section 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee, the Company shall
execute and the Trustee shall authenticate and deliver in exchange therefor a
new Security of the
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same series and of like tenor and principal amount and bearing a number not
contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i) evidence to
their satisfaction of the destruction, loss or theft of any Security and (ii)
such security or indemnity as may be required by them to save each of them and
any agent of either of them harmless, then, in the absence of notice to the
Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and the Trustee shall authenticate and
deliver, in lieu of any such destroyed, lost or stolen Security, a new Security
of the same series and of like tenor and principal amount and bearing a number
not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has become or
is about to become due and payable, the Company in its discretion may, instead
of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this Section in lieu of
any destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of that series duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.
Section 307. Payment of Interest; Interest Rights Preserved.
Except as otherwise provided as contemplated by Section 301 with respect to
any series of Securities, interest on any Security which is payable, and is
punctually paid or duly provided for, on any Interest Payment Date shall be paid
to the Person in whose name that Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest.
Any interest on any Security of any series which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular
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Record Date by virtue of having been such Holder, and such Defaulted Interest
may be paid by the Company, at its election in each case, as provided in Clause
(1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to the
Persons in whose names the Securities of such series (or their respective
Predecessor Securities) are registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest, which shall be fixed
in the following manner. The Company shall notify the Trustee in writing of
the amount of Defaulted Interest proposed to be paid on each Security of such
series and the date of the proposed payment, and at the same time the Company
shall deposit with the Trustee an amount of money equal to the aggregate
amount proposed to be paid in respect of such Defaulted Interest or shall
make arrangements satisfactory to the Trustee for such deposit prior to the
date of the proposed payment, such money when deposited to be held in trust
for the benefit of the Persons entitled to such Defaulted Interest as in this
Clause provided. Thereupon the Trustee shall fix a Special Record Date for
the payment of such Defaulted Interest which shall be not more than 15 days
and not less than 10 days prior to the date of the proposed payment and not
less than 10 days after the receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly notify the Company of such
Special Record Date and, in the name and at the expense of the Company, shall
cause notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor to be given to each Holder of Securities of such
series in the manner set forth in Section 106, not less than 10 days prior to
such Special Record Date. Notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor having been so mailed, such
Defaulted Interest shall be paid to the Persons in whose names the Securities
of such series (or their respective Predecessor Securities) are registered at
the close of business on such Special Record Date and shall no longer be
payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest on the
Securities of any series in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such Securities may be
listed, and upon such notice as may be required by such exchange, if, after
notice given by the Company to the Trustee of the proposed payment pursuant
to this Clause, such manner of payment shall be deemed practicable by the
Trustee.
Subject to the foregoing provisions of this Section, each Security delivered
under this Indenture upon registration of transfer of or in exchange for or in
lieu of any other Security shall carry the rights to interest accrued and
unpaid, and to accrue, which were carried by such other Security.
Section 308. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name such Security is registered as the owner of such Security
for the purpose of
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receiving payment of principal of and any premium and (subject to Section 307)
any interest on such Security and for all other purposes whatsoever, whether or
not such Security be overdue, and neither the Company, the Trustee nor any agent
of the Company or the Trustee shall be affected by notice to the contrary.
Section 309. Cancellation.
All Securities surrendered for payment, redemption, registration of transfer
or exchange or for credit against any sinking fund payment shall, if surrendered
to any Person other than the Trustee, be delivered to the Trustee and shall be
promptly cancelled by it. The Company may at any time deliver to the Trustee for
cancellation any Securities previously authenticated and delivered hereunder
which the Company may have acquired in any manner whatsoever, and may deliver to
the Trustee (or to any other Person for delivery to the Trustee) for
cancellation any Securities previously authenticated hereunder which the Company
has not issued and sold, and all Securities so delivered shall be promptly
cancelled by the Trustee. No Securities shall be authenticated in lieu of or in
exchange for any Securities cancelled as provided in this Section, except as
expressly permitted by this Indenture. All cancelled Securities held by the
Trustee shall be disposed of as directed by a Company Order.
Section 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301 for Securities
of any series, interest on the Securities of each series shall be computed on
the basis of a 360-day year of twelve 30-day months.
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of further effect
(except as to any surviving rights of registration of transfer or exchange of
Securities herein expressly provided for), and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered (other than (i)
Securities which have been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 306 and (ii) Securities for whose
payment money has theretofore been deposited in trust or segregated and held
in trust by the Company
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and thereafter repaid to the Company or discharged from such trust, as
provided in Section 1003) have been delivered to the Trustee for
cancellation; or
(B) all such Securities not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity within one
year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the Company,
and the Company, in the case of (i), (ii) or (iii) above, has deposited or
caused to be deposited with the Trustee as trust funds in trust for the
purpose money in an amount sufficient to pay and discharge the entire
indebtedness on such Securities not theretofore delivered to the Trustee for
cancellation, for principal and any premium and interest to the date of such
deposit (in the case of Securities which have become due and payable) or to
the Stated Maturity or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel, each stating that all conditions precedent herein provided
for relating to the satisfaction and discharge of this Indenture have been
complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 607, the obligations of
the Trustee to any Authenticating Agent under Section 614 and, if money shall
have been deposited with the Trustee pursuant to subclause (B) of Clause (1) of
this Section, the obligations of the Trustee under Section 402 and the last
paragraph of Section 1003 shall survive.
Section 402. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all money
deposited with the Trustee pursuant to Section 401 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal and any premium and
interest for whose payment such money has been deposited with the Trustee.
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ARTICLE FIVE
Remedies
Section 501. Events of Default.
"Event of Default", wherever used herein with respect to Securities of any
series, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(1) default in the payment of any interest upon any Security of that series
when it becomes due and payable, and continuance of such default for a period
of 30 days; or
(2) default in the payment of the principal of or any premium on any
Security of that series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when and as due by
the terms of a Security of that series; or
(4) default in the performance, or breach, of any covenant or warranty of
the Company in this Indenture (other than a covenant or warranty a default in
whose performance or whose breach is elsewhere in this Section specifically
dealt with or which has expressly been included in this Indenture solely for
the benefit of series of Securities other than that series), and continuance of
such default or breach for a period of 60 days after there has been given, by
registered or certified mail, to the Company by the Trustee or to the Company
and the Trustee by the Holders of at least 25% in principal amount of the
Outstanding Securities of that series a written notice specifying such default
or breach and requiring it to be remedied and stating that such notice is a
"Notice of Default" hereunder; or
(5) acceleration of payment on any bond, debenture, note or other evidence of
indebtedness for money borrowed by the Company (including the acceleration of
Securities of any series other than that series) having an aggregate principal
amount outstanding of at least $25,000,000, or under any mortgage, indenture or
instrument (including this Indenture) under which there may be issued or by
which there may be secured or evidenced any indebtedness for money borrowed by
the Company having an aggregate principal amount outstanding of at least
$25,000,000, whether such indebtedness now exists or shall hereafter be
created, without such indebtedness having been discharged, or such acceleration
having been rescinded or annulled, within a period of 10 days after there shall
have been given, by registered or certified mail, to the Company by the Trustee
or to the Company and the Trustee by the Holders of at least 25% in principal
amount of the Outstanding Securities of that series a written notice specifying
such acceleration and requiring the Company to cause such indebtedness to be
discharged or cause such acceleration to be rescinded or annulled,
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as the case may be, and stating that such notice is a "Notice of Default"
hereunder; provided, however, that, subject to the provisions of Sections 601
and 602, the Trustee shall not be deemed to have knowledge of such acceleration
unless either (A) a Responsible Officer of the Trustee shall have actual
knowledge of such acceleration or (B) the Trustee shall have received written
notice thereof from the Company, from any Holder, from the holder of any such
indebtedness or from the trustee under any such mortgage, indenture or other
instrument; and provided, further, that neither any offer to prepay nor any
prepayment by the Company of its 12.65% Senior Notes due October 1, 2000
resulting from the consummation of the Agreement and Plan of Merger, dated June
29, 1994, between the Company and Burlington Northern, Inc., shall constitute
an Event of Default under this Indenture or result in the acceleration of the
Company's indebtedness under this Indenture; or
(6) the entry by a court having jurisdiction in the premises of (A) a decree
or order for relief in respect of the Company or a Material Subsidiary in an
involuntary case or proceeding under any applicable Federal or State
bankruptcy, insolvency, reorganization or other similar law or (B) a decree or
order adjudging the Company or such Material Subsidiary a bankrupt or
insolvent, or approving as properly filed a petition seeking reorganization,
arrangement, adjustment or composition of or in respect of the Company or such
Material Subsidiary under any applicable Federal or State law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or such Material Subsidiary or of any
substantial part of its or such Material Subsidiary's property, or ordering the
winding up or liquidation of its or such Material Subsidiary's affairs, and the
continuance of any such decree or order for relief or any such other decree or
order unstayed and in effect for a period of 60 consecutive days; or
(7) the commencement by the Company or a Material Subsidiary, as the case
may be, of a voluntary case or proceeding under any applicable Federal or State
bankruptcy, insolvency, reorganization or other similar law or of any other
case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by
it or such Material Subsidiary to the entry of a decree or order for relief in
respect of the Company or such Material Subsidiary in an involuntary case or
proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or to the commencement of any bankruptcy or
insolvency case or proceeding against it or such Material Subsidiary, or the
filing by it or such Material Subsidiary of a petition or answer or consent
seeking reorganization or relief under any applicable Federal or State law, or
the consent by it or such Material Subsidiary to the filing of such petition or
to the appointment of or taking possession by a custodian, receiver,
liquidator, assignee, trustee, sequestrator or other similar official of the
Company or such Material Subsidiary or of any substantial part of its or such
Material Subsidiary's property, or the making by it or such Material Subsidiary
of an assignment for the benefit of creditors, or the admission by it or such
Material Subsidiary in writing of its or such Material Subsidiary's inability
to pay its debts generally as they become due, or the taking of corporate
action by the Company or such Material Subsidiary in furtherance of any such
action; or
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(8) any other Event of Default provided with respect to Securities of that
series.
Section 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in Section
501(6) or 501(7)) with respect to Securities of any series at the time
Outstanding occurs and is continuing, then in every such case the Trustee or the
Holders of not less than 25% in principal amount of the Outstanding Securities
of that series may declare the principal amount of all the Securities of that
series (or, if any Securities of that series are Original Issue Discount
Securities, such portion of the principal amount of such Securities as may be
specified by the terms thereof) to be due and payable immediately, by a notice
in writing to the Company (and to the Trustee if given by Holders), and upon any
such declaration such principal amount (or specified amount) shall become
immediately due and payable. If an Event of Default specified in Section 501(6)
or 501 (7) with respect to Securities of any series at the time Outstanding
occurs, the principal amount of all the Securities of that series (or, if any
Securities of that series are Original Issue Discount Securities, such portion
of the principal amount of such Securities as may be specified by the terms
thereof) shall automatically, and without any declaration or other action on the
part of the Trustee or any Holder, become immediately due and payable.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in principal amount of the
Outstanding Securities of that series, by written notice to the Company and the
Trustee, may rescind and annul such declaration and its consequences if
(1) the Company has paid or deposited with the Trustee a sum sufficient to
pay
(A) all overdue interest on all Securities of that series,
(B) the principal of (and premium, if any, on) any Securities of that
series which have become due otherwise than by such declaration of
acceleration and any interest thereon at the rate or rates prescribed
therefor in such Securities,
(C) to the extent that payment of such interest is lawful, interest upon
overdue interest at the rate or rates prescribed therefor in such Securities,
and
(D) all sums paid or advanced by the Trustee hereunder and the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel;
and
(2) all Events of Default with respect to Securities of that series, other
than the non-payment of the principal of Securities of that series which have
become due solely
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by such declaration of acceleration, have been cured or waived as provided in
Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Section 503. Collection of Indebtedness and Suits for Enforcement by Trustee.
The Company covenants that if
(1) default is made in the payment of any interest on any Security when such
interest becomes due and payable and such default continues for a period of 30
days, or
(2) default is made in the payment of the principal of (or premium, if any,
on) any Security at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal and any premium and interest and, to the extent that
payment of such interest shall be legally enforceable, interest on any overdue
principal and premium and on any overdue interest, at the rate or rates
prescribed therefor in such Securities, and, in addition thereto, such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel.
If an Event of Default with respect to Securities of any series occurs and is
continuing, the Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the Holders of Securities of such series by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the exercise of any power
granted herein, or to enforce any other proper remedy.
Section 504. Trustee May File Proofs of Claim.
In case of any judicial proceeding relative to the Company (or any other
obligor upon the Securities), its property or its creditors, the Trustee shall
be entitled and empowered, by intervention in such proceeding or otherwise, to
take any and all actions authorized under the Trust Indenture Act in order to
have claims of the Holders and the Trustee allowed in any such proceeding. In
particular, the Trustee shall be authorized to collect and receive any moneys or
other property payable or deliverable on any such claims and to distribute the
same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator
or other similar official in any such judicial proceeding is hereby authorized
by each Holder to make such payments to the Trustee and, in the event that
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the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 607.
No provision of this Indenture shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding; provided, however,
that the Trustee may, on behalf of the Holders, vote for the election of a
trustee in bankruptcy or similar official and be a member of a creditors' or
other similar committee.
Section 505. Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the Securities may be
prosecuted and enforced by the Trustee without the possession of any of the
Securities or the production thereof in any proceeding relating thereto, and any
such proceeding instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment shall, after provision
for the payment of the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, be for the ratable benefit of
the Holders of the Securities in respect of which such judgment has been
recovered.
Section 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall be applied
in the following order, at the date or dates fixed by the Trustee and, in case
of the distribution of such money on account of principal or any premium or
interest, upon presentation of the Securities and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:
First: To the payment of all amounts due the Trustee under Section 607; and
Second: To the payment of the amounts then due and unpaid for principal of
and any premium and interest on the Securities in respect of which or for the
benefit of which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable on such
Securities for principal and any premium and interest, respectively.
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Section 507. Limitation on Suits.
No Holder of any Security of any series shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless
(1) such Holder has previously given written notice to the Trustee of a
continuing Event of Default with respect to the Securities of that series;
(2) the Holders of not less than 25% in principal amount of the Outstanding
Securities of that series shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name as
Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable indemnity
against the costs, expenses and liabilities to be incurred in compliance with
such request;
(4) the Trustee for 60 days after its receipt of such notice, request and
offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given to the
Trustee during such 60-day period by the Holders of a majority in principal
amount of the Outstanding Securities of that series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all of such
Holders.
Section 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest.
Notwithstanding any other provision in this Indenture, the Holder of any
Security shall have the right, which is absolute and unconditional, to receive
payment of the principal of and any premium and (subject to Section 307)
interest on such Security on the respective Stated Maturities expressed in such
Security (or, in the case of redemption, on the Redemption Date) and to
institute suit for the enforcement of any such payment, and such rights shall
not be impaired without the consent of such Holder.
Section 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to enforce any
right or remedy under this Indenture and such proceeding has been discontinued
or abandoned for
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any reason, or has been determined adversely to the Trustee or to such Holder,
then and in every such case, subject to any determination in such proceeding,
the Company, the Trustee and the Holders shall be restored severally and
respectively to their former positions hereunder and thereafter all rights and
remedies of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.
Section 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Securities in the last paragraph of Section
306, no right or remedy herein conferred upon or reserved to the Trustee or to
the Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Securities to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article or by law to
the Trustee or to the Holders may be exercised from time to time, and as often
as may be deemed expedient, by the Trustee or by the Holders, as the case may
be.
Section 512. Control by Holders.
The Holders of a majority in principal amount of the Outstanding Securities
of any series shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred on the Trustee, with respect to the Securities of
such series, provided that
(1) such direction shall not be in conflict with any rule of law or with this
Indenture, and
(2) the Trustee may take any other action deemed proper by the Trustee which
is not inconsistent with such direction.
Section 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series may on behalf of the Holders of all the
Securities of such series
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waive any past default hereunder with respect to such series and its
consequences, except a default
(1) in the payment of the principal of or any premium or interest on any
Security of such series, or
(2) in respect of a covenant or provision hereof which under Article Nine
cannot be modified or amended without the consent of the Holder of each
Outstanding Security of such series affected.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
Section 514. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this Indenture,
or in any suit against the Trustee for any action taken or omitted by it as
Trustee, the court may in its discretion require the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and such
court may in its discretion assess reasonable costs including reasonable
attorneys' fees, against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defenses made by such party litigant;
provided, that the provisions of this Section 514 shall not apply to any suit
instituted by the Trustee, to any suit instituted by any Holder or group of
Holders holding in the aggregate more than 10 per centum in principal amount of
the Outstanding Securities, or to any suit instituted by any Holder for the
enforcement of the payment of the principal of or interest on any Security, on
or after the respective due dates expressed in such Security. Neither this
Section 514 nor the Trust Indenture Act shall be deemed to authorize any court
to require such an undertaking or such an assessment in any proceeding
instituted by the Company.
Section 515. Waiver of Usury, Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that it will
not at any time insist upon, or plead, or in any manner whatsoever claim or take
the benefit or advantage of, any usury, stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
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ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities.
The duties and responsibilities of the Trustee shall be as provided by the
Trust Indenture Act.
Section 602. Notice of Defaults.
If a default occurs hereunder with respect to Securities of any series, the
Trustee shall give the Holders of Securities of such series notice of such
default as and to the extent provided by the Trust Indenture Act; provided,
however, that in the case of any default of the character specified in Section
501(4) with respect to Securities of such series, no such notice to Holders
shall be given until at least 30 days after the occurrence thereof. For the
purpose of this Section, the term "default" means any event which is, or after
notice or lapse of time or both would become, an Event of Default with respect
to Securities of such series.
Section 603. Certain Rights of Trustee.
Subject to the provisions of Section 601:
(1) the Trustee may rely and shall be protected in acting or refraining from
acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party or parties;
(2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order, and any
resolution of the Board of Directors shall be sufficiently evidenced by a Board
Resolution;
(3) whenever in the administration of this Indenture the Trustee shall deem
it desirable that a matter be proved or established prior to taking, suffering
or omitting any action hereunder, the Trustee (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part, rely
upon an Officers' Certificate;
(4) the Trustee may consult with counsel and the written advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon;
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(5) the Trustee shall be under no obligation to exercise any of the rights or
powers vested in it by this Indenture at the request or direction of any of the
Holders pursuant to this Indenture, unless such Holders shall have offered to
the Trustee reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or
direction;
(6) the Trustee shall not be bound to make any investigation into the facts
or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and, if the Trustee shall determine to
make such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or attorney;
and
(7) the Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder either directly or by or through agents or attorneys and
the Trustee shall not be responsible for any misconduct or negligence on the
part of any agent or attorney appointed with due care by it hereunder.
Section 604. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the Trustee's
certificates of authentication, shall be taken as the statements of the Company,
and neither the Trustee nor any Authenticating Agent assumes any responsibility
for their correctness. The Trustee makes no representations as to the validity
or sufficiency of this Indenture or of the Securities. Neither the Trustee nor
any Authenticating Agent shall be accountable for the use or application by the
Company of Securities or the proceeds thereof.
Section 605. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to Sections
608 and 613, may otherwise deal with the Company with the same rights it would
have if it were not Trustee, Authenticating Agent, Paying Agent, Security
Registrar or such other agent.
Section 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated from
other funds except to the extent required by law. The Trustee shall be under no
liability for interest on any money received by it hereunder except as otherwise
agreed with the Company.
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Section 607. Compensation and Reimbursement.
The Company agrees
(1) to pay to the Trustee from time to time reasonable compensation for all
services rendered by it hereunder (which compensation shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust);
(2) except as otherwise expressly provided herein, to reimburse the Trustee
upon its request for all reasonable expenses, disbursements and advances
incurred or made by the Trustee in accordance with any provision of this
Indenture (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense, disbursement
or advance as may be attributable to its negligence or bad faith; and
(3) to indemnify the Trustee for, and to hold it harmless against, any loss,
liability or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of the
trust or trusts hereunder, including the costs and expenses of defending itself
against any claim or liability in connection with the exercise or performance
of any of its powers or duties hereunder.
Section 608. Conflicting Interests.
If the Trustee has or shall acquire a conflicting interest within the meaning
of the Trust Indenture Act, the Trustee shall either eliminate such interest or
resign, to the extent and in the manner provided by, and subject to the
provisions of, the Trust Indenture Act and this Indenture. To the extent
permitted by such Act, the Trustee shall not be deemed to have a conflicting
interest by virtue of being a trustee under this Indenture with respect to
Securities of more than one series.
Section 609. Corporate Trustee Required; Eligibility.
There shall at all times be one (and only one) Trustee hereunder with respect
to the Securities of each series, which may be Trustee hereunder for Securities
of one or more other series. Each Trustee shall be a Person that is eligible
pursuant to the Trust Indenture Act to act as such and has a combined capital
and surplus of at least $50,000,000. If any such Person publishes reports of
condition at least annually, pursuant to law or to the requirements of its
supervising or examining authority, then for the purposes of this Section and to
the extent permitted by the Trust Indenture Act, the combined capital and
surplus of such Person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
the Trustee with respect to the Securities of any series shall cease to be
eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.
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Section 610. Resignation and Removal; Appointment of Successor.
No resignation or removal of the Trustee and no appointment of a successor
Trustee pursuant to this Article shall become effective until the acceptance of
appointment by the successor Trustee in accordance with the applicable
requirements of Section 611.
The Trustee may resign at any time with respect to the Securities of one or
more series by giving written notice thereof to the Company. If the instrument
of acceptance by a successor Trustee required by Section 611 shall not have been
delivered to the Trustee within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities of such series.
The Trustee may be removed at any time with respect to the Securities of any
series by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series, delivered to the Trustee and to the
Company.
If at any time:
(1) the Trustee shall fail to comply with Section 608 after written request
therefor by the Company or by any Holder who has been a bona fide Holder of a
Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609 and shall fail
to resign after written request therefor by the Company or by any such Holder,
or
(3) the Trustee shall become incapable of acting or shall be adjudged a
bankrupt or insolvent or a receiver of the Trustee or of its property shall be
appointed or any public officer shall take charge or control of the Trustee or
of its property or affairs for the purpose of rehabilitation, conservation or
liquidation,
then, in any such case, (A) the Company by a Board Resolution may remove the
Trustee with respect to all Securities, or (B) subject to Section 514, any
Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Securities and the appointment of a successor Trustee or Trustees.
If the Trustee shall resign, be removed or become incapable of acting, or if
a vacancy shall occur in the office of Trustee for any cause, with respect to
the Securities of one or more series, the Company, by a Board Resolution, shall
promptly appoint a successor Trustee or Trustees with respect to the Securities
of that or those series (it being understood that any such successor Trustee may
be appointed with respect to the Securities of one or more or all of such series
and that at any time there shall be only one Trustee with respect to the
Securities of any particular series) and shall comply with the applicable
requirements of Section 611. If, within one year after such resignation,
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removal or incapability, or the occurrence of such vacancy, a successor Trustee
with respect to the Securities of any series shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding Securities of such
series delivered to the Company and the retiring Trustee, the successor Trustee
so appointed shall, forthwith upon its acceptance of such appointment in
accordance with the applicable requirements of Section 611, become the successor
Trustee with respect to the Securities of such series and to that extent
supersede the successor Trustee appointed by the Company. If no successor
Trustee with respect to the Securities of any series shall have been so
appointed by the Company or the Holders and accepted appointment in the manner
required by Section 611, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee with respect to the Securities of such
series.
The Company shall give notice of each resignation and each removal of the
Trustee with respect to the Securities of any series and each appointment of a
successor Trustee with respect to the Securities of any series to all Holders of
Securities of such series in the manner provided in Section 106. Each notice
shall include the name of the successor Trustee with respect to the Securities
of such series and the address of its Corporate Trust Office.
Section 611. Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Trustee with respect to
all Securities, every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; but, on the request of the
Company or the successor Trustee, such retiring Trustee shall, upon payment of
its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to such successor Trustee all property and money
held by such retiring Trustee hereunder.
In case of the appointment hereunder of a successor Trustee with respect to
the Securities of one or more (but not all) series, the Company, the retiring
Trustee and each successor Trustee with respect to the Securities of one or more
series shall execute and deliver an indenture supplemental hereto wherein each
successor Trustee shall accept such appointment and which (1) shall contain such
provisions as shall be necessary or desirable to transfer and confirm to, and to
vest in, each successor Trustee all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of that or those series to which
the appointment of such successor Trustee relates, (2) if the retiring Trustee
is not retiring with respect to all Securities, shall contain such provisions as
shall be deemed necessary or desirable to confirm that all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of that
or those series as to which
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the retiring Trustee is not retiring shall continue to be vested in the retiring
Trustee, and (3) shall add to or change any of the provisions of this Indenture
as shall be necessary to provide for or facilitate the administration of the
trusts hereunder by more than one Trustee, it being understood that nothing
herein or in such supplemental indenture shall constitute such Trustees co-
trustees of the same trust and that each such Trustee shall be trustee of a
trust or trusts hereunder separate and apart from any trust or trusts hereunder
administered by any other such Trustee; and upon the execution and delivery of
such supplemental indenture the resignation or removal of the retiring Trustee
shall become effective to the extent provided therein and each such successor
Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the retiring Trustee with respect
to the Securities of that or those series to which the appointment of such
successor Trustee relates; but, on request of the Company or any successor
Trustee, such retiring Trustee shall duly assign, transfer and deliver to such
successor Trustee all property and money held by such retiring Trustee hereunder
with respect to the Securities of that or those series to which the appointment
of such successor Trustee relates.
Upon request of any such successor Trustee, the Company shall execute any and
all instruments for more fully and certainly vesting in and confirming to such
successor Trustee all such rights, powers and trusts referred to in the first or
second preceding paragraph, as the case may be.
No successor Trustee shall accept its appointment unless at the time of such
acceptance such successor Trustee shall be qualified and eligible under this
Article.
Section 612. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the same effect
as if such successor Trustee had itself authenticated such Securities.
Section 613. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company (or any
other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
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Section 614. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents with respect to one
or more series of Securities which shall be authorized to act on behalf of the
Trustee to authenticate Securities of such series issued upon original issue and
upon exchange, registration of transfer or partial redemption thereof or
pursuant to Section 306, and Securities so authenticated shall be entitled to
the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in this Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and shall at all times be a corporation organized and
doing business under the laws of the United States of America, any State thereof
or the District of Columbia, authorized under such laws to act as Authenticating
Agent, having a combined capital and surplus of not less than $50,000,000 and
subject to supervision or examination by Federal or State authority. If such
Authenticating Agent publishes reports of condition at least annually, pursuant
to law or to the requirements of said supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such
Authenticating Agent shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time an
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which such Authenticating Agent shall be
a party, or any corporation succeeding to the corporate agency or corporate
trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time terminate
the agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall give notice of such
appointment in the manner provided in Section 106 to all Holders of Securities
of the series with respect to which such Authenticating Agent will serve. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if
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originally named as an Authenticating Agent. No successor Authenticating Agent
shall be appointed unless eligible under the provisions of this Section.
The Trustee agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section, and the Trustee
shall be entitled to be reimbursed for such payments, subject to the provisions
of Section 607.
If an appointment with respect to one or more series is made pursuant to this
Section, the Securities of such series may have endorsed thereon, in addition to
the Trustee's certificate of authentication, an alternative certificate of
authentication in the following form:
This is one of the Securities of the series designated therein referred to in
the within-mentioned Indenture.
........................................,
As Trustee
By......................................,
As Authenticating Agent
By.......................................
Authorized Officer
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee
(1) semi-annually, not later than [June 15] and [December 15] in each year, a
list, in such form as the Trustee may reasonably require, of the names and
addresses of the Holders of Securities of each series as of the preceding [June
1] or [December 1] as the case may be, and
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(2) at such other times as the Trustee may request in writing, within 30 days
after the receipt by the Company of any such request, a list of similar form
and content as of a date not more than 15 days prior to the time such list is
furnished;
excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.
Section 702. Preservation of Information; Communications to Holders.
The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 701 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 701 upon receipt of a new list so furnished.
The rights of Holders to communicate with other Holders with respect to their
rights under this Indenture or under the Securities, and the corresponding
rights and privileges of the Trustee, shall be as provided by the Trust
Indenture Act.
Every Holder of Securities, by receiving and holding the same, agrees with
the Company and the Trustee that neither the Company nor the Trustee nor any
agent of either of them shall be held accountable by reason of any disclosure of
information as to names and addresses of Holders made pursuant to the Trust
Indenture Act.
Section 703. Reports by Trustee.
The Trustee shall transmit to Holders such reports concerning the Trustee and
its actions under this Indenture as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant thereto.
A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange upon which any
Securities are listed, with the Commission and with the Company. The Company
will notify the Trustee when any Securities are listed on any stock exchange.
Section 704. Reports by Company.
The Company shall file with the Trustee and the Commission, and transmit to
Holders, such information, documents and other reports, and such summaries
thereof, as may be required pursuant to the Trust Indenture Act at the times and
in the manner provided pursuant to such Act; provided that any such information,
documents or reports required to be filed with the Commission pursuant to
Section 13 or 15(d) of the Exchange Act shall be filed with the Trustee within
15 days after the same is so required to be filed with the Commission.
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ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other Person or
convey, transfer or lease its properties and assets substantially as an entirety
to any Person, and the Company shall not permit any Person to consolidate with
or merge into the Company or convey, transfer or lease its properties and assets
substantially as an entirety to the Company, unless:
(1) in case the Company shall consolidate with or merge into another Person
or convey, transfer or lease its properties and assets substantially as an
entirety to any Person, the Person formed by such consolidation or into which
the Company is merged or the Person which acquires by conveyance or transfer,
or which leases, the properties and assets of the Company substantially as an
entirety shall be a corporation, partnership or trust, shall be organized and
validly existing under the laws of the United States of America, any State
thereof or the District of Columbia and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the principal of
and any premium and interest on all the Securities and the performance or
observance of every covenant of this Indenture on the part of the Company to be
performed or observed;
(2) immediately after giving effect to such transaction and treating any
indebtedness which becomes an obligation of the Company or any Subsidiary as a
result of such transaction as having been incurred by the Company or such
Subsidiary at the time of such transaction, no Event of Default, and no event
which, after notice or lapse of time or both, would become an Event of Default,
shall have happened and be continuing; and
(3) the Company has delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel stating that such consolidation, merger, conveyance,
transfer or lease and, if a supplemental indenture is required in connection
with such transaction, such supplemental indenture comply with this Article and
that all conditions precedent herein provided for relating to such transaction
have been complied with; provided, however, that the delivery of an Officers'
Certificate or an Opinion of Counsel is not required with respect to any
consolidation, merger, conveyance, transfer or lease involving the Company and
any wholly-owned subsidiary of the Company.
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Section 802. Successor Substituted.
Upon any consolidation of the Company with, or merger of the Company into,
any other Person or any conveyance, transfer or lease of the properties and
assets of the Company substantially as an entirety in accordance with Section
801, the successor Person formed by such consolidation or into which the Company
is merged or to which such conveyance, transfer or lease is made shall succeed
to, and be substituted for, and may exercise every right and power of, the
Company under this Indenture with the same effect as if such successor Person
had been named as the Company herein, and thereafter, except in the case of a
lease, the predecessor Person shall be relieved of all obligations and covenants
under this Indenture and the Securities.
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by a Board
Resolution, and the Trustee, at any time and from time to time, may enter into
one or more indentures supplemental hereto, in form satisfactory to the Trustee,
for any of the following purposes:
(1) to evidence the succession of another Person to the Company and the
assumption by any such successor of the covenants of the Company herein and in
the Securities; or
(2) to add to the covenants of the Company for the benefit of the Holders of
all or any series of Securities (and if such covenants are to be for the
benefit of less than all series of Securities, stating that such covenants are
expressly being included solely for the benefit of such series) or to surrender
any right or power herein conferred upon the Company; or
(3) to add any additional Events of Default for the benefit of the Holders of
all or any series of Securities (and if such additional Events of Default are
to be for the benefit of less than all series of Securities, stating that such
additional Events of Default are expressly being included solely for the
benefit of such series); or
(4) to add to or change any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the issuance of Securities
in bearer form, registrable or not registrable as to principal, and with or
without interest coupons, or to permit or facilitate the issuance of Securities
in uncertificated form; or
(5) to add to, change or eliminate any of the provisions of this Indenture in
respect of one or more series of Securities, provided that any such addition,
change or
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elimination (A) shall neither (i) apply to any Security of any series created
prior to the execution of such supplemental indenture and entitled to the
benefit of such provision nor (ii) modify the rights of the Holder of any such
Security with respect to such provision or (B) shall become effective only when
there is no such Security Outstanding; or
(6) to secure the Securities pursuant to the requirements of Section 1008 or
otherwise; or
(7) to establish the form or terms of Securities of any series as permitted
by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment hereunder by a
successor Trustee with respect to the Securities of one or more series and to
add to or change any of the provisions of this Indenture as shall be necessary
to provide for or facilitate the administration of the trusts hereunder by more
than one Trustee, pursuant to the requirements of Section 611; or
(9) to cure any ambiguity, to correct or supplement any provision herein
which may be defective or inconsistent with any other provision herein, or to
make any other provisions with respect to matters or questions arising under
this Indenture, provided that such action pursuant to this Clause (9) shall not
adversely affect the interests of the Holders of Securities of any series; or
(10) to supplement any of the provisions of this Indenture to such extent as
shall be necessary to permit or facilitate the defeasance and discharge of any
series of Securities pursuant to Section 401, 1302 and 1303; provided that any
such action shall not adversely affect the interests of the holders of
Securities of such series or any other series of Securities.
Section 902. Supplemental Indentures With Consent of Holders.
With the consent of the Holders of not less than a majority in principal
amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company and the
Trustee, the Company, when authorized by a Board Resolution, and the Trustee may
enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of modifying in any manner the rights of the
Holders of Securities of such series under this Indenture; provided, however,
that no such supplemental indenture shall, without the consent of the Holder of
each Outstanding Security affected thereby,
(1) change the Stated Maturity of the principal of, or any instalment of
principal of or interest on, any Security, or reduce the principal amount
thereof or the rate of interest thereon or any premium payable upon the
redemption thereof, or reduce the amount of the principal of an Original Issue
Discount Security or any other Security
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which would be due and payable upon a declaration of acceleration of the
Maturity thereof pursuant to Section 502, or change any Place of Payment where,
or the coin or currency in which, any Security or any premium or interest
thereon is payable, or impair the right to institute suit for the enforcement
of any such payment on or after the Stated Maturity thereof (or, in the case of
redemption, on or after the Redemption Date), or
(2) reduce the percentage in principal amount of the Outstanding Securities
of any series, the consent of whose Holders is required for any such
supplemental indenture, or the consent of whose Holders is required for any
waiver (of compliance with certain provisions of this Indenture or certain
defaults hereunder and their consequences) provided for in this Indenture, or
(3) modify any of the provisions of this Section, Section 513 or Section
1009, except to increase any such percentage or to provide that certain other
provisions of this Indenture cannot be modified or waived without the consent
of the Holder of each Outstanding Security affected thereby; provided, however,
that this clause shall not be deemed to require the consent of any Holder with
respect to changes in the references to "the Trustee" and concomitant changes
in this Section and Section 1009, or the deletion of this proviso, in
accordance with the requirements of Sections 611 and 901(8).
A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which modifies the
rights of the Holders of Securities of such series with respect to such covenant
or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
Section 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article or the modifications thereby of the trusts
created by this Indenture, the Trustee shall be entitled to receive, and
(subject to Section 601) shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of such supplemental indenture is authorized
or permitted by this Indenture. The Trustee may, but shall not be obligated to,
enter into any such supplemental indenture which affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise.
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Section 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
Section 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall conform
to the requirements of the Trust Indenture Act.
Section 906. Reference in Securities to Supplemental Indentures.
Securities of any series authenticated and delivered after the execution of
any supplemental indenture pursuant to this Article may, and shall if required
by the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities of any series so modified as to conform, in the opinion of the
Trustee and the Company, to any such supplemental indenture may be prepared and
executed by the Company and authenticated and delivered by the Trustee in
exchange for Outstanding Securities of such series.
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of each series of Securities
that it will duly and punctually pay the principal of and any premium and
interest on the Securities of that series in accordance with the terms of the
Securities and this Indenture.
Section 1002. Maintenance of Office or Agency.
The Company will maintain in each Place of Payment for any series of
Securities an office or agency where Securities of that series may be presented
or surrendered for payment, where Securities of that series may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Company in respect of the Securities of that series and this Indenture
may be served. The Company will give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presen-
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tations, surrenders, notices and demands may be made or served at the Corporate
Trust Office of the Trustee, and the Company hereby appoints the Trustee as its
agent to receive all such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more other offices or
agencies where the Securities of one or more series may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such designation or rescission shall in
any manner relieve the Company of its obligation to maintain an office or agency
in each Place of Payment for Securities of any series for such purposes. The
Company will give prompt written notice to the Trustee of any such designation
or rescission and of any change in the location of any such other office or
agency.
Section 1003. Money for Securities Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent with respect to
any series of Securities, it will, on or before each due date of the principal
of or any premium or interest on any of the Securities of that series, segregate
to the extent required by law and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay the principal and any premium and
interest so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and will promptly notify the Trustee of
its action or failure so to act.
Whenever the Company shall have one or more Paying Agents for any series of
Securities, it will provide to a Paying Agent a sum sufficient to pay the
principal of or any premium or interest on any Securities of that series, such
sum to be held as provided by the Trust Indenture Act, and (unless such Paying
Agent is the Trustee) the Company will promptly notify the Trustee of its action
or failure so to act.
The Company will cause each Paying Agent for any series of Securities other
than the Trustee to execute and deliver to the Trustee an instrument in which
such Paying Agent shall agree with the Trustee, subject to the provisions of
this Section, that such Paying Agent will (1) comply with the provisions of the
Trust Indenture Act applicable to it as a Paying Agent and (2) during the
continuance of any default by the Company (or any other obligor upon the
Securities of that series) in the making of any payment in respect of the
Securities of that series, upon the written request of the Trustee, forthwith
pay to the Trustee all sums held in trust by such Paying Agent for payment in
respect of the Securities of that series.
The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Company
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Company or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
money.
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Any money deposited with the Trustee or any Paying Agent, or then held by the
Company, in trust for the payment of the principal of or any premium or interest
on any Security of any series and remaining unclaimed for two years after such
principal, premium or interest has become due and payable may be paid to the
Company on Company Request, or (if then held by the Company) shall be discharged
from such trust; provided, however, that the Trustee or such Paying Agent,
before being required to make any such repayment, may at the expense of the
Company cause to be published once, in a newspaper published in the English
language, customarily published on each Business Day and of general circulation
in The City of New York, notice that such money remains unclaimed and that,
after a date specified therein, which shall not be less than 30 days from the
date of such publication, any unclaimed balance of such money then remaining
will be repaid to the Company.
Section 1004. Statement by Officers as to Default.
The Company will deliver to the Trustee, within 120 days after the end of
each fiscal year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not to the best knowledge of the signers thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions of this Indenture (without regard to any period of
grace or requirement of notice provided hereunder) and, if the Company shall be
in default, specifying all such defaults and the nature and status thereof of
which they may have knowledge.
Section 1005. Existence.
Subject to Article Eight, the Company will do or cause to be done all things
necessary to preserve and keep in full force and effect its existence, rights
(charter and statutory) and franchises; provided, however, that the Company
shall not be required to preserve any such right or franchise if the Board of
Directors shall determine that the preservation thereof is no longer desirable
in the conduct of the business of the Company and that the loss thereof is not
disadvantageous in any material respect to the Holders.
Section 1006. Maintenance of Properties.
The Company will cause all properties used or useful in the conduct of its
business or the business of any Subsidiary to be maintained and kept in good
condition, repair and working order and supplied with all necessary equipment
and will cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of the Company may
be necessary so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided, however, that
nothing in this Section shall prevent the Company from discontinuing the
operation or maintenance of any of such properties if such discontinuance is, in
the judgment of the Company, desirable in the conduct of its
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business or the business of any Subsidiary and not disadvantageous in any
material respect to the Holders.
Section 1007. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or discharged, before
the same shall become delinquent, (1) all taxes, assessments and governmental
charges levied or imposed upon the Company or any Subsidiary or upon the income,
profits or property of the Company or any Subsidiary, and (2) all lawful claims
for labor, materials and supplies which, if unpaid, might by law become a lien
upon the property of the Company or any Subsidiary; provided, however, that the
Company shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claim whose amount, applicability
or validity is being contested in good faith by appropriate proceedings.
Section 1008. Limitation on Liens.
The Company will not, and it will not permit any Subsidiary to, create,
assume, incur or suffer to exist any Lien upon any stock or indebtedness whether
owned on the date of this Indenture or hereafter acquired of the Restricted
Subsidiary owned by the Company or any Subsidiary to secure any Debt (other than
the Securities) of the Company, any Subsidiary or any Person without in any such
case making effective provision whereby all of the Outstanding Securities shall
be directly secured equally and ratably with such Debt; provided, however, that
the Restricted Subsidiary may secure any indebtedness of the Restricted
Subsidiary with other indebtedness of the Restricted Subsidiary.
Section 1009. Waiver of Certain Covenants.
Except as otherwise specified as contemplated by Section 301 for Securities
of such series, the Company may, with respect to the Securities of any series,
omit in any particular instance to comply with any term, provision or condition
set forth in any covenant provided pursuant to Section 301(17), 901(2) or 901(7)
for the benefit of the Holders of such series or in any of Section 1008, if the
Holders of at least a majority in principal amount of the Outstanding Securities
of such series shall, by Act of such Holders, either waive such compliance in
such instance or generally waive compliance with such term, provision or
condition, but no such waiver shall extend to or affect such term, provision or
condition except to the extent so expressly waived, and, until such waiver shall
become effective, the obligations of the Company and the duties of the Trustee
in respect of any such term, provision or condition shall remain in full force
and effect.
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ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article.
Securities of any series which are redeemable before their Stated Maturity
shall be redeemable in accordance with their terms and (except as otherwise
specified as contemplated by Section 301 for such Securities) in accordance with
this Article.
Section 1102. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be evidenced by a
Board Resolution or in another manner specified as contemplated by Section 301
for such Securities. In case of any redemption at the election of the Company of
less than all the Securities of any series (including any such redemption
affecting only a single Security), the Company shall, at least 60 days prior to
the Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date, of the
principal amount of Securities of such series to be redeemed and, if applicable,
of the tenor of the Securities to be redeemed. In the case of any redemption of
Securities prior to the expiration of any restriction on such redemption
provided in the terms of such Securities or elsewhere in this Indenture, the
Company shall furnish the Trustee with an Officers' Certificate evidencing
compliance with such restriction.
Section 1103. Selection by Trustee of Securities to Be Redeemed.
If less than all the Securities of any series are to be redeemed (unless all
the Securities of such series and of a specified tenor are to be redeemed or
unless such redemption affects only a single Security), the particular
Securities to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Trustee, from the Outstanding Securities of such series
not previously called for redemption, by such method as the Trustee shall deem
fair and appropriate and which may provide for the selection for redemption of a
portion of the principal amount of any Security of such series, provided that
the unredeemed portion of the principal amount of any Security shall be in an
authorized denomination (which shall not be less than the minimum authorized
denomination) for such Security. If less than all the Securities of such series
and of a specified tenor are to be redeemed (unless such redemption affects only
a single Security), the particular Securities to be redeemed shall be selected
not more than 60 days prior to the Redemption Date by the Trustee, from the
Outstanding Securities of such series and specified tenor not previously called
for redemption in accordance with the preceding sentence.
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<PAGE>
The Trustee shall promptly notify the Company in writing of the Securities
selected for redemption as aforesaid and, in case of any Securities selected for
partial redemption as aforesaid, the principal amount thereof to be redeemed.
The provisions of the two preceding paragraphs shall not apply with respect
to any redemption affecting only a single Security, whether such Security is to
be redeemed in whole or in part. In the case of any such redemption in part, the
unredeemed portion of the principal amount of the Security shall be in an
authorized denomination (which shall not be less than the minimum authorized
denomination) for such Security.
For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Securities shall relate, in the
case of any Securities redeemed or to be redeemed only in part, to the portion
of the principal amount of such Securities which has been or is to be redeemed.
Section 1104. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage prepaid,
mailed not less than 30 nor more than 60 days prior to the Redemption Date, to
each Holder of Securities to be redeemed, at his address appearing in the
Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Securities of any series consisting of
more than a single Security are to be redeemed, the identification (and, in the
case of partial redemption of any such Securities, the principal amounts) of
the particular Securities to be redeemed and, if less than all the Outstanding
Securities of any series consisting of a single Security are to be redeemed,
the principal amount of the particular Security to be redeemed,
(4) that on the Redemption Date the Redemption Price will become due and
payable upon each such Security to be redeemed and, if applicable, that
interest thereon will cease to accrue on and after said date,
(5) the place or places where each such Security is to be surrendered for
payment of the Redemption Price, and
(6) that the redemption is for a sinking fund, if such is the case.
Notice of redemption of Securities to be redeemed at the election of the
Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company and shall be irrevocable.
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Section 1105. Deposit of Redemption Price.
Prior to any Redemption Date, the Company shall deposit with the Trustee or
with a Paying Agent (or, if the Company is acting as its own Paying Agent,
segregate and hold in trust as provided in Section 1003) an amount of money
sufficient to pay the Redemption Price of, and (except if the Redemption Date
shall be an Interest Payment Date) accrued interest on, all the Securities which
are to be redeemed on that date.
Section 1106. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities so to be
redeemed shall, on the Redemption Date, become due and payable at the Redemption
Price therein specified, and from and after such date (unless the Company shall
default in the payment of the Redemption Price and accrued interest) such
Securities shall cease to bear interest. Upon surrender of any such Security for
redemption in accordance with said notice, such Security shall be paid by the
Company at the Redemption Price, together with accrued interest to the
Redemption Date; provided, however, that, unless otherwise specified as
contemplated by Section 301, instalments of interest whose Stated Maturity is on
or prior to the Redemption Date will be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such at the
close of business on the relevant Record Dates according to their terms and the
provisions of Section 307.
If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal and any premium shall, until paid, bear
interest from the Redemption Date at the rate prescribed therefor in the
Security.
Section 1107. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be surrendered at a
Place of Payment therefor (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing), and the Company shall execute, and the Trustee
shall authenticate and deliver to the Holder of such Security without service
charge, a new Security or Securities of the same series and of like tenor, of
any authorized denomination as requested by such Holder, in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Security so surrendered.
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ARTICLE TWELVE
Sinking Funds
Section 1201. Applicability of Article.
The provisions of this Article shall be applicable to any sinking fund for
the retirement of Securities of any series except as otherwise specified as
contemplated by Section 301 for such Securities.
The minimum amount of any sinking fund payment provided for by the terms of
any Securities 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 such
Securities is herein referred to as an "optional sinking fund payment". If
provided for by the terms of any Securities, the cash amount of any sinking fund
payment may be subject to reduction as provided in Section 1202. Each sinking
fund payment shall be applied to the redemption of Securities as provided for by
the terms of such Securities.
Section 1202. Satisfaction of Sinking Fund Payments with Securities.
The Company (1) may deliver Outstanding Securities of a series (other than
any previously called for redemption) and (2) may apply as a credit Securities
of a series which have been redeemed either at the election of the Company
pursuant to the terms of such Securities or through the application of permitted
optional sinking fund payments pursuant to the terms of such Securities, in each
case in satisfaction of all or any part of any sinking fund payment with respect
to any Securities of such series required to be made pursuant to the terms of
such Securities as and to the extent provided for by the terms of such
Securities; provided that the Securities to be so credited have not been
previously so credited. The Securities to be so credited shall be received and
credited for such purpose by the Trustee at the Redemption Price, as specified
in the Securities so to be redeemed, for redemption through operation of the
sinking fund and the amount of such sinking fund payment shall be reduced
accordingly.
Section 1203. Redemption of Securities for Sinking Fund.
Not less than 60 days prior to each sinking fund payment date for any
Securities, the Company will deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing sinking fund payment for such
Securities pursuant to the terms of such Securities, the portion thereof, if
any, which is to be satisfied by payment of cash and the portion thereof, if
any, which is to be satisfied by delivering and crediting Securities pursuant to
Section 1202 and will also deliver to the Trustee any Securities to be so
delivered. Not less than 45 days prior to each such sinking fund payment date,
the Trustee shall select the Securities to be redeemed upon such sinking fund
payment date in the manner specified in Section 1103 and cause notice of the
redemption thereof to be
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given in the name of and at the expense of the Company in the manner provided in
Section 1104. Such notice having been duly given, the redemption of such
Securities shall be made upon the terms and in the manner stated in Sections
1106 and 1107.
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Company's Option to Effect Defeasance or Covenant Defeasance.
The Company may elect, at its option at any time, to have Section 1302 or
Section 1303 applied to any Securities or any series of Securities, as the case
may be, designated pursuant to Section 301 as being defeasible pursuant to such
Section 1302 or 1303, in accordance with any applicable requirements provided
pursuant to Section 301 and upon compliance with the conditions set forth below
in this Article. Any such election shall be evidenced by a Board Resolution or
in another manner specified as contemplated by Section 301 for such Securities.
Section 1302. Defeasance and Discharge.
Upon the Company's exercise of its option (if any) to have this Section
applied to any Securities or any series of Securities, as the case may be, the
Company shall be deemed to have been discharged from its obligations with
respect to such Securities as provided in this Section on and after the date the
conditions set forth in Section 1304 are satisfied (hereinafter called
"Defeasance"). For this purpose, such Defeasance means that the Company shall be
deemed to have paid and discharged the entire indebtedness represented by such
Securities 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 Company, shall execute proper instruments acknowledging the
same), subject to the following which shall survive until otherwise terminated
or discharged hereunder: (1) the rights of Holders of such Securities to
receive, solely from the trust fund described in Section 1304 and as more fully
set forth in such Section, payments in respect of the principal of and any
premium and interest on such Securities when payments are due, (2) the Company's
obligations with respect to such Securities under Sections 304, 305, 306, 1002
and 1003, (3) the rights, powers, trusts, duties and immunities of the Trustee
hereunder and (4) this Article. Subject to compliance with this Article, the
Company may exercise its option (if any) to have this Section applied to any
Securities notwithstanding the prior exercise of its option (if any) to have
Section 1303 applied to such Securities.
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Section 1303. Covenant Defeasance.
Upon the Company's exercise of its option (if any) to have this Section
applied to any Securities or any series of Securities, as the case may be, (1)
the Company shall be released from its obligations under Section 801(3),
Sections 1006 through 1008, inclusive, and any covenants provided pursuant to
Section 301(17), 901(2) or 901(7) for the benefit of the Holders of such
Securities and (2) the occurrence of any event specified in Sections 501(4)
(with respect to any of Section 801(3), Sections 1006 through 1008, inclusive,
and any such covenants provided pursuant to Section 301(17), 901(2) or 901(7)),
501(5) and 501(8) shall be deemed not to be or result in an Event of Default, in
each case with respect to such Securities as provided in this Section on and
after the date the conditions set forth in Section 1304 are satisfied
(hereinafter called "Covenant Defeasance"). For this purpose, such Covenant
Defeasance means that, with respect to such Securities, the Company may omit to
comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such specified Section (to the extent so specified
in the case of Section 501(4)), whether directly or indirectly by reason of any
reference elsewhere herein to any such Section or by reason of any 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 1304. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to the application of Section 1302 or
Section 1303 to any Securities or any series of Securities, as the case may be:
(1) The Company shall irrevocably have deposited or caused to be deposited
with the Trustee (or another trustee which satisfies the requirements
contemplated by Section 609 and agrees to comply with the provisions of this
Article 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 benefits 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, in each case 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 any such other qualifying
trustee) to pay and discharge, the principal of and any premium and interest on
such Securities on the respective Stated Maturities, in accordance with the
terms of this Indenture and such Securities. As used herein, "U.S. Government
Obligation" means (x) any security which is (i) a direct obligation of the
United States of America for the payment of which the full faith and credit of
the United States of America is pledged or (ii) an obligation 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 (i) or (ii), is not callable or redeemable at the option
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of the issuer thereof, and (y) any depositary receipt issued by a bank (as
defined in Section 3(a)(2) of the Securities Act) as custodian with respect to
any U.S. Government Obligation which is specified in Clause (x) above and held
by such bank for the account of the holder of such depositary receipt, or with
respect to any specific payment of principal of or interest on any U.S.
Government Obligation which is so specified and held, 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 or interest evidenced by such depositary receipt.
(2) In the event of an election to have Section 1302 apply to any Securities
or any series of Securities, as the case may be, the Company shall have
delivered to the Trustee an Opinion of Counsel stating that (A) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling or (B) since the date of this instrument, there has been a change in the
applicable Federal income tax law, in either case (A) or (B) to the effect
that, and based thereon such opinion shall confirm that, the Holders of such
Securities will not recognize gain or loss for Federal income tax purposes as a
result of the deposit, Defeasance and discharge to be effected with respect to
such Securities and will be subject to Federal income tax on the same amount,
in the same manner and at the same times as would be the case if such deposit,
Defeasance and discharge were not to occur.
(3) In the event of an election to have Section 1303 apply to any Securities
or any series of Securities, as the case may be, the Company shall have
delivered to the Trustee an Opinion of Counsel to the effect that the Holders
of such Securities will not recognize gain or loss for Federal income tax
purposes as a result of the deposit and Covenant Defeasance to be effected with
respect to such Securities and will be subject to Federal income tax on the
same amount, in the same manner and at the same times as would be the case if
such deposit and Covenant Defeasance were not to occur.
(4) The Company shall have delivered to the Trustee an Officer's Certificate
to the effect that neither such Securities nor any other Securities of the same
series, if then listed on any securities exchange, will be delisted as a result
of such deposit.
(5) No event which is, or after notice or lapse of time or both would become,
an Event of Default with respect to such Securities or any other Securities
shall have occurred and be continuing at the time of such deposit or, with
regard to any such event specified in Sections 501(6) and (7), at any time on
or prior to the 90th day after the date of such deposit (it being understood
that this condition shall not be deemed satisfied until after such 90th day).
(6) Such Defeasance or Covenant Defeasance shall not cause the Trustee to
have a conflicting interest within the meaning of the Trust Indenture Act
(assuming all Securities are in default within the meaning of such Act).
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(7) Such Defeasance or Covenant Defeasance shall not result in a breach or
violation of, or constitute a default under, any other agreement or instrument
to which the Company is a party or by which it is bound.
(8) Such Defeasance or Covenant Defeasance shall not result in the trust
arising from such deposit constituting an investment company within the meaning
of the Investment Company Act unless such trust shall be registered under such
Act or exempt from registration thereunder.
(9) The Company shall have delivered to the Trustee an Officer's Certificate
and an Opinion of Counsel, each stating that all conditions precedent with
respect to such Defeasance or Covenant Defeasance have been complied with.
Section 1305. Deposited Money and U.S. Government Obligations to Be
Held in Trust; Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 1003, all money
and U.S. Government Obligations (including the proceeds thereof) deposited with
the Trustee or other qualifying trustee (solely for purposes of this Section and
Section 1306, the Trustee and any such other trustee are referred to
collectively as the "Trustee") pursuant to Section 1304 in respect of any
Securities 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 such Paying Agent (including the Company 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 any premium and interest, but money so held in trust need not be segregated
from other funds except to the extent required by law.
The Company 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 1304 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 Outstanding Securities.
Anything in this Article to the contrary notwithstanding, the Trustee shall
deliver or pay to the Company from time to time upon Company Request any money
or U.S. Government Obligations held by it as provided in Section 1304 with
respect to any Securities 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 the Defeasance or Covenant Defeasance, as
the case may be, with respect to such Securities.
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Section 1306. Reinstatement.
If the Trustee or the Paying Agent is unable to apply any money in accordance
with this Article with respect to any Securities by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, then the obligations under this
Indenture and such Securities from which the Company has been discharged or
released pursuant to Section 1302 or 1303 shall be revived and reinstated as
though no deposit had occurred pursuant to this Article with respect to such
Securities, until such time as the Trustee or Paying Agent is permitted to apply
all money held in trust pursuant to Section 1305 with respect to such Securities
in accordance with this Article; provided, however, that if the Company makes
any payment of principal of or any premium or interest on any such Security
following such reinstatement of its obligations, the Company shall be subrogated
to the rights (if any) of the Holders of such Securities to receive such payment
from the money so held in trust.
ARTICLE FOURTEEN
Immunity of Incorporators, Stockholders,
Officers, Directors and Employees
Section 1401. Exemption from Individual Liability.
No recourse under or upon any obligation, covenant or agreement of this
Indenture, or of any Security, or for any claim based thereon or otherwise in
respect thereof, shall be had against any incorporator, stockholder, officer,
director or employee, as such, past, present or future, of the Company or of any
successor corporation, either directly or through the Company, whether by virtue
of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise; it being expressly understood that this
Indenture and the obligations issued hereunder are solely corporate obligations
of the Company, and that no such personal liability whatever shall attach to, or
is or shall be incurred by, the incorporators, stockholders, officers,
directors, or employees, as such, of the Company or of any successor
corporation, or any of them, because of the creation of the indebtedness hereby
authorized, or under or by reason of the obligations, covenants or agreements
contained in this Indenture or in any of the Securities or implied therefrom;
and that any and all such personal liability, either at common law or in equity
or by constitution or statute, of, and any and all such rights and claims
against, every such incorporator, stockholder, officer, director or employee, as
such, because of the creation of the indebtedness hereby authorized, or under or
by reason of the obligations, covenants or agreements contained in this
Indenture or in any of the Securities or implied therefrom, are hereby expressly
waived and released as a condition of, and as a consideration for, the execution
of this Indenture and the issue of such Securities.
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_____________________________
This instrument may be executed in any number of counterparts, each of which
so executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.
In Witness Whereof, the parties hereto have caused this Indenture to be duly
executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
Santa Fe Pacific Corporation
By......................................
Attest:
......................................
The First National Bank of Chicago
By......................................
Attest:
......................................
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State of )
) ss.:
County of )
On the .... day of ..........., ...., before me personally came
..........................., to me known, who, being by me duly sworn, did
depose and say that he is ................. of ...............................,
one of the corporations described in and which executed the foregoing
instrument; that he knows the seal of said corporation; that the seal affixed to
said instrument is such corporate seal; that it was so affixed by authority of
the Board of Directors of said corporation; and that he signed his name thereto
by like authority.
........................................
State of )
) ss.:
County of )
On the .... day of ..........., ...., before me personally came
..........................., to me known, who, being by me duly sworn, did
depose and say that he is ................. of ...............................,
one of the corporations described in and which executed the foregoing
instrument; that he knows the seal of said corporation; that the seal affixed to
said instrument is such corporate seal; that it was so affixed by authority of
the Board of Directors of said corporation; and that he signed his name thereto
by like authority.
........................................
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EXHIBIT 10.2
AMENDMENT
TO
AGREEMENT AND PLAN OF MERGER
AMENDMENT dated as of October 26, 1994 (this "Amendment") between Burlington
Northern Inc., a Delaware corporation ("BNI"), and Santa Fe Pacific
Corporation, a Delaware Corporation ("SFP").
WHEREAS, BNI and SFP have previously entered into that certain Agreement and
Plan of Merger dated as of June 29, 1994 between BNI and SFP (the "Merger
Agreement"); and
WHEREAS, the respective Boards of Directors of BNI and SFP have determined
that it is in the best interests of BNI or SFP, as the case may be, and its
respective stockholders to amend the Merger Agreement as hereinafter set forth
and have duly approved this Amendment and authorized its execution and
delivery.
NOW, THEREFORE, the parties hereto agree as follows:
1. All capitalized terms used herein, unless otherwise defined herein,
shall have the meanings given them in the Merger Agreement, and each
reference in the Merger Agreement to "this Agreement", "hereof", "herein",
"hereunder" or "hereby" and each other similar reference shall be deemed to
refer to the Merger Agreement as amended hereby. All references to the
Merger Agreement in any other agreement between BNI and SFP relating to the
transactions contemplated by the Merger Agreement shall be deemed to refer
to the Merger Agreement as amended hereby.
2. Section 1.2(a)(i) of the Merger Agreement is hereby amended by
deleting the number "0.27" wherever such number appears therein and
inserting in its place the number "0.34".
3. This Amendment shall be construed in accordance with and governed by
the law of the State of Delaware (without regard to principles of conflict
of laws).
4. This Amendment 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. This Amendment shall
become effective when each party hereto shall have received counterparts
hereof signed by all of the other parties hereto.
5. Except as expressly amended hereby, the Merger Agreement shall remain
in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed by their respective authorized officers as of the day and year first
above written.
Burlington Northern Inc.
/s/ Gerald Grinstein
By __________________________________
Title: Chairman and Chief
Executive Officer
Santa Fe Pacific Corporation
/s/ Robert D. Krebs
By __________________________________
Title: Chairman, President and
Chief Executive Officer
<PAGE>
EXHIBIT 12
SANTA FE PACIFIC CORPORATION
STATEMENT OF COMPUTATION OF EARNINGS TO FIXED CHARGES
(IN MILLIONS, EXCEPT RATIO)
<TABLE>
<CAPTION>
SIX MONTHS YEAR ENDED DECEMBER 31,
ENDED JUNE --------------------------------------
30, 1993 1993 1992 1991 1990 1989
---------- ------ ------ ------ ------- -------
<S> <C> <C> <C> <C> <C> <C>
Earnings:
Income (loss) from
continuing operations
before income taxes...... $229.6 $354.1 $ 41.4 $ 99.1 $(380.6) $(512.8)
Add distributions greater
than income of
unconsolidated
subsidiaries............. (2.6) 5.4 0.1 (5.1) (8.4) (8.8)
Amortization of
capitalized interest..... 0.8 1.6 1.4 1.3 1.1 1.0
Fixed charges before
interest capitalized (see
below)................... 86.7 167.3 190.6 233.0 291.2 400.6
------ ------ ------ ------ ------- -------
Total Earnings.......... $314.5 $528.4 $233.5 $328.3 $ (96.7) $(120.0)
====== ====== ====== ====== ======= =======
Fixed Charges:
Interest expense including
amortization of debt
discount................. $ 69.6 $133.4 $164.5 $208.9 $ 269.6 $ 381.2
Portion of rentals
representing an interest
factor................... 17.1 33.9 26.1 24.1 21.6 19.4
------ ------ ------ ------ ------- -------
Fixed charges before
interest capitalized..... 86.7 167.3 190.6 233.0 291.2 400.6
Interest capitalized...... 2.9 8.2 3.6 3.9 7.7 3.9
------ ------ ------ ------ ------- -------
Total Fixed Charges..... $ 89.6 $175.5 $194.2 $236.9 $ 298.9 $ 404.5
====== ====== ====== ====== ======= =======
Ratio of earnings to fixed
charges.................... 3.5 3.0 1.2 1.4 -- --
Deficiency in earnings to
cover fixed charges (in
millions)(1)............... -- -- -- -- $ 395.6 $ 524.5
</TABLE>
- --------
(1) Earnings in the first six months 1993 and the full year 1993 include a
$145.4 million gain on the sale of rail lines in southern California.
Excluding this gain, the ratios would have been 1.9 and 2.2,
respectively. Earnings in 1992 include a $320.4 million Santa Fe Railway
special charge and a $204.9 million gain on the sale of rail lines in
southern California. Excluding these items, the ratio would have been
1.8. Earnings in 1990 include a $342.1 million charge for an unfavorable
litigation settlement. Excluding this charge SFP was unable to fully
cover fixed charges by $53.5 million. Earnings in 1989 include a $441.8
million Santa Fe Railway special charge. Excluding this charge, SFP was
unable to fully cover fixed charges by $82.7 million.
<PAGE>
EXHIBIT 23
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the Registration Statement
No. 33-51435 and in the Current Report on Form 8-K dated October 28, 1994 of
Santa Fe Pacific Corporation of our report dated January 17, 1994, on our
audits of the consolidated financial statements and the financial statement
schedules of Burlington Northern Inc. and Subsidiaries as of December 31, 1993
and 1992, and for the years ended December 31, 1993, 1992 and 1991. We also
consent to the reference to our firm under the caption "Experts" in the
aforementioned Registration Statement.
Coopers & Lybrand L.L.P.
Fort Worth, Texas
October 28, 1994
