SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934
Date of Report (Date of earliest event reported):
April 11, 1996
TIME WARNER INC.
(Exact name of registrant as specified in its charter)
DELAWARE 1-8637 13-1388520
(State or other jurisdiction of (Commission File Number) (I.R.S. Employer
incorporation or organization) Identification No.)
75 Rockefeller Plaza, New York, NY 10019
(Address of principal executive offices) (zip code)
(212) 484-8000
(Registrant's telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
<PAGE> Page 2
ITEM 7. Exhibits
4.1 Certificate of Designation of the 10 1/4 % Series K Exchangeable
Preferred Stock
4.2 Form of Senior Subordinated Indenture
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, thereunto duly authorized, in the City of New
York, State of New York, on April 15, 1996.
TIME WARNER INC.
By: /S/ THOMAS W. MCENERNEY
-------------------------------
Name: Thomas W. McEnerney
Title: Vice President
<PAGE>
EXHIBIT INDEX
Pursuant to Item 601 of Regulation S-K
EXHIBIT NO. DESCRIPTION OF EXHIBIT
4.1 Certificate of Designation of
the 10 1/4 % Series K Exchangeable
Preferred Stock
4.2 Form of Senior Subordinated
Indenture
CERTIFICATE OF THE VOTING POWERS, DESIGNATIONS, PREFERENCES
AND RELATIVE, PARTICIPATING, OPTIONAL OR OTHER SPECIAL
RIGHTS, AND QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS
THEREOF, OF 10 1/4% SERIES K EXCHANGEABLE PREFERRED STOCK
OF
TIME WARNER INC.
---------------------------
PURSUANT TO SECTION 151 OF THE GENERAL CORPORATION LAW
OF THE STATE OF DELAWARE
-----------------------------
TIME WARNER INC., a corporation organized and existing by virtue of
the General Corporation Law of the State of Delaware (the "Corporation"),
does hereby certify that the following resolution was duly adopted by
action of the Board of Directors of the Corporation, with the provisions
thereof fixing the number of shares of the series, the dividend rate, and
the optional redemption prices being set by action of the Pricing
Committee of the Board of Directors of the Corporation:
RESOLVED that pursuant to the authority expressly granted to and
vested in the Board of Directors of the Corporation by the provisions of
Section 2 of Article IV of the Restated Certificate of Incorporation of
the Corporation, as amended from time to time (the "Certificate of
Incorporation"), and pursuant to authority expressly delegated to the
Pricing Committee of the Board of Directors of the Corporation by such
Board of Directors, and pursuant to Section 151(g) of the General
Corporation Law of the State of Delaware, there be created from the
250,000,000 shares of Preferred Stock, par value $1.00 per share (the
"Preferred Stock"), of the Corporation authorized to be issued pursuant
to the Certificate of Incorporation, a series of Preferred Stock,
consisting of 15,200,000 shares of 10 1/4% Series K Exchangeable
Preferred Stock, the voting powers, designations, preferences and
relative, participating, optional or other special rights of which, and
qualifications, limitations or restrictions thereof, shall be as follows:
The series of Preferred Stock hereby established shall consist of
15,200,000 shares of 10 1/4% Series K Exchangeable Preferred Stock (such
series being hereinafter referred to as "Series K Preferred Stock" or
"this Series"). The rights, preferences and limitations of the Series K
Preferred Stock shall be as follows:
1. DEFINITIONS. As used herein, the following terms shall
have the following meanings:
1.1 "Accrued Dividends" shall mean, with respect to any
share of this Series, as of any date, the accrued and unpaid dividends on
such share from the most recent Dividend Payment Date (or the Issue Date
applicable to such share, if such date is prior to the first Dividend
Payment Date applicable to such share) to such date.
1.2. "Accumulated Dividends" shall mean, with respect to
any share of this Series, as of any date, the aggregate accumulated and
unpaid dividends on such share from the Issue Date applicable to such
share until the most recent Dividend Payment Date prior to such date.
There shall be no Accumulated Dividends with respect to any share of this
Series prior to the first Dividend Payment Date applicable to such share.
1.3. "Applicable Series B Redemption Date" shall mean,
with respect to any Mandatory Redemption Date, the Series B Redemption
Date occurring one year and one day prior to such Mandatory Redemption
Date.
1.4 "Board of Directors" shall mean the Board of
Directors of the Corporation or, with respect to any action to be taken
by the Board of Directors, any committee of the Board of Directors duly
authorized to take such action.
1.5 "Board of Representatives of TWE" shall mean the
Board of Representatives of TWE (as defined in the TWE Partnership
Agreement).
1.6 "Business Day" shall mean any day other than a
Saturday, Sunday or other day on which commercial banks in the City of
New York are authorized or required by law or executive order to close.
1.7 "Change of Control" shall mean:
(i) whenever, in any three-year period, a majority
of the members of the Board of Directors elected during such three-year
period shall have been so elected against the recommendation of the
management of the Corporation or the Board of Directors in office
immediately prior to such election; it being understood that for purposes
of this clause (i) a member of such Board of Directors shall be deemed to
have been elected against the recommendation of such Board of Directors
if his or her initial election occurs as a result of either an actual or
threatened election contest (as such terms are used in Rule 14a-11 of
Regulation 14A promulgated under the Exchange Act) or other actual or
threatened solicitation of proxies or consents by or on behalf of a
Person other than such Board of Directors; or
(ii) whenever any Person shall acquire (whether by
merger, consolidation, sale, assignment, lease, transfer or otherwise, in
one transaction or any related series of transactions) or otherwise
beneficially own voting securities of the Corporation that represent in
excess of 50% of the voting power of all outstanding voting securities of
the Corporation generally entitled to vote for the election of directors,
if such Person had acquired or publicly announced its intention to
initially acquire ten percent or more of such voting securities in a
transaction that had not, within 30 days after the date of such
acquisition or public announcement, been approved by the management of
the Corporation.
1.8 "Common Stock" shall mean the class of Common Stock,
par value $1.00 per share, of the Corporation or any other class of stock
resulting from successive changes or reclassifications of such Common
Stock consisting solely of changes in par value, or from par value to no
par value, or as a result of a subdivision or combination.
1.9 "Cumulative Priority Capital of the TWE Series B
Interests" shall mean, as of any date, the excess of (a) the sum of (i)
the aggregate B Contributions (as defined in the TWE Partnership
Agreement) of the Corporation (and its subsidiaries) and (ii) the
aggregate cumulative B Returns (as defined in the TWE Partnership
Agreement) of the Corporation (and its subsidiaries) as of such date,
over (b) the sum of all distributions theretofore made to the Corporation
(and its subsidiaries) with respect to the TWE Series B Interests
pursuant to the TWE Partnership Agreement.
1.10 "Dividend Payment Date" shall mean March 30, June 30,
September 30 and December 30 of each year, commencing June 30, 1996.
1.11 "Dividend Record Date" shall mean, with respect to
each Dividend Payment Date, the twentieth day immediately preceding such
Dividend Payment Date.
1.12 "Exchange Act" shall mean the Securities Exchange Act
of 1934, as amended.
1.13 "Excluded Tax Distributions" shall mean, with respect
to any period, all Tax Distributions made by TWE during such period other
than Included Tax Distributions.
1.14 "Final Redemption Date" shall mean July 1, 2016.
1.15 "Included Tax Distributions" shall mean, with respect
to any period, Tax Distributions made by TWE during such period with
respect to the TWE Series B Interests, but only if the total
distributions made by TWE during such period with respect to the TWE
Series B Interests exceed such Tax Distributions.
1.16 "Initial Issue Date" shall mean April 11, 1996.
1.17 "Insolvency Distribution Date" shall mean the date of
the completion of the liquidation, winding up or dissolution of TWE upon
the Insolvency of TWE, including the distribution of all of the cash and
non-cash assets to the partners of TWE.
1.18 "Insolvency of TWE" shall mean:
(i) the entry by a court having jurisdiction in the
premises of (a) a decree or order for relief in respect of TWE 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 TWE a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjustment
or composition of or in respect of TWE under any applicable federal or
state law, or appointing a custodian, receiver, liquidator, assignee,
trustee, sequestrator or other similar official of TWE or of any
substantial part of its property, or ordering the winding up or
liquidation of its affairs, and the continuance of any such decree or
order for relief or any such other decree or order under either clause
(a) or (b) above unstayed and in effect for a period of 60 consecutive
days; or
(ii) the commencement by TWE of a voluntary case or
proceeding under any applicable federal or state bankruptcy, insolvency,
reorganization or other similar law or of any other case or proceeding to
be adjudicated a bankrupt or insolvent, or the consent by it to the entry
of a decree or order for relief in respect of TWE in an involuntary case
or proceeding under any applicable federal or state bankruptcy,
insolvency, reorganization or other similar law or to the commencement of
any bankruptcy or insolvency case or proceeding against it, or the filing
by it of a petition or answer or consent seeking reorganization or relief
under any applicable federal or state law, or the consent by it to the
filing of such petition or to the appointment of or taking possession by
a custodian, receiver, liquidator, assignee, trustee, sequestrator or
other similar official of TWE or of any substantial part of its property,
or the making by it of a general assignment for the benefit of creditors,
or the admission by it in writing of its inability to pay its debts
generally as they become due, or the adoption of a resolution by the
Board of Representatives of TWE to take any of the foregoing actions.
1.19 "Insolvency Redemption Amount" shall mean an amount
equal to the lesser of (i) the sum of (a) the Pro Rata Percentage as of
the Insolvency Distribution Date, multiplied by the sum of cash
distributions and non-cash distributions (the value of which shall be
determined pursuant to a TWE Insolvency Valuation) received by the
Corporation (and its subsidiaries) with respect to its TWE Series B
Interests and its TWE Junior Interests in connection with such
liquidation, winding up or dissolution in accordance with the TWE
Partnership Agreement, and (b) an amount equal to the aggregate dividends
payable during the period from the Insolvency Distribution Date to the
Insolvency Redemption Date on the shares of Series K Preferred Stock
outstanding from time to time during such period and (ii) the aggregate
Liquidation Preference of the outstanding shares of Series K Preferred
Stock plus Accumulated Dividends and Accrued Dividends thereon.
1.20 "Insolvency Redemption Amount Per Share" shall mean
an amount equal to (i) the Insolvency Redemption Amount divided by (ii)
the number of shares of Series K Preferred Stock outstanding on the
Insolvency Redemption Date.
1.21 "Insolvency Redemption Date" shall mean the day that
is one year and one day following the Insolvency Distribution Date.
1.22 "Issue Date" shall mean, with respect to each share
of Series K Preferred Stock, the date upon which such share is first
issued.
1.23 "Junior Stock" shall mean the Common Stock, the
Series A Participating Cumulative Preferred Stock and the shares of any
other class or series of stock of the Corporation created after the
Initial Issue Date that, by the terms of the Certificate of Incorporation
or of the instrument by which the Board of Directors, acting pursuant to
authority granted in the Certificate of Incorporation, shall fix the
relative rights, preferences and limitations thereof, shall be junior to
the Series K Preferred Stock in respect of the right to receive dividends
or to participate in any other distribution of assets.
1.24 "Liquidation Preference" shall mean, with respect to
each share of Series K Preferred Stock, $1,000.
1.25 "Mandatory Redemption Amount" shall mean an amount
equal to (i) the Pro Rata Percentage (determined as of June 30, 2015
without giving effect to the Series B Redemption occurring on such date)
multiplied by the amount (as determined by a TWE Valuation) that the
Corporation (and its subsidiaries) would have received in accordance with
the TWE Partnership Agreement with respect to its TWE Series B Interests
and its TWE Junior Interests, had TWE sold all of its assets and
liquidated on June 30, 2015, plus (ii) the aggregate dividends payable
from July 1, 2015 to July 1, 2016 on the shares of Series K Preferred
Stock from time to time outstanding during such period.
1.26 "Mandatory Redemption Amount Per Share" shall mean an
amount equal to (i) the Mandatory Redemption Amount divided by (ii) the
number of shares of Series K Preferred Stock outstanding on the Final
Redemption Date.
1.27 "Mandatory Redemption Date" shall mean July 1 of each
of 2012, 2013, 2014 and 2015.
1.28 "Mandatory Redemption Price Per Share" shall mean an
amount equal to the Liquidation Preference of each share of Series K
Preferred Stock to be redeemed, plus Accumulated Dividends and Accrued
Dividends thereon.
1.29 "Material Contribution of Assets" shall mean a
contribution to TWE in a single transaction or a series of related
transactions of Relevant Assets, the fair market value of which (net of
associated debt) is in excess of $1,000,000,000 (as determined by the
Board of Directors in good faith).
1.30 "Nationally Recognized Investment Banking Firm" shall
mean an investment banking firm having a national reputation in the
United States which shall have experience in valuation or securities
rating matters, as the case may be, and which shall be approved by a
majority of the members of the Board of Directors who are not officers or
employees of the Corporation or its subsidiaries, including TWE.
1.31 "Optional Redemption Price Per Share" shall mean, as
of any date, the price at which the Corporation may, at its option,
redeem one share of the Series K Preferred Stock pursuant to Section 3.1.
1.32 "Parity Stock" shall mean the shares of the
Corporation's Series B 6.40% Preferred Stock, Series C Convertible
Preferred Stock, Series D Convertible Preferred Stock, Series E
Convertible Preferred Stock, Series F Convertible Preferred Stock, Series
G Convertible Preferred Stock, Series H Convertible Preferred Stock,
Series I Convertible Preferred Stock, Series K Preferred Stock and any
other class or series of stock of the Corporation created after the
Initial Issue Date that, by the terms of the Certificate of Incorporation
or of the instrument by which the Board of Directors, acting pursuant to
authority granted in the Certificate of Incorporation, shall fix the
relative rights, preferences and limitations thereof, shall, in the event
that the stated dividends thereon are not paid in full, be entitled to
share ratably with the Series K Preferred Stock in the payment of
dividends, including accumulations, if any, in accordance with the sums
which would be payable on such shares if all dividends were declared and
paid in full, or shall, in the event that the amounts payable thereon in
liquidation are not paid in full, be entitled to share ratably with the
Series K Preferred Stock in any other distribution of assets in
accordance with the sums which would be payable in such distribution if
all sums payable were discharged in full; PROVIDED, HOWEVER, that the
term "Parity Stock" shall be deemed to refer (i) in Section 2.3 hereof,
to any stock which is Parity Stock in respect of dividend rights; (ii) in
Section 10 hereof, to any stock which is Parity Stock in respect of the
distribution of assets; and (iii) in Section 9.1 hereof, to any stock
which is Parity Stock in respect of either dividend rights or the
distribution of assets and which, pursuant to the Certificate of
Incorporation or any instrument in which the Board of Directors, acting
pursuant to authority granted in the Certificate of Incorporation, shall
so designate, is entitled to vote as part of the Voting Rights Class.
1.33 "Person" shall mean any individual, corporation,
general partnership, limited partnership, limited liability partnership,
joint venture, association, joint-stock company, trust, limited liability
company, unincorporated organization or government or any agency or
political subdivision thereof.
1.34 "Pro Rata Percentage" shall mean, as of any date, a
fraction, the numerator of which shall be the aggregate Liquidation
Preference of the outstanding shares of Series K Preferred Stock as of
such date, plus Accumulated Dividends thereon, and the denominator of
which shall be the Cumulative Priority Capital of the TWE Series B
Interests as of such date. In calculating the Pro Rata Percentage in
connection with the mandatory redemption on the Final Redemption Date or
upon an Insolvency of TWE, the Cumulative Priority Capital of the TWE
Series B Interests shall be increased by the sum of all Tax Distributions
(other than Included Tax Distributions) made by TWE to the Corporation
(and its subsidiaries) following the Initial Issue Date with respect to
the TWE Series B Interests.
1.35 "Rating Confirmation" shall mean either (i) a
confirmation from each of Moody's Investors Service, Inc. or any
successor to its rating agency business ("Moody's") and Standard and
Poor's Corporation or any successor to its rating agency business ("S&P")
that any contemplated redemption or exchange by the Corporation would not
result in a downgrade of its rating of the Corporation's senior unsecured
long-term debt, or (ii) a good faith determination by the Board of
Directors or any committee thereof (after consultation with a Nationally
Recognized Investment Banking Firm) that any contemplated redemption or
exchange by the Corporation should not result in a downgrade in the
rating of the Corporation's senior unsecured long-term debt by either
Moody's or S&P.
1.36 "Redeemable Number" shall mean, with respect to any
Mandatory Redemption Date, a number (rounded down to the nearest whole
number) of shares of Series K Preferred Stock equal to (i) the Pro Rata
Percentage (as of the Applicable Series B Redemption Date without giving
effect to the Series B Redemption occurring on such date) of the amount
of (a) cash distributions received by the Corporation (and its
subsidiaries) in respect of the Series B Redemption occurring on the
Applicable Series B Redemption Date, plus (b) cash distributions received
by the Corporation in respect of its TWE Junior Interests from the
Applicable Series B Redemption Date to such Mandatory Redemption Date,
divided by (ii) the Liquidation Preference per share of Series K
Preferred Stock plus Accumulated Dividends and Accrued Dividends thereon;
PROVIDED, HOWEVER, that in no event shall the Redeemable Number exceed
20%, 25%, 33 1/3% and 50% of the number of shares of Series K Preferred
Stock outstanding on the Mandatory Redemption Dates occurring on July 1
of 2012, 2013, 2014 and 2015, respectively.
1.37 "Relevant Assets" shall mean filmed entertainment or
programming assets currently owned by the Corporation or any of its
subsidiaries (other than TWE) or which the Corporation or any of its
subsidiaries (other than TWE) currently has an agreement to acquire.
1.38 "Registration Rights Agreement" shall mean that
certain Registration Rights Agreement, dated April 11, 1996, among the
Corporation, Bear, Stearns & Co. Inc. and Morgan Stanley & Co.
Incorporated.
1.39 "Reorganization of TWE" shall mean (i) any merger or
consolidation of TWE or any sale of all or substantially all of the
assets of TWE, (ii) the liquidation, winding up or dissolution of TWE
other than as a result of the Insolvency of TWE, (iii) the making of any
distributions, in cash or other property (other than cash distributions
in accordance with the TWE Partnership Agreement), on the partnership
interests in TWE from and after the Initial Issue Date having an
aggregate fair market value (together with any such prior distributions)
in excess of $500,000,000 as determined by the Board of Directors in good
faith, (iv) any transaction or series of related transactions which
results in a sale or transfer of 10% or more of the total assets of TWE
(excluding asset swaps and contributions to subsidiaries or joint
ventures, other than joint ventures with any partner of TWE as of the
Initial Issue Date that is not a subsidiary of the Company) unless such
sale or transfer is made at fair market value, the proceeds of such sale
or transfer are substantially in cash and such cash is used to repay debt
or is reinvested in the business of TWE, (v) any transfer in the
beneficial ownership of a class of partnership interests in TWE that
would result in the Corporation (directly or indirectly) owning (after
giving effect to any reductions permitted by clauses (a) or (b) of this
clause (v)) less than 90% or more than 110% of its percentage ownership
interest in such class of partnership interests in TWE as of the Initial
Issue Date, other than any change resulting from (a) cash distributions
in accordance with the TWE Partnership Agreement or (b) the issuance of
partnership interests in TWE upon exercise of the U S WEST Option, (vi)
any material reduction in voting or management rights of the Corporation
(and its subsidiaries) in TWE, (vii) any issuance of additional
partnership interests in TWE which rank senior to the TWE Series B
Interests (other than (a) the TWE Contingent Interests, (b) partnership
interests in TWE issued upon exercise of the U S WEST Option or (c)
partnership interests in TWE having a fair market value (together with
any such prior issuances) no greater than $500,000,000, as determined by
the Board of Directors in good faith, issued in connection with any
contribution of assets to TWE), it being understood that allocations of
income or accretion with respect to the capital accounts associated with
the outstanding partnership interests in TWE shall not be considered
issuances of additional partnership interests in TWE, (viii) the failure
of a registration statement of the Corporation (contemplated to be filed
by the Registration Rights Agreement) to have become effective within one
year from the Initial Issue Date, (ix) any amendment to the TWE
Partnership Agreement (other than an amendment to effectuate an issuance
of partnership interests in TWE permitted by clause (vii)(c) above) that
adversely affects the allocation of income or payment of distributions
to, or priority capital rate of return or priority of, the TWE Series B
Interests or (x) the date that is six months following the occurrence of
a Material Contribution of Assets which does not otherwise result in the
occurrence of an event specified in clauses (i) through (ix) above.
1.40 "Reorganization Redemption/Exchange Date" means, with
respect to any Reorganization of TWE, the first Dividend Payment Date
following the 90th day after such Reorganization of TWE; PROVIDED that if
such first Dividend Payment Date occurs on or prior to the 30th day
following such 90th day, then the Reorganization Redemption/Exchange Date
means the second Dividend Payment Date following the 90th day after such
Reorganization of TWE.
1.41 "Reorganization Redemption Price Per Share" shall
mean, with respect to each share of Series K Preferred Stock, (i) (a)
110% of the Liquidation Preference thereof, plus (b) Accumulated
Dividends and Accrued Dividends thereon, or (ii) if the Series K
Preferred Stock may be redeemed at the option of the Corporation at such
time, the Optional Redemption Price Per Share then in effect.
1.42 "Senior Stock" shall mean the shares of any class or
series of stock of the Corporation created after the Initial Issue Date
that, by the terms of the Certificate of Incorporation or of the
instrument by which the Board of Directors, acting pursuant to authority
granted in the Certificate of Incorporation, shall fix the relative
rights, preferences and limitations thereof, shall be senior to the
Series K Preferred Stock in respect of the right to receive dividends or
to participate in any other distribution of assets.
1.43 "Series B Redemption" shall mean each distribution
with respect to the TWE Series B Interests in accordance with Section
8.4(c)(ii) of the TWE Partnership Agreement.
1.44 "Series B Redemption Date" shall mean June 30 of
each of 2011, 2012, 2013, 2014 and 2015.
1.45 "Series L Preferred Stock" shall mean the
Corporation's 10-1/4% Series L Exchangeable Preferred Stock which may be
issued after the Initial Issue Date upon a Reorganization of TWE pursuant
to Section 6.1(i), and which shall have the voting powers, designations,
preferences and relative, participating, optional or other special
rights, and qualifications, limitations or restrictions as are set forth
in a certificate of designation substantially in the form attached hereto
as Exhibit A.
1.46 "Tax Distributions" shall mean cash distributions
made to the Corporation (and its subsidiaries) pursuant to Section 8.5 of
the TWE Partnership Agreement.
1.47 "TBS Merger Agreement" shall mean the Amended and
Restated Agreement and Plan of Merger dated as of September 22, 1995,
among the Corporation, certain of its subsidiaries and Turner
Broadcasting System, Inc., as the same may be amended from time to time.
1.48 "TBS Transaction" shall mean the transactions
contemplated by the TBS Merger Agreement.
1.49 "TWE" shall mean Time Warner Entertainment Company,
L.P., a Delaware limited partnership.
1.50 "TWE Contingent Interests" shall mean the partnership
interests in TWE associated with the C Sub-Accounts and the D Sub-
Accounts (each as defined in the TWE Partnership Agreement) of the
Corporation (and its subsidiaries).
1.51 "TWE Insolvency Valuation" shall mean the average of
the determinations of two Nationally Recognized Investment Banking Firms
with respect to the fair market value, as of the Insolvency Distribution
Date, of each non-cash distribution from TWE received by the Corporation
(and its subsidiaries) upon a liquidation, winding up or dissolution of
TWE upon the Insolvency of TWE. The Nationally Recognized Investment
Banking Firms shall be selected by the Corporation within 30 days
following the Insolvency Distribution Date and shall render their
opinions within 90 days following the Insolvency Distribution Date. For
purposes of the foregoing, (i) the fair market value of such non-cash
distributions shall be based on the price at which such property would be
sold in an arm's-length transaction between a willing buyer and a willing
seller, and to the extent such property comprises an operating business,
it shall be valued on a going concern basis; and (ii) such value shall be
increased by the sum of all Tax Distributions (other than Included Tax
Distributions) made by TWE to the Corporation (and its subsidiaries)
following the Initial Issue Date with respect to the TWE Series B
Interests.
1.52 "TWE Junior Interests" shall mean the TWE Residual
Interests together with the TWE Contingent Interests.
1.53 "TWE Partnership Agreement" shall mean that certain
Agreement of Limited Partnership, dated as of October 29, 1991, as the
same may be amended from time to time.
1.54 "TWE Residual Interests" shall mean the partnership
interests in TWE associated with the Common Sub-Accounts (as defined in
the TWE Partnership Agreement) of the Corporation (and its subsidiaries).
1.55 "TWE Series A Interests" shall mean the partnership
interests in TWE associated with the A Sub-Accounts (as defined in the
TWE Partnership Agreement) of the Corporation (and its subsidiaries).
1.56 "TWE Series B Interests" shall mean the partnership
interests in TWE associated with the B Sub-Accounts (as defined in the
TWE Partnership Agreement) of the Corporation (and its subsidiaries).
1.57 "TWE Valuation" shall mean the average of the
determinations of two Nationally Recognized Investment Banking Firms with
respect to the fair market value of the assets of TWE as of June 30, 2015
(without giving effect to the Series B Redemption or any distribution in
respect of the TWE Junior Interests occurring on such date). The
Nationally Recognized Investment Banking Firms shall be selected by the
Corporation by September 28, 2015 and shall render their opinions by
November 27, 2015. For purposes of the foregoing, (i) the fair market
value of the assets of TWE shall be determined on a going concern basis,
assuming that each division of TWE is sold in a separate arm's-length
transaction between a willing buyer and a willing seller; and (ii) such
value shall be increased by the sum of all Tax Distributions (other than
Included Tax Distributions) made by TWE to the Corporation (and its
subsidiaries) following the Initial Issue Date with respect to the TWE
Series B Interests.
1.58 "U S WEST Option" shall mean the option granted to U
S WEST, Inc., a Delaware corporation, to increase its share of the
partnership interests in TWE pursuant to the Option Agreement, dated as
of September 15, 1992, between TWE and U S WEST, Inc.
1.59 "Voting Rights Triggering Event" shall mean the
failure of the Corporation to (i) pay dividends on the Series K Preferred
Stock in cash, or to the extent permitted by its terms, by the issuance
of additional shares of Series K Preferred Stock, for more than six
consecutive quarterly dividend periods or (ii) discharge any redemption
or exchange obligation with respect to the Series K Preferred Stock.
2. DIVIDENDS.
2.1 The holders of shares of the outstanding Series K
Preferred Stock shall be entitled, when, as and if declared by the Board
of Directors out of funds legally available therefor, to receive
dividends on each outstanding share of Series K Preferred Stock. Each
quarter-annual dividend shall be an amount per share (rounded to the
nearest $.01) equal to $25.625 per $1,000 Liquidation Preference of
Series K Preferred Stock and shall be payable on each Dividend Payment
Date, to the holders of record of Series K Preferred Stock at the close
of business on the Dividend Record Date applicable to such Dividend
Payment Date, commencing on June 30, 1996. Such dividends shall be
cumulative and shall accrue on a day-to-day basis, whether or not earned
or declared, from and after the Issue Date applicable to each share of
this Series. Dividends on the Series K Preferred Stock which are not
declared and paid when due will compound quarterly on each Dividend
Payment Date at the dividend rate. Dividends payable for any partial
dividend period shall be computed on the basis of actual days elapsed
over a 365- (or 366-) day year.
2.2 Dividends may, at the option of the Corporation, be
paid on any Dividend Payment Date either in cash or by issuing fully paid
and nonassessable shares of Series K Preferred Stock with an aggregate
Liquidation Preference equal to the amount of such dividends; PROVIDED,
HOWEVER, that dividends payable on any Dividend Payment Date shall be
paid (i) in cash, to the extent of an amount equal to the Pro Rata
Percentage as of the Dividend Record Date applicable to the immediately
preceding Dividend Payment Date (or the Issue Date, in the case of the
first Dividend Payment Date) multiplied by the amount of cash
distributions, other than Excluded Tax Distributions, if any, received by
the Corporation (and its subsidiaries) with respect to its TWE Series B
Interests and TWE Junior Interests on or after the Dividend Record Date
applicable to the immediately preceding Dividend Payment Date (or the
Issue Date, in the case of the first Dividend Payment Date) to but not
including, the current Dividend Record Date, and (ii) in Series K
Preferred Stock or cash, at the Corporation's option, to the extent of
any balance.
2.3 Except as hereinafter provided in this Section 2.3,
no full dividends or other distributions may be declared or paid or set
apart for payment on Series K Preferred Stock or any other Parity Stock,
and no Parity Stock, including the Series K Preferred Stock, may be
repurchased, exchanged, redeemed or otherwise acquired by the
Corporation, nor may funds be set apart for payment with respect thereto,
unless full cumulative dividends shall have been paid or set apart for
such payment on, and all applicable redemption, exchange and repurchase
obligations shall have been satisfied with respect to, all outstanding
shares of Series K Preferred Stock and such other Parity Stock; PROVIDED
that dividends or distributions may be made on Parity Stock if they are
payable in Junior Stock, and Parity Stock may be converted into or
exchanged for Parity Stock (having no greater preference upon
liquidation) or Junior Stock; and PROVIDED FURTHER that if the Company
shall have satisfied all applicable redemption, exchange and repurchase
obligations with respect to all outstanding shares of Series K Preferred
Stock and other Parity Stock, but if full dividends are not so paid, the
Series K Preferred Stock shall share dividends with all other Parity
Stock, so that the amount of dividends declared per share on Series K
Preferred Stock and all such other Parity Stock shall in all cases bear
to each other the same ratio that full cumulative dividends per share on
the shares of Series K Preferred Stock and all such other Parity Stock
bear to each other. No dividends or other distributions may be paid or
set apart for such payment on Junior Stock, and no Junior Stock may be
repurchased, exchanged, redeemed or otherwise acquired nor may funds be
set apart for payment with respect thereto, if full cumulative dividends
have not been paid on, or any applicable redemption, exchange or
repurchase obligations shall not have been satisfied with respect to, the
Series K Preferred Stock and all other Parity Stock; PROVIDED that
dividends or distributions may be made on Junior Stock if they are
payable-in-kind in additional shares of, or warrants, rights, calls or
options exercisable for or convertible into additional shares of Junior
Stock; and PROVIDED FURTHER that Junior Stock may be converted into or
exchanged for Junior Stock.
2.4 Holders of shares of Series K Preferred Stock shall
not be entitled to any dividends, whether payable in cash, property or
stock, in excess of full cumulative dividends, as herein provided, on the
Series K Preferred Stock. No interest, or sum of money in lieu of
interest, shall be payable in respect of any dividend payment or payments
on the Series K Preferred Stock which may be in arrears (it being
understood that the compounding of unpaid dividends shall not constitute
money in lieu of interest).
2.5 The dividend rate borne by shares of Series K
Preferred Stock shall be subject to increase in accordance with the
Registration Rights Agreement.
2.6 To the extent that the amount of any quarter-annual
dividend payable to a holder of Series K Preferred Stock (in respect of
all shares held by such holder) that is payable in additional shares of
Series K Preferred Stock, valued at the Liquidation Preference thereof,
does not equal a whole number of shares of Series K Preferred Stock, such
fractional amount shall be paid in cash to such holder of Series K
Preferred Stock.
3. OPTIONAL REDEMPTION.
3.1 At any time on or after July 1, 2006, the Corporation
may, at its sole option, subject to the provisions of Sections 2.3 and
3.2, redeem, out of funds legally available therefor, all or any part of
the outstanding shares of Series K Preferred Stock. The redemption
prices for each share of Series K Preferred Stock called for redemption
during the 12-month periods commencing on July 1 of the years set forth
below shall be the amount (expressed as a percentage of the Liquidation
Preference thereof) set forth opposite such years, plus Accumulated
Dividends and Accrued Dividends thereon to the redemption date.
PERIOD PERCENTAGE OF LIQUIDATION PREFERENCE
2006 105.125%
2007 103.844%
2008 102.563%
2009 101.281%
2010 and thereafter 100.000%
3.2 No optional redemption shall be effected unless the
Corporation shall have obtained a Rating Confirmation with respect to
such redemption.
4. MANDATORY REDEMPTION.
4.1 On each Mandatory Redemption Date, the Corporation
shall redeem, out of funds legally available therefor, the Redeemable
Number of shares of Series K Preferred Stock with respect to such
Mandatory Redemption Date at the Mandatory Redemption Price Per Share.
4.2 On the Final Redemption Date, the Corporation shall
redeem, out of funds legally available therefor, each of the then
outstanding shares of Series K Preferred Stock at the lesser of the
Mandatory Redemption Amount Per Share and the Mandatory Redemption Price
Per Share; PROVIDED that if the Corporation does not obtain a TWE
Valuation within 120 days following the final Series B Redemption Date,
the Corporation shall redeem, out of funds legally available therefor,
such shares at the Mandatory Redemption Price Per Share; and PROVIDED
FURTHER that, if the TWE Series B Interests have been fully redeemed in
accordance with the TWE Partnership Agreement, the Corporation shall
redeem, out of funds legally available therefor, such shares at the
Mandatory Redemption Price Per Share.
4.3 Upon the redemption of all of the outstanding shares
of Series K Preferred Stock on the Final Redemption Date pursuant to
Section 4.2, the Corporation's obligations with respect thereto will be
discharged.
5. REDEMPTION UPON INSOLVENCY OF TWE.
5.1 In the event of a liquidation, winding up or
dissolution of TWE upon the Insolvency of TWE, the Corporation shall
redeem, out of funds legally available therefor, each of the outstanding
shares of Series K Preferred Stock on the Insolvency Redemption Date at
the Insolvency Redemption Amount Per Share.
5.2 Upon such redemption, the Corporation's obligation
with respect to the Series K Preferred Stock will be discharged.
6. REORGANIZATION OF TWE.
6.1 In the event of a Reorganization of TWE, on the
Reorganization Redemption/Exchange Date, the Corporation shall either (at
its election) (i) exchange each outstanding share of Series K Preferred
Stock for shares of Series L Preferred Stock having an aggregate
liquidation preference of $1,000 plus the Accumulated Dividends and
Accrued Dividends on such share of Series K Preferred Stock so exchanged
(the "Reorganization Exchange") or (ii) redeem, out of funds legally
available therefor, each outstanding share of Series K Preferred Stock at
the Reorganization Redemption Price Per Share (the "Reorganization
Redemption"); PROVIDED, HOWEVER, that the Corporation may not effect a
Reorganization Redemption prior to July 1, 2011 unless the Corporation
shall have obtained a Rating Confirmation with respect to such
Reorganization Redemption; and PROVIDED, FURTHER, that the Corporation
may not effect a Reorganization Exchange on or after July 1, 2011.
Within 90 days after a Reorganization of TWE, the Corporation shall make
a public announcement that a Reorganization of TWE has occurred and as to
whether it will effect a Reorganization Exchange or Reorganization
Redemption.
6.2 The Corporation shall be entitled to effect a
Reorganization Exchange only to the extent that upon issuance of shares
of Series L Preferred Stock such shares shall be duly authorized and
validly issued, fully paid and nonassessable shares of Series L Preferred
Stock. Certificates for shares of Series L Preferred Stock issued in
exchange for surrendered shares of this Series pursuant to a
Reorganization Exchange shall be made available by the Corporation not
later than the fifth Business Day following the Reorganization
Redemption/Exchange Date.
6.3 Prior to giving notice of its intention to effect a
Reorganization Exchange, the Corporation shall execute and file with the
Secretary of State of the State of Delaware a Certificate of Designation
substantially in the form of Exhibit A hereto relating to the Series L
Preferred Stock, with such changes as may be required by law or that
would not adversely affect the interests of the holders of the Series L
Preferred Stock.
6.4 To the extent that in connection with a
Reorganization Exchange any holder of Series K Preferred Stock shall be
entitled to receive, in respect of all of its shares of Series K
Preferred Stock, a number of shares of Series L Preferred Stock that does
not equal a whole number of shares, then such holder shall receive cash
in lieu of such fractional amount.
7. PROCEDURE FOR REDEMPTION OR EXCHANGE.
7.1 In the event the Corporation shall elect or be
required to redeem or exchange shares of Series K Preferred Stock
pursuant to Sections 3, 4, 5 or 6 hereof, notice of such redemption or
exchange shall be given by first-class mail, not less than 30 nor more
than 60 days prior to the redemption or exchange date, to each record
holder of the shares to be redeemed or exchanged, at such holder's
address as the same appears on the books of the Corporation. Each such
notice shall state: (i) whether the redemption or exchange is pursuant to
Section 3, 4, 5 or 6 hereof; (ii) the time and date as of which the
redemption or exchange shall occur; (iii) the total number of shares of
Series K Preferred Stock to be redeemed or exchanged and, if fewer than
all the shares held by such holder are to be redeemed, the number of such
shares to be redeemed from such holder; (iv) in the case of a redemption,
the redemption price; (v) the place or places where certificates for such
shares are to be surrendered for payment of the redemption price in the
case of a redemption, or for delivery of certificates representing shares
of Series L Preferred Stock in the case of an exchange; (vi) that
dividends on the shares to be redeemed will cease to accrue on such
redemption or exchange date unless the Corporation defaults in the
payment of the redemption price or fails to satisfy its exchange
obligation; and (vii) in the case of redemption, the name of any bank or
trust company, if any, performing the duties referred to in Section 7.3.
7.2 On or before any redemption or exchange date, each
holder of shares of Series K Preferred Stock to be redeemed or exchanged
shall surrender the certificate or certificates representing such shares
of Series K Preferred Stock to the Corporation, in the manner and at the
place designated in the notice of redemption or exchange, and on the
redemption or exchange date, the full redemption price or shares of
Series L Preferred Stock, as the case may be, for such shares of Series K
Preferred Stock shall be paid or delivered to the Person whose name
appears on such certificate or certificates as the owner thereof, and
each surrendered certificate shall be returned to authorized but unissued
shares. Upon surrender (in accordance with the notice of redemption or
exchange) of the certificate or certificates representing any shares to
be so redeemed or exchanged (properly endorsed or assigned for transfer,
if the Corporation shall so require and the notice of redemption or
exchange shall so state), such shares shall be redeemed by the
Corporation at the redemption price or exchanged by the Corporation for
shares of Series L Preferred Stock. If fewer than all the shares
represented by any such certificate are to be redeemed, a new certificate
shall be issued representing the unredeemed shares, without cost to the
holder thereof, together with the amount of cash, if any, in lieu of
fractional shares.
7.3 If a notice of redemption or exchange shall have been
given as provided in Section 7.1, dividends on the shares of Series K
Preferred Stock so called for redemption shall cease to accrue, such
shares shall no longer be deemed to be outstanding, and all rights of the
holders thereof as stockholders of the Corporation with respect to shares
so called for redemption or exchange (except the right to receive from
the Corporation the redemption price or the Series L Preferred Stock
without interest) shall cease (including any right to receive dividends
otherwise payable on any Dividend Payment Date that would have occurred
after the time and date of redemption or exchange) either (i) from and
after the time and date fixed in the notice of redemption or exchange as
the time and date of redemption or exchange (unless the Corporation
shall default in the payment of the redemption price or shall fail to
satisfy its exchange obligation, in which case such rights shall not
terminate at such time and date) or (ii) if the Corporation shall so
elect and state in the notice of redemption, from and after the time and
date (which date shall be the date fixed for redemption or an earlier
date not less than 30 days after the date of mailing of the redemption
notice) on which the Corporation shall irrevocably deposit in trust for
the holders of the shares to be redeemed with a designated bank or trust
company doing business in the Borough of Manhattan, City and State of New
York, as paying agent, money sufficient to pay at the office of such
paying agent, on the redemption date, the redemption price. Any money so
deposited with any such paying agent which shall not be required for such
redemption shall be returned to the Corporation forthwith. Subject to
applicable escheat laws, any moneys so set aside by the Corporation and
unclaimed at the end of one year from the redemption date shall revert to
the general funds of the Corporation, after which reversion the holders
of such shares so called for redemption shall look only to the general
funds of the Corporation for the payment of the redemption price without
interest. Any interest accrued on funds so deposited shall be paid to
the Corporation from time to time.
7.4 In the event that fewer than all the outstanding
shares of Series K Preferred Stock are to be redeemed, the shares to be
redeemed shall be determined PRO RATA or by lot, as determined by the
Corporation, except that the Corporation may redeem such shares held by
any holder of fewer than 100 shares (or shares held by holders who would
hold fewer than 100 shares as a result of such redemption), as may be
determined by the Corporation.
8. CHANGE OF CONTROL.
8.1 Upon the occurrence of a Change of Control of the
Corporation, the Corporation shall make an offer (the "Change of Control
Offer") to each holder of Series K Preferred Stock to repurchase, out of
funds legally available therefor, all or any part of such holder's Series
K Preferred Stock at a purchase price per share in cash equal to 101% of
the Liquidation Preference thereof, plus an amount equal to all
Accumulated Dividends and Accrued Dividends thereon to the date of
purchase. The Change of Control Offer must be made within 30 days
following a Change of Control, shall remain open for at least 30 and not
more than 40 days and shall comply with the requirements of Rule 14e-1
under the Exchange Act and any other applicable securities laws and
regulations.
8.2 In the event the Corporation shall be required to
make a Change of Control Offer pursuant to Section 8.1 hereof, notice of
such Change of Control Offer shall be given by first-class mail, to each
record holder of shares of Series K Preferred Stock, at such holder's
address as the same appears on the books of the Corporation. Each such
notice shall state: (i) that a Change of Control has occurred; (ii) the
last day on which the Change of Control Offer may be accepted (the
"Expiration Date"); (iii) the repurchase price; (iv) the name and address
of the paying agent; and (v) the procedures that holders must follow to
accept the Change of Control Offer.
8.3 On or before the Expiration Date, each holder of
shares of Series K Preferred Stock wishing to accept the Change of
Control Offer shall surrender the certificate or certificates
representing such shares of Series K Preferred Stock that such holder
wishes to have repurchased to the Corporation, in the manner and at the
place designated in the notice described in Section 8.2, and on the
repurchase date, the full repurchase price for such shares of Series K
Preferred Stock shall be payable to the Person whose name appears on such
certificate or certificates as the owner thereof, and each surrendered
certificate shall be returned to authorized but unissued shares. Upon
surrender (in accordance with the notice described in Section 8.2) of the
certificate or certificates representing any shares to be so repurchased
(properly endorsed or assigned for transfer, if the Corporation shall so
require and the notice of a Change of Control Offer shall so state), such
shares shall be repurchased by the Corporation at the repurchase price.
In case fewer than all the shares represented by any such certificate are
to be repurchased, a new certificate shall be issued representing the
non-repurchased shares, without cost to the holder thereof, together with
the amount of cash, if any, in lieu of fractional shares.
9. VOTING.
9.1 The shares of Series K Preferred Stock shall have no
voting rights except as required by law or as set forth below:
(a) If and whenever at any time or times, a Voting
Rights Triggering Event occurs, then the number of directors constituting
the Board of Directors shall be increased by two (without duplication of
any such increase in directorships required under the terms of any other
Parity Stock) and the holders of shares of Series K Preferred Stock,
voting or consenting, as the case may be, together as a class with the
holders of any shares of Parity Stock entitled to vote thereon and as to
which (i) dividends are in arrears or unpaid in an aggregate amount equal
to or exceeding the amount of dividends payable thereon for six quarterly
dividend periods or (ii) redemption or exchange obligations have not been
satisfied (together with the Series K Preferred Stock, the "Voting Rights
Class"), will be entitled to elect two directors of the Corporation to
fill the newly created directorships.
(b) Such voting rights may be exercised initially
either by written consent or at a special meeting of the holders of the
shares of the Voting Rights Class, called as hereinafter provided, or at
any annual meeting of stockholders held for the purpose of electing
directors, and thereafter at each such annual meeting until such time as
all dividends in arrears on the shares of this Series shall have been
paid in full and/or all redemption or exchange obligations have been
satisfied, as applicable, at which time or times such voting rights and
the term of the directors elected pursuant to Section 9.1(a) shall
terminate.
(c) At any time when such voting rights shall have
vested in holders of shares of the Voting Rights Class described in
Section 9.1(a), and if such rights shall not already have been exercised
by written consent, a proper officer of the Corporation may call, and,
upon the written request of the record holders of shares representing
twenty-five percent (25%) of the voting power of the shares then
outstanding of the Voting Rights Class, addressed to the Secretary of the
Corporation, shall call a special meeting of the holders of shares of
Voting Rights Class. Such meeting shall be held at the earliest
practicable date upon the notice required for annual meetings of
stockholders at the place for holding annual meetings of stockholders of
the Corporation, or, if none, at a place designated by the Board of
Directors. Notwithstanding the provisions of this Section 9.1(c), no
such special meeting shall be called during a period within the 60 days
immediately preceding the date fixed for the next annual meeting of
stockholders.
(d) At any meeting held for the purpose of electing
directors at which the holders of the Voting Rights Class shall have the
right to elect directors as provided herein, the presence in person or by
proxy of the holders of shares representing more than fifty percent (50%)
in voting power of the then outstanding shares of the Voting Rights Class
shall be required and shall be sufficient to constitute a quorum of such
class for the election of directors by such class.
(e) Any director elected pursuant to the voting
rights created under this Section 9.1 shall hold office until the next
annual meeting of stockholders (unless such term has previously
terminated pursuant to Section 9.1(b)) and any vacancy in respect of any
such director shall be filled only by vote of the remaining director so
elected by holders of the Voting Rights Class, or if there be no such
remaining director, by the holders of shares of the Voting Rights Class
by written consent or at a special meeting called in accordance with the
procedures set forth in this Section 9, or, if no such special meeting is
called or written consent executed, at the next annual meeting of
stockholders. Upon any termination of such voting rights, the term of
office of all directors elected pursuant to this Section 9 shall
terminate.
(f) So long as any shares of Series K Preferred
Stock remain outstanding, unless a greater percentage shall then be
required by law, the Corporation shall not, without the affirmative vote
at a meeting or the written consent with or without a meeting of the
holders of shares of Series K Preferred Stock representing at least a
majority of the outstanding shares of Series K Preferred Stock voting or
consenting, as the case may be, separately as one class, (i) create,
authorize or issue any Senior Stock or (ii) amend the Certificate of
Designation or the Certificate of Incorporation so as to affect adversely
the specified rights, preferences, privileges or voting rights of holders
of shares of Series K Preferred Stock. The holders of at least a
majority of the outstanding shares of Series K Preferred Stock, voting or
consenting, as the case may be, separately as one class, may waive
compliance with any provision of the Certificate of Designation.
(g) In exercising the voting rights set forth in
this Section 9.1, each share of Series K Preferred Stock shall have a
number of votes equal to its Liquidation Preference.
9.2 Except as set forth in Section 9.1, the Corporation
may (a) create, authorize or issue any shares of Junior Stock or Parity
Stock or (b) increase or decrease the amount of authorized capital stock
of any class, including any preferred stock, without the consent of the
holders of Series K Preferred Stock, voting or consenting separately as a
class, and in taking the actions specified in (a) and (b) the Corporation
shall not be deemed to have affected adversely the rights, preferences,
privileges or voting rights of holders of shares of Series K Preferred
Stock.
10. LIQUIDATION RIGHTS.
10.1 In the event of any liquidation, dissolution or
winding-up of the Corporation, whether voluntary or involuntary, the
holders of the shares of Series K Preferred Stock shall be entitled to
receive out of the assets of the Corporation available for distribution
to stockholders up to their Liquidation Preference of $1,000 per share
plus Accumulated Dividends and Accrued Dividends thereon in preference to
the holders of, and before any distribution is made on, any Junior Stock,
including, without limitation on any Common Stock.
10.2 Neither the sale, conveyance, exchange or transfer
(for cash, shares of stock, securities or other consideration) of all or
substantially all the property and assets of the Corporation nor the
merger or consolidation of the Corporation into or with any other
corporation, or the merger or consolidation of any other corporation into
or with the Corporation, shall be deemed to be a liquidation, dissolution
or winding up, voluntary or involuntary, for the purposes of this Section
10.
10.3 After the payment to the holders of the shares of
Series K Preferred Stock of full preferential amounts provided for in
this Section 10, the holders of Series K Preferred Stock as such shall
have no right or claim to any of the remaining assets of the Corporation.
10.4 In the event the assets of the Corporation available
for distribution to the holders of shares of Series K Preferred Stock
upon any liquidation, dissolution or winding up of the Corporation,
whether voluntary or involuntary, shall be insufficient to pay in full
all amounts to which such holders are entitled pursuant to Section 10.1,
no such distribution shall be made on account of any shares of any Parity
Stock upon such liquidation, dissolution or winding up unless
proportionate distributable amounts shall be paid on account of the
shares of Series K Preferred Stock, ratably, in proportion to the full
distributable amounts for which holders of all Parity Stock are entitled
upon such liquidation, dissolution or winding up.
11. MERGER, CONSOLIDATION AND SALE OF ASSETS. Subject to the
next sentence, without the affirmative vote or consent of the holders of
at least a majority of the outstanding shares of Series K Preferred
Stock, voting or consenting, as the case may be, separately as one class,
the Corporation may not consolidate or merge with or into, or sell,
assign, transfer, lease, convey or otherwise dispose of all or
substantially all of its assets to, any Person unless: (a) the Person
formed by such consolidation or merger (if other than the Corporation) or
to which such sale, assignment, transfer, lease, conveyance or other
disposition shall have been made shall be a corporation organized or
existing under the laws of the United States or any State thereof or the
District of Columbia; (b) each share of Series K Preferred Stock shall be
converted into or exchanged for and shall become a share of such
successor, transferee or resulting corporation or a parent corporation of
such corporation, having in respect of such successor, transferee or
resulting corporation or parent corporation substantially the same
powers, preferences and relative participating, optional or other special
rights, and the qualifications, limitations or restrictions thereon, that
the Series K Preferred Stock had immediately prior to such transaction;
and (c) immediately after giving effect to such transaction, no Voting
Rights Triggering Event shall have occurred or be continuing. The
consummation of the TBS Transaction pursuant to the TBS Merger Agreement
will not require the affirmative vote or consent of the holders of shares
of the Series K Preferred Stock.
12. TRANSFER AGENT AND REGISTRAR. The transfer agent and
registrar (the "Transfer Agent") for the Series K Preferred Stock shall
be Chemical Mellon Shareholder Services, L.L.C. The Corporation may, in
its sole discretion, remove the Transfer Agent with 10 days' prior
written notice to the Transfer Agent and appoint a successor Transfer
Agent prior to such removal.
13. COVENANT TO REPORT. Notwithstanding that the Corporation
may not be subject to the reporting requirements of Section 13 or Section
15(d) of the Exchange Act, the Corporation will provide the Transfer
Agent and the holders of Series K Preferred Stock with all information,
documents and reports specified in Section 13 and Section 15(d) of the
Exchange Act.
14. OTHER PROVISIONS.
14.1 With respect to any notice to a holder of shares of
Series K Preferred Stock required to be provided hereunder, neither
failure to mail such notice, nor any defect therein or in the mailing
thereof, to any particular holder shall affect the sufficiency of the
notice or the validity of the proceedings referred to in such notice with
respect to the other holders or affect the legality or validity of any
distribution, right, warrant, reclassification, consolidation, merger,
conveyance, transfer, dissolution, liquidation or winding up, or the vote
upon any such action. Any notice which was mailed in the manner herein
provided shall be conclusively presumed to have been duly given whether
or not the holder receives the notice.
14.2 Shares of Series K Preferred Stock issued and
reacquired will, upon compliance with the applicable requirements of
Delaware law, have the status of authorized but unissued shares of
Preferred Stock of the Corporation undesignated as to series and may with
any and all other authorized but unissued shares of Preferred Stock of
the Corporation be designated or redesignated and issued or reissued, as
the case may be, as part of any series of Preferred Stock of the
Corporation, except that any issuance or reissuance of shares of Series K
Preferred Stock must be in compliance with the Certificate of
Designation.
14.3 The shares of Series K Preferred Stock shall be
issuable in whole shares.
14.4 The Corporation shall be entitled to recognize the
exclusive right of a person registered on its records as the holder of
shares of Series K Preferred Stock for all purposes.
14.5 All notice periods referred to herein shall commence
on the date of the mailing of the applicable notice.
IN WITNESS WHEREOF, Time Warner Inc. has caused this
certificate to be signed and attested this ______ day of April, 1996.
TIME WARNER INC.
By:
----------------------------
Name:
Title:
Attest:
________________________
Name:
Title:
<PAGE>
Exhibit A
[FORM OF]
CERTIFICATE OF THE VOTING POWERS, DESIGNATIONS, PREFERENCES
AND RELATIVE, PARTICIPATING, OPTIONAL OR OTHER SPECIAL
RIGHTS, AND QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS
THEREOF, OF 10 1/4% SERIES L EXCHANGEABLE PREFERRED STOCK
OF
TIME WARNER INC.
----------------------------
PURSUANT TO SECTION 151 OF THE GENERAL CORPORATION LAW
OF THE STATE OF DELAWARE
------------------------------
TIME WARNER INC., a corporation organized and existing by virtue of
the General Corporation Law of the State of Delaware (the "Corporation"),
does hereby certify that the following resolution was duly adopted by
action of the Board of Directors of the Corporation, with the provisions
thereof fixing the number of shares of the series, the dividend rate, and
the optional redemption prices being set by action of the Pricing
Committee of the Board of Directors of the Corporation:
RESOLVED that pursuant to the authority expressly granted to and
vested in the Board of Directors of the Corporation by the provisions of
Section 2 of Article IV of the Restated Certificate of Incorporation of
the Corporation, as amended from time to time (the "Certificate of
Incorporation"), and pursuant to authority expressly delegated to the
Pricing Committee of the Board of Directors of the Corporation by such
Board of Directors, and pursuant to Section 151(g) of the General
Corporation Law of the State of Delaware, there be created from the
250,000,000 shares of Preferred Stock, par value $1.00 per share (the
"Preferred Stock"), of the Corporation authorized to be issued pursuant
to the Certificate of Incorporation, a series of Preferred Stock,
consisting of 9,000,000 shares of 10 1/4% Series L Exchangeable
Preferred Stock, the voting powers, designations, preferences and
relative, participating, optional or other special rights of which, and
qualifications, limitations or restrictions thereof, shall be as follows:
The series of Preferred Stock hereby established shall consist of
9,000,000 shares of 10 1/4% Series L Exchangeable Preferred Stock (such
series being hereinafter referred to as "Series L Preferred Stock" or
"this Series"). The rights, preferences and limitations of the Series L
Preferred Stock shall be as follows:
1. DEFINITIONS. As used herein, the following terms shall
have the following meanings:
1.1 "Accrued Dividends" shall mean, with respect to any
share of this Series, as of any date, the accrued and unpaid dividends on
such share from the most recent Dividend Payment Date (or the Issue Date
applicable to such share, if such date is prior to the first Dividend
Payment Date applicable to such share) to such date.
1.2 "Accumulated Dividends" shall mean, with respect to
any share of this Series, as of any date, the aggregate accumulated and
unpaid dividends on such share from the Issue Date applicable to such
share until the most recent Dividend Payment Date prior to such date.
There shall be no Accumulated Dividends with respect to any share of this
Series prior to the first Dividend Payment Date applicable to such share.
1.3 "Board of Directors" shall mean the Board of
Directors of the Corporation or, with respect to any action to be taken
by the Board of Directors, any committee of the Board of Directors duly
authorized to take such action.
1.4 "Business Day" shall mean any day other than a
Saturday, Sunday or other day on which commercial banks in the City of
New York are authorized or required by law or executive order to close.
1.5 "Change of Control" shall mean:
(i) whenever, in any three-year period, a majority
of the members of the Board of Directors elected during such three-year
period shall have been so elected against the recommendation of the
management of the Corporation or the Board of Directors in office
immediately prior to such election; it being understood that for purposes
of this clause (i) a member of such Board of Directors shall be deemed to
have been elected against the recommendation of such Board of Directors
if his or her initial election occurs as a result of either an actual or
threatened election contest (as such terms are used in Rule 14a-11 of
Regulation 14A promulgated under the Exchange Act) or other actual or
threatened solicitation of proxies or consents by or on behalf of a
Person other than such Board of Directors; or
(ii) whenever any Person shall acquire (whether by
merger, consolidation, sale, assignment, lease, transfer or otherwise, in
one transaction or any related series of transactions) or otherwise
beneficially own voting securities of the Corporation that represent in
excess of 50% of the voting power of all outstanding voting securities of
the Corporation generally entitled to vote for the election of directors,
if such Person had acquired or publicly announced its intention to
initially acquire ten percent or more of such voting securities in a
transaction that had not, within 30 days after the date of such
acquisition or public announcement, been approved by the management of
the Corporation.
1.6 "Common Stock" shall mean the class of Common Stock,
par value $1.00 per share, of the Corporation or any other class of stock
resulting from successive changes or reclassifications of such Common
Stock consisting solely of changes in par value, or from par value to no
par value, or as a result of a subdivision or combination.
1.7 "Debt Exchange" shall mean the exchange of Series L
Preferred Stock for Senior Subordinated Debentures pursuant to Section 5.
1.8 "Dividend Payment Date" shall mean March 30, June 30,
September 30 and December 30 of each year, commencing on the first such
date to occur after the Issue Date.
1.9 "Dividend Record Date" shall mean, with respect to
each Dividend Payment Date, the fifteenth day immediately preceding such
Dividend Payment Date.
1.10 "Exchange Act" shall mean the Securities Exchange Act
of 1934, as amended.
1.11 "Exchange Date" shall mean the date upon which the
Debt Exchange occurs.
1.12 "Initial Issue Date" shall mean the first date on
which shares of Series L Preferred Stock are issued in exchange for
shares of Series K Preferred Stock.
1.13 "Issue Date" shall mean, with respect to each share
of Series L Preferred Stock, the date upon which such share is first
issued.
1.14 "Junior Stock" shall mean the Common Stock, the
Series A Participating Cumulative Preferred Stock and the shares of any
other class or series of stock of the Corporation established, authorized
or issued after April 11, 1996 that, by the terms of the Certificate of
Incorporation or of the instrument by which the Board of Directors,
acting pursuant to authority granted in the Certificate of Incorporation,
shall fix the relative rights, preferences and limitations thereof, shall
be junior to the Series L Preferred Stock in respect of the right to
receive dividends or to participate in any other distribution of assets.
1.15 "Liquidation Preference" shall mean, with respect to
each share of Series L Preferred Stock, $1,000.
1.16 "Mandatory Redemption Date" shall mean July 1, 2011.
1.17 "Mandatory Redemption Price Per Share" shall mean,
with respect to each share of Series L Preferred Stock to be redeemed, an
amount equal to the Liquidation Preference thereof, plus Accumulated
Dividends and Accrued Dividends thereon.
1.18 "Nationally Recognized Investment Banking Firm" shall
mean an investment banking firm having a national reputation in the
United States which shall have experience in securities rating matters
and which shall be approved by a majority of the members of the Board of
Directors who are not officers or employees of the Corporation or its
subsidiaries, including TWE.
1.19 "New Time Warner" shall mean Holdco (as defined in
the TBS Merger Agreement).
1.20 "Optional Redemption Price Per Share" shall mean, as
of any date, the price at which the Corporation may, at its option,
redeem one share of Series L Preferred Stock pursuant to Section 3.1.
1.21 "Parity Stock" shall mean the shares of the
Corporation's Series B 6.40% Preferred Stock, Series C Convertible
Preferred Stock, Series D Convertible Preferred Stock, Series E
Convertible Preferred Stock, Series F Convertible Preferred Stock, Series
G Convertible Preferred Stock, Series H Convertible Preferred Stock,
Series I Convertible Preferred Stock, Series K Preferred Stock, Series L
Preferred Stock and any other class or series of stock of the Corporation
created after April 11, 1996 that, by the terms of the Certificate of
Incorporation or of the instrument by which the Board of Directors,
acting pursuant to authority granted in the Certificate of Incorporation,
shall fix the relative rights, preferences and limitations thereof,
shall, in the event that the stated dividends thereon are not paid in
full, be entitled to share ratably with the Series L Preferred Stock in
the payment of dividends, including accumulations, if any, in accordance
with the sums which would be payable on such shares if all dividends were
declared and paid in full, or shall, in the event that the amounts
payable thereon in liquidation are not paid in full, be entitled to share
ratably with the Series L Preferred Stock in any other distribution of
assets in accordance with the sums which would be payable in such
distribution if all sums payable were discharged in full; PROVIDED,
HOWEVER, that the term "Parity Stock" shall be deemed to refer (i) in
Section 2.3 hereof, to any stock which is Parity Stock in respect of
dividend rights; (ii) in Section 9 hereof, to any stock which is Parity
Stock in respect of the distribution of assets; and (iii) in Section 8.1
hereof, to any stock which is Parity Stock in respect of either dividend
rights or the distribution of assets and which, pursuant to the
Certificate of Incorporation or any instrument in which the Board of
Directors, acting pursuant to authority granted in the Certificate of
Incorporation, shall so designate, is entitled to vote as part of the
Voting Rights Class.
1.22 "Person" shall mean any individual, corporation,
general partnership, limited partnership, limited liability partnership,
joint venture, association, joint-stock company, trust, limited liability
company, unincorporated organization or government or any agency or
political subdivision thereof.
1.23 "Rating Confirmation" shall mean either (i) a
confirmation from each of Moody's Investors Service, Inc. or any
successor to its rating agency business ("Moody's") and Standard and
Poor's Corporation or any successor to its rating agency business ("S&P")
that any contemplated redemption or exchange by the Corporation would not
result in a downgrade of its rating of the Corporation's senior unsecured
long-term debt, or (ii) a good faith determination by the Board of
Directors or any committee thereof (after consultation with a Nationally
Recognized Investment Banking Firm) that any contemplated redemption or
exchange by the Corporation should not result in a downgrade in the
rating of the Corporation's senior unsecured long-term debt by either
Moody's or S&P.
1.24 "Registration Rights Agreement" shall mean that
certain Registration Rights Agreement, dated April 11, 1996, among the
Corporation, Bear, Stearns & Co. Inc. and Morgan Stanley & Co.
Incorporated.
1.25 "Senior Stock" shall mean the shares of any class or
series of stock of the Corporation created after April 11, 1996 that, by
the terms of the Certificate of Incorporation or of the instrument by
which the Board of Directors, acting pursuant to authority granted in the
Certificate of Incorporation, shall fix the relative rights, preferences
and limitations thereof, shall be senior to the Series L Preferred Stock
in respect of the right to receive dividends or to participate in any
other distribution of assets.
1.26 "Senior Subordinated Debentures" shall mean the
10 1/4% Senior Subordinated Debentures 2011 issued by the Corporation or
New Time Warner, as the case may be, pursuant to the Senior Subordinated
Indenture.
1.27 "Senior Subordinated Indenture" shall mean an
indenture substantially in the form filed as an exhibit to the
Corporation's Current Report on Form 8-K dated April 11, 1996.
1.28 "Series K Preferred Stock" shall mean the
Corporation's 10 1/4% Series K Exchangeable Preferred Stock in exchange
for which shares of this Series were first issued.
1.29 "TBS Merger Agreement" shall mean the Amended and
Restated Agreement and Plan of Merger dated as of September 22, 1995,
among the Corporation, certain of its subsidiaries and Turner
Broadcasting System, Inc., as the same may be amended from time to time.
1.30 "TBS Transaction" shall mean the transactions
contemplated by the TBS Merger Agreement.
1.31 "Trust Indenture Act" shall mean the Trust Indenture
Act of 1939, as amended.
1.32 "TWE" shall mean Time Warner Entertainment Company,
L.P., a Delaware limited partnership.
1.33 "Voting Rights Triggering Event" shall mean the
failure of the Corporation to (i) pay dividends on the Series L Preferred
Stock in cash, or to the extent permitted by its terms, by the issuance
of additional shares of Series L Preferred Stock, for more than six
consecutive quarterly dividend periods or (ii) discharge any redemption
or exchange obligation with respect to the Series L Preferred Stock.
2. DIVIDENDS.
2.1 The holders of outstanding shares of Series L
Preferred Stock shall be entitled, when, as and if declared by the Board
of Directors out of funds legally available therefor, to receive
dividends on each outstanding share of Series L Preferred Stock. Each
quarter-annual dividend shall be an amount per share (rounded to the
nearest $.01) equal to $25.625 per $1,000 Liquidation Preference of
Series L Preferred Stock and shall be payable on each Dividend Payment
Date, to the holders of record of Series L Preferred Stock at the close
of business on the Dividend Record Date applicable to such Dividend
Payment Date, commencing on the first Dividend Payment Date following the
Initial Issue Date. Such dividends shall be cumulative and shall accrue
on a day-to-day basis, whether or not earned or declared, from and after
the Issue Date applicable to each share of this Series. Dividends on the
Series L Preferred Stock which are not declared and paid when due will
compound quarterly on each Dividend Payment Date at the dividend rate.
Dividends payable for any partial dividend period shall be computed on
the basis of actual days elapsed over a 365- (or 366-) day year.
2.2 With respect to any periods ending on or prior to
June 30, 2006, dividends may, at the option of the Corporation, be paid
on any Dividend Payment Date either in cash or by issuing fully paid and
nonassessable shares of Series L Preferred Stock with an aggregate
Liquidation Preference equal to the amount of such dividends (or, in
connection with a Debt Exchange, by issuing Senior Subordinated
Debentures with an aggregate principal amount equal to the amount of such
dividends as provided in Section 5.1). Thereafter, dividends payable on
any Dividend Payment Date shall be paid only in cash.
2.3 Except as hereinafter provided in this Section 2.3,
no full dividends or other distributions may be declared or paid or set
apart for payment on Series L Preferred Stock or any other Parity Stock,
and no Parity Stock, including the Series L Preferred Stock, may be
repurchased, exchanged, redeemed or otherwise acquired by the
Corporation, nor may funds be set apart for payment with respect thereto,
unless full cumulative dividends shall have been paid or set apart for
such payment on, and all applicable redemption, exchange and repurchase
obligations shall have been satisfied with respect to, all outstanding
shares of Series L Preferred Stock and such other Parity Stock; PROVIDED
that dividends or distributions may be made on Parity Stock if they are
payable in Junior Stock, and Parity Stock may be converted into or
exchanged for Parity Stock (having no greater preference upon
liquidation) or Junior Stock; and PROVIDED FURTHER that if the Company
shall have satisfied all applicable redemption, exchange and repurchase
obligations with respect to all outstanding shares of Series K Preferred
Stock and other Parity Stock, but if full dividends are not so paid, the
Series L Preferred Stock shall share dividends with all other Parity
Stock, so that the amount of dividends declared per share on Series L
Preferred Stock and all such other Parity Stock shall in all cases bear
to each other the same ratio that full cumulative dividends per share on
the shares of Series L Preferred Stock and all such other Parity Stock
bear to each other. No dividends or other distributions may be paid or
set apart for such payment on Junior Stock, and no Junior Stock may be
repurchased, redeemed, exchanged or otherwise acquired nor may funds be
set apart for payment with respect thereto, if full cumulative dividends
have not been paid on, or any applicable redemption, exchange or
repurchase obligations shall not have been satisfied with respect to, the
Series L Preferred Stock and all other Parity Stock; PROVIDED that
dividends or distributions may be made on Junior Stock if they are
payable-in-kind in additional shares of, or warrants, rights, calls or
options exercisable for or convertible into additional shares of Junior
Stock and; and PROVIDED FURTHER that Junior Stock may be converted into
or exchanged for Junior Stock.
2.4 Holders of shares of Series L Preferred Stock shall
not be entitled to any dividends, whether payable in cash, property or
stock, in excess of full cumulative dividends, as herein provided, on the
Series L Preferred Stock. No interest, or sum of money in lieu of
interest, shall be payable in respect of any dividend payment or payments
on the Series L Preferred Stock which may be in arrears (it being
understood that compounding of unpaid dividends shall not constitute
money in lieu of interest).
2.5 The dividend rate borne by shares of Series L
Preferred Stock may be subject to increase in accordance with the
Registration Rights Agreement.
2.6 To the extent that the amount of any quarter-annual
dividend payable to a holder of Series L Preferred Stock (in respect of
all shares held by such holder) that is payable in additional shares of
Series L Preferred Stock, valued at the Liquidation Preference thereof,
does not equal a whole number of shares of Series L Preferred Stock, such
fractional amount shall be paid in cash to such holder of Series L
Preferred Stock.
3. OPTIONAL REDEMPTION.
3.1 At any time on or after July 1, 2006, the Corporation
may, at its sole option, subject to the provisions of Sections 2.3 and
3.2, redeem, out of funds legally available therefor, all or any part of
the outstanding shares of Series L Preferred Stock. The redemption
prices for each share of Series L Preferred Stock called for redemption
during the 12-month periods commencing on July 1 of the years set forth
below shall be the amount (expressed as a percentage of the Liquidation
Preference thereof) set forth opposite such years, plus Accumulated
Dividends and Accrued Dividends thereon to the redemption date.
PERIOD PERCENTAGE OF LIQUIDATION PREFERENCE
2006 105.125%
2007 103.844%
2008 102.563%
2009 101.281%
2010 and thereafter 100.000%
3.2 No optional redemption shall be effected unless the
Corporation shall have obtained a Rating Confirmation with respect to
such redemption.
4. MANDATORY REDEMPTION.
4.1 On the Mandatory Redemption Date, the Corporation
shall redeem, out of funds legally available therefor, each of the then
outstanding shares of Series L Preferred Stock as of the Mandatory
Redemption Date at the Mandatory Redemption Price Per Share.
4.2 Upon the redemption of all of the outstanding shares
of Series L Preferred Stock on the Mandatory Redemption Date pursuant to
Section 4.1, the Corporation's obligations with respect thereto will be
discharged.
5. DEBT EXCHANGE
5.1 On any Dividend Payment Date, subject to the
provisions of Sections 2.3 and 5.2, the Corporation may, at its sole
option, exchange, out of funds legally available therefor, each of the
shares of Series L Preferred Stock, in whole but not in part, for Senior
Subordinated Debentures having an aggregate principal amount equal to the
Liquidation Preference on the Series L Preferred Stock plus Accrued
Dividends thereon. Notwithstanding the foregoing, the Corporation may
not exercise such exchange option unless all Accumulated Dividends in
respect of shares of Series L Preferred Stock surrendered to the
Corporation upon exchange shall have been paid either in cash or, in
respect of Accumulated Dividends relating to any Dividend Payment Date
prior to July 1, 2006, at the option of the Corporation, in cash,
additional shares of Series L Preferred Stock or Senior Subordinated
Debentures having a principal amount equal to such amount.
5.2 No Debt Exchange shall be effected unless the
Corporation shall have obtained a Rating Confirmation with respect to the
Debt Exchange.
5.3 Upon the Debt Exchange, the Corporation shall issue
Senior Subordinated Debentures only in denominations of $1,000 and
integral multiples thereof and shall pay cash in lieu of issuing Senior
Subordinated Debentures in principal amounts of less than $1,000.
5.4 Prior to giving notice of its intention to effect the
Debt Exchange, the Corporation shall execute and deliver with a bank or
trust company selected by the Corporation, the Senior Subordinated
Indenture.
6. PROCEDURE FOR REDEMPTION OR EXCHANGE.
6.1 In the event the Corporation shall elect or be
required to redeem or exchange shares of Series L Preferred Stock
pursuant to Sections 3, 4 or 5 hereof, notice of such redemption or
exchange shall be given by first-class mail, not less than 30 nor more
than 60 days prior to the redemption or exchange date, to each record
holder of the shares to be redeemed or exchanged, at such holder's
address as the same appears on the books of the Corporation. Each such
notice shall state: (i) whether the redemption or exchange is pursuant to
Section 3, 4 or 5 hereof; (ii) the time and date as of which the
redemption or exchange shall occur; (iii) the total number of shares of
Series L Preferred Stock to be redeemed or exchanged and, if fewer than
all the shares held by such holder are to be redeemed, the number of such
shares to be redeemed from such holder; (iv) in the case of a redemption,
the redemption price; (v) the place or places where certificates for such
shares are to be surrendered for payment of the redemption price in the
case of a redemption, or for delivery of Senior Subordinated Debentures
in the case of the Debt Exchange; (vi) that dividends on the shares to be
redeemed will cease to accrue on such redemption or exchange date unless
the Corporation defaults in the payment of the redemption price or fails
to satisfy its exchange obligation; and (vii) in the case of redemption,
the name of any bank or trust company, if any, performing the duties
referred to in Section 6.3.
6.2 On or before any redemption or exchange date, each
holder of shares of Series L Preferred Stock to be redeemed or exchanged
shall surrender the certificate or certificates representing such shares
of Series L Preferred Stock to the Corporation, in the manner and at the
place designated in the notice of redemption or exchange, and on the
redemption or exchange date, the full redemption price or Senior
Subordinated Debentures in the principal amount specified in Section 5.1,
as the case may be, for such shares of Series L Preferred Stock shall be
paid or delivered to the Person whose name appears on such certificate or
certificates as the owner thereof, and each surrendered certificate shall
be returned to authorized but unissued shares. Upon surrender (in
accordance with the notice of redemption or exchange) of the certificate
or certificates representing any shares to be so redeemed or exchanged
(properly endorsed or assigned for transfer, if the Corporation shall so
require and the notice of redemption or exchange shall so state), such
shares shall be redeemed by the Corporation at the redemption price or
exchanged by the Corporation for Senior Subordinated Debentures in the
principal amount specified in Section 5.1. If fewer than all the shares
represented by any such certificate are to be redeemed, a new certificate
shall be issued representing the unredeemed shares, without cost to the
holder thereof, together with the amount of cash, if any, in lieu of
fractional shares.
6.3 If a notice of redemption or exchange shall have been
given as provided in Section 6.1, dividends on the shares of Series L
Preferred Stock so called for redemption or exchange shall cease to
accrue, such shares shall no longer be deemed to be outstanding, and all
rights of the holders thereof as stockholders of the Corporation with
respect to shares so called for redemption or exchange (except the right
to receive from the Corporation the redemption price or the Senior
Subordinated Debentures without interest) shall cease (including any
right to receive dividends otherwise payable on any Dividend Payment Date
that would have occurred after the time and date of redemption or
exchange) either (i) from and after the time and date fixed in the notice
of redemption or exchange as the time and date of redemption or exchange
(unless the Corporation shall default in the payment of the redemption
price or shall fail to satisfy its exchange obligation, in which case
such rights shall not terminate at such time and date) or (ii) if the
Corporation shall so elect and state in the notice of redemption, from
and after the time and date (which date shall be the date fixed for
redemption or an earlier date not less than 30 days after the date of
mailing of the redemption notice) on which the Corporation shall
irrevocably deposit in trust for the holders of the shares to be redeemed
with a designated bank or trust company doing business in the Borough of
Manhattan, City and State of New York, as paying agent, money sufficient
to pay at the office of such paying agent, on the redemption date, the
redemption price. Any money so deposited with any such paying agent
which shall not be required for such redemption shall be returned to the
Corporation forthwith. Subject to applicable escheat laws, any moneys so
set aside by the Corporation and unclaimed at the end of one year from
the redemption date shall revert to the general funds of the Corporation,
after which reversion the holders of such shares so called for redemption
shall look only to the general funds of the Corporation for the payment
of the redemption price without interest. Any interest accrued on funds
so deposited shall be paid to the Corporation from time to time.
6.4 In the event that fewer than all the outstanding
shares of Series L Preferred Stock are to be redeemed, the shares to be
redeemed shall be determined PRO RATA or by lot, as determined by the
Corporation, except that the Corporation may redeem such shares held by
any holder of fewer than 100 shares (or shares held by holders who would
hold fewer than 100 shares as a result of such redemption), as may be
determined by the Corporation.
7. CHANGE OF CONTROL.
7.1 Upon the occurrence of a Change of Control of the
Corporation, the Corporation shall make an offer (the "Change of Control
Offer") to each holder of Series L Preferred Stock to repurchase, out of
funds legally available therefor, all or any part of such holder's Series
L Preferred Stock at a purchase price per share in cash equal to 101% of
the Liquidation Preference thereof, plus an amount equal to all
Accumulated Dividends and Accrued Dividends thereon to the date of
purchase. The Change of Control Offer must be made within 30 days
following a Change of Control, shall remain open for at least 30 and not
more than 40 days and shall comply with the requirements of Rule 14e-1
under the Exchange Act and any other applicable securities laws and
regulations.
7.2 In the event the Corporation shall be required to
make a Change of Control Offer pursuant to Section 7.1 hereof, notice of
such Change of Control Offer shall be given by first-class mail, to each
record holder of shares of Series L Preferred Stock, at such holder's
address as the same appears on the books of the Corporation. Each such
notice shall state: (i) that a Change of Control has occurred; (ii) the
last day on which the Change of Control Offer may be accepted (the
"Expiration Date"); (iii) the repurchase price; (iv) the name and address
of the paying agent; and (v) the procedures that holders must follow to
accept the Change of Control Offer.
7.3 On or before the Expiration Date, each holder of
shares of Series L Preferred Stock wishing to accept the Change of
Control Offer shall surrender the certificate or certificates
representing such shares of Series L Preferred Stock that such holder
wishes to have repurchased to the Corporation, in the manner and at the
place designated in the notice described in Section 7.2, and on the
repurchase date, the full repurchase price for such shares of Series L
Preferred Stock shall be payable to the Person whose name appears on such
certificate or certificates as the owner thereof, and each surrendered
certificate shall be returned to authorized but unissued shares. Upon
surrender (in accordance with the notice described in Section 7.2) of the
certificate or certificates representing any shares to be so repurchased
(properly endorsed or assigned for transfer, if the Corporation shall so
require and the notice of a Change of Control Offer shall so state), such
shares shall be repurchased by the Corporation at the repurchase price.
In case fewer than all the shares represented by any such certificate are
to be repurchased, a new certificate shall be issued representing the
non-repurchased shares, without cost to the holder thereof, together with
the amount of cash, if any, in lieu of fractional shares.
8. VOTING.
8.1 The shares of Series L Preferred Stock shall have no
voting rights except as required by law or as set forth below:
(a) If and whenever at any time or times, a Voting
Rights Triggering Event occurs, then the number of directors constituting
the Board of Directors shall be increased by two (without duplication of
any such increase in directorships required under the terms of any other
Parity Stock) and the holders of shares of Series L Preferred Stock,
voting or consenting, as the case may be, together as a class with the
holders of any shares of Parity Stock entitled to vote thereon and as to
which (i) dividends are in arrears or unpaid in an aggregate amount equal
to or exceeding the amount of dividends payable thereon for six quarterly
dividend periods or (ii) redemption or exchange obligations have not been
satisfied (together with the Series L Preferred Stock, the "Voting Rights
Class"), will be entitled to elect two directors of the Corporation to
fill the newly created directorships.
(b) Such voting rights may be exercised initially
either by written consent or at a special meeting of the holders of the
shares of the Voting Rights Class, called as hereinafter provided, or at
any annual meeting of stockholders held for the purpose of electing
directors, and thereafter at each such annual meeting until such time as
all dividends in arrears on the shares of this Series shall have been
paid in full and/or all redemption or exchange obligations have been
satisfied, as applicable, at which time or times such voting rights and
the term of the directors elected pursuant to Section 8.1(a) shall
terminate.
(c) At any time when such voting rights shall have
vested in holders of shares of the Voting Rights Class described in
Section 8.1(a), and if such rights shall not already have been exercised
by written consent, a proper officer of the Corporation may call, and,
upon the written request of the record holders of shares representing
twenty-five percent (25%) of the voting power of the shares then
outstanding of the Voting Rights Class, addressed to the Secretary of the
Corporation, shall call a special meeting of the holders of shares of
Voting Rights Class. Such meeting shall be held at the earliest
practicable date upon the notice required for annual meetings of
stockholders at the place for holding annual meetings of stockholders of
the Corporation, or, if none, at a place designated by the Board of
Directors. Notwithstanding the provisions of this Section 8.1(c), no
such special meeting shall be called during a period within the 60 days
immediately preceding the date fixed for the next annual meeting of
stockholders.
(d) At any meeting held for the purpose of electing
directors at which the holders of the Voting Rights Class shall have the
right to elect directors as provided herein, the presence in person or by
proxy of the holders of shares representing more than fifty percent (50%)
in voting power of the then outstanding shares of the Voting Rights Class
shall be required and shall be sufficient to constitute a quorum of such
class for the election of directors by such class.
(e) Any director elected pursuant to the voting
rights created under this Section 8.1 shall hold office until the next
annual meeting of stockholders (unless such term has previously
terminated pursuant to Section 8.1(b)) and any vacancy in respect of any
such director shall be filled only by vote of the remaining director so
elected by holders of the Voting Rights Class, or if there be no such
remaining director, by the holders of shares of the Voting Rights Class
by written consent or at a special meeting called in accordance with the
procedures set forth in this Section 8, or, if no such special meeting is
called or written consent executed, at the next annual meeting of
stockholders. Upon any termination of such voting rights, the term of
office of all directors elected pursuant to this Section 8 shall
terminate.
(f) So long as any shares of Series L Preferred
Stock remain outstanding, unless a greater percentage shall then be
required by law, the Corporation shall not, without the affirmative vote
at a meeting or the written consent with or without a meeting of the
holders of shares of Series L Preferred Stock representing at least a
majority of the outstanding shares of Series L Preferred Stock voting or
consenting, as the case may be, separately as one class, (i) create,
authorize or issue any Senior Stock or (ii) amend the Certificate of
Designation or the Certificate of Incorporation so as to affect adversely
the specified rights, preferences, privileges or voting rights of holders
of shares of Series L Preferred Stock. The holders of at least a
majority of the outstanding shares of Series L Preferred Stock, voting or
consenting, as the case may be, separately as one class, may waive
compliance with any provision of the Certificate of Designation.
(g) In exercising the voting rights set forth in
this Section 8.1, each share of Series L Preferred Stock shall have a
number of votes equal to its Liquidation Preference.
8.2 Except as set forth in Section 8.1, the Corporation
may (a) create, authorize or issue any shares of Junior Stock or Parity
Stock or (b) increase or decrease the amount of authorized capital stock
of any class, including any preferred stock, without the consent of the
holders of Series L Preferred Stock, voting or consenting separately as a
class, and in taking the actions specified in (a) and (b) the Corporation
shall not be deemed to have affected adversely the rights, preferences,
privileges or voting rights of holders of shares of Series L Preferred
Stock.
9. LIQUIDATION RIGHTS.
9.1 In the event of any liquidation, dissolution or
winding-up of the Corporation, whether voluntary or involuntary, the
holders of the shares of Series L Preferred Stock shall be entitled to
receive out of the assets of the Corporation available for distribution
to stockholders up to their Liquidation Preference of $1,000 per share
plus Accumulated Dividends and Accrued Dividends thereon in preference to
the holders of, and before any distribution is made on, any Junior Stock,
including, without limitation on any Common Stock.
9.2 Neither the sale, conveyance, exchange or transfer
(for cash, shares of stock, securities or other consideration) of all or
substantially all the property and assets of the Corporation nor the
merger or consolidation of the Corporation into or with any other
corporation, or the merger or consolidation of any other corporation into
or with the Corporation, shall be deemed to be a liquidation, dissolution
or winding up, voluntary or involuntary, for the purposes of this Section
9.
9.3 After the payment to the holders of the shares of
Series L Preferred Stock of full preferential amounts provided for in
this Section 9, the holders of Series L Preferred Stock as such shall
have no right or claim to any of the remaining assets of the Corporation.
9.4 In the event the assets of the Corporation available
for distribution to the holders of shares of Series L Preferred Stock
upon any liquidation, dissolution or winding up of the Corporation,
whether voluntary or involuntary, shall be insufficient to pay in full
all amounts to which such holders are entitled pursuant to Section 9.1,
no such distribution shall be made on account of any shares of any Parity
Stock upon such liquidation, dissolution or winding up unless
proportionate distributable amounts shall be paid on account of the
shares of Series L Preferred Stock, ratably, in proportion to the full
distributable amounts for which holders of all Parity Stock are entitled
upon such liquidation, dissolution or winding up.
10. MERGER, CONSOLIDATION AND SALE OF ASSETS. Subject to the
next sentence, without the affirmative vote or consent of the holders of
at least a majority of the outstanding shares of Series L Preferred
Stock, voting or consenting, as the case may be, separately as one class,
the Corporation may not consolidate or merge with or into, or sell,
assign, transfer, lease, convey or otherwise dispose of all or
substantially all of its assets to, any Person unless: (a) the Person
formed by such consolidation or merger (if other than the Corporation) or
to which such sale, assignment, transfer, lease, conveyance or other
disposition shall have been made shall be a corporation organized or
existing under the laws of the United States or any State thereof or the
District of Columbia; (b) each share of Series L Preferred Stock shall be
converted into or exchanged for and shall become a share of such
successor, transferee or resulting corporation or a parent corporation of
such corporation, having in respect of such successor, transferee or
resulting corporation or parent corporation substantially the same
powers, preferences and relative participating, optional or other special
rights, and the qualifications, limitations or restrictions thereon, that
the Series L Preferred Stock had immediately prior to such transaction;
and (c) immediately after giving effect to such transaction, no Voting
Rights Triggering Event shall have occurred or be continuing. The
consummation of the TBS Transaction pursuant to the TBS Merger Agreement
will not require the affirmative vote or consent of the holders of shares
of the Series L Preferred Stock.
11. TRANSFER AGENT AND REGISTRAR. The transfer agent and
registrar (the "Transfer Agent") for Series L Preferred Stock shall be
_______________. The Corporation may, in its sole discretion, remove the
Transfer Agent with 10 days' prior written notice to the Transfer Agent
and appoint a successor Transfer Agent prior to such removal.
12. COVENANT TO REPORT. Notwithstanding that the Corporation
may not be subject to the reporting requirements of Section 13 or Section
15(d) of the Exchange Act, the Corporation will provide the Transfer
Agent and the holders of Series L Preferred Stock with all information,
documents and reports specified in Section 13 and Section 15(d) of the
Exchange Act.
13. OTHER PROVISIONS.
13.1 With respect to any notice to a holder of shares of
Series L Preferred Stock required to be provided hereunder, neither
failure to mail such notice, nor any defect therein or in the mailing
thereof, to any particular holder shall affect the sufficiency of the
notice or the validity of the proceedings referred to in such notice with
respect to the other holders or affect the legality or validity of any
distribution, right, warrant, reclassification, consolidation, merger,
conveyance, transfer, dissolution, liquidation or winding up, or the vote
upon any such action. Any notice which was mailed in the manner herein
provided shall be conclusively presumed to have been duly given whether
or not the holder receives the notice.
13.2 Shares of Series L Preferred Stock issued and
reacquired will, upon compliance with the applicable requirements of
Delaware law, have the status of authorized but unissued shares of
Preferred Stock of the Corporation undesignated as to series and may with
any and all other authorized but unissued shares of Preferred Stock of
the Corporation be designated or redesignated and issued or reissued, as
the case may be, as part of any series of Preferred Stock of the
Corporation, except that any issuance or reissuance of shares of Series L
Preferred Stock must be in compliance with the Certificate of
Designation.
13.3 The shares of Series L Preferred Stock shall be
issuable in whole shares.
13.4 The Corporation shall be entitled to recognize the
exclusive right of a person registered on its records as the holder of
shares of Series L Preferred Stock for all purposes.
13.5 All notice periods referred to herein shall commence
on the date of the mailing of the applicable notice.
IN WITNESS WHEREOF, Time Warner Inc. has caused this
certificate to be signed and attested this ______ day of____________,_____.
TIME WARNER INC.
By:
---------------------------
Name:
Title:
Attest:
________________________
Name:
Title:
INDENTURE
between
TIME WARNER INC.
and
[_________________________]
Trustee
Dated as of [_______ __, _____]
Providing for Issuance of
Senior Subordinated Securities in Series
<PAGE>
TABLE OF CONTENTS
PAGE
ARTICLE I
Definitions and Other Provisions
of General Application
SECTION 1.01. Definitions...................................... 1
SECTION 1.02. Compliance Certificates and Opinions............. 14
SECTION 1.03. Form of Documents Delivered to Trustee........... 15
SECTION 1.04. Acts of Securityholders.......................... 15
SECTION 1.05. Notices, etc., to Trustee and Company............ 17
SECTION 1.06. Notices to Securityholders; Waiver............... 17
SECTION 1.07. Conflict with Trust Indenture Act................ 18
SECTION 1.08. Effect of Headings and Table of Contents......... 18
SECTION 1.09. Successors and Assigns........................... 18
SECTION 1.10. Separability Clause.............................. 18
SECTION 1.11. Benefits of Indenture............................ 18
SECTION 1.12. Governing Law.................................... 18
SECTION 1.13. Counterparts..................................... 18
SECTION 1.14. Judgment Currency................................ 18
ARTICLE II
Security Forms
SECTION 2.01. Forms Generally.................................. 19
SECTION 2.02. Forms of Securities.............................. 19
SECTION 2.03. Form of Trustee's Certificate of Authentication.. 20
SECTION 2.04. Securities Issuable in the Form of a Global
Security......................................... 20
ARTICLE III
The Securities
SECTION 3.01. General Title; General Limitations; Issuable in
Series; Terms of Particular Series....................... 22
SECTION 3.02. Denominations.................................... 25
SECTION 3.03. Execution, Authentication and Delivery and Dating 26
SECTION 3.04. Temporary Securities............................. 27
SECTION 3.05. Registration, Transfer and Exchange.............. 28
SECTION 3.06. Mutilated, Destroyed, Lost and Stolen Securities. 29
SECTION 3.07. Payment of Interest; Interest Rights Preserved... 30
SECTION 3.08. Persons Deemed Owners............................ 31
SECTION 3.09. Cancellation..................................... 32
SECTION 3.10. Computation of Interest.......................... 32
SECTION 3.11. Delayed Issuance of Securities................... 32
ARTICLE IV
Satisfaction and Discharge
SECTION 4.01. Satisfaction and Discharge of Indenture.......... 33
SECTION 4.02. Application of Trust Money....................... 34
SECTION 4.03. Defeasance upon Deposit of Funds or Government
Obligations.............................................. 34
SECTION 4.04. Reinstatement.................................... 36
SECTION 4.05. Subordination Provisions Inapplicable............ 37
ARTICLE V
Remedies
SECTION 5.01. Events of Default................................ 37
SECTION 5.02. Acceleration of Maturity;Rescission and Annulment 39
SECTION 5.03. Collection of Indebtedness and Suits for Enforcement
by Trustee............................................... 40
SECTION 5.04. Trustee May File Proofs of Claim................. 41
SECTION 5.05. Trustee May Enforce Claims Without Possession of
Securities............................................... 42
SECTION 5.06. Application of Money Collected................... 42
SECTION 5.07. Limitation on Suits.............................. 43
SECTION 5.08. Unconditional Right of Securityholders To Receive
Principal, Premium and Interest.......................... 43
SECTION 5.09. Restoration of Rights and Remedies............... 44
SECTION 5.10. Rights and Remedies Cumulative................... 44
SECTION 5.11. Delay or Omission Not Waiver..................... 44
SECTION 5.12. Control by Securityholders....................... 44
SECTION 5.13. Waiver of Past Defaults.......................... 44
SECTION 5.14. Undertaking for Costs............................ 45
SECTION 5.15. Waiver of Stay or Extension Laws................. 45
ARTICLE VI
The Trustee
SECTION 6.01. Certain Duties and Responsibilities.............. 46
SECTION 6.02. Notice of Defaults............................... 47
SECTION 6.03. Certain Rights of Trustee........................ 47
SECTION 6.04. Not Responsible for Recitals or Issuance of
Securities............................................... 49
SECTION 6.05. May Hold Securities.............................. 49
SECTION 6.06. Money Held in Trust.............................. 49
SECTION 6.07. Compensation and Reimbursement................... 49
SECTION 6.08. Disqualification; Conflicting Interests.......... 50
SECTION 6.09. Corporate Trustee Required; Eligibility.......... 50
SECTION 6.10. Resignation and Removal; Appointment of Successor 51
SECTION 6.11. Acceptance of Appointment by Successor........... 52
SECTION 6.12. Merger, Conversion, Consolidation or Succession to
Business................................................. 53
SECTION 6.13. Preferential Collection of Claims Against Company 54
SECTION 6.14. Appointment of Authenticating Agent.............. 57
ARTICLE VII
Securityholders' Lists and Reports by
Trustee and Company
SECTION 7.01. Company To Furnish Trustee Names and Addresses of
Securityholders.......................................... 59
SECTION 7.02. Preservation of Information; Communications to
Securityholders.......................................... 60
SECTION 7.03. Reports by Trustee............................... 61
SECTION 7.04. Reports by Company............................... 62
ARTICLE VIII
Consolidation, Merger, Conveyance or Transfer
SECTION 8.01. Company May Consolidate, etc., Only on Certain
Terms.................................................... 63
SECTION 8.02. Successor Person Substituted..................... 63
ARTICLE IX
Supplemental Indentures
SECTION 9.01. Supplemental Indentures Without Consent of
Securityholders.......................................... 64
SECTION 9.02. Supplemental Indentures with Consent of
Securityholders.......................................... 65
SECTION 9.03. Execution of Supplemental Indentures............. 66
SECTION 9.04. Effect of Supplemental Indentures................ 67
SECTION 9.05. Conformity with Trust Indenture Act.............. 67
SECTION 9.06. Reference in Securities to Supplemental
Indentures............................................... 67
SECTION 9.07. Subordination Unimpaired......................... 67
ARTICLE X
Covenants
SECTION 10.01. Payment of Principal, Premium and Interest...... 67
SECTION 10.02. Maintenance of Office or Agency................. 67
SECTION 10.03. Money for Security Payments to Be Held in Trust. 68
SECTION 10.04. Statement as to Compliance...................... 69
SECTION 10.05. Legal Existence................................. 70
SECTION 10.06. Waiver of Certain Covenants..................... 70
SECTION 10.07. Limitation on Senior Subordinated Indebtedness.. 70
SECTION 10.08. Repurchase of Securities Upon a Change of
Control................................................. 71
ARTICLE XI
Redemption of Securities
SECTION 11.01. Applicability of Article........................ 71
SECTION 11.02. Election To Redeem; Notice to Trustee........... 71
SECTION 11.03. Selection by Trustee of Securities To Be
Redeemed................................................ 72
SECTION 11.04. Notice of Redemption............................ 72
SECTION 11.05. Deposit of Redemption Price..................... 73
SECTION 11.06. Securities Payable on Redemption Date........... 74
SECTION 11.07. Securities Redeemed in Part..................... 74
SECTION 11.08. Provisions with Respect to Any Sinking Funds.... 74
SECTION 11.09. Rescission of Redemption........................ 76
ARTICLE XII
Conversion
SECTION 12.01. Conversion Privilege............................ 77
SECTION 12.02. Conversion Procedure; Rescission of Conversion;
Conversion Price; Fractional Shares...................... 77
SECTION 12.03. Adjustment of Conversion Price for Common Stock or
Other Marketable Securities.............................. 79
SECTION 12.04. Consolidation or Merger of the Company.......... 83
SECTION 12.05. Notice of Adjustment............................ 84
SECTION 12.06. Notice in Certain Events........................ 84
SECTION 12.07. Company To Reserve Stock or Other Marketable
Securities; Registration; Listing........................ 85
SECTION 12.08. Taxes on Conversion............................. 85
SECTION 12.09. Conversion After Record Date.................... 86
SECTION 12.10. Corporate Action Regarding Par Value of Common
Stock................................................... 86
SECTION 12.11. Company Determination Final..................... 86
SECTION 12.12. Trustee's Disclaimer............................ 86
ARTICLE XIII
Subordination
SECTION 13.01. Agreement To Subordinate........................ 87
SECTION 13.02. Liquidation, Dissolution, Bankruptcy............ 87
SECTION 13.03. Default on Senior Indebtedness and Senior
Subordinated Indebtedness; Payment Restrictions in Certain
Circumstances............................................ 89
SECTION 13.04. Disputes with Holders of Certain Senior
Indebtedness............................................. 90
SECTION 13.05. Acceleration of Notes........................... 90
SECTION 13.06. When Distribution Must Be Paid Over............. 90
SECTION 13.07. Relative Rights................................. 90
SECTION 13.08. Subordination May Not Be Impaired by Company.... 91
SECTION 13.09. Distribution or Notice to Representative........ 91
SECTION 13.10. Rights of Trustee and Paying Agent.............. 91
SECTION 13.11. Notice to Trustee............................... 91
SECTION 13.12. Trustee Not a Fiduciary......................... 92
SECTION 13.13. Effectuation of Subordination by Trustee........ 92
SECTION 13.14. Article Applicable to Paying Agents............. 92
SECTION 13.15. Trustee; Compensation Not Prejudiced............ 92
<PAGE>
INDENTURE between [_________________]*, a Delaware corporation
(hereinafter called the "Company") having its principal office at 75
Rockefeller Plaza, New York, New York 10019, and [_________________], a
[_____________], trustee (hereinafter called the "Trustee"), made and
entered into as of the [__] day of [_______, ______].
The Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance of its senior subordinated
debentures, notes, bonds or other evidences of indebtedness, to be issued
in one or more fully registered series.
All things necessary to make this Indenture a valid agreement of
the Company, in accordance with its terms, have been done.
To set forth or to provide for the establishment of the terms and
conditions upon which the Securities are to be authenticated, issued and
delivered, and in consideration of the premises and the purchase of
Securities by the Holders thereof, it is mutually covenanted and agreed as
follows, for the equal and proportionate benefit of all Holders of the
Securities or of a series thereof, as the case may be:
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 1.01. DEFINITIONS. For all purposes of this Indenture
and of any indenture supplemental hereto, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned
to them in this Article and include the plural as well as the
singular;
- --------------------------------------------
**FOOTNOTES**
* Except as provided in this footnote, for purposes of this Indenture, the
Company shall mean Time Warner Inc., a Delaware corporation ("Time
Warner"). To the extent that the TBS Transaction shall have occurred on
or prior to the date of this Indenture and substantially all of the
indebtedness for borrowed money of Time Warner immediately prior to the
TBS Transaction (the "Time Warner Debt") is assumed by a holding company
("New Time Warner") which immediately after the TBS Transaction owns,
either directly or indirectly, all of the capital stock of Time Warner,
then the Company shall mean New Time Warner; PROVIDED that if the Time
Warner Debt being assumed by New Time Warner is guaranteed by Time
Warner, Time Warner shall provide a senior subordinated guarantee for the
Securities. To the extent the TBS Transaction shall have occurred on or
prior to the date of this Indenture and substantially all of the Tine
Warner Debt is not assumed by New Time Warner, the Company shall mean (at
New Time Warner's option) either (i) New Time Warner (PROVIDED that Time
Warner shall provide a senior subordinated guarantee for the Securities)
or (ii) Time Warner. If the TBS Transaction has not occurred prior to
the date of this Indenture, Section 8.1 hereof shall be modified to
include provisions effectuating the intent of the foregoing upon the
consummation of the TBS Transaction (pursuant to an indenture supplement,
if appropriate).
<PAGE>
(b) all other terms used herein which are defined in the Trust
Indenture Act or by Commission rule under the Trust Indenture Act,
either directly or by reference therein, have the meanings assigned to
them therein;
(c) 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 and any accounting rules or interpretations
promulgated by the Commission as are generally in effect in the United
States of America as of the date of this Indenture; and
(d) all references in this instrument to designated "Articles",
"Sections" and other subdivisions are to the designated Articles,
Sections and other subdivisions of this instrument as originally
executed. The words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Indenture as a whole and not to
any particular Article, Section or other subdivision.
Certain terms, used principally in Article Six, are defined in
that Article.
"Act", when used with respect to any Securityholder, has the
meaning specified in Section 1.04.
"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
to authenticate Securities under Section 6.14.
"Board of Directors" means (a) the board of directors of the
Company, (b) any duly authorized committee of such board, (c) any committee
of officers of the Company or (d) any officer of the Company acting, in the
case of (c) or (d), pursuant to authority granted by the board of directors
of the Company or any committee of such 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" means, with respect to any series of Securities,
unless otherwise specified in a Board Resolution or an Officer's
Certificate with respect to a particular series of Securities, any day
other than a Saturday or Sunday or any other day on which banking
institutions in the pertinent Place or Places of Payment or the city in
which the Corporate Trust Office is located are authorized or required by
law or executive order to be closed.
"Change of Control" means, (i) whenever, in any three-year
period, a majority of the members of the Board of Directors of the Company
elected during such three-year period shall have been so elected against
the recommendation of the management of the Company or the Board of
Directors of the Company in office immediately prior to such election;
PROVIDED, HOWEVER, that for purposes of this clause (i) a member of such
Board of Directors shall be deemed to have been elected against the
recommendation of such Board of Directors if his or her initial election
occurs as a result of either an actual or threatened election contest (as
such terms are used in Rule 14a-11 of Regulation 14A promulgated under the
Exchange Act) or other actual or threatened solicitation of proxies or
consents by or on behalf of a person other than such Board of Directors; or
(ii) whenever any Person shall acquire (whether by merger, consolidation,
sale, assignment, lease, transfer or otherwise, in one transaction or any
related series of transactions) or otherwise beneficially own voting
securities of the Company that represent in excess of 50% of the voting
power of all outstanding voting securities of the Company generally
entitled to vote for the election of directors of the Company, if such
Person had acquired or publicly announced its intention to initially
acquire ten percent or more of such voting securities in a transaction that
had not, within 30 days after the date of such acquisition or public
announcement, been approved by the management of the Company.
"Change of Control Offer" means, with respect to Securities of
any series the terms of which require the Company to make such offer, an
offer to purchase such Securities by the Company from the Holders commenced
by mailing a notice to the Trustee and each Holder stating: (i) the
covenant of this Indenture pursuant to which the offer is being made and
that all Securities validly tendered will be accepted for payment on a pro
rata basis; (ii) the purchase price and the date of purchase (which shall
be a Business Day no earlier than 30 days nor later than 40 days from the
date such notice is mailed) (the "Change of Control Payment Date"); (iii)
that any Security not tendered will continue to accrue interest pursuant to
its terms; (iv) that, unless the Company defaults in the payment of the
purchase price, any Security accepted for payment pursuant to the Change of
Control Offer shall cease to accrue interest on and after the Change of
Control Payment Date; (v) that Holders electing to have a Security
purchased pursuant to the Change of Control Offer will be required to
surrender the Security, together with the form entitled "Option of the
Holder to Elect Purchase" on the reverse side of the Security completed (or
such other form that shall appear on the reverse side of such Security for
such purpose), to the Paying Agent at the address specified in the notice
prior to the close of business on the Business Day immediately preceding
the Change of Control Payment Date; (vi) that Holders will be entitled to
withdraw their election if the Paying Agent receives, not later than the
close of business on the third Business Day immediately preceding the
Change of Control Payment Date, a telegram, facsimile transmission or
letter setting forth the name of such Holder, the principal amount of
Securities delivered for purchase and a statement that such Holder is
withdrawing his election to have such Securities purchased; and (vii) that
Holders whose Securities are being purchased only in part will be issued
new Securities equal in principal amount to the unpurchased portion of the
Securities surrendered; PROVIDED that each Security purchased shall be in a
principal amount equal to the minimum authorized denomination for the
applicable series or integral multiples thereof. On the Change of Control
Payment Date, the Company shall (i) accept for payment on a pro rata basis
Securities or portions thereof tendered pursuant to a Change of Control
Offer; (ii) deposit with the Paying Agent money sufficient to pay the
purchase price of all Securities or portions thereof so accepted; and (iii)
deliver, or cause to be delivered, to the Trustee all Securities or
portions thereof so accepted together with an Officers' Certificate
specifying the Securities or portions thereof accepted for payment by the
Company. The Paying Agent shall promptly mail to the Holders of Securities
so accepted payment in an amount equal to the purchase price, and the
Trustee shall promptly authenticate and mail to such Holders a new Security
equal in principal amount to any unpurchased portion of the Security
surrendered; PROVIDED that each Security purchased shall be in a principal
amount equal to the minimum authorized denomination for the applicable
series or integral multiples thereof. The Company will publicly announce
the results of a Change of Control Offer as soon as practicable after the
Change of Control Payment Date. The Trustee shall act as the Paying Agent
for a Change of Control Offer. The Change of Control Offer must remain
open for at least 30 days and not more than 40 days and the Company will
comply with Rule 14e-1 under the Exchange Act and any other securities laws
and regulations thereunder to the extent such laws and regulations are
applicable, in the event that the Company is required to repurchase one or
more series of Securities pursuant to a Change of Control Offer.
"Closing Price" of the Common Stock or other Marketable Security,
as the case may be, shall mean the last reported sale price of such stock
or other Marketable Security (regular way) as shown on the Composite Tape
of the NYSE (or, if such stock or other Marketable Security is not listed
or admitted to trading on the NYSE, on the principal national securities
exchange on which such stock or other Marketable Security is listed or
admitted to trading), or, if it is not listed or admitted to trading on any
national securities exchange, the last reported sale price of such stock or
other Marketable Security (regular way) as reported by the National
Association of Security Dealers Automated Quotation System (NASDAQ), or in
case no such sale takes place on such day, the average of the closing bid
and asked prices on the NYSE (or, if such stock or other Marketable
Security is not listed or admitted to trading on the NYSE, on the principal
national securities exchange on which such stock or other Marketable
Security is listed or admitted to trading), or, if it is not listed or
admitted to trading on any national securities exchange, the average of the
closing bid and asked prices as reported by the National Association of
Securities Dealers Automated Quotation System (NASDAQ), or if such stock or
other Marketable Security is not so reported, the average of the closing
bid and asked prices as furnished by any member of the National Association
of Securities Dealers, Inc., selected from time to time by the Company for
that purpose.
"Commission" means the Securities and Exchange Commission, as
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.
"Common Stock" shall mean the class of Common Stock, par value
$1.00 per share, of the Company authorized at the date of this Indenture as
originally signed, or any other class of stock resulting from successive
changes or reclassifications of such Common Stock, and in any such case
including any shares thereof authorized after the date of this Indenture,
and any other shares of stock of the Company which do not have any priority
in the payment of dividends or upon liquidation over any other class of
stock.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor.
"Company Request", "Company Order" and "Company Consent" mean a
written request, order or consent, respectively, signed in the name of the
Company by its Chairman of the Board, President or a Vice President, and by
its Treasurer, an Assistant Treasurer, Controller, an Assistant Controller,
Secretary or an Assistant Secretary, and delivered to the Trustee.
"Conversion Agent" means any Person authorized by the Company to
receive Securities to be converted into Common Stock or other Marketable
Securities on behalf of the Company. The Company initially authorizes the
Trustee to act as Conversion Agent for the Securities on its behalf. The
Company may at any time and from time to time authorize one or more Persons
to act as Conversion Agent in addition to or in place of the Trustee with
respect to any series of Securities issued under this Indenture.
"Conversion Price" means, with respect to any series of
Securities which are convertible into Common Stock or other Marketable
Securities, the price per share of Common Stock or the price per designated
unit of other Marketable Security at which the Securities of such series
are so convertible as set forth in the Board Resolution with respect to
such series (or in any supplemental indenture entered into pursuant to
Section 9.01(i) with respect to such series), as the same may be adjusted
from time to time in accordance with Section 12.03 (or such supplemental
indenture).
"Converting Holder" shall have the meaning specified in Section
12.02(c) of this Indenture.
"Corporate Trust Office" means the office of the Trustee at which
at any particular time its corporate trust business shall be principally
administered, which office at the date hereof is located at 450 West 33rd
Street, 15th Floor, New York, New York 10001.
"Current Market Price" on any date shall mean the average of the
daily Closing Prices per share of Common Stock or of such other Marketable
Securities for any 30 consecutive Trading Days selected by the Company
prior to the day in question, which 30 consecutive Trading Day period shall
not commence more than 45 Trading Days prior to the day in question;
provided that, with respect to Section 12.03(c), the "Current Market Price"
of the Common Stock or of such other Marketable Securities shall mean the
average of the daily Closing Prices per share of Common Stock or of such
other Marketable Securities for the five consecutive Trading Days ending on
the date of the distribution referred to in Section 12.03(c) (or if such
date shall not be a Trading Day, on the Trading Day immediately preceding
such date).
"Defaulted Interest" has the meaning specified in Section 3.07.
"Depository" means, unless otherwise specified by the Company
pursuant to either Section 2.04 or 3.01, with respect to Securities of any
series issuable or issued as a Global Security, The Depository Trust
Company, New York, New York, or any successor thereto registered as a
clearing agency under the Exchange Act, or other applicable statute or
regulation.
"Event of Default" has the meaning specified in Article Five.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"GAAP" means generally accepted accounting principles as such
principles are in effect as of the date of this Indenture.
"Global Security", when used with respect to any series of
Securities issued hereunder, means a Security which is executed by the
Company and authenticated and delivered by the Trustee to the Depository or
pursuant to the Depository's instruction, all in accordance with this
Indenture and an indenture supplemental hereto, if any, or Board Resolution
and pursuant to a Company Request, which shall be registered in the name of
the Depository or its nominee and which shall represent, and shall be
denominated in an amount equal to the aggregate principal amount of, all of
the Outstanding Securities of such series or any portion thereof, in either
case having the same terms, including, without limitation, the same
original issue date, date or dates on which principal is due, and interest
rate or method of determining interest.
"Holder", when used with respect to any Security, means a
Securityholder.
"Indenture" or "this Indenture" means this instrument as
originally executed or as it may from time to time be supplemented or
amended by one or more indentures supplemental hereto entered into pursuant
to the applicable provisions hereof and shall include the terms of
particular series of Securities established as contemplated by Section
3.01.
"Interest Payment Date", when used with respect to any series of
Securities, means the Stated Maturity of any installment of interest on
those Securities.
"Marketable Security" means any common stock, debt security or
other security of a Person which is (or will, upon distribution thereof,
be) listed on the NYSE, the American Stock Exchange or any national
securities exchange registered under Section 6 of the Exchange Act, or
approved for quotation in the National Market System of the National
Association of Securities Dealers, Inc. Automated Quotations System or any
similar system of automated dissemination of quotations of securities
prices in the United States or for which there is a recognized market maker
or trading market.
"Material U.S. Subsidiary" means any Person that is a Subsidiary
if (a) such Person is organized under the laws of the United States of
America or any political subdivision thereof (including any state thereof
or the District of Columbia) and (b) at the end of the most recent fiscal
quarter of the Company, the aggregate amount, determined in accordance with
GAAP consistently applied, of securities of, loans and advances to, and
other investments in, such Person held by the Company and its other
Subsidiaries exceeded 10% of the Company's Consolidated Net Worth. For
purposes of the foregoing, "Consolidated Net Worth" means the consolidated
stockholders' or owners' equity of the holders of capital stock or
partnership interests of such Person and its Subsidiaries, determined on a
consolidated basis in accordance with GAAP consistently applied; PROVIDED
that to the extent the Company's 8- 3/4 % Convertible Subordinated
Debentures due 2015 or 11% Convertible Subordinated Debentures due 2015
have been issued in exchange for the Company's outstanding Series C 8-
3/4 % Convertible Exchangeable Preferred Stock or Series D 11% Convertible
Exchangeable Preferred Stock, respectively, such Debentures that are then
outstanding shall be considered equity for the purposes of the computation
of the Company's Consolidated Net Worth.
"Maturity", when used with respect to any Securities, means the
date on which the principal of any such Security becomes due and payable as
therein or herein provided, whether on a Repayment Date, at the Stated
Maturity or by declaration of acceleration, call for redemption or
otherwise.
"NYSE" shall mean the New York Stock Exchange, Inc.
"Officers' Certificate" means a certificate signed by the
Chairman of the Board, the President or a Vice President, and by the
Treasurer, an Assistant Treasurer, the Controller, an Assistant Controller,
the Secretary or an Assistant Secretary of the Company and delivered to the
Trustee. Wherever this Indenture requires that an Officers' Certificate be
signed also by an engineer or an accountant or other expert, such engineer,
accountant or other expert (except as otherwise expressly provided in this
Indenture) may be in the employ of the Company, and shall be acceptable to
the Trustee, whose acceptance shall not be unreasonably withheld.
"Opinion of Counsel" means a written opinion of counsel, who may
(except as otherwise expressly provided in this Indenture) be an employee
of or of counsel to the Company, which is delivered to the Trustee. Such
counsel shall be acceptable to the Trustee, whose acceptance shall not be
unreasonably withheld.
"Original Issue Discount Security" means (a) 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, and (b)
any other Security which is with "original issue discount" within the
meaning of Section 1273(a) of the Internal Revenue Code of 1986, as
amended, and the regulations thereunder.
"Outstanding", when used with respect to Securities or Securities
of any series, means, as of the date of determination, all such Securities
theretofore authenticated and delivered under this Indenture, except:
(a) such Securities theretofore cancelled by the Trustee or
delivered to the Trustee for cancellation;
(b) such Securities for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Trustee or
any Paying Agent in trust for the Holders of such Securities; provided
that, if such Securities are to be redeemed, notice of such redemption
has been duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made; and
(c) such Securities in exchange for or in lieu of which other
Securities have been authenticated and delivered pursuant to this
Indenture, or which shall have been paid pursuant to the terms of
Section 3.06 (except with respect to any such Security as to which
proof satisfactory to the Trustee is presented that such Security is
held by a Person in whose hands such Security is a legal, valid and
binding obligation of the Company).
In determining whether the Holders of the requisite principal amount of
such Securities Outstanding have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, (i) the principal amount of
any Original Issue Discount Security that shall be deemed to be Outstanding
shall be the amount of the principal thereof that would be due and payable
as of the date of the taking of such action upon a declaration of
acceleration of the Maturity thereof and (ii) Securities owned by the
Company or any other obligor upon the Securities or any Affiliate of the
Company or of such other obligor shall be disregarded and deemed not to be
Outstanding. In determining whether the Trustee shall be protected in
relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Securities which a Responsible Officer assigned to
the Corporate Trust Department of the Trustee knows to be owned by the
Company or any other obligor upon the Securities or any Affiliate of the
Company or such other obligor 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
to act as owner with respect to such Securities and that the pledgee is not
the Company or any other obligor upon the Securities or any Affiliate of
the Company or such other obligor.
"PARI PASSU", as applied to the ranking of any indebtedness or
other obligation of a Person in relation to other indebtedness or other
obligation of such Person, means that each such indebtedness or other
obligation either (a) is not subordinated in right of payment to any
indebtedness or other obligation or (b) is subordinate in right of payment
to the same indebtedness or other obligation as is the other, and is so
subordinate to the same extent, and is not subordinate in right of payment
to each other or to any indebtedness or other obligation as to which the
other is not so subordinate.
"Paying Agent" means any Person authorized by the Company to pay
the principal of (and premium, if any) or interest on any Securities on
behalf of the Company. The Company initially authorizes the Trustee to act
as Paying Agent for the Securities on its behalf. The Company may at any
time and from time to time authorize one or more Persons to act as Paying
Agent in addition to or in place of the Trustee with respect to any series
of Securities issued under this Indenture.
"Person" means any individual, corporation, partnership, limited
liability partnership, limited liability company, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Place of Payment" means with respect to any series of Securities
issued hereunder the city or political subdivision so designated with
respect to the series of Securities in question in accordance with the
provisions of Section 3.01.
"Predecessor Securities" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that
evidenced by such particular Security; and, for the purposes of this
definition, any Security authenticated and delivered under Section 3.06 in
lieu of a lost, destroyed or stolen Security shall be deemed to evidence
the same debt as the lost, destroyed 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 specified in the Security at which it is to be
redeemed pursuant to this Indenture.
"Redemption Rescission Event" shall mean the occurrence of (a)
any general suspension of trading in, or limitation on prices for,
securities on the principal national securities exchange on which shares of
Common Stock or Marketable Securities are registered and listed for trading
(or, if shares of Common Stock or Marketable Securities are not registered
and listed for trading on any such exchange, in the over-the-counter
market) for more than 6- 1/2 consecutive trading hours, (b) any decline in
either the Dow Jones Industrial Average or the Standard & Poor's Index of
400 Industrial Companies (or any successor index published by Dow Jones &
Company, Inc., or Standard & Poor's Corporation) by either (i) an amount in
excess of 10%, measured from the close of business on any Trading Day to
the close of business on the next succeeding Trading Day during the period
commencing on the Trading Day preceding the day notice of any redemption of
Securities is given (or, if such notice is given after the close of
business on a Trading Day, commencing on such Trading Day) and ending at
the time and date fixed for redemption in such notice or (ii) an amount in
excess of 15% (or, if the time and date fixed for redemption is more than
15 days following the date on which such notice of redemption is given,
20%), measured from the close of business on the Trading Day preceding the
day notice of such redemption is given (or, if such notice is given after
the close of business on a Trading Day, from such Trading Day) to the close
of business on any Trading Day at or prior to the time and date fixed for
redemption, (c) a declaration of a banking moratorium or any suspension of
payments in respect of banks by Federal or state authorities in the United
States or (d) the commencement of a war or armed hostilities or other
national or international calamity directly or indirectly involving the
United States which in the reasonable judgment of the Company could have a
material adverse effect on the market for the Common Stock or Marketable
Securities.
"Regular Record Date" for the interest payable on any Security on
any Interest Payment Date means the date specified in such Security as the
Regular Record Date.
"Repayment Date", when used with respect to any Security to be
repaid, means the date fixed for such repayment pursuant to such Security.
"Repayment Price", when used with respect to any Security to be
repaid, means the price at which it is to be repaid pursuant to such
Security.
"Representative" means any Person whom the Company has, by
written notice to the Trustee, identified as the indenture trustee or other
trustee, agent or representative for an issue of Senior Indebtedness.
"Required Currency", when used with respect to any Security, has
the meaning set forth in Section 1.14.
"Responsible Officer", when used with respect to the Trustee,
means any officer of the Trustee with direct responsibility for the
administration of this Indenture 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.
"Security" or "Securities" means any note or notes, bond or
bonds, debenture or debentures, or any other evidences of indebtedness, as
the case may be, of any series authenticated and delivered from time to
time under this Indenture.
"Securityholder" means a Person in whose name a Security is
registered in the Security Register.
"Security Register" shall have the meaning specified in Section
3.05.
"Security Registrar" means the Person who keeps the Security
Register specified in Section 3.05. The Company initially appoints the
Trustee to act as Security Registrar for the Securities on its behalf. The
Company may at any time and from time to time authorize any Person to act
as Security Registrar in place of the Trustee with respect to any series of
Securities issued under this Indenture.
"Senior Indebtedness" means all indebtedness or obligations of
the Company, whether outstanding at the date of execution of this Indenture
or thereafter incurred, assumed, guaranteed or otherwise created, unless
the terms of the instrument or instruments by which the Company incurred,
assumed, guaranteed or otherwise created any such indebtedness or
obligation expressly provide that such indebtedness or obligation is
subordinated to all other indebtedness of the Company or that such
indebtedness or obligation is PARI PASSU with, or is subordinated in right
of payment to, the Securities, with respect to any of the following
(including, without limitation, interest accruing on or after a bankruptcy
or other similar event, whether or not an allowed claim therein): (a) any
indebtedness incurred by the Company or assumed or guaranteed, directly or
indirectly, by the Company (i) for money borrowed, (ii) in connection with
the acquisition of any business, property or other assets (other than trade
payables incurred in the ordinary course of business) or (iii) for advances
or progress payments in connection with the construction or acquisition of
any building, motion picture, television production or other entertainment
of any kind; (b) any obligation of the Company (or of a Subsidiary which is
guaranteed by the Company) as lessee under a lease of real or personal
property; (c) any obligation of the Company to purchase property at a
future date in connection with a financing by the Company or a Subsidiary;
(d) letters of credit; (e) currency swaps and interest rate hedges; and (f)
any deferral, renewal, extension or refunding of any of the foregoing.
"Senior Subordinated Indebtedness" means the Company's senior
subordinated indebtedness outstanding from time to time, which indebtedness
is PARI PASSU with the Securities.
"Special Record Date" for the payment of any Defaulted Interest
(as defined in Section 3.07) means a date fixed by the Trustee pursuant to
Section 3.07.
"Stated Maturity" when used with respect to any Security or any
installment of principal thereof or interest thereon means the date
specified in such Security as the fixed date on which the principal of such
Security or such installment of principal or interest is due and payable.
"Subsidiary" means, with respect to any Person, any corporation
more than 50% of the Voting Stock of which is owned directly or indirectly
by such Person, and any partnership, association, joint venture or other
entity in which such Person owns more than 50% of the equity interests or
has the power to elect a majority of the board of directors or other
governing body.
"TBS Transaction"** means the transaction contemplated by the
Amended and Restated Agreement and Plan of Merger dated as of September 22,
1995, among the Company, certain of its subsidiaries and Turner
Broadcasting System, Inc., as the same may be amended from time to time.
- -------------------------------------
***FOOTNOTES***
** This definition will be deleted if the TBS Transaction has occurred
prior to the date of this Indenture.
<PAGE>
"Trading Day" shall mean with respect to the Common Stock or a
Marketable Security, so long as the Common Stock or such Marketable
Security, as the case may be, is listed or admitted to trading on the NYSE,
a day on which the NYSE is open for the transaction of business, or, if the
Common Stock or such Marketable Security, as the case may be, is not listed
or admitted to trading on the NYSE, a day on which the principal national
securities exchange on which the Common Stock or such Marketable Security,
as the case may be, is listed is open for the transaction of business, or,
if the Common Stock or such Marketable Security, as the case may be, is not
so listed or admitted for trading on any national securities exchange, a
day on which NASDAQ is open for the transaction of business.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of
1939 as in force at the date as of which this instrument was executed;
PROVIDED, HOWEVER, that, in the event the Trust Indenture Act of 1939 is
amended after such date, "Trust Indenture Act" or "TIA" 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 and include each Person who is then a
Trustee hereunder. 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 Obligations" means securities that are (i)
direct obligations of the United States of America for the payment of which
its full faith and credit is pledged or (ii) obligations of a Person
controlled or supervised by and acting as an agency or instrumentality of
the United States of America the payment of which is unconditionally
guaranteed as a full faith and credit obligation by the United States of
America, which, in either case, are not callable or redeemable at the
option of the issuer thereof at any time prior to the Stated Maturity of
any series of Securities, and shall also include a depository receipt
issued by a bank or trust company as custodian with respect to any such
U.S. Government Obligation or a specific payment of interest on or
principal of any such U.S. Government Obligation held by such custodian for
the account of the holder of a depository receipt; provided that (except as
required by law) such custodian is not authorized to make any deduction
from the amount payable to the holder of such depository receipt from any
amount received by the custodian in respect of the U.S. Government
Obligation or the specific payment of interest on or principal of the U.S.
Government Obligation evidenced by such depository receipt.
"Vice President" when used with respect to the Company or the
Trustee means any vice president, whether or not designated by a number or
a word or words added before or after the title "vice president",
including, without limitation, an assistant vice president.
"Voting Stock", as applied to the stock of any corporation, means
stock of any class or classes (however designated) having by the terms
thereof ordinary voting power to elect a majority of the members of the
board of directors (or other governing body) of such corporation other than
stock having such power only by reason of the happening of a contingency.
SECTION 1.02. COMPLIANCE CERTIFICATES AND OPINIONS. Upon any
application or request by the Company to the Trustee to take any action
under any provision of this Indenture, the Company shall furnish to the
Trustee an Officers' Certificate stating that all conditions precedent, if
any (including any covenants compliance with which constitutes a condition
precedent), provided for in this Indenture relating to the proposed action
have been complied with and an Opinion of Counsel stating that in the
opinion of such Counsel all such conditions precedent, if any (including
any covenants compliance with which constitutes a condition precedent),
have been complied with, except that in the case of any such application or
request as to which the furnishing of such documents is specifically
required by any provision of this Indenture relating to such particular
application or request, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than annual
statements of compliance provided pursuant to Section 10.04) shall include
(a) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(c) a statement that, in the opinion of 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
(d) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
SECTION 1.03. 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, and 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 may certify or give an opinion as to the
other matters, and any such Person may certify or give an opinion as to
such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or
opinion of, or representations by, counsel, unless such officer knows, or
in the exercise of reasonable care should know, that the certificate or
opinion or representations with respect to the matters upon which his
certificate or opinion is based are erroneous. Any such certificate or
Opinion of Counsel may be based, insofar as it relates to factual matters,
upon a certificate or opinion of, or representations by, an officer or
officers of the Company stating that the information with respect to such
factual matters is in the possession of the Company, unless such counsel
knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to such matters are
erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be
consolidated and form one instrument.
SECTION 1.04. ACTS OF SECURITYHOLDERS. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided
by this Indenture to be given or taken by Securityholders or
Securityholders of any series may be embodied in and evidenced by one or
more instruments of substantially similar tenor signed by such
Securityholders in person or by an agent duly appointed in writing; and,
except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Trustee,
and, where it is hereby expressly required, to the Company. If any
Securities are denominated in coin or currency other than that of the
United States, then for the purposes of determining whether the Holders of
the requisite principal amount of Securities have taken any action as
herein described, the principal amount of such Securities shall be deemed
to be that amount of United States dollars that could be obtained for such
principal amount on the basis of the spot rate of exchange into United
States dollars for the currency in which such Securities are denominated
(as evidenced to the Trustee by an Officers' Certificate) as of the date
the taking of such action by the Holders of such requisite principal amount
is evidenced to the Trustee as provided in the immediately preceding
sentence. Such instrument or instruments (and the action embodied therein
and evidenced thereby) are herein sometimes referred to as the "Act" of the
Securityholders 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 6.01)
conclusive in favor of the Trustee and the Company, if made in the manner
provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness to such
execution or by the certificate of any 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 an officer of a corporation
or a member of a partnership, on behalf of such corporation or partnership,
such certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or
writing, or the authority of the person executing the same, may also be
proved in any other manner which the Trustee deems sufficient.
(c) The ownership of Securities shall be proved by the Security
Register.
(d) If the Company shall solicit from the Holders any request,
demand, authorization, direction, notice, consent, waiver or other action,
the Company may, at its option, by Board Resolution, fix in advance a
record date for the determination of Holders entitled to give such request,
demand, authorization, direction, notice, consent, waiver or other action,
but the Company shall have no obligation to do so. Such record date shall
be the later of 10 days prior to the first solicitation of such action or
the date of the most recent list of Holders furnished to the Trustee
pursuant to Section 7.01. If such a record date is fixed, such request,
demand, authorization, direction, notice, consent, waiver or other action
may be given before or after the record date, but only the Holders of
record at the close of business on the record date shall be deemed to be
Holders for the purposes of determining whether Holders of the requisite
proportion of Securities Outstanding have authorized or agreed or consented
to such request, demand, authorization, direction, notice, consent, waiver
or other action, and for that purpose the Securities Outstanding shall be
computed as of the record date; provided that no such request, demand,
authorization, direction, notice, consent, waiver or other action by the
Holders on the record date shall be deemed effective unless it shall become
effective pursuant to the provisions of this Indenture not later than six
months after the record date, and that no such request, demand,
authorization, direction, notice, consent, waiver or other action may be
amended, withdrawn or revoked once given by a Holder, unless the Company
shall provide for such amendment, withdrawal or revocation in conjunction
with such solicitation of requests, demands, authorizations, directions,
notices, consents, waivers or other actions or unless and to the extent
required by applicable law.
(e) Any request, demand, authorization, direction, notice,
consent, waiver or other action by the Holder of any Security shall bind
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 or suffered to be done by the Trustee or the Company in reliance
thereon whether or not notation of such action is made upon such Security.
SECTION 1.05. NOTICES, ETC., TO TRUSTEE AND COMPANY. Any
request, demand, authorization, direction, notice, consent, waiver or Act
of Securityholders or other document provided or permitted by this
Indenture to be made upon, given or furnished to, or filed with:
(a) the Trustee by any Securityholder 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 of Corporate Trust Department; or
(b) the Company by the Trustee or by any Securityholder shall be
sufficient for every purpose hereunder (except as provided in Section
5.01(d) or, in the case of a request for repayment, as specified in
the Security carrying the right to repayment) 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, Attention of Treasurer, or at any other address
previously furnished in writing to the Trustee by the Company.
SECTION 1.06. NOTICES TO SECURITYHOLDERS; WAIVER. Where this
Indenture or any Security provides for notice to Securityholders of any
event, such notice shall be sufficiently given (unless otherwise herein or
in such Security expressly provided) if in writing and mailed, first-class
postage prepaid, to each Securityholder affected by such event, at his
address as it appears in the Security Register, not later than the latest
date, and not earlier than the earliest date, prescribed for the giving of
such notice. In any case where notice to Securityholders is given by mail,
neither the failure to mail such notice, nor any defect in any notice so
mailed, to any particular Securityholder shall affect the sufficiency of
such notice with respect to other Securityholders. Where this Indenture or
any Security provides for notice in any manner, such notice may be waived
in writing by the Person entitled to receive such notice, either before or
after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Securityholders shall be filed with the Trustee, but
such filing shall not be a condition precedent to the validity of any
action taken in reliance upon such waiver.
In case, by reason of the suspension of regular mail service as a
result of a strike, work stoppage or otherwise, it shall be impractical to
mail notice of any event to any Securityholder when such notice is required
to be given pursuant to any provision of this Indenture, then any method of
notification as shall be satisfactory to the Trustee and the Company shall
be deemed to be a sufficient giving of such notice.
SECTION 1.07. CONFLICT WITH TRUST INDENTURE ACT. If and to the
extent that any provision hereof limits, qualifies or conflicts with the
duties imposed by, or with another provision (an "incorporated provision")
included in this Indenture by operation of, any of Sections 3.10 to 3.18,
inclusive, of the Trust Indenture Act, such imposed duties or incorporated
provision shall control.
SECTION 1.08. EFFECT OF HEADINGS AND TABLE OF CONTENTS. The
Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 1.09. SUCCESSORS AND ASSIGNS. All covenants and
agreements in this Indenture by the Company shall bind its successors and
assigns, whether so expressed or not.
SECTION 1.10. 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 1.11. BENEFITS OF INDENTURE. Nothing in this Indenture
or in any Securities, express or implied, shall give to any Person, other
than the parties hereto and their successors hereunder, any Authenticating
Agent or Paying Agent, the Security Registrar, the holders of Senior
Indebtedness and the Holders of Securities (or such of them as may be
affected thereby), any benefit or any legal or equitable right, remedy or
claim under this Indenture.
SECTION 1.12. GOVERNING LAW. This Indenture shall be construed
in accordance with and governed by the laws of the State of New York.
SECTION 1.13. COUNTERPARTS. 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.
SECTION 1.14. JUDGMENT CURRENCY. The Company agrees, to the
fullest extent that it may effectively do so under applicable law, that (a)
if for the purpose of obtaining judgment in any court it is necessary to
convert the sum due in respect of the principal of, or premium or interest,
if any, on the Securities of any series (the "Required Currency") into a
currency in which a judgment will be rendered (the "Judgment Currency"),
the rate of exchange used shall be the rate at which in accordance with
normal banking procedures the Trustee could purchase in the City of New
York the Required Currency with the Judgment Currency on the New York
Banking Day preceding that on which a final unappealable judgment is given
and (b) its obligations under this Indenture to make payments in the
Required Currency (i) shall not be discharged or satisfied by any tender,
or any recovery pursuant to any judgment (whether or not entered in
accordance with subsection (a)), in any currency other than the Required
Currency, except to the extent that such tender or recovery shall result in
the actual receipt, by the payee, of the full amount of the Required
Currency, expressed to be payable in respect of such payments, (ii) shall
be enforceable as an alternative or additional cause of action for the
purpose of recovering in the Required Currency the amount, if any, by which
such actual receipt shall fall short of the full amount of the Required
Currency so expressed to be payable and (iii) shall not be affected by
judgment being obtained for any other sum due under this Indenture. For
purposes of the foregoing, "New York Banking Day" means any day except a
Saturday, Sunday or a legal holiday in the City of New York or a day on
which banking institutions in the City of New York are authorized or
required by law or executive order to close.
ARTICLE II
SECURITY FORMS
SECTION 2.01. FORMS GENERALLY. The Securities shall have such
appropriate insertions, omissions, substitutions and other variations as
are required or permitted by this Indenture and may have such letters,
numbers or other marks of identification and such legends or endorsements
placed thereon, as may be required to comply with the rules of any
securities exchange, or as may, consistently herewith, be determined by the
officers executing such Securities, as evidenced by their execution of the
Securities. Any portion of the text of any Security may be set forth on
the reverse thereof, with an appropriate reference thereto on the face of
the Security.
The definitive Securities shall be printed, lithographed or
engraved or produced by any combination of these methods 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, subject, with respect to the Securities of any series, to the
rules of any securities exchange on which such Securities are listed.
SECTION 2.02. FORMS OF SECURITIES. Each Security shall be in
one of the forms approved from time to time by or pursuant to a Board
Resolution, or established in one or more indentures supplemental hereto.
Prior to the delivery of a Security to the Trustee for authentication in
any form approved by or pursuant to a Board Resolution, the Company shall
deliver to the Trustee the Board Resolution by or pursuant to which such
form of Security has been approved, which Board Resolution shall have
attached thereto a true and correct copy of the form of Security which has
been approved thereby or, if a Board Resolution authorizes a specific
officer or officers to approve a form of Security, a certificate of such
officer or officers approving the form of Security attached thereto. Any
form of Security approved by or pursuant to a Board Resolution must be
acceptable as to form to the Trustee, such acceptance to be evidenced by
the Trustee's authentication of Securities in that form or a certificate
signed by a Responsible Officer of the Trustee and delivered to the
Company.
SECTION 2.03. FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION.
The form of Trustee's Certificate of Authentication for any Security issued
pursuant to this Indenture shall be substantially as follows:
"TRUSTEE'S CERTIFICATE OF AUTHENTICATION"
This is one of the Securities of the series designated therein
referred to in the within mentioned Indenture.
[______________],
as Trustee,
By
Authorized Officer"
SECTION 2.04. SECURITIES ISSUABLE IN THE FORM OF A GLOBAL
SECURITY. (a) If the Company shall establish pursuant to Sections 2.02 and
3.01 that the Securities of a particular series are to be issued in whole
or in part in the form of one or more Global Securities, then the Company
shall execute and the Trustee or its agent shall in accordance with Section
3.03 and the Company Order delivered to the Trustee or its agent
thereunder, authenticate and deliver, such Global Security or Securities,
which (i) shall represent, and shall be denominated in an amount equal to
the aggregate principal amount of, the outstanding Securities of such
series to be represented by such Global Security or Securities, or such
portion thereof as the Company shall specify in a Company Order, (ii) shall
be registered in the name of the Depository for such Global Security or
Securities or its nominee, (iii) shall be delivered by the Trustee or its
agent to the Depository or pursuant to the Depository's instruction and
(iv) shall bear a legend substantially to the following effect:
"Unless this certificate is presented by an authorized
representative of the Depository to the Issuer or its agent for
registration of transfer, exchange, or payment, and any
certificate issued is registered in the name of the nominee of
the Depository or in such other name as is requested by an
authorized representative of the Depository (and any payment is
made to the nominee of the Depository or to such other entity as
is requested by an authorized representative of the Depository),
ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, the nominee of the Depository, has an interest herein.
Unless and until it is exchanged in whole or in part for
securities in definitive registered form, this certificate may
not be transferred except as a whole by the Depository to a
nominee of the Depository or by a nominee of the Depository to
the Depository or another nominee of the Depository or by the
Depository or any such nominee to a successor depository or a
nominee of such successor depository."
(b) Notwithstanding any other provision of this Section 2.04 or
of Section 3.05, and subject to the provisions of paragraph (c) below,
unless the terms of a Global Security expressly permit such Global Security
to be exchanged in whole or in part for individual Securities, a Global
Security may be transferred, in whole but not in part and in the manner
provided in Section 3.05, only to a nominee of the Depository for such
Global Security, or to the Depository, or a successor Depository for such
Global Security selected or approved by the Company, or to a nominee of
such successor Depository.
(c) (i) If at any time the Depository for a Global Security
notifies the Company that it is unwilling or unable to continue as
Depository for such Global Security or if at any time the Depository for
the Securities for such series shall no longer be eligible or in good
standing under the Exchange Act or other applicable statute or regulation,
the Company shall appoint a successor Depository with respect to such
Global Security. If a successor Depository for such Global Security is not
appointed by the Company within 90 days after the Company receives such
notice or becomes aware of such ineligibility, the Company will execute,
and the Trustee or its agent, upon receipt of a Company Request for the
authentication and delivery of individual Securities of such series in
exchange for such Global Security, will authenticate and deliver,
individual Securities of such series of like tenor and terms in an
aggregate principal amount equal to the principal amount of the Global
Security in exchange for such Global Security.
(ii) The Company may at any time and in its sole discretion
determine that the Securities of any series or portion thereof issued or
issuable in the form of one or more Global Securities shall no longer be
represented by such Global Security or Securities. In such event the
Company will execute, and the Trustee, upon receipt of a Company Request
for the authentication and delivery of individual Securities of such series
in exchange in whole or in part for such Global Security, will authenticate
and deliver individual Securities of such series of like tenor and terms in
definitive form in an aggregate principal amount equal to the principal
amount of such Global Security or Securities representing such series or
portion thereof in exchange for such Global Security or Securities.
(iii)If specified by the Company pursuant to Sections 2.02 and
3.01 with respect to Securities issued or issuable in the form of a Global
Security, the Depository for such Global Security may surrender such Global
Security in exchange in whole or in part for individual Securities of such
series of like tenor and terms in definitive form on such terms as are
acceptable to the Company and such Depository. Thereupon the Company shall
execute, and the Trustee or its agent shall authenticate and deliver,
without service charge, (A) to each Person specified by such Depository a
new Security or Securities of the same series of like tenor and terms and
of any authorized denomination as requested by such Person in aggregate
principal amount equal to and in exchange for such Person's beneficial
interest as specified by such Depository in the Global Security; and (B) to
such Depository a new Global Security of like tenor and terms and in an
authorized denomination equal to the difference, if any, between the
principal amount of the surrendered Global Security and the aggregate
principal amount of Securities delivered to Holders thereof.
(iv) In any exchange provided for in any of the preceding three
paragraphs, the Company will execute and the Trustee or its agent will
authenticate and deliver individual Securities in definitive registered
form in authorized denominations. Upon the exchange of the entire
principal amount of a Global Security for individual Securities, such
Global Security shall be canceled by the Trustee or its agent. Except as
provided in the preceding paragraph, Securities issued in exchange for a
Global Security pursuant to this Section shall be registered in such names
and in such authorized denominations as the Depository for such Global
Security, pursuant to instructions from its direct or indirect participants
or otherwise, shall instruct the Trustee or the Security Registrar. The
Trustee or the Security Registrar shall deliver at its Corporate Trust
Office such Securities to the Persons in whose names such Securities are so
registered.
ARTICLE III
THE SECURITIES
SECTION 3.01. GENERAL TITLE; GENERAL LIMITATIONS; ISSUABLE IN
SERIES; TERMS OF PARTICULAR SERIES. The aggregate principal amount of
Securities which may be authenticated and delivered and outstanding under
this Indenture is not limited.
The Securities may be issued in one or more series as from time
to time may be authorized by the Board of Directors. There shall be
established in or pursuant to a Board Resolution or in a supplemental
indenture, subject to Section 3.11, prior to the issuance of Securities of
any such series:
(a) the title of the Securities of such series (which shall
distinguish the Securities of such series from Securities of any other
series);
(b) the Person to whom any interest on a Security of such series
shall be payable, if other than the Person in whose name that Security
(or one or more Predecessor Securities) is registered at the close of
business on the Regular Record Date for such interest;
(c) the date or dates on which the principal of the Securities
of such series is payable;
(d) the rate or rates at which the Securities of such series
shall bear interest, if any, the date or dates from which such
interest shall accrue, the Interest Payment Dates on which any such
interest shall be payable and the Regular Record Date for any interest
payable on any Interest Payment Date;
(e) the place or places where the principal of and any premium
and interest on Securities of such series shall be payable;
(f) the period or periods within which, the Redemption Price or
Prices or the Repayment Price or Prices, as the case may be, at which
and the terms and conditions upon which Securities of such series may
be redeemed or repaid (including the applicability of Section 11.09),
as the case may be, in whole or in part, at the option of the Company
or the Holder;
(g) the obligation, if any, of the Company to purchase
Securities of such series pursuant to any sinking fund or analogous
provisions or at the option of a Holder thereof and the period or
periods within which, the price or prices at which and the terms and
conditions upon which Securities of such series shall be purchased, in
whole or in part, pursuant to such obligation;
(h) if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which Securities of such series
shall be issuable;
(i) provisions, if any, with regard to the conversion or
exchange of the Securities of such series, at the option of the
Holders thereof or the Company, as the case may be, for or into new
Securities of a different series, Common Stock or other securities
and, if the Securities of such series are convertible into Common
Stock or other Marketable Securities, the Conversion Price therefor;
(j) if other than U.S. dollars, the currency or currencies or
units based on or related to currencies in which the Securities of
such series shall be denominated and in which payments of principal
of, and any premium and interest on, such Securities shall or may be
payable;
(k) if the principal of (and premium, if any) or interest, if
any, on the Securities of such series are to be payable, at the
election of the Company or a Holder thereof, in a coin or currency
(including a composite currency) other than that in which the
Securities are stated to be payable, the period or periods within
which, and the terms and conditions upon which, such election may be
made;
(l) if the amount of payments of principal of (and premium, if
any) or interest, if any, on the Securities of such series may be
determined with reference to an index based on a coin or currency
(including a composite currency) other than that in which the
Securities are stated to be payable, the manner in which such amounts
shall be determined;
(m) any limit upon the aggregate principal amount of the
Securities of such series which may be authenticated and delivered
under this Indenture (except for Securities authenticated and
delivered upon registration of transfer of, or in exchange for, or in
lieu of, other Securities of the series pursuant to Section 3.04,
3.05, 3.06, 9.06, 11.07, 12.02 and except for any Securities which,
pursuant to Section 3.03, are deemed never to have been authenticated
and delivered hereunder);
(n) provisions, if any, with regard to the exchange of
Securities of such series, at the option of the Holders thereof, for
other Securities of the same series of the same aggregate principal
amount of a different authorized kind or different authorized
denomination or denominations, or both;
(o) provisions, if any, with regard to the appointment by the
Trustee of an Authenticating Agent in one or more places other than
the location of the office of the Trustee with power to act on behalf
of the Trustee and subject to its direction in the authentication and
delivery of the Securities of any one or more series in connection
with such transactions as shall be specified in the provisions of this
Indenture or in or pursuant to such Board Resolution or supplemental
indenture;
(p) the portion of the principal amount of Securities of the
series, if other than the principal amount thereof, which shall be
payable upon declaration of acceleration of the Maturity thereof
pursuant to Section 5.02 or provable in bankruptcy pursuant to Section
5.04;
(q) any Event of Default with respect to the Securities of such
series, if not set forth herein, and any additions, deletions or other
changes to the Events of Default set forth herein that shall be
applicable to the Securities of such series;
(r) any covenant solely for the benefit of the Securities of
such series and any additions, deletions or other changes to Article
Ten or Section 1.01 or any definitions otherwise applicable to the
Securities of that series;
(s) if Section 4.03 of this Indenture shall not be applicable to
the Securities of such series and if Section 4.03 shall be applicable
to any covenant or Event of Default established in or pursuant to a
Board Resolution or in a supplemental indenture as described above
that has not already been established herein;
(t) if the Securities of such series shall be issued in whole or
in part in the form of a Global Security or Securities, the terms and
conditions, if any, upon which such Global Security or Securities may
be exchanged in whole or in part for other individual Securities, and
the Depository for such Global Security or Securities;
(u) if the Securities of such series shall bear interest,
whether such interest shall be payable in cash, in such Securities or
in a combination thereof; and
(v) any other terms of such series, all upon such terms as may
be determined in or pursuant to such Board Resolution or supplemental
indenture with respect to such series.
The form of the Securities of each series shall be established
pursuant to the provisions of this Indenture in or pursuant to the Board
Resolution or in the supplemental indenture creating such series. The
Securities of each series shall be distinguished from the Securities of
each other series in such manner, reasonably satisfactory to the Trustee,
as the Board of Directors may determine.
Unless otherwise provided with respect to Securities of a
particular series, the Securities of any series may only be issuable in
registered form, without coupons.
Any terms or provisions in respect of the Securities of any
series issued under this Indenture may be determined pursuant to this
Section by providing for the method by which such terms or provisions shall
be determined.
SECTION 3.02. DENOMINATIONS. The Securities of each series
shall be issuable in such denominations and currency as shall be provided
pursuant to the provisions of this Indenture or in or pursuant to the Board
Resolution or the supplemental indenture creating such series. In the
absence of any such provisions with respect to the Securities of any
series, the Securities of that series shall be issuable only in fully
registered form in denominations of $1,000 and any integral multiple
thereof.
SECTION 3.03. EXECUTION, AUTHENTICATION AND DELIVERY AND DATING.
The Securities shall be executed on behalf of the Company by its Chairman
of the Board, its President, one of its Vice Presidents or its Treasurer
under its corporate seal reproduced thereon and 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 executed by
the Company to the Trustee for authentication; and the Trustee shall, upon
Company Order, authenticate and deliver such Securities as in this
Indenture provided and not otherwise.
Prior to any such authentication and delivery, the Trustee shall
be entitled to receive, in addition to any Officers' Certificate and
Opinion of Counsel required to be furnished to the Trustee pursuant to
Section 1.02, and the Board Resolution and any certificate relating to the
issuance of the series of Securities required to be furnished pursuant to
Section 2.02, an Opinion of Counsel stating that:
(a) all instruments furnished to the Trustee conform to the
requirements of the Indenture and constitute sufficient authority
hereunder for the Trustee to authenticate and deliver such Securities;
(b) the form and terms of such Securities have been established
in conformity with the provisions of this Indenture;
(c) all laws and requirements with respect to the execution and
delivery by the Company of such Securities have been complied with,
the Company has the corporate power to issue such Securities and such
Securities have been duly authorized and delivered by the Company and,
assuming due authentication and delivery by the Trustee, constitute
legal, valid and binding obligations of the Company enforceable
against the Company in accordance with their terms (except as
enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer or conveyance and
other similar laws affecting enforcement of creditors' rights
generally, and except as enforcement thereof is subject to general
principles of equity (regardless of whether enforcement is considered
in a proceeding in equity or at law) and subject to other customary
exceptions and qualifications) and are entitled to the benefits of
this Indenture, equally and ratably with all other Securities, if any,
of such series Outstanding;
(d) the Indenture is qualified under the Trust Indenture Act;
and
(e) such other matters as the Trustee may reasonably request;
and, if the authentication and delivery relates to a new series of
Securities created by an indenture supplemental hereto, also stating that
all laws and requirements with respect to the form and execution by the
Company of the supplemental indenture with respect to that series of
Securities have been complied with, the Company has corporate power to
execute and deliver any such supplemental indenture and has taken all
necessary corporate action for those purposes and any such supplemental
indenture has been duly authorized, executed and delivered by the Company
and constitutes a valid and legally binding obligation of the Company
enforceable against the Company in accordance with its terms (except as
enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer or conveyance and other
similar laws affecting enforcement of creditors' rights generally, and
except as enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in equity
or at law) and subject to other customary exceptions and qualifications).
The Trustee shall not be required to authenticate such Securities
if the issue thereof will adversely affect the Trustee's own rights, duties
or immunities under the Securities and this Indenture.
Unless otherwise provided in the form of Security for any series,
all Securities shall be dated the date of their 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 3.09, for all purposes of this
Indenture such Security shall be deemed never to have been authenticated
and delivered hereunder and shall never be entitled to the benefits of this
Indenture.
SECTION 3.04. TEMPORARY SECURITIES. Pending the preparation of
definitive Securities of any series, the Company may execute, and, upon
receipt of the documents required by Section 3.03, together with a 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 such series to be prepared without
unreasonable delay. After the preparation of definitive Securities, 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,
without charge to the Holder; and upon surrender for cancellation of any
one or more temporary Securities the Company shall execute and the Trustee
shall authenticate and deliver in exchange therefor a like principal amount
of definitive Securities of such series of authorized denominations and of
like tenor and terms. Until so exchanged the temporary Securities of such
series shall in all respects be entitled to the same benefits under this
Indenture as definitive Securities of such series.
SECTION 3.05. REGISTRATION, TRANSFER AND EXCHANGE. The Company
shall keep or cause to be kept a register or registers (herein sometimes
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, or of Securities of a particular series,
and of transfers of Securities or of Securities of such series. Any such
register shall be in written form or in any other form capable of being
converted into written form within a reasonable time. At all reasonable
times the information contained in such register or registers shall be
available for inspection by the Trustee at the office or agency to be
maintained by the Company as provided in Section 10.02. There shall be
only one Security Register per series of Securities.
Subject to the provisions of this Indenture, upon surrender for
registration of transfer of any Security of any series at the office or
agency of the Company maintained for such purpose in a Place of Payment,
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 such series of any authorized denominations, of a like
aggregate principal amount and Stated Maturity and of like tenor and terms.
Subject to Section 2.04, at the option of the Holder, Securities
of any series may be exchanged for other Securities of such series of any
authorized denominations, of a like aggregate principal amount and Stated
Maturity and like tenor and terms, 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 Securityholder 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 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 Trustee duly executed, by the
Holder thereof or his attorney duly authorized in writing.
Unless otherwise provided in this Indenture or the Security to be
registered for transfer or exchanged, no service charge shall be made on
any Securityholder for any registration of transfer or exchange of
Securities, but the Company may (unless otherwise provided in such
Security) require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration
of transfer or exchange of Securities, other than exchanges pursuant to
Section 3.04, 9.06 or 11.07 not involving any transfer.
The Company shall not be required (a) to issue, register the
transfer of or exchange any Security of any series during a period
beginning at the opening of business 15 days before the day of the mailing
of a notice of redemption of Securities of such series selected for
redemption under Section 11.03 and ending at the close of business on the
date for redemption set forth in such mailing or (b) to register the
transfer of or exchange any Security so selected for redemption in whole or
in part.
None of the Company, the Trustee, any agent of the Trustee, any
Paying Agent or the Security Registrar will have any responsibility or
liability for any aspect of the records relating to or payments made on
account of beneficial ownership interests of a Global Security or for
maintaining, supervising or reviewing any records relating to such
beneficial ownership interests.
SECTION 3.06. MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES.
If (a) any mutilated Security is surrendered to the Trustee, or the Company
and the Trustee receive evidence to their satisfaction of the destruction,
loss or theft of any Security and (b) there is delivered to the Company and
the Trustee such security or indemnity as may be required by them to save
each of them harmless, then, in the absence of notice to the Company or the
Trustee that such Security has been acquired by a bona fide purchaser, the
Company shall execute and upon its written request the Trustee shall
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Security, a new Security of like tenor, series,
Stated Maturity and principal amount, 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) in
connection therewith.
Every new Security 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 the same 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 3.07. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.
Unless otherwise provided with respect to such Security pursuant to Section
3.01, 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 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
registered Holder on the relevant Regular Record Date by virtue of his
having been such Holder; and, except as hereinafter provided, such
Defaulted Interest may be paid by the Company, at its election in each
case, as provided in clause (a) or clause (b) below:
(a) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names any such Securities (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 such Security 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 nor less than 10 days prior to the date of
the proposed payment and not less than 10 days after the receipt by the
Trustee of the notice of the proposed payment. The Trustee shall promptly
notify the Company of such Special Record Date and, in the name and at the
expense of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be mailed, first
class postage prepaid, to the Holder of each such Security at his address
as it appears in the Security Register, not less than 10 days prior to such
Special Record Date. Notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor having been mailed as
aforesaid, such Defaulted Interest shall be paid to the Persons in whose
names such Securities (or their respective Predecessor Securities) are
registered on such Special Record Date and shall no longer be payable
pursuant to the following clause (b).
(b) The Company may make payment of any Defaulted Interest 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.
If any installment of interest the Stated Maturity of which is on
or prior to the Redemption Date for any Security called for redemption
pursuant to Article Eleven is not paid or duly provided for on or prior to
the Redemption Date in accordance with the foregoing provisions of this
Section, such interest shall be payable as part of the Redemption Price of
such Securities.
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 3.08. PERSONS DEEMED OWNERS. The Company, the Trustee
and any agent of the Company or the Trustee may treat the Person in whose
name any Security is registered as the owner of such Security for the
purpose of receiving payment of principal of (and premium, if any), and
(subject to Section 3.07) 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.
None of the Company, the Trustee, any Paying Agent or the
Security Registrar will have any responsibility or liability for any aspect
of the records relating to or payments made on account of beneficial
ownership interests in a Global Security or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
SECTION 3.09. CANCELLATION. All Securities surrendered for
payment, redemption, conversion, registration of transfer, or exchange or
credit against a sinking fund shall, if surrendered to any Person other
than the Trustee, be delivered to the Trustee and, if not already
cancelled, 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 all Securities so delivered shall be promptly
cancelled by the Trustee. No Security 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. The Trustee shall dispose
of all cancelled Securities in accordance with its standard procedures and
deliver a certificate of such disposition to the Company.
SECTION 3.10. COMPUTATION OF INTEREST. Unless otherwise
provided as contemplated in Section 3.01, interest on the Securities shall
be calculated on the basis of a 360-day year of twelve 30-day months.
SECTION 3.11. DELAYED ISSUANCE OF SECURITIES. Notwithstanding
any contrary provision herein, if all Securities of a series are not to be
originally issued at one time, it shall not be necessary for the Company to
deliver to the Trustee an Officers' Certificate, Board Resolution,
supplemental indenture, Opinion of Counsel or Company Order otherwise
required pursuant to Sections 1.02, 2.02, 3.01 and 3.03 at or prior to the
time of authentication of each Security of such series if such documents
are delivered to the Trustee or its agent at or prior to the authentication
upon original issuance of the first Security of such series to be issued;
provided that any subsequent request by the Company to the Trustee to
authenticate Securities of such series upon original issuance shall
constitute a representation and warranty by the Company that as of the date
of such request, the statements made in the Officers' Certificate or other
certificates delivered pursuant to Sections 1.02 and 2.02 shall be true and
correct as if made on such date.
A Company Order, Officers' Certificate or Board Resolution or
supplemental indenture delivered by the Company to the Trustee in the
circumstances set forth in the preceding paragraph may provide that
Securities which are the subject thereof will be authenticated and
delivered by the Trustee or its agent on original issue from time to time
in the aggregate principal amount, if any, established for such series
pursuant to such procedures acceptable to the Trustee as may be specified
from time to time by Company Order upon the telephonic, electronic or
written order of Persons designated in such Company Order, Officers'
Certificate, supplemental indenture or Board Resolution (any such
telephonic or electronic instructions to be promptly confirmed in writing
by such Persons) and that such Persons are authorized to determine,
consistent with such Company Order, Officers' Certificate, supplemental
indenture or Board Resolution, such terms and conditions of said Securities
as are specified in such Company Order, Officers' Certificate, supplemental
indenture or Board Resolution.
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.01. SATISFACTION AND DISCHARGE OF INDENTURE. This
Indenture shall cease to be of further effect with respect to any series of
Securities (except as to any surviving rights of conversion or transfer or
exchange of Securities of such series expressly provided for herein or in
the form of Security for such series), and the Trustee, on receipt of a
Company Request and at the expense of the Company, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture as
to such series, when:
(a) either:
(i) all Securities of that series theretofore authenticated
and delivered (other than (A) Securities of such series which
have been destroyed, lost or stolen and which have been replaced
or paid as provided in Section 3.06 and (B) Securities of such
series for whose payment money in the Required Currency has
theretofore been deposited in trust or segregated and held in
trust by the Company and thereafter repaid to the Company or
discharged from such trust, as provided in Section 10.03) have
been delivered to the Trustee canceled or for cancellation; or
(ii) all such Securities of that series not theretofore
delivered to the Trustee canceled or for cancellation:
(A) have become due and payable,
(B) will become due and payable at their Stated Maturity
within one year, or
(C) 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 (A), (B) or (C) above, has
irrevocably deposited or caused to be deposited (which deposit is
not prohibited by Article Thirteen) with the Trustee as trust
funds in trust for the purpose an amount in the Required Currency
sufficient to pay and discharge the entire indebtedness on such
Securities not theretofore delivered to the Trustee canceled or
for cancellation, for principal of (and premium, if any) and
interest thereon 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;
(b) the Company has paid or caused to be paid all other sums
payable hereunder by the Company with respect to the Securities of
such series; and
(c) 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 with respect to the Securities of such
series have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture with
respect to any series of Securities, the obligations of the Company to the
Trustee with respect to that series under Section 6.07 shall survive and
the obligations of the Company and the Trustee with respect to that series
under Sections 3.05, 3.06, 4.02, 10.02 and 10.03 shall survive.
SECTION 4.02. APPLICATION OF TRUST MONEY. Subject to the
provisions of the last paragraph of Section 10.03, all money deposited with
the Trustee pursuant to Section 4.01 or Section 4.03 shall be held in trust
and applied by it, in accordance with the provisions of the series of
Securities in respect of which it was deposited 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 of (and premium, if any) and
interest thereon for whose payment such money has been deposited with the
Trustee; but such money need not be segregated from other funds except to
the extent required by law.
Anything herein to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon Company Request
any money or securities deposited with and held by it as provided in
Section 4.03 and this Section 4.02 which, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, are in excess of the amount
thereof which would then be required to be deposited to effect an
equivalent satisfaction and discharge, Discharge (as defined below) or
covenant defeasance; provided that the Trustee shall not be required to
liquidate any securities in order to comply with the provisions of this
paragraph.
SECTION 4.03. DEFEASANCE UPON DEPOSIT OF FUNDS OR GOVERNMENT
OBLIGATIONS. Unless pursuant to Section 3.01 provision is made that this
Section shall not be applicable to the Securities of any series, at the
Company's option, either (a) the Company shall be deemed to have been
Discharged from its obligations with respect to any series of Securities
after the applicable conditions set forth below have been satisfied or (b)
the Company shall cease to be under any obligation to comply with any term,
provision or condition set forth in Sections 10.05 and 10.07 and Article
Eight (and any other Sections or covenants applicable to such Securities
that are determined pursuant to Section 3.01 to be subject to this
provision), and clause (d) of Section 5.01 (and any other Events of Default
applicable to such Securities that are determined pursuant to Section 3.01
to be subject to this provision) shall be deemed not to be an Event of
Default, with respect to any series of Securities at any time after the
applicable conditions set forth below have been satisfied:
(i) the Company shall have deposited or caused to be deposited
(which deposit is not prohibited by Article Thirteen) irrevocably with
the Trustee as trust funds in trust, specifically pledged as security
for, and dedicated solely to, the benefit of the Holders of the
Securities of such series (A) money in an amount, (B) (x) with respect
to securities denominated in United States dollars, U.S. Government
Obligations which through the payment of interest and principal in
respect thereof in accordance with their terms will provide, not later
than one day before the due date of any payment, money in an amount or
(y) with respect to securities denominated in currencies other than
United States dollars, the equivalent in securities of the government
which issued the currency in which the Securities are denominated or
government agencies backed by the full faith and credit of such
government which through the payment of interest and principal in
respect thereof in accordance with their terms will provide, not later
than one day before the due date of any payment, money in an amount or
(C) a combination of (A) and (B), sufficient, in the opinion (with
respect to (B) and (C)) of a nationally recognized firm of independent
public accountants expressed in a written certification thereof
delivered to the Trustee, to pay and discharge each installment of
principal (including any mandatory sinking fund payments) and any
premium of, interest on and any repurchase or redemption obligations
with respect to the outstanding Securities of such series on the dates
such installments of interest or principal or repurchase or redemption
obligations are due (before such a deposit, if the Securities of such
series are then redeemable or may be redeemed in the future pursuant
to the terms thereof, in either case at the option of the Company, the
Company may give to the Trustee, in accordance with Section 11.02, a
notice of its election to redeem all of the Securities of such series
at a future date in accordance with Article Eleven);
(ii) no Event of Default or event (including such deposit) which
with notice or lapse of time would become an Event of Default with
respect to the Securities of such series shall have occurred and be
continuing on the date of such deposit;
(iii)the Company shall have delivered to the Trustee (A) an
Opinion of Counsel to the effect that Holders of the Securities of
such series will not recognize income, gain or loss for Federal income
tax purposes as a result of the Company's exercise of its option under
this Section 4.03 and will be subject to Federal income tax on the
same amount and in the same manner and at the same times as would have
been the case if such option had not been exercised, and, in the case
of Securities being Discharged, accompanied by a ruling to that effect
from the Internal Revenue Service, unless, as set forth in such
Opinion of Counsel, there has been a change in the applicable federal
income tax law since the date of this Indenture such that a ruling
from the Internal Revenue Service is no longer required and (B) an
Opinion of Counsel, subject to such qualifications, exceptions,
assumptions and limitations as are reasonably deemed necessary by such
counsel and are reasonably satisfactory to counsel for the Trustee, to
the effect that the trust resulting from the deposit referred to in
paragraph (i) above does not violate the Investment Company Act of
1940; and
(iv) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit referred to in paragraph (i)
above was not made by the Company with the intent of preferring the
Holders over other creditors of the Company or with the intent of
defeating, hindering, delaying or defrauding creditors of the Company
or others.
"Discharged" means that the Company shall be deemed to have paid
and discharged the entire indebtedness represented by, and obligations
under, the Securities of such series and to have satisfied all the
obligations under this Indenture relating to the Securities of such series
(and the Trustee, upon receipt of a Company Request and at the expense of
the Company, shall execute proper instruments acknowledging the same),
except (a) the rights of Holders of Securities to receive, from the trust
fund described in paragraph (i) above, payment of the principal of and any
premium and interest on such Securities when such payments are due; (b) the
Company's obligations with respect to such Securities under Sections 3.05,
3.06, 4.02, 6.07, 10.02 and 10.03; (c) the Company's right of redemption,
if any, with respect to any Securities of such series pursuant to Article
Eleven, in which case the Company may redeem the Securities of such series
in accordance with Article Eleven by complying with such Article and
depositing with the Trustee, in accordance with Section 11.05, an amount of
money sufficient, together with all amounts held in trust pursuant to
Section 4.02 with respect to Securities of such series, to pay the
Redemption Price of all the Securities of such series to be so redeemed;
and (d) the rights, powers, trusts, duties and immunities of the Trustee
hereunder; and Discharge has a correlative meaning.
SECTION 4.04. REINSTATEMENT. If the Trustee or Paying Agent is
unable to apply any money or securities in accordance with Section 4.02 of
this Indenture by reason of any legal proceeding or by reason of any order
or judgment of any court or governmental authority enjoining, restraining
or otherwise prohibiting such application, the Company's obligations under
this Indenture and the Securities shall be revived and reinstated as though
no deposit had occurred pursuant to Section 4.01 or 4.03 of this Indenture,
as the case may be, until such time as the Trustee or Paying Agent is
permitted to apply all such money or securities in accordance with Section
4.02 of this Indenture; PROVIDED that if the Company has made any payment
of principal of or premium or interest on any Securities because of the
reinstatement of its obligations, the Company shall be subrogated to the
rights of the Holders of such Securities to receive such payment from the
money or securities held by the Trustee or Paying Agent.
SECTION 4.05. SUBORDINATION PROVISIONS INAPPLICABLE.
Notwithstanding anything contained herein to the contrary, any money that
shall have been deposited by the Company with the Trustee pursuant to
Section 4.01 or Section 4.03 shall not be subject to the provisions of
Article Thirteen of this Indenture respecting subordination of the
Securities;PROVIDED, HOWEVER, that said provisions respecting subordination
shall continue to apply to such money, if any, that has been returned to
the Company or its legal representative pursuant to any legal proceeding or
an order or judgment of a court or governmental authority.
ARTICLE V
REMEDIES
SECTION 5.01. EVENTS OF DEFAULT. "Event of Default", wherever
used herein, means with respect to any series of Securities 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), unless such
event is either inapplicable to a particular series or it is specifically
deleted or modified in or pursuant to the supplemental indenture or Board
Resolution creating such series of Securities or in the form of Security
for such series pursuant to Section 3.01:
(a) 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
(b) default in the payment of the principal of (or premium, if
any, on) any Security of that series at its Maturity (or, in the case
of a redemption of Securities, default in the payment of the principal
of (or premium, if any, on) such Securities when such Securities
become due and payable as provided in Section 11.06); or
(c) default in the payment of any sinking or purchase fund or
analogous obligation when the same becomes due by the terms of the
Securities of such series; or
(d) default in the performance, or breach, of any covenant or
warranty of the Company in this Indenture in respect of the Securities
of such series (other than a covenant or warranty in respect of the
Securities of such series a default in the performance of which or
the breach of which is elsewhere in this Section specifically dealt
with), all of such covenants and warranties in the Indenture which are
not expressly stated to be for the benefit of a particular series of
Securities being deemed in respect of the Securities of all series for
this purpose, and continuance of such default or breach for a period
of 90 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 such 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
(e) the entry of an order for relief against the Company under
Title 11, United States Code (the "Federal Bankruptcy Act") by a court
having jurisdiction in the premises or a decree or order by a court
having jurisdiction in the premises adjudging the Company or any
Material U.S. Subsidiary a bankrupt or insolvent under any other
applicable Federal or State law, or the entry of a decree or order
approving as properly filed a petition seeking reorganization,
arrangement, adjustment or composition of or in respect of the Company
or such Material U.S. Subsidiary under the Federal Bankruptcy Act or
any other applicable Federal or State law, or appointing a receiver,
liquidator, assignee, trustee, sequestrator (or other similar
official) of the Company or such Material U.S. Subsidiary or of any
substantial part of its property, or ordering the winding up or
liquidation of its affairs, and the continuance of any such decree or
order unstayed and in effect for a period of 90 consecutive days; or
(f) the consent by the Company or any Material U.S. Subsidiary
to the institution of bankruptcy or insolvency proceedings against it,
or the filing by it of a petition or answer or consent seeking
reorganization or relief under the Federal Bankruptcy Act or any other
applicable Federal or State law, or the consent by it to the filing of
any such petition or to the appointment of a receiver, liquidator,
assignee, trustee, sequestrator (or other similar official) of the
Company or such Material U.S. Subsidiary or of any substantial part of
its property, or the making by it of an assignment for the benefit of
creditors, or the admission by it in writing of its inability to pay
its debts generally as they become due, or the taking of corporate
action by the Company or such material U.S. Subsidiary in furtherance
of any such action; or
(g) any other Event of Default provided in the supplemental
indenture or Board Resolution under which such series of Securities is
issued or in the form of Security for such series.
SECTION 5.02. ACCELERATION OF MATURITY; RESCISSION AND
ANNULMENT. If an Event of Default described in paragraph (a), (b),
(c), (d) or (g) (if the Event of Default under paragraph (d) or (g) is with
respect to less than all series of Securities then Outstanding) of Section
5.01 occurs and is continuing with respect to any series, then and in each
and every such case, unless the principal of all the Securities of such
series shall have already become due and payable, either the Trustee or the
Holders of not less than 25% in aggregate principal amount of the
Securities of such series then Outstanding hereunder (each such series
acting as a separate class), by notice in writing to the Company (and to
the Trustee if given by Holders), may declare the principal amount (or, if
the Securities of such series are Original Issue Discount Securities, such
portion of the principal amount as may be specified in the terms of that
series) of all the Securities of such series and all accrued interest
thereon to be due and payable immediately, and upon any such declaration
the same shall become and shall be immediately due and payable, anything in
this Indenture or in the Securities of such series contained to the
contrary notwithstanding. If an Event of Default described in paragraph
(d) or (g) (if the Event of Default under paragraph (d) or (g) is with
respect to all series of Securities then Outstanding) of Section 5.01
occurs and is continuing, then and in each and every such case, unless the
principal of all the Securities shall have already become due and payable,
either the Trustee or the Holders of not less than 25% in aggregate
principal amount of all the Securities then Outstanding hereunder (treated
as one class), by notice in writing to the Company (and to the Trustee if
given by Holders), may declare the principal amount (or, if any Securities
are Original Issue Discount Securities, such portion of the principal
amount as may be specified in the terms thereof) of all the Securities then
Outstanding and all accrued interest thereon to be due and payable
immediately, and upon any such declaration the same shall become and shall
be immediately due and payable, anything in this Indenture or in the
Securities contained to the contrary notwithstanding. If an Event of
Default of the type set forth in clause (e) or clause (f) of Section 5.01
occurs and is continuing, the principal of and any interest on the
Securities then Outstanding shall become immediately due and payable.
At any time after such a declaration of acceleration has been
made with respect to the Securities of any or all series, as the case may
be, 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
such series, by written notice to the Company and the Trustee, may rescind
and annul such declaration and its consequences if
(a) the Company has paid or deposited with the Trustee a sum
sufficient to pay
(i) all overdue installments of interest on the Securities
of such series;
(ii) the principal of (and premium, if any, on) any
Securities of such series which have become due otherwise than by
such declaration of acceleration, and interest thereon at the
rate or rates prescribed therefor by the terms of the Securities
of such series, to the extent that payment of such interest is
lawful;
(iii)interest upon overdue installments of interest at the
rate or rates prescribed therefor by the terms of the Securities
of such series to the extent that payment of such interest is
lawful, and
(iv) 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 all other amounts due
the Trustee under Section 6.07; and
(b) all Events of Default with respect to such series of
Securities, other than the nonpayment of the principal of the
Securities of such series which have become due solely by such
acceleration, have been cured or waived as provided in Section 5.13.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 5.03. COLLECTION OF INDEBTEDNESS AND SUITS FOR
ENFORCEMENT BY TRUSTEE. The Company covenants that if
(a) default is made in the payment of any installment of
interest on any Security of any series when such interest becomes due
and payable;
(b) default is made in the payment of the principal of (or
premium, if any, on) any Security at the Maturity thereof; or
(c) default is made in the payment of any sinking or purchase
fund or analogous obligation when the same becomes due by the terms of
the Securities of any series;
and any such default continues for any period of grace provided with
respect to the Securities of such series, the Company will, upon demand of
the Trustee, pay to it, for the benefit of the Holder of any such Security
(or the Holders of any such series in the case of Clause (c) above), the
whole amount then due and payable on any such Security (or on the
Securities of any such series in the case of Clause (c) above) for
principal (and premium, if any) and interest, with interest, to the extent
that payment of such interest shall be legally enforceable, upon the
overdue principal (and premium, if any) and upon overdue installments of
interest, at such rate or rates as may be prescribed therefor by the terms
of any such Security (or of securities of any such series in the case of
Clause (c) above); 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 and all other amounts due the Trustee under
Section 6.07.
If the Company fails to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as trustee of an express trust,
may institute a judicial proceeding for the collection of the sums so due
and unpaid, and may prosecute such proceeding to judgment or final decree,
and may enforce the same against the Company or any other obligor upon the
Securities of such series and collect the money adjudged or decreed to be
payable in the manner provided by law out of the property of the Company or
any other obligor upon such Securities, wherever situated.
If an Event of Default with respect to any series of Securities
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 5.04. TRUSTEE MAY FILE PROOFS OF CLAIM. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relating to the Company or any other obligor upon the securities
or the property of the Company or of such other obligor or their creditors,
the Trustee (irrespective of whether the principal of the Securities shall
then be due and payable as therein expressed or by declaration or otherwise
and irrespective of whether the Trustee shall have made any demand on the
Company for the payment of overdue principal or interest) shall be entitled
and empowered, by intervention in such proceedings or otherwise,
(a) to file and prove a claim for the whole amount of principal
(or portion thereof determined pursuant to Section 3.01(p) to be
provable in bankruptcy) (and premium, if any) and interest owing and
unpaid in respect of the Securities and to file such other papers or
documents as may be necessary and advisable in order to have the
claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel and all other amounts due the Trustee under Section
6.07) and of the Securityholders allowed in such judicial proceeding;
and
(b) to collect and receive any moneys or other property payable
or deliverable on any such claims and to distribute the same;
and any receiver, assignee, trustee, liquidator, sequestrator (or other
similar official) in any such judicial proceeding is hereby authorized by
each Securityholder to make such payment to the Trustee and in the event
that the Trustee shall consent to the making of such payments directly to
the Securityholders, to pay to the Trustee any amount due to it for the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee
under Section 6.07.
Nothing herein contained shall be deemed to authorize the Trustee
to authorize or consent to or accept or adopt on behalf of any
Securityholder 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
Securityholder in any such proceeding.
SECTION 5.05. TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF
SECURITIES. All rights of action and claims under this Indenture or the
Securities of any series may be prosecuted and enforced by the Trustee
without the possession of any of the Securities of such series 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 agent and counsel and any
other amounts due the Trustee under Section 6.07, be for the ratable
benefit of the Holders of the Securities of the series in respect of which
such judgment has been recovered.
SECTION 5.06. APPLICATION OF MONEY COLLECTED. Any money
collected by the Trustee with respect to a series of Securities pursuant to
this Article shall be applied in the following order, at the date or dates
fixed by the Trustee and, in case of the distribution of such money on
account of principal (or premium, if any) or interest, upon presentation of
the Securities of such series and the notation thereon of the payment if
only partially paid and upon surrender thereof if fully paid:
(a) to the payment of all amounts due the Trustee under Section
6.07;
(b) subject to Article Thirteen, to the payment of the amounts
then due and unpaid upon the Securities of that series for principal (and
premium, if any) and interest, in respect of which or for the benefit of
which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable on such
Securities for principal (and premium, if any) and interest, respectively.
SECTION 5.07. 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
(a) such Holder has previously given written notice to the
Trustee of a continuing Event of Default with respect to Securities of
such series;
(b) the Holders of not less than 25% in principal amount of the
Outstanding Securities of such 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;
(c) 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;
(d) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(e) 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 such
series; it being understood and intended that no one or more Holders
of Securities of such series 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
Holders of Securities of such series, or to obtain or to seek to
obtain priority or preference over any other such Holders or to
enforce any right under this Indenture, except in the manner herein
provided and for the equal and proportionate benefit of all the
Holders of all Securities of such series.
SECTION 5.08. UNCONDITIONAL RIGHT OF SECURITYHOLDERS TO RECEIVE
PRINCIPAL, PREMIUM AND INTEREST. Notwithstanding any other provisions in
Indenture except for the provisions of Article Thirteen, the Holder of any
Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of (and premium, if any) and (subject to
Section 3.07) interest on such Security on the respective Stated Maturities
expressed in such Security (or, in the case of redemption or repayment, on
the Redemption Date or Repayment Date, as the case may be) and to institute
suit for the enforcement of any such payment, and such right shall not be
impaired without the consent of such Holder.
SECTION 5.09. RESTORATION OF RIGHTS AND REMEDIES. If the
Trustee or any Securityholder has instituted any proceeding to enforce any
right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, then and in every such case the
Company, the Trustee and the Securityholders shall, subject to any
determination in such proceeding, be restored severally and respectively to
their former positions hereunder, and thereafter all rights and remedies of
the Trustee and the Securityholders shall continue as though no such
proceeding had been instituted.
SECTION 5.10. RIGHTS AND REMEDIES CUMULATIVE. No right or
remedy herein conferred upon or reserved to the Trustee or to the
Securityholders is intended to be exclusive of any other right or remedy,
and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder
or now or hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
SECTION 5.11. DELAY OR OMISSION NOT WAIVER. No delay or
omission of Trustee or of any Holder of any Security to exercise any right
or remedy accruing upon any Event of Default shall impair any such right or
remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article or by
law to the Trustee or to the Securityholders may be exercised from time to
time, and as often as may be deemed expedient, by the Trustee or by the
Securityholders, as the case may be.
SECTION 5.12. CONTROL BY SECURITYHOLDERS. 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:
(a) the Trustee shall have the right to decline to follow any
such direction if the Trustee, being advised by counsel, determines
that the action so directed may not lawfully be taken or would
conflict with this Indenture or if the Trustee in good faith shall, by
a Responsible Officer, determine that the proceedings so directed
would involve it in personal liability or be unjustly prejudicial to
the Holders not taking part in such direction; and
(b) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
SECTION 5.13. WAIVER OF PAST DEFAULTS. The Holders of not less
than a majority in principal amount of the Outstanding Securities of any
series may on behalf of the Holders of all the Securities of such series
waive any past default hereunder with respect to such series and its
consequences, except a default not theretofore cured:
(a) in the payment of the principal of (or premium, if any) or
interest on any Security of such series, or in the payment of any
sinking or purchase fund or any analogous obligation with respect to
the Securities of such series; or
(b) 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.
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 5.14. UNDERTAKING FOR COSTS. All parties to this
Indenture agree, and each Holder of any Security by his acceptance thereof
shall be deemed to have agreed, that any court may in its discretion
require, in any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken or
omitted by it as Trustee, the filing by any party litigant in such suit of
an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorneys'
fees, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party
litigant; but the provisions of this Section shall not apply to any suit
instituted by the Trustee, to any suit instituted by any Securityholder, or
group of Securityholders, holding in the aggregate more than 10% in
principal amount of the Outstanding Securities of any series to which the
suit relates, or to any suit instituted by any Securityholder for the
enforcement of the payment of the principal of (or premium, if any) or
interest on any Security on or after the respective Stated Maturities
expressed in such Security (or, in the case of redemption or repayment, on
or after the Redemption Date or Repayment Date, as the case may be).
SECTION 5.15. WAIVER OF STAY OR EXTENSION LAWS. The Company
covenants (to the extent it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or
at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any
such law, and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and
permit the execution of every such power as though no such law had been
enacted.
ARTICLE VI
THE TRUSTEE
SECTION 6.01. CERTAIN DUTIES AND RESPONSIBILITIES. (a) Except
during the continuance of an Event of Default with respect to any series
of Securities:
(i) the Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture with respect to
the Securities of such series, and no implied covenants or obligations
shall be read into this Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may,
with respect to Securities of such series, conclusively rely, as to
the truth of the statements and the correctness of the opinions
expressed therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture; but in
the case of any such certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine whether
or not they conform to the requirements of this Indenture.
(b) In case an Event of Default with respect to any series of
Securities has occurred and is continuing, the Trustee shall exercise with
respect to the Securities of such series such of the rights and powers
vested in it by this Indenture, and use the same degree of care and skill
in its exercise, as a prudent person would exercise or use under the
circumstances in the conduct of his own affairs.
(c) No provision of this Indenture shall be construed to relieve
the Trustee from liability for its own negligent action, its own negligent
failure to act, or its own wilful misconduct, except that:
(i) this Subsection shall not be construed to limit the effect
of Subsection (a) of this Section;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall be proved
that the Trustee was negligent in ascertaining the pertinent facts;
(iii)the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with
the direction of the Holders of a majority in principal amount of the
Outstanding Securities of any series relating to the time, method and
place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the Trustee,
under this Indenture with respect to the Securities of such series;
and
(iv) no provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any personal or
financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably
assured to it.
(d) Whether or not therein expressly so provided, every
provision of this Indenture relating to the conduct or affecting the
liability of or affording protection to the Trustee shall be subject to the
provisions of this Section.
SECTION 6.02. NOTICE OF DEFAULTS. Within 90 days after the
occurrence of any default hereunder with respect to Securities of any
series, the Trustee shall transmit by mail to all Securityholders of such
series, as their names and addresses appear in the Security Register,
notice of such default hereunder known to the Trustee, unless such default
shall have been cured or waived; PROVIDED, HOWEVER, that, except in the
case of a default in the payment of the principal of (or premium, if any)
or interest on any Security of such series or in the payment of any sinking
or purchase fund installment or analogous obligation with respect to
Securities of such series, the Trustee shall be protected in withholding
such notice if and so long as the board of directors, the executive
committee or a trust committee of directors and/or Responsible Officers of
the Trustee in good faith determine that the withholding of such notice is
in the interests of the Securityholders of such series; and PROVIDED
FURTHER that in the case of any default of the character specified in
Section 5.01(d) with respect to Securities of such series no such notice to
Securityholders of such series shall be given until at least 90 days after
the occurrence thereof. For the purpose of this Section, the term
"default," with respect to Securities of any series, 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 6.03. CERTAIN RIGHTS OF TRUSTEE. Except as otherwise
provided in Section 6.01:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party or
parties;
(b) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or Company Order
and any resolution of the Board of Directors may be sufficiently
evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior
to taking, suffering or omitting any action hereunder, the Trustee
(unless other evidence be herein specifically prescribed) may, in the
absence of bad faith on its part, rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel and the written advice
of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Indenture at the request or
direction of any of the Securityholders pursuant to this Indenture,
unless such Securityholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such
request or direction;
(f) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture 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;
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder; and
(h) the Trustee shall not be charged with knowledge of any
default (as defined in Section 6.02) or Event of Default with respect
to the Securities of any series for which it is acting as Trustee
unless either (1) a Responsible Officer of the Trustee assigned to the
Corporation Trust Department of the Trustee (or any successor division
or department of the Trustee) shall have actual knowledge of such
default or Event of Default or (2) written notice of such default or
Event of Default shall have been given to the Trustee by the Company
or any other obligor on such Securities or by any Holder of such
Securities; and
(i) the Trustee shall not be liable for any action taken,
suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon
it by this Indenture.
SECTION 6.04. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF
SECURITIES. The recitals contained herein and in the Securities, except
the certificates of authentication, shall be taken as the statements of the
Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of
this Indenture or of the Securities. The Trustee shall not be accountable
for the use or application by the Company of Securities or the proceeds
thereof.
SECTION 6.05. MAY HOLD SECURITIES. The Trustee, any
Authenticating Agent, any Paying Agent, the Security Registrar, any
Conversion Agent 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 6.08 and 6.13, may otherwise deal with the Company with
the same rights it would have if it were not Trustee, Authenticating Agent,
Paying Agent, Security Registrar, Conversion Agent or such other agent.
SECTION 6.06. MONEY HELD IN TRUST. Subject to the provisions of
Section 10.03 hereof, all moneys in any currency or currencies received by
the Trustee shall, until used or applied as herein provided, be held in
trust for the purposes for which they were received, but need not be
segregated from other funds except to the extent required by law. The
Trustee shall be under no liability for interest on any money received by
it hereunder except as otherwise agreed in writing with the Company.
SECTION 6.07. COMPENSATION AND REIMBURSEMENT. The Company
agrees:
(a) 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);
(b) 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 negligence or bad faith; and
(c) to indemnify the Trustee for, and to hold it harmless
against, any loss, liability or expense incurred without negligence or
bad faith on its part, arising out of or in connection with the
acceptance or administration of this trust, 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.
As security for the performance of the obligations of the Company
under this Section the Trustee shall have a lien prior to the Securities
upon all property and funds held or collected by the Trustee as such,
except funds held in trust for the payment of principal of (and premium, if
any) or interest on particular Securities.
When the Trustee incurs expenses or renders services in
connection with an Event of Default specified in Section 5.01(e) or (f),
the expenses and the compensation for the services are intended to
constitute expenses of administration under any bankruptcy law.
The Company's obligations under this Section 6.07 and any lien
arising hereunder shall survive the resignation or removal of any Trustee,
the discharge of the Company's obligations pursuant to Article Four of this
Indenture and/or the termination of this Indenture.
SECTION 6.08. DISQUALIFICATION; CONFLICTING INTERESTS. The
Trustee for the Securities of any series issued hereunder shall be subject
to the provisions of Section 3.10(b) of the Trust Indenture Act during the
period of time provided for therein. In determining whether the Trustee
has a conflicting interest as defined in Section 3.10(b) of the Trust
Indenture Act with respect to the Securities of any series, there shall be
excluded from consideration this Indenture with respect to Securities of
any particular series of Securities other than that series. Nothing herein
shall prevent the Trustee from filing with the Commission the application
referred to in the second to last paragraph of Section 3.10(b) of the Trust
Indenture Act.
SECTION 6.09. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY. There
shall at all times be a Trustee hereunder with respect to each series of
Securities, which shall be either:
(a) a corporation organized and doing business under the laws of
the United States of America or of any State, authorized under such
laws to exercise corporate trust powers and subject to supervision or
examination by Federal or State authority; or
(b) a corporation or other Person organized and doing business
under the laws of a foreign government that is permitted to act as
Trustee pursuant to a rule, regulation or order of the Commission,
authorized under such laws to exercise corporate trust powers, and
subject to supervision or examination by authority of such foreign
government or a political subdivision thereof substantially equivalent
to supervision or examination applicable to United States
institutional trustees;
in either case having a combined capital and surplus of at least $50
million. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purposes of this Section,
the combined capital and surplus of such corporation shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published. Neither the Company nor any Person directly or
indirectly controlling, controlled by, or under common control with the
Company shall serve as trustee for the Securities of any series issued
hereunder. If at any time the Trustee with respect to any series of
Securities shall cease to be eligible in accordance with the provisions of
this Section, it shall resign immediately in the manner and with the effect
specified in Section 6.10.
SECTION 6.10. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 6.11.
(b) The Trustee may resign with respect to any series of
Securities at any time by giving written notice thereof to the Company. If
an instrument of acceptance by a successor Trustee 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.
(c) The Trustee may be removed with respect to any series of
Securities at any time by Act of the Holders of a majority in principal
amount of the Outstanding Securities of that Series, delivered to the
Trustee and to the Company.
(d) If at any time:
(i) the Trustee shall fail to comply with Section 3.10(b) of the
Trust Indenture Act and Section 6.08 with respect to any series of
Securities after written request therefor by the Company or by any
Securityholder who has been a bona fide Holder of a Security of that
series for at least six months, unless the Trustee's duty to resign is
stayed in accordance with the provisions of Section 3.10(b) of the
Trust Indenture Act;
(ii) the Trustee shall cease to be eligible under Section 6.09
with respect to any series of Securities and shall fail to resign
after written request therefor by the Company or by any such
Securityholder;
(iii)the Trustee shall become incapable of acting with respect to
any series of Securities; or
(iv) the Trustee 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 the series, or in the case of Clause (iv),
with respect to all series, or (B) subject to Section 5.14, any
Securityholder 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 removal of
the Trustee and the appointment of a successor Trustee with respect to the
series, or, in the case of Clause (iv), with respect to all series.
(e) If the Trustee shall resign, be removed or become incapable
of acting with respect to any series of Securities, or if a vacancy shall
occur in the office of the Trustee with respect to any series of Securities
for any cause, the Company, by a Board Resolution, shall promptly appoint a
successor Trustee for that series of Securities. If, within one year after
such resignation, removal or incapacity, or the occurrence of such vacancy,
a successor Trustee with respect to such series of Securities 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, become the successor Trustee with
respect to such series and supersede the successor Trustee appointed by the
Company with respect to such series. If no successor Trustee with respect
to such series shall have been so appointed by the Company or the
Securityholders of such series and accepted appointment in the manner
hereinafter provided, subject to Section 5.14, any Securityholder who has
been a bona fide Holder of a Security of that 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 such series.
(f) The Company shall give notice of each resignation and each
removal of the Trustee with respect to any series and each appointment or a
successor Trustee with respect to any series by mailing written notice of
such event by first-class mail, postage prepaid, to the Holders of
Securities of that series as their names and addresses appear in the
Security Register. Each notice shall include the name of the successor
Trustee and the address of its principal Corporate Trust Office.
SECTION 6.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR. Every
successor Trustee appointed hereunder shall execute, acknowledge and
deliver to the Company and to the predecessor Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
predecessor Trustee shall become effective with respect to any series as to
which it is resigning or being removed as Trustee, and such successor
Trustee, without any further act, deed or conveyance, shall become vested
with all the rights, powers, trusts and duties of the predecessor Trustee
with respect to any such series; but, on request of the Company or the
successor Trustee, such predecessor Trustee shall, upon payment of its
reasonable charges, if any, execute and deliver an instrument transferring
to such successor Trustee all the rights, powers and trusts of the
predecessor Trustee, and shall duly assign, transfer and deliver to such
successor Trustee all property and money held by such predecessor Trustee
hereunder with respect to all or any such series, subject nevertheless to
its lien, if any, provided for in Section 6.07. 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.
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 predecessor Trustee and each successor Trustee with respect to the
Securities of any applicable series shall execute and deliver an indenture
supplemental hereto which shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers, trusts and
duties of the predecessor Trustee with respect to the Securities of any
series as to which the predecessor Trustee is not being succeeded shall
continue to be vested in the predecessor Trustee, and shall add to or
change any of the provisions of this Indenture as shall be necessary to
provide for or facilitate the administration of the trusts hereunder by
more than one Trustee, it being understood that nothing herein or in such
supplemental indenture shall 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.
No successor Trustee with respect to any series of Securities
shall accept its appointment unless at the time of such acceptance such
successor Trustee shall be qualified and eligible with respect to that
series under this Article.
SECTION 6.12. 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
of the corporate trust business of the Trustee, shall be the successor of
the Trustee hereunder, provided such corporation shall be otherwise
qualified and eligible under this Article, without the execution or filing
of any paper or any further act on the part of any of the parties hereto.
In case any Securities shall have been authenticated, but not delivered, by
the Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Trustee may adopt such authentication
and deliver the Securities so authenticated with the same effect as if such
successor Trustee had itself authenticated such Securities.
SECTION 6.13. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
(a) Subject to Subsection (b) of this Section, if the Trustee shall be or
shall become a creditor, directly or indirectly, secured or unsecured, of
the Company within three months prior to a default, as defined in
Subsection (c) of this Section, or subsequent to such a default, then,
unless and until such default shall be cured, the Trustee shall set apart
and hold in a special account for the benefit of the Trustee individually,
the Holders of the Securities and the holders of other indenture securities
(as defined in Subsection (c) of this Section):
(i) an amount equal to any and all reduction in the amount due
and owing upon any claim as such creditor in respect of principal or
interest, effected after the beginning of such three-month period and
valid as against the Company and its other creditors, except any such
reduction resulting from the receipt or disposition of any property
described in paragraph (ii) of this Subsection, or from the exercise
of any right of set-off which the Trustee could have exercised if a
petition in bankruptcy had been filed by or against the Company upon
the date of such default; and
(ii) all property received by the Trustee in respect of any claim
as such creditor, either as security therefor, or in satisfaction or
composition thereof, or otherwise, after the beginning of such three-
month period, or an amount equal to the proceeds of any such property,
if disposed of, subject, however, to the rights, if any, of the
Company and its other creditors in such property or such proceeds.
Nothing herein contained, however, shall affect the right of the Trustee:
(A) to retain for its own account (I) payments made on account
of any such claim by any Person (other than the Company) who is liable
thereon, and (II) the proceeds of the bona fide sale of any such claim
by the Trustee to a third Person, and (III) distributions made in
cash, securities or other property in respect of claims filed against
the Company in bankruptcy or receivership or in proceedings for
reorganization pursuant to the Federal Bankruptcy Act or applicable
State law;
(B) to realize, for its own account, upon any property held by
it as security for any such claim, if such property was so held prior
to the beginning of such three-month period;
(C) to realize, for its own account, but only to the extent of
the claim hereinafter mentioned, upon any property held by it as
security for any such claim, if such claim was created after the
beginning of such three-month period and such property was received as
security therefor simultaneously with the creation thereof, and if the
Trustee shall sustain the burden of proving that at the time such
property was so received the Trustee had no reasonable cause to
believe that a default as defined in Subsection (c) of this Section
would occur within three months; or
(D) to receive payment on any claim referred to in paragraph (B)
or (C) or against the release of any property held as security for
such claim as provided in paragraph (B) or (C), as the case may be, to
the extent of the fair value of such property.
For the purposes of paragraphs (B), (C) and (D), property
substituted after the beginning of such three-month period for property
held as security at the time of such substitution shall, to the extent of
the fair value of the property released, have the same status as the
property released, and, to the extent that any claim referred to in any of
such paragraphs is created in renewal of or in substitution for or for the
purpose of repaying or refunding any pre-existing claim of the Trustee as
such creditor, such claim shall have the same status as such pre-existing
claim.
If the Trustee shall be required to account, the funds and
property held in such special account and the proceeds thereof shall be
apportioned between the Trustee, the Securityholders and the holders of
other indenture securities in such manner that the Trustee, the
Securityholders and the holders of other indenture securities realize, as a
result of payments from such special account and payments of dividends on
claims filed against the Company in bankruptcy or receivership or in
proceedings for reorganization pursuant to the Federal Bankruptcy Act or
applicable State law, the same percentage of their respective claims,
figured before crediting to the claim of the Trustee anything on account of
the receipt by it from the Company of the funds and property in such
special account and before crediting to the respective claims of the
Trustee and the Securityholders and the holders of other indenture
securities dividends on claims filed against the Company in bankruptcy or
receivership or in proceedings for reorganization pursuant to the Federal
Bankruptcy Act or applicable State law, but after crediting thereon
receipts on account of the indebtedness represented by their respective
claims from all sources other than from such dividends and from the funds
and property so held in such special account. As used in this paragraph,
with respect to any claim, the term "dividends" shall include any
distribution with respect to such claim, in bankruptcy or receivership or
proceedings for reorganization pursuant to the Federal Bankruptcy Act or
applicable State law, whether such distribution is made in cash,
securities, or other property, but shall not include any such distribution
with respect to the secured portion, if any, of such claim. The court in
which such bankruptcy, receivership or proceedings for reorganization is
pending shall have, jurisdiction (i) to apportion between the Trustee and
the Securityholders and the holders of other indenture securities, in
accordance with the provisions of this paragraph, the funds and property
held in such special account and proceeds thereof, or (ii) in lieu of such
apportionment, in whole or in part, to give to the provisions of this
paragraph due consideration in determining the fairness of the distribution
to be made to the Trustee and the Securityholders and the holders of other
indenture securities with respect to their respective claims, in which
event it shall not be necessary to liquidate or to appraise the value of
any securities or other property held in such special account or as
security for any such claim, or to make a specific allocation of such
distributions as between the secured and unsecured portions of such claims,
or otherwise to apply the provisions of this paragraph as a mathematical
formula.
Any Trustee which has resigned or been removed after the
beginning of such three-month period shall be subject to the provisions of
this Subsection as though such resignation or removal had not occurred. If
any Trustee has resigned or been removed prior to the beginning of such
three-month period, it shall be subject to the provisions of this
Subsection if and only if the following conditions exist:
(i) the receipt of property or reduction of claim, which would
have given rise to the obligation to account, if such Trustee had
continued as Trustee, occurred after the beginning of such three-month
period; and
(ii) such receipt of property or reduction of claim occurred
within three months after such resignation or removal.
(b) There shall be excluded from the operation of Subsection
(a) of this Section a creditor relationship arising from:
(i) the ownership or acquisition of securities issued under any
indenture, or any security or securities having a maturity of one year
or more at the time of acquisition by the Trustee;
(ii) advances authorized by a receivership or bankruptcy court
of competent jurisdiction, or by this Indenture, for the purpose of
preserving any property which shall at any time be subject to the lien
of this Indenture or of discharging tax liens or other prior liens or
encumbrances thereon, if notice of such advances and of the
circumstances surrounding the making thereof is given to the
Securityholders at the time and in the manner provided in this
Indenture;
(iii) disbursements made in the ordinary course of business in
the capacity of trustee under an indenture, transfer agent, registrar,
custodian, paying agent, fiscal agent or depository, or other similar
capacity;
(iv) an indebtedness created as a result of services rendered or
premises rented; or an indebtedness created as a result of goods or
securities sold in a cash transaction, as defined in Subsection (c) of
this Section;
(v) the ownership of stock or of other securities of a
corporation organized under the provisions of Section 25(a) of the
Federal Reserve Act, as amended, which is directly or indirectly a
creditor of the Company; or
(vi) the acquisition, ownership, acceptance or negotiation of
any drafts, bills of exchange, acceptances or obligations which fall
within the classification of self-liquidating paper, as defined in
Subsection (c) of this Section.
(c) For the purposes of this Section only:
(i) The term "default" means any failure to make payment in full
of the principal of or interest on any of the Securities or upon the
other indenture securities when and as such principal or interest
becomes due and payable.
(ii) The term "other indenture securities" means securities upon
which the Company is an obligor outstanding under any other indenture
(A) under which the Trustee is also trustee, (B) which contains
provisions substantially similar to the provisions of this Section,
and (C) under which a default exists at the time of the apportionment
of the funds and property held in such special account.
(iii)The term "cash transaction" means any transaction in which
full payment for goods or securities sold is made within seven days
after delivery of the goods or securities in currency or in checks or
other orders drawn upon banks or bankers and payable upon demand.
(iv) The term "self-liquidating paper" means any draft, bill of
exchange, acceptance or obligation which is made, drawn, negotiated or
incurred by the Company for the purpose of financing the purchase,
processing, manufacturing, shipment, storage or sale of goods, wares
or merchandise and which is secured by documents evidencing title to,
possession of, or a lien upon, the goods, wares or merchandise or the
receivables or proceeds arising from the sale of the goods, wares or
merchandise previously constituting the security, provided the
security is received by the Trustee simultaneously with the creation
of the creditor relationship with the Company arising from the making,
drawing, negotiating or incurring of the draft, bill of exchange,
acceptance or obligation.
(v) The term "Company" means any obligor upon the securities.
SECTION 6.14. APPOINTMENT OF AUTHENTICATING AGENT. At any time
when any of the Securities remain Outstanding the Trustee, with the
approval of the Company, may appoint an authenticating Agent or Agents with
respect to one or more series of Securities which shall be authorized to
act on behalf of the Trustee to authenticate Securities of such series
issued upon original issuance, exchange, registration of transfer or
partial redemption thereof or pursuant to Section 3.06, 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 an
Authenticating Agent, having a combined capital and surplus of not less
than $50 million and, if other than the Company itself, 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, if other than the Company, 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, if other than the Company, 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, with the
approval of the Company, may appoint a successor Authenticating Agent which
shall be acceptable to the Company and shall mail written notice of such
appointment by first-class mail, postage prepaid, to all Holders of
Securities of the series with respect to which such Authenticating Agent
will serve, as their names and addresses appear in the Security Register.
Any successor Authenticating Agent upon acceptance of its appointment
hereunder shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an
Authenticating Agent. No successor Authenticating Agent shall be appointed
unless eligible under the provisions of this Section.
The Trustee agrees to pay to each Authenticating Agent from time
to time reasonable compensation for its services under this Section, and
the Trustee shall be entitled to be reimbursed for such payments, subject
to the provisions of Section 6.07.
If an appointment with respect to one or more series is made
pursuant to this Section, the Securities of such series may have endorsed
thereon, in addition to the Trustee's certificate of authentication, an
alternate certificate of authentication in the following form:
"This is one of the Securities of the series designated therein
referred to in the within mentioned indenture.
[______________],
as Trustee
By ______________________
As Authenticating Agent
By ______________________
As Authorized Agent"
ARTICLE VII
SECURITYHOLDERS' LISTS AND REPORTS BY
TRUSTEE AND COMPANY
SECTION 7.01. COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF
SECURITYHOLDERS. The Company will furnish or cause to be furnished to the
Trustee:
(a) semi-annually, not more than 15 days after December 15 and
June 15 in each year in such form as the Trustee may reasonably
require, a list of the names and addresses of the Holders of
Securities of each series as of such December 15 and June 15, as
applicable, and
(b) at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Company of any such request, a
list of similar form and content as of a date not more than 15 days
prior to the time such list is furnished;
PROVIDED, HOWEVER, that if and so long as the Trustee shall be the Security
Registrar for Securities of a series, no such list need be furnished with
respect to such series of Securities.
SECTION 7.02. PRESERVATION OF INFORMATION; COMMUNICATIONS TO
SECURITYHOLDERS. (a) The Trustee shall preserve, in as current a term as
is reasonably practicable, the names and addresses of Holders of Securities
contained in the most recent list furnished to the Trustee as provided in
Section 7.01 and the names and addresses of Holders of Securities received
by the Trustee in its capacity as Security Registrar, it so acting. The
Trustee may destroy any list furnished to it as provided in Section 7.01
upon receipt of a new list so furnished.
(b) If three or more Holders of Securities of any series
(hereinafter referred to as "applicants") apply in writing to the Trustee,
and furnish to the Trustee reasonable proof that each such applicant has
owned a Security of such series for a period of at least six months
preceding the date of such application, and such application states that
the applicants desire to communicate with other Holders of Securities of
such series or with the Holders of all Securities with respect to their
rights under this Indenture or under such Securities and is accompanied by
a copy of the form of proxy or other communication which such applicants
propose to transmit, then the Trustee shall, within five Business Days
after the receipt of such application, at its election, either
(i) afford such applicants access to the information preserved
at the time by the Trustee in accordance with Section 7.02(a), or
(ii) inform such applicants as to the approximate number of
Holders of Securities of such series or all Securities, as the case
may be, whose names and addresses appear in the information preserved
at the time by the Trustee in accordance with Section 7.02(a), and as
to the approximate cost of mailing to such Securityholders the form of
proxy or other communication, if any, specified in such application.
If the Trustee shall elect not to afford such applicants access
to such information, the Trustee shall, upon the written request of such
applicants, mail to each Holder of a Security of such series or to all
Securityholders, as the case may be, whose names and addresses appear in
the information preserved at the time by the Trustee in accordance with
Section 7.02(a), a copy of the form of proxy or other communication which
is specified in such request, with reasonable promptness after a tender to
the Trustee of the material to be mailed and of payment, or provision for
the payment, of the reasonable expenses of mailing, unless, within five
days after such tender, the Trustee shall mail to such applicants and file
with the Commission, together with a copy of the material to be mailed, a
written statement to the effect that, in the opinion of the Trustee, such
mailing would be contrary to the best interests of the Holders of
Securities of such series or all Securityholders, as the case may be, or
would be in violation of applicable law. Such written statement shall
specify the basis of such opinion. If the Commission, after opportunity
for a hearing upon the objections specified in the written statement so
filed, shall enter an order refusing to sustain any of such objections or
if, after the entry of an order sustaining one or more of such objections,
the Commission shall find, after notice and opportunity for hearing, that
all the objections so sustained have been met and shall enter an order of
declaring, the Trustee shall mail copies of such material to all
Securityholders of such series or all Securityholders, as the case may be,
with reasonable promptness after the entry of such order and the renewal of
such tender; otherwise the Trustee shall be relieved of any obligation or
duty to such applicants respecting their application.
(c) Every Holder of Securities, by receiving and holding the
same, agrees with the Company and the Trustee that neither the Company nor
the Trustee shall be held accountable by reason of the disclosure of any
such information as to the names and addresses of the Holders of Securities
in accordance with Section 7.02(b), regardless of the source from which
such information was derived, and that the Trustee shall not be held
accountable by reason of mailing any material pursuant to a request made
under Section 7.02(b).
SECTION 7.03. REPORTS BY TRUSTEE. The term "reporting date" as
used in this Section means May 15. Within 60 days after the reporting date
in each year, beginning in [_____], the Trustee shall transmit by mail to
all Securityholders, as their names and addresses appear in the Security
Register, a brief report dated as of such reporting date with respect to
any of the following events which may have occurred during the 12 months
preceding the date of such report (but if no such event has occurred within
such period, no report need be transmitted):
(i) any change to its eligibility under Section 6.09 and its
qualifications under Section 6.08;
(ii) the creation of or any material change to a relationship
specified in Section 3.10(b)(1) through Section 3.10(b)(10) of the
Trust Indenture Act;
(iii) the character and amount of any advances (and if the
Trustee elects so to state, the circumstances surrounding the making
thereof) made by the Trustee (as such) which remain unpaid on the date
of such report, and for the reimbursement of which it claims or may
claim a lien or charge, prior to that of Securities of any series, on
any property or funds held or collected by it as Trustee, except that
the Trustee shall not be required (but may elect) to report such
advances if such advances so remaining unpaid aggregate not more than
one-half of 1% of the principal amount of the Securities of such
series Outstanding on the date of such report;
(iv) any change to the amount, interest rate and maturity date
of all other indebtedness owing by the Company (or by any other
obligor on the Securities) to the Trustee in its individual capacity,
on the date of such report, with a brief description of any property
held as collateral security therefor, except an indebtedness based
upon a creditor relationship arising in any manner described in
Section 6.13(b)(ii), (iii), (iv), or (vi);
(v) any change to the property and funds, if any, physically in
the possession of the Trustee as such on the date of such report;
(vi) any additional issue of Securities for which the Trustee so
acts and which the Trustee has not previously reported; and
(vii) any action taken by the Trustee in the performance of its
duties hereunder which it has not previously reported and which in its
opinion materially affects the Securities, except action in respect of
a default, notice of which has been or is to be withheld by the
Trustee in accordance with Section 6.02.
(b) The Trustee shall transmit by mail to all Securityholders,
as their names and addresses appear in the Security Register, a brief
report with respect to the character and amount of any advances (and if the
Trustee elects so to state, the circumstances surrounding the making
thereof) made by the Trustee (as such) since the date of the last report
transmitted pursuant to Subsection (a) of this Section (or if no such
report has yet been so transmitted, since the date of execution of this
instrument) for the reimbursement of which it claims or may claim a lien or
charge, prior to that of the Securities of any series, on property or funds
held or collected by it as Trustee, and which it has not previously
reported pursuant to this Subsection, except that the Trustee shall not be
required (but may elect) to report such advances if such advances remaining
unpaid at any time aggregate 10% or less of the principal amount of the
Securities outstanding of such series at such time, such report to be
transmitted within 90 days after such time.
(c) A copy of each such report shall, at the time of such
transmission to Securityholders, be furnished to the Company and be filed
by the Trustee with each stock exchange upon which the Securities are
listed, and also with the Commission. The Company will notify the Trustee
when the Securities are listed on any stock exchange.
SECTION 7.04. REPORTS BY COMPANY. The Company shall file with
the Trustee, 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. The Company also shall
comply with the other provisions of Trust Indenture Act Section 3.14(a).
ARTICLE VIII
CONSOLIDATION, MERGER, CONVEYANCE OR TRANSFER
SECTION 8.01. COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN
TERMS. The Company shall not consolidate with or merge into any other
Person or convey or transfer its properties and assets substantially as an
entirety to any Person, unless:
(a) the Person formed by such consolidation or into which the
Company is merged or the Person which acquires by conveyance or
transfer the properties and assets of the Company substantially as an
entirety shall be organized and existing under the laws of the United
States of America or any political subdivision thereof, and such
Person, or such Person's parent Person, shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the Trustee,
in form satisfactory to the Trustee, the due and punctual payment of
the principal of (and premium, if any) and interest on all the
Securities and the performance of every covenant of this Indenture on
the part of the Company to be performed or observed;
(b) immediately after giving effect to such transaction, no
Event of Default, and no event which, after notice or lapse of time,
or both, would become an Event of Default, shall have occurred and be
continuing; and
(c) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel each stating that such
consolidation, merger, conveyance or transfer and 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 notwithstanding anything to the contrary herein
contained, the TBS Transaction shall not be subject to the approval of the
Securityholders***.
SECTION 8.02. SUCCESSOR PERSON SUBSTITUTED. Upon any
consolidation or merger, or any conveyance or transfer of the properties
and assets gf the Company substantially as an entirety in accordance with
Section 8.01, the successor Person formed by such consolidation or into
which the Company is merged or to which such conveyance or transfer is
made, or if the parent is assuming the Company's obligation in accordance
with Section 8.01(a), such parent, 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 had been named as the
Company herein. In the event of any such conveyance or
- ------------------------------------------
***FOOTNOTES***
*** This proviso will be deleted if the TBS Transaction has occurred prior to
the date of this Indenture.
<PAGE>
transfer, the Company as the predecessor shall be discharged from all
obligations and covenants under this Indenture and the Securities and
may be dissolved, wound up or liquidated at any time thereafter.
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.01. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF
SECURITYHOLDERS. Without the consent of the Holders of any securities, 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:
(a) 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 contained;
(b) to add to the covenants of the Company, or to surrender any
right or power herein conferred upon the Company, for the benefit of
the Holders of the Securities of any or all series (and if such
covenants or the surrender of such right or power are to be for the
benefit of less than all series of Securities, stating that such
covenants are expressly being included or such surrenders are
expressly being made solely for the benefit of one or more specified
series);
(c) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Indenture;
(d) to add to this Indenture such provisions as may be
expressly permitted by the TIA, excluding, however, the provisions
referred to in Section 3.16(a)(2) of the TIA as in effect at the date
as of which this instrument was executed or any corresponding
provision in any similar Federal statute hereafter enacted;
(e) to establish any form of Security, as provided in Article
Two, and to provide for the issuance of any series of Securities as
provided in Article Three and to set forth the terms thereof, and/or
to add to the rights of the Holders of the Securities of any series;
(f) to evidence and provide for the acceptance of appointment by
another corporation as a successor Trustee hereunder with respect to
one or more series of Securities 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 Section 6.11;
(g) to add any additional Events of Default in respect of the
Securities of any or all series (and if such additional Events of
Default are to be in respect of less than all series of Securities,
stating that such Events of Default are expressly being included
solely for the benefit of one or more specified series);
(h) to provide for the issuance of Securities in coupon as well
as fully registered form;
(i) to provide for the terms and conditions of conversion into
Common Stock or other Marketable Securities of the Securities of any
series which are convertible into Common Stock or other Marketable
Securities, if different from those set forth in Article Twelve; or
(j) to secure the Securities of any series.
No supplemental indenture for the purposes identified in Clauses
(b), (c), (e) or (g) above may be entered into if to do so would adversely
affect the interest of the Holders of Securities of any series in any
material respect.
SECTION 9.02. SUPPLEMENTAL INDENTURES WITH CONSENT OF
SECURITYHOLDERS. 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 or indentures, 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 the Securities of each 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:
(a) change the Maturity of the principal of, or the Stated
Maturity of any premium on, or any installment of interest on, any
Security, or reduce the principal amount thereof or the interest or
any premium thereon, or change the method of computing the amount of
principal thereof or interest thereon on any date 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 alter the provisions of
this Indenture so as to affect adversely the terms, if any, of
conversion of any Securities into Common Stock or other securities, or
alter the provisions of Article Thirteen or the definition of Senior
Indebtedness so as to affect adversely the rights of any Holder of
Securities;
(b) 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;
(c) modify any of the provisions of this Section, Section 5.13
or Section 10.06, 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;
(d) make any principal of (or premium, if any) or interest on
any Security payable in cash or property other than as provided herein
or in the applicable supplemental indenture hereto; or
(e) impair or adversely affect the right of any Holder to
institute suit for the enforcement of any payment on, or with respect
to, the Securities of any series on or after the Stated Maturity of
such Securities (or in the case of redemption, on or after the
Redemption Date).
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 Securityholders 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 9.03. EXECUTION OF SUPPLEMENTAL INDENTURES. In
executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article or the modifications thereby of the
trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 6.01) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental
indenture is authorized or permitted by this Indenture. The Trustee may,
but shall not be obligated to, enter into any such supplemental indenture
which affects the Trustee's own rights, duties or immunities under this
Indenture or otherwise.
SECTION 9.04. EFFECT OF SUPPLEMENTAL INDENTURES. Upon the
execution of any supplemental indenture under this Article, this Indenture
shall be modified in accordance therewith, and such supplemental indenture
shall form a part of this Indenture for all purposes; and every Holder of
Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby to the extent provided therein.
SECTION 9.05. CONFORMITY WITH TRUST INDENTURE ACT. Every
supplemental indenture executed pursuant to this Article shall conform to
the requirements of the TIA as then in effect.
SECTION 9.06. REFERENCE IN SECURITIES TO SUPPLEMENTAL
INDENTURES. Securities authenticated and delivered after the execution of
any supplemental indenture pursuant to this Article may, and shall if
required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Company
shall so determine, new Securities so modified as to conform, in the
opinion of the Trustee and the Board of Directors, 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.
SECTION 9.07. SUBORDINATION UNIMPAIRED. No supplemental
indenture entered into under this Article shall modify, directly or
indirectly, the provisions of Article Thirteen or the definition of Senior
Indebtedness in Section 1.01 in any manner that adversely affects the
rights of the holders of Senior Indebtedness then outstanding under Article
Thirteen unless written consents are obtained from holders of such Senior
Indebtedness; PROVIDED, HOWEVER, that in any case where the instrument or
agreement governing Senior Indebtedness contains express provisions
pertaining to the giving of consent in such circumstances, such consents
shall only be required to the extent they are required under the terms of
such instrument or agreement.
ARTICLE X
COVENANTS
SECTION 10.01. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST. With
respect to each series of Securities, the Company will duly and punctually
pay the principal of (and premium, if any) and interest on such Securities
in accordance with their terms and this Indenture, and will duly comply
with all the other terms, agreements and conditions contained in, or made
in the Indenture for the benefit of, the Securities of such series.
SECTION 10.02. MAINTENANCE OF OFFICE OR AGENCY. The Company
will maintain an office or agency in each Place of Payment where Securities
may be presented or surrendered for payment, where Securities may be
surrendered for registration of transfer or exchange, where notices and
demands to or upon the Company in respect of the Securities and this
Indenture may be served and where any Securities with conversion privileges
may be presented and surrendered for conversion. The Company will give
prompt written notice to the Trustee of the location, and of any change in
the location, of such office or agency. If at any time the Company shall
fail to maintain such office or agency or shall fail to furnish the Trustee
with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the Corporate Trust Office of the Trustee,
and the Company hereby appoints the Trustee its agent to receive all such
presentations, surrenders, notices and demands.
Unless otherwise set forth in, or pursuant to, a Board Resolution
or Indenture supplemental hereto with respect to a series of Securities,
the Company hereby initially designates as the Place of Payment for each
series of Securities, the Borough of Manhattan, the City and State of New
York, and initially appoints the Trustee at its Corporate Trust Office as
the Company's office or agency for each such purpose in such city.
SECTION 10.03. MONEY FOR SECURITY PAYMENTS TO BE HELD IN TRUST.
If the Company shall at any time act as its own Paying Agent for any series
of Securities, it will, on or before each due date of the principal of (and
premium, if any) or interest on, any of the Securities of such series,
segregate and hold in trust for the benefit of the Persons entitled thereto
a sum sufficient to pay the principal (and premium, if any) or interest so
becoming due until such sums shall be paid to such Persons or otherwise
disposed of as herein provided, and will promptly notify the Trustee of its
action or failure to act.
Whenever the Company shall have one or more Paying Agents for any
series of Securities, it will, on or prior to each due date of the
principal of (and premium, if any) or interest on, any Securities of such
series, deposit with a Paying Agent a sum sufficient to pay the principal
(and premium, if any) or interest so becoming due, such sum to be held in
trust for the benefit of the Persons entitled to such principal (and
premium, if any) or interest, and (unless such Paying Agent is the Trustee)
the Company will promptly notify the Trustee of its action or failure so to
act.
The Company will cause each Paying Agent other than the Trustee
for any series of Securities 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:
(a) hold all sums held by it for the payment of principal of
(and premium, if any) or interest on Securities of such series in
trust for the benefit of the Persons entitled thereto until such sums
shall be paid to such Persons or otherwise disposed of as herein
provided;
(b) give the Trustee notice of any default by the Company (or
any other obligor upon the Securities of such series) in the making of
any such payment of principal (and premium, if any) or interest on the
Securities of such series; and
(c) at any time during the continuance of any such default,
upon the written request of the Trustee, forthwith pay to the Trustee
all sums so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture with respect to any series of
Securities 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 in respect of each and every series of Securities as
to which it seeks to discharge this Indenture or, if for any other purpose,
all sums so held in trust by the Company in respect of all Securities, such
sums to be held by the Trustee upon the same trusts as those upon which
such sums were held by the Company or such Paying Agent; and, upon such
payment by any Paying Agent to the Trustee, such Paying Agent shall be
released from all further liability with respect to such money.
Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal of (and
premium, if any) or interest on any Security of any series and remaining
unclaimed for two years after such principal (and premium, if any) or
interest has become due and payable shall be paid to the Company on Company
Request, or (if then held by the Company) shall be discharged from such
trust; and the Holder of such Security shall thereafter, as an unsecured
general creditor, look only to the Company for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease. The Trustee or such Paying Agent, before being required to make any
such repayment, may at the expense of the Company mail to the Holders of
the Securities as to which the money to be repaid was held in trust, as
their names and address appear in the Security Register, a notice that such
moneys remain unclaimed and that, after a date specified in the notice,
which shall not be less than 30 days from the date on which the notice was
first mailed to the Holders of the Securities as to which the money to be
repaid was held in trust, any unclaimed balance of such money then
remaining will be paid to the Company free of the trust formerly impressed
upon it.
SECTION 10.04. STATEMENT AS TO COMPLIANCE. The Company will
deliver to the Trustee, within 120 days after the end of each fiscal year,
a written statement signed by the principal executive officer, principal
financial officer or principal accounting officer of the Company stating
that:
(a) a review of the activities of the Company during such year
and of performance under this Indenture and under the terms of the
Securities has been made under his supervision; and
(b) to the best of his knowledge, based on such review, the
Company has fulfilled all its obligations under this Indenture and has
complied with all conditions and covenants on its part contained in
this Indenture through such year, or, if there has been a default in
the fulfillment of any such obligation, covenant or condition,
specifying each such default known to him and the nature and status
thereof.
For the purpose of this Section 10.04, default and compliance
shall be determined without regard to any grace period or requirement of
notice provided pursuant to the terms of this Indenture.
SECTION 10.05. LEGAL 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 legal existence.
SECTION 10.06. WAIVER OF CERTAIN COVENANTS. The Company may
omit in respect of any series of Securities, in any particular instance, to
comply with any covenant or condition set forth in a Board Resolution or
supplemental indenture with respect to the Securities of such series,
unless otherwise specified in a Board Resolution or supplemental indenture,
if before or after the time such compliance the Holders of at least a
majority in principal amount of the Securities at the time Outstanding of
such series shall, by Act of such Securityholders, either waive such
compliance in such instance or generally waive compliance with such
covenant or condition, but no such waiver shall extend to or affect such
covenant 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 covenant or condition shall
remain in full force and effect. Nothing in this Section 10.06 shall
permit the waiver of compliance with any covenant or condition set forth in
such Board Resolution or supplemental indenture which, if in the form of an
indenture supplemental hereto, would not be permitted by Section 9.02
without the consent of the Holder of each Outstanding Security affected
thereby.
SECTION 10.07. LIMITATION ON SENIOR SUBORDINATED INDEBTEDNESS.
The Company will not incur, create, assume, guarantee or in any other
manner become directly or indirectly liable with respect to or responsible
for, or permit to remain outstanding, any indebtedness that is expressly
made subordinate or junior in right of payment to any Senior Indebtedness
unless such indebtedness is also made expressly PARI PASSU with, or
subordinate in right of payment to, the Securities pursuant to
subordination provisions substantially similar to those contained in
Article Thirteen.
SECTION 10.08. REPURCHASE OF SECURITIES UPON A CHANGE OF
CONTROL. If specified by the Company pursuant to Section 3.01 with respect
to any series of Securities, the Company must commence, within 30 days
after the occurrence of a Change of Control, and consummate a Change of
Control Offer for all Securities of such series then outstanding, at a
purchase price equal to 101% of the principal amount thereof, plus accrued
interest (if any) to the date of purchase.
ARTICLE XI
REDEMPTION OF SECURITIES
SECTION 11.01. APPLICABILITY OF ARTICLE. The Company may
reserve the right to redeem and pay before Stated Maturity all or any part
of the Securities of any series, either by optional redemption, sinking or
purchase fund or analogous obligation or otherwise, by provision therefor
in the form of Security for such series established and approved pursuant
to Section 2.02 and on such terms as are specified in such form or in the
indenture supplemental hereto with respect to Securities of such series as
provided in Section 3.01. Redemption of Securities of any series shall be
made, subject to the provisions of Section 13.03 hereof, in accordance with
the terms of such Securities and, to the extent that this Article does not
conflict with such terms, the succeeding Sections of this Article.
Notwithstanding anything to the contrary in this Indenture, except in the
case of redemption pursuant to a sinking fund, the Trustee shall not make
any payment in connection with the redemption of Securities until the close
of business on the Redemption Date.
SECTION 11.02. ELECTION TO REDEEM; NOTICE TO TRUSTEE. The
election of the Company to redeem any Securities redeemable at the election
of the Company shall be evidenced by, or pursuant to authority granted by,
a Board Resolution. Unless otherwise provided in the terms of a particular
series of Securities, in case of any redemption at the election of the
Company of less than all of the Securities of any series, the Company
shall, at least 60 days prior to the Redemption Date fixed by the Company
(unless a shorter notice shall be satisfactory to the Trustee), notify the
Trustee of such Redemption Date and of the principal amount of Securities
of such series and the Tranche (as defined in Section 11.03) to be
redeemed.
In the case of any redemption of Securities (a) prior to the
expiration of any restriction on such redemption provided in the terms of
such Securities or elsewhere in this Indenture, or (b) pursuant to an
election of the Company which is subject to a condition specified in the
terms of such Securities, the Company shall furnish the Trustee with an
Officers' Certificate evidencing compliance with such restriction or
condition.
SECTION 11.03. SELECTION BY TRUSTEE OF SECURITIES TO BE
REDEEMED. Unless otherwise provided in the terms of a particular series of
Securities, if less than all the Securities of like tenor and terms of any
series (a "Tranche") are to be redeemed, the particular Securities to be
redeemed shall be selected not more than 60 days prior to the Redemption
Date by the Trustee, from the Outstanding Securities of such Tranche not
previously called for redemption, by such method as the Trustee shall deem
fair and appropriate and which may include provision for the selection for
redemption of portions of the principal of Securities of such Tranche of a
denomination larger than the minimum authorized denomination for Securities
of that series. Unless otherwise provided in the terms of a particular
series of Securities, the portions of the principal of Securities so
selected for partial redemption shall be equal to the minimum authorized
denomination of the Securities of such series, or an integral multiple
thereof, and the principal amount which remains outstanding shall not be
less than the minimum authorized denomination for Securities of such
series. If less than all the Securities of unlike tenor and terms of
series are to be redeemed, the particular Tranche of Securities to be
redeemed shall be selected by the Company.
If any convertible Security selected for partial redemption is
converted in part before the termination of the conversion right with
respect to the portion of the Security so selected, the converted portion
of such Security shall be deemed (so far as may be) to be the portion
selected for redemption.
Upon any redemption of fewer than all the Securities of a Series
or Tranche, the Company and the Trustee may treat as Outstanding any
Securities surrendered for conversion during the period of 15 days next
preceding the mailing of a notice of redemption, and need not treat as
Outstanding any Security authenticated and delivered during such period in
exchange for the unconverted portion of any Security converted in part
during such period.
The Trustee shall promptly notify the Company in writing of the
Securities selected for redemption and, in the case of any Security
selected for partial redemption, the principal amount thereof to be
redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall
relate, in the case of any Security redeemed or to be redeemed only in
part, to the portion of the principal of such Security which has been or is
to be redeemed.
SECTION 11.04. NOTICE OF REDEMPTION. Unless otherwise provided
in the terms of a particular series of Securities, 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.
Unless otherwise provided in the terms of a particular series of
Securities, all notices of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) if less than all Outstanding Securities of any series are to
be redeemed, the identification (and, in the case of partial
redemption, the respective principal amounts) of the Securities to be
redeemed, from the Holder to whom the notice is given;
(d) that on the Redemption Date the Redemption Price will become
due and payable upon each such Security, and that interest, if any,
thereon shall cease to accrue from and after said date;
(e) the place where such Securities are to be surrendered for
payment of the Redemption Price, which shall be the office or agency
of the Company in the Place of Payment;
(f) that the redemption is on account of a sinking or purchase
fund, or other analogous obligation, if that be the case;
(g) if such Securities are convertible into Common Stock or
other securities, the Conversion Price or other conversion price and
the date on which the right to convert such Securities into Common
Stock or other securities will terminate; and
(h) that the redemption may be rescinded by the Company, at its
sole option, pursuant to Section 11.09 of this Indenture upon the
occurrence of a Redemption Rescission Event, except in the case of any
redemption on account of a sinking fund.
Notice of redemption of Securities to be redeemed at the election
of the Company shall be given by the Company or, at the Company's request,
by the Trustee in the name and at the expense of the Company.
SECTION 11.05. DEPOSIT OF REDEMPTION PRICE. On or prior to any
Redemption Date and subject to Section 11.09, the Company shall deposit
with the Trustee or with a Paying Agent (or, if the Company is acting as
its own Paying Agent, segregate and hold in trust as provided in Section
10.03) an amount of money sufficient to pay the Redemption Price of all the
Securities which are to be redeemed on that date. If any Security to be
redeemed is converted into Common Stock or other securities, any money so
deposited with the Trustee or a Paying Agent shall be paid to the Company
upon Company Request or, if then so segregated and held in trust by the
Company, shall be discharged from such trust.
SECTION 11.06. SECURITIES PAYABLE ON REDEMPTION DATE. Notice of
Redemption having been given as aforesaid, the Securities so to be redeemed
shall, subject to Section 11.09, 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) such Securities shall cease to bear interest and any rights to
convert such Securities shall terminate. Upon surrender of such Securities
for redemption in accordance with the notice and subject to Section 11.09,
such Securities shall be paid by the Company at the Redemption Price.
Unless otherwise provided with respect to such Securities pursuant to
Section 3.01, installments of interest the Stated Maturity of which is on
or prior to the Redemption Date shall be payable to the Holders of such
Securities registered as such on the relevant Regular Record Dates
according to their terms and the provisions of Section 3.07.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal shall, until paid, bear
interest from the Redemption Date at the rate borne by the Security, or as
otherwise provided in such Security.
SECTION 11.07. SECURITIES REDEEMED IN PART. Any Security which
is to be redeemed only in part shall be surrendered at the office or agency
of the Company in the Place of Payment with respect to that series (with,
if the Company or the Trustee so requires, due endorsement by, or a written
instrument of transfer in form satisfactory to the Company and the Trustee
duly executed by, the Holder thereof or 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 Stated Maturity and of like
tenor and terms, 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.
SECTION 11.08. PROVISIONS WITH RESPECT TO ANY SINKING FUNDS.
Unless the form or terms of any series of Securities shall provide
otherwise, in lieu of making all or any part of any mandatory sinking fund
payment with respect to such series of Securities in cash, the Company may
at its option (a) deliver to the Trustee for cancellation any Securities of
such series theretofore acquired by the Company or converted by the Holder
thereof into Common Stock or other securities, or (b) receive credit for
any Securities of such series (not previously so credited) acquired by the
Company (including by way of optional redemption (pursuant to the sinking
fund or otherwise but not by way of mandatory sinking fund redemption) or
converted by the Holder thereof into Common Stock or other securities and
theretofore delivered to the Trustee for cancellation, and if it does so
(i) Securities so delivered or credited shall be credited at the applicable
sinking fund Redemption Price with respect to Securities of such series of
Securities, and (ii) on or before the 60th day next preceding each sinking
fund Redemption Date with respect to such series of Securities, the Company
will deliver to the Trustee (A) an Officers' Certificate specifying the
portions of such sinking fund payment to be satisfied by payment of cash
and by delivery or credit of Securities of such series acquired by the
Company or converted by the Holder thereof and (B) such Securities, to the
extent not previously surrendered. Such Officers' Certificate shall also
state the basis for such credit and that the Securities for which the
Company elects to receive credit have not been previously so credited and
were not acquired by the Company through operation of the mandatory sinking
fund, if any, provided with respect to such Securities and shall also state
that no Event of Default with respect to Securities of such series has
occurred and is continuing. All Securities so delivered to the Trustee
shall be canceled by the Trustee and no Securities shall be authenticated
in lieu thereof.
If the sinking fund payment or payments (mandatory or optional)
with respect to any series of Securities made in cash plus any unused
balance of any preceding sinking fund payments with respect to Securities
of such series made in cash shall exceed $50,000 (or a lesser sum if the
Company shall so request), unless otherwise provided by the terms of such
series of Securities, that cash shall be applied by the Trustee on the
sinking fund Redemption Date with respect to Securities of such series next
following the date of such payment to the redemption of Securities of such
series at the applicable sinking fund Redemption Price with respect to
Securities of such series, together with accrued interest, if any, to the
date fixed for redemption, with the effect provided in Section 11.06. The
Trustee shall select, in the manner provided in Section 11.03, for
redemption on such sinking fund Redemption Date a sufficient principal
amount of Securities of such series to utilize that cash and shall
thereupon cause notice of redemption of the Securities of such series for
the sinking fund to be given in the manner provided in Section 11.04 (and
with the effect provided in Section 11.06) for the redemption of Securities
in part at the option of the Company. Any sinking fund moneys not so
applied or allocated by the Trustee to the redemption of Securities of such
series shall be added to the next cash sinking fund payment with respect to
Securities of such series received by the Trustee and, together with such
payment, shall be applied in accordance with the provisions of this Section
11.08. Any and all sinking fund moneys with respect to Securities of any
series held by the Trustee at the Maturity of Securities of such series,
and not held for the payment or redemption of particular Securities of such
series, shall be applied by the Trustee, together with other moneys, if
necessary, to be deposited sufficient for the purpose, to the payment of
the principal of the Securities of such series at Maturity.
On or before each sinking fund Redemption Date provided with
respect to Securities of any series, the Company shall pay to the Trustee
in cash a sum equal to all accrued interest, if any, to the date fixed for
redemption on Securities to be redeemed on such sinking fund Redemption
Date pursuant to this Section 11.08.
SECTION 11.09. RESCISSION OF REDEMPTION. In the event that this
Section 11.09 is specified to be applicable to a series of Securities
pursuant to Section 3.01 and a Redemption Rescission Event shall occur
following any day on which a notice of redemption shall have been given
pursuant to Section 11.04 hereof at or prior to the time and date fixed for
redemption as set forth in such notice of redemption, the Company may, at
its sole option, at any time prior to the earlier of (a) the close of
business on that day which is two Trading Days following such Redemption
Rescission Event and (b) the time and date fixed for redemption as set
forth in such notice, rescind the redemption to which such notice of
redemption shall have related by making a public announcement of such
rescission (the date on which such public announcement shall have been made
being hereinafter referred to as the "Rescission Date"). The Company shall
be deemed to have made such announcement if it shall issue a release to the
Dow Jones News Service, Reuters Information Services or any successor news
wire service. From and after the making of such announcement, the Company
shall have no obligation to redeem Securities called for redemption
pursuant to such notice of redemption or to pay the Redemption Price
therefor and all rights of Holders of Securities shall be restored as if
such notice of redemption had not been given. As promptly as practicable
following the making of such announcement, the Company shall telephonically
notify the Trustee and the Paying Agent of such rescission. The Company
shall give notice of any such rescission by first-class mail, postage
prepaid, mailed as promptly as practicable but in no event later than the
close of business on that day which is five Trading Days following the
Rescission Date to each Holder of Securities at the close of business on
the Rescission Date, to any other Person that was a Holder of Securities
and that shall have surrendered Securities for conversion following the
giving of notice of the subsequently rescinded redemption and to the
Trustee and the Paying Agent. Each notice of rescission shall (i) state
that the redemption described in the notice of redemption has been
rescinded, (ii) state that any Converting Holder shall be entitled to
rescind the conversion of Securities surrendered for conversion following
the day on which notice of redemption was given but on or prior to the date
of the mailing of the Company's notice of rescission, (iii) be accompanied
by a form prescribed by the Company to be used by any Converting Holder
rescinding the conversion of Securities so surrendered for conversion (and
instructions for the completion and delivery of such form, including
instructions with respect to any payment that may be required to accompany
such delivery) and (iv) state that such form must be properly completed and
received by the Company no later than the close of business on a date that
shall be 15 Trading Days following the date of the mailing of such notice
of rescission.
ARTICLE XII
CONVERSION
SECTION 12.01. CONVERSION PRIVILEGE. If so provided in a Board
Resolution with respect to the Securities of any series, the Holder of a
Security of such series shall have the right, at such Holder's option, to
convert, in accordance with the terms of such series of Securities and this
Article Twelve, all or any part (in a denomination of, unless otherwise
specified in a Board Resolution or supplemental indenture with respect to
Securities of such series, $1,000 in principal amount or any integral
multiple thereof) of such Security into shares of Common Stock or other
Marketable Securities specified in such Board Resolution at any time or, as
to any Securities called for redemption, at any time prior to the time and
date fixed for such redemption (unless the Company shall default in the
payment of the Redemption Price, in which case such right shall not
terminate at such time and date). The provisions of this Article Twelve
shall not be applicable to the Securities of a series unless otherwise
specified in a Board Resolution with respect to the Securities of such
series.
SECTION 12.02. CONVERSION PROCEDURE; RESCISSION OF CONVERSION;
CONVERSION PRICE; FRACTIONAL SHARES. (a) Each Security to which this
Article is applicable shall be convertible at the office of the Conversion
Agent, and at such other place or places, if any, specified in a Board
Resolution with respect to the Securities of such series, into fully paid
and nonassessable shares (calculated to the nearest one-hundredth of a
share) of Common Stock or other Marketable Securities. The Securities will
be converted into shares of Common Stock or such other Marketable
Securities at the Conversion Price therefor. No payment or adjustment
shall be made in respect of dividends on the Common Stock or such other
Marketable Securities or accrued interest on a converted Security except as
described in Section 12.09. The Company may, but shall not be required to,
in connection with any conversion of Securities, issue a fraction of a
share of Common Stock or of such other Marketable Security, and, if the
Company shall determine not to issue any such fraction, the Company shall,
subject to Article Thirteen, make a cash payment (calculated to the nearest
cent) equal to such fraction multiplied by the Closing Price of the Common
Stock or such other Marketable Security on the last Trading Day prior to
the date of conversion.
(b) Before any Holder of a Security shall be entitled to convert
the same into Common Stock or other Marketable Securities, such Holder
shall surrender such Security duly endorsed to the Company or in blank, at
the office of the Conversion Agent or at such other place or places, if
any, specified in a Board Resolution with respect to the Securities of such
series and shall give written notice to the Company at said office or place
that he elects to convert the same and shall state in writing therein the
principal amount of Securities to be converted and the name or names (with
addresses) in which he wishes the certificate or certificates for Common
Stock or for such other marketable Securities to be issued; PROVIDED,
HOWEVER, that no Security or portion thereof shall be accepted for
conversion unless the principal amount of such Security or such portion,
when added to the principal amount of all other Securities or portions
thereof then being surrendered by the Holder thereof for conversion,
exceeds the then effective Conversion Price with respect thereto. If more
than one Security shall be surrendered for conversion at one time by the
same Holder, the number of full shares of Common Stock or such other
Marketable Securities which shall be deliverable upon conversion shall be
computed on the basis of the aggregate principal amount of the Securities
(or specified portions thereof to the extent permitted thereby) so
surrendered. Subject to the next succeeding sentence, the Company will,
as soon as practicable thereafter, issue and deliver at said office or
place to such Holder of a Security, or to his nominee or nominees,
certificates for the number of full shares of Common Stock or other
Marketable Securities to which he shall be entitled as aforesaid, together,
subject to the last sentence of paragraph (a) above, with cash in lieu of
any fraction of a share to which he would otherwise be entitled. The
Company shall not be required to deliver certificates for shares of Common
Stock or other Marketable Securities while the stock transfer books for
such stock or the transfer books for such Marketable Securities, as the
case may be, or the Security Register are duly closed for any purpose, but
certificates for shares of Common Stock or other Marketable Securities
shall be issued and delivered as soon as practicable after the opening of
such books or Security Register. A Security shall be deemed to have been
converted as of the close of business on the date of the surrender of such
Security for conversion as provided above, and the person or persons
entitled to receive the Common Stock or other Marketable Securities
issuable upon such conversion shall be treated for all purposes as the
record Holder or Holders of such Common Stock or other Marketable
Securities as of the close of business on such date. In case any Security
shall be surrendered for partial conversion, the Company shall execute and
the Trustee shall authenticate and deliver to or upon the written order of
the Holder of the Securities so surrendered, without charge to such Holder
(subject to the provisions of Section 12.08), a new Security or Securities
in authorized denominations in an aggregate principal amount equal to the
unconverted portion of the surrendered Security.
(c) Notwithstanding anything to the contrary contained herein,
in the event the Company shall have rescinded a redemption of Securities
pursuant to Section 11.09 hereof, any Holder of Securities that shall have
surrendered Securities for conversion following the day on which notice of
the subsequently rescinded redemption shall have been given but prior to
the later of (i) the close of business on the Trading Day next succeeding
the date on which public announcement of the rescission of such redemption
shall have been made and (ii) the date of the mailing of the notice of
rescission required by Section 11.09 hereof (a "Converting Holder") may
rescind the conversion of such Securities surrendered for conversion by (A)
properly completing a form prescribed by the Company and mailed to Holders
of Securities (including Converting Holders) with the Company's notice of
rescission, which form shall provide for the certification by any
Converting Holder rescinding a conversion on behalf of any beneficial owner
(within the meaning of Rule 13d-3 under the Exchange Act) of Securities
that the beneficial ownership (within the meaning of such Rule) of such
Securities shall not have changed from the date on which such Securities
were surrendered for conversion to the date of such certification, and (B)
delivering such form to the Company no later than the close of business on
the date which is 15 Trading Days following the date of the mailing of the
Company's notice of rescission. The delivery of such form by a Converting
Holder shall be accompanied by (I) any certificates representing shares of
Common Stock or other securities issued to such Converting Holder upon a
conversion of Securities that shall be rescinded by the proper delivery of
such form (the "Surrendered Securities"), (II) any securities, evidences of
indebtedness or assets (other than cash) distributed by the Company to such
Converting Holder by reason of such Converting Holder being a record holder
of Surrendered Securities and (III) payment in New York Clearing House
funds or other funds acceptable to the Company of an amount equal to the
sum of (1) any cash such Converting Holder may have received in lieu of the
issuance of fractional Surrendered Securities and (2) any cash paid or
payable by the Company to such Converting Holder by reason of such
Converting Holder being a record holder of Surrendered Securities. Upon
receipt by the Company of any such form properly completed by a converting
Holder and any certificates, securities, evidences of indebtedness, assets
or cash payments required to be returned by such Converting Holder to the
Company as set forth above, the Company shall instruct the transfer agent
or agents for shares of Common Stock or other securities to cancel any
certificates representing Surrendered Securities (which Surrendered
Securities shall be deposited in the treasury of the Company) and shall
instruct the Registrar to reissue certificates representing Securities to
such Converting Holder (which Securities shall be deemed to have been
Outstanding at all times during the period following their surrender for
conversion). The Company shall, as promptly as practicable, and in no
event more than five Trading Days following the receipt of any such
properly completed form and any such certificates, securities, evidences of
indebtedness, assets or cash payments required to be so returned, pay to
the Holder of Securities surrendered to the Company pursuant to a rescinded
conversion or as otherwise directed by such Holder any interest paid or
other payment made to Holders of Securities during the period from the time
such Securities shall have been surrendered for conversion to the
rescission of such conversion. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance of any form
submitted to the Company to rescind the conversion of Securities, including
questions as to the proper completion or execution of any such form or any
certification contained therein, shall be resolved by the Company, whose
determination shall be final and binding.
SECTION 12.03. ADJUSTMENT OF CONVERSION PRICE FOR COMMON STOCK
OR OTHER MARKETABLE SECURITIES. The Conversion Price with respect to any
Security which is convertible into Common Stock or other Marketable
Securities shall be adjusted from time to time as follows:
(a) In case the Company shall, at any time or from time to time
while any of such Securities are outstanding, (i) pay a dividend in
shares of its Common Stock or other Marketable Securities, (ii)
combine its outstanding shares of Common Stock or other Marketable
Securities into a smaller number of shares or securities, (iii)
subdivide its outstanding shares of Common Stock or other Marketable
Securities or (iv) issue by reclassification of its shares of Common
Stock or other Marketable Securities any shares of stock or other
Marketable Securities of the Company, the Conversion Price in effect
immediately before such action shall be adjusted so that the Holders
of such Securities, upon conversion thereof into Common Stock or other
Marketable Securities immediately following such event, shall be
entitled to receive the kind and amount of shares of capital stock of
the Company or other Marketable Securities which they would have owned
or been entitled to receive upon or by reason of such event if such
Securities had been converted immediately before the record date (or,
if no record date, the effective date) for such event. An adjustment
made pursuant to this Section 12.03(a) shall become effective
retroactively immediately after the record date in the case of a
dividend or distribution and shall become effective retroactively
immediately after the effective date in the case of a subdivision,
combination or reclassification. For the purposes of this Section
12.03(a), each Holder of Securities shall be deemed to have failed to
exercise any right to elect the kind or amount of securities
receivable upon the payment of any such dividend, subdivision,
combination or reclassification (provided that, if the kind or amount
of securities receivable upon such dividend, subdivision, combination
or reclassification is not the same for each nonelecting share, the
kind and amount of securities or other property receivable upon such
dividend, subdivision, combination or reclassification for each
nonelecting share shall be deemed to be the kind and amount so
receivable per share by a plurality of the nonelecting shares).
(b) In case the Company shall, at any time or from time to time
while any of such Securities are outstanding, issue rights or warrants
to all holders of shares of its Common Stock or other Marketable
Securities entitling them (for a period expiring within 45 days after
the record date for such issuance) to subscribe for or purchase shares
of Common Stock or other Marketable Securities (or securities
convertible into shares of Common Stock or other Marketable
Securities) at a price per share less than the Current Market Price of
the Common Stock or other Marketable Securities at such record date
(treating the price per share of the securities convertible into
Common Stock or other Marketable Securities as equal to (i) the sum of
(A) the price for a unit of the security convertible into Common Stock
or other Marketable Securities plus (B) any additional consideration
initially payable upon the conversion of such security into Common
Stock or other Marketable Securities divided by (ii) the number of
shares of Common Stock or other Marketable Securities initially
underlying such convertible security), the Conversion Price with
respect to such Securities shall be adjusted so that it shall equal
the price determined by dividing the Conversion Price in effect
immediately prior to the date of issuance of such rights or warrants
by a fraction, the numerator of which shall be the number of shares of
Common Stock or other Marketable Securities outstanding on the date of
issuance of such rights or warrants plus the number of additional
shares of Common Stock or other Marketable Securities offered for
subscription or purchase (or into which the convertible securities so
offered are initially convertible) and the denominator of which shall
be the number of shares of Common Stock or other Marketable Securities
outstanding on the date of issuance of such rights or warrants plus
the number of shares or securities which the aggregate offering price
of the total number of shares or securities so offered for
subscription or purchase (or the aggregate purchase price of the
convertible securities so offered plus the aggregate amount of any
additional consideration initially payable upon conversion of such
Securities into Common Stock or other Marketable Securities) would
purchase at such Current Market Price of the Common Stock or other
Marketable Securities. Such adjustment shall become effective
retroactively immediately after the record date for the determination
of stockholders entitled to receive such rights or warrants.
(c) In case the Company shall, at any time or from time to time
while any of such Securities are outstanding, distribute to all
holders of shares of its Common Stock or other Marketable Securities
(including any such distribution made in connection with a
consolidation or merger in which the Company is the continuing
corporation and the Common Stock or other Marketable Securities are
not changed or exchanged) cash, evidences of its indebtedness,
securities or assets (excluding (i) regular periodic cash dividends in
amounts, if any, determined from time to time by the Board of
Directors, (ii) dividends payable in shares of Common Stock or other
Marketable Securities for which adjustment is made under Section
12.03(a) or (iii) rights or warrants to subscribe for or purchase
securities of the Company (excluding those referred to in Section
12.03(b)), the Conversion Price with respect to such Securities shall
be adjusted so that it shall equal the price determined by dividing
the Conversion Price in effect immediately prior to the date of such
distribution by a fraction, the numerator of which shall be the
Current Market Price of the Common Stock or other Marketable
Securities on the record date referred to below and the denominator of
which shall be such Current Market Price of the Common Stock or other
Marketable Securities less the then fair market value (as determined
by the Board of Directors of the Company, whose determination shall be
conclusive) of the portion of the cash or assets or evidences of
indebtedness or securities so distributed or of such subscription
rights or warrants applicable to one share of Common Stock or one
other Marketable Security (provided that such denominator shall never
be less than one); PROVIDED, HOWEVER, that no adjustment shall be made
with respect to any distribution of rights to purchase securities of
the Company if a Holder of Securities would otherwise be entitled to
receive such rights upon conversion at any time of such Securities
into Common Stock or other Marketable Securities unless such rights
are subsequently redeemed by the Company, in which case such
redemption shall be treated for purposes of this Section as a dividend
on the Common Stock or other Marketable Securities. Such adjustment
shall become effective retroactively immediately after the record date
for the determination of stockholders or holders of Marketable
Securities entitled to receive such distribution; and, in the event
that such distribution is not so made, the Conversion Price shall
again be adjusted to the Conversion Price which would then be in
effect if such record date had not been fixed.
(d) The Company shall be entitled to make such additional
adjustments in the Conversion Price, in addition to those required by
Sections 12.03(a), 12.03(b) and 12.03(c), as shall be necessary in
order that any dividend or distribution of Common Stock or other
Marketable Securities, any subdivision, reclassification or
combination of shares of Common Stock or other Marketable Securities
or any issuance of rights or warrants referred to above shall not be
taxable to the holders of Common Stock or other Marketable Securities
for United States Federal income tax purposes.
(e) In any case in which this Section 12.03 shall require that
any adjustment be made effective as of or retroactively immediately
following a record date, the Company may elect to defer (but only for
five Trading Days following the filing of the statement referred to in
Section 12.05) issuing to the Holder of any Securities converted after
such record date the shares of Common Stock or other Marketable
Securities and other capital stock of the Company issuable upon such
conversion over and above the shares of Common Stock or other
Marketable Securities and other capital stock of the Company issuable
upon such conversion on the basis of the Conversion Price prior to
adjustment; PROVIDED, HOWEVER, that the Company shall deliver to such
Holder a due bill or other appropriate instrument evidencing such
Holder's right to receive such additional shares upon the occurrence
of the event requiring such adjustment.
(f) All calculations under this Section 12.03 shall be made to
the nearest cent or one-hundredth of a share or security, with one-
half cent and .005 of a share, respectively, being rounded upward.
Notwithstanding any other provision of this Section 12.03, the Company
shall not be required to make any adjustment of the Conversion Price
unless such adjustment would require an increase or decrease of at
least 1% of such price. Any lesser adjustment shall be carried
forward and shall be made at the time of and together with the next
subsequent adjustment which, together with any adjustment or
adjustments so carried forward, shall amount to an increase or
decrease of at least 1% in such price. Any adjustments under this
Section 12.03 shall be made successively whenever an event requiring
such an adjustment occurs.
(g) In the event that at any time, as a result of an adjustment
made pursuant to this Section 12.03, the Holder of any Security
thereafter surrendered for conversion shall become entitled to receive
any shares of stock of or other Marketable Securities of the Company
other than shares of Common Stock or Marketable Securities into which
the Securities originally were convertible, the Conversion Price of
such other shares or Marketable Securities so receivable upon
conversion of any such Security shall be subject to adjustment from
time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to Common Stock and
Marketable Securities contained in subparagraphs (a) through (f) of
this Section 12.03, and the provisions of Sections 12.01, 12.02 and
12.04 through 12.09 with respect to the Common Stock or other
Marketable Securities shall apply on like or similar terms to any such
other shares or Marketable Securities and the determination of the
Board of Directors as to any such adjustment shall be conclusive.
(h) No adjustment shall be made pursuant to this Section (i) if
the effect thereof would be to reduce the Conversion Price below the
par value (if any) of the Common Stock or other Marketable Security,
if any, or (ii) subject to Section 12.03(e) hereof, with respect to
any Security that is converted prior to the time such adjustment
otherwise would be made.
SECTION 12.04. CONSOLIDATION OR MERGER OF THE COMPANY. In case
of either (a) any consolidation or merger to which the Company is a party,
other than a merger or consolidation in which the Company is the surviving
or continuing corporation and which does not result in a reclassification
of, or change (other than a change in par value or from par value to no par
value or from no par value to par value, as a result of a subdivision or
combination) in, outstanding shares of Common Stock or other Marketable
Securities or (b) any sale or conveyance of all or substantially all the
property and assets of the Company to another Person, each Security then
Outstanding shall be convertible from and after such merger, consolidation,
sale or conveyance of property and assets into the kind and amount of
shares of stock or other securities and property (including cash)
receivable upon such consolidation, merger, sale or conveyance by a holder
of the number of shares of Common Stock or other Marketable Securities into
which such Securities would have been converted immediately prior to such
consolidation, merger, sale or conveyance, subject to adjustments which
shall be as nearly equivalent as may be practicable to the adjustments
provided for in this Article Twelve (and assuming such holder of Common
Stock or other Marketable Securities failed to exercise his rights of
election, if any, as to the kind or amount of securities, cash or other
property (including cash) receivable upon such consolidation, merger, sale
or conveyance (provided that, if the kind or amount of securities, cash or
other property (including cash) receivable upon such consolidation, merger,
sale or conveyance is not the same for each nonelecting share, the kind and
amount of securities, cash or other property (including cash) receivable
upon such consolidation, merger, sale or conveyance for each nonelecting
share shall be deemed to be the kind and amount so receivable per share by
a plurality of the nonelecting shares or securities)). The Company shall
not enter into any of the transactions referred to in clause (a) or (b) of
the preceding sentence unless effective provision shall be made so as to
give effect to the provisions set forth in this Section 12.04. The
provisions of this Section 12.04 shall apply similarly to successive
consolidations, mergers, sales or conveyances.
SECTION 12.05. NOTICE OF ADJUSTMENT. Whenever an adjustment in
the Conversion Price with respect to a series of Securities is required:
(a) the Company shall forthwith place on file with the Trustee
and any Conversion Agent for such Securities a certificate of a senior
financial officer of the Company, stating the adjusted Conversion
Price determined as provided herein and setting forth in reasonable
detail such facts as shall be necessary to show the reason for and the
manner of computing such adjustment, such certificate to be conclusive
evidence that the adjustment is correct; and
(b) a notice stating that the Conversion Price has been adjusted
and setting forth the adjusted Conversion Price shall forthwith be
mailed, first-class postage prepaid, by the Company to the Holders of
record of such Outstanding Securities.
SECTION 12.06. NOTICE IN CERTAIN EVENTS. In case:
(a) of a consolidation or merger to which the Company is a party
and for which approval of any stockholders of the Company is required
or of the sale or conveyance to another person or entity or group of
persons or entities acting in concert as a partnership, limited
partnership, syndicate or other group (within the meaning of Rule 13d-
3 under the Exchange Act) of all or substantially all the property and
assets of the Company;
(b) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company; or
(c) of any action triggering an adjustment of the Conversion
Price pursuant to this Article Twelve;
the Company shall cause to be filed with the Trustee and the Conversion
Agent for the applicable securities, and shall cause to be mailed, first-
class postage prepaid, to the Holders of record of applicable Securities,
at least 15 days prior to the applicable date hereinafter specified, a
notice stating (i) the date on which a record is to be taken for the
purpose of any distribution or grant of rights or warrants triggering an
adjustment to the Conversion Price pursuant to this Article Twelve or, if a
record is not to be taken, the date as of which the holders of record of
Common Stock or other Marketable Securities entitled to such distribution,
rights or warrants are to be determined or (ii) the date on which any
reclassification, consolidation, merger, sale, conveyance, dissolution,
liquidation or winding up triggering an adjustment to the Conversion Price
pursuant to this Article Twelve is expected to become effective, and the
date as of which it is expected that holders of Common Stock or other
Marketable Securities of record shall be entitled to exchange their Common
Stock or other Marketable Securities for securities or other property
deliverable upon such reclassification, consolidation, merger, sale,
conveyance, dissolution, liquidation or winding up.
Failure to give such notice or any defect therein shall not
affect the legality or validity of the proceedings described in clause (a),
(b) or (c) of this Section.
SECTION 12.07. COMPANY TO RESERVE STOCK OR OTHER MARKETABLE
SECURITIES; REGISTRATION; LISTING. (a) The Company shall at all times
reserve and keep available, free from preemptive rights, out of its
authorized but unissued shares of Common Stock or other Marketable
Securities, for the purpose of effecting the conversion of the Securities,
such number of its duly authorized shares of Common Stock or number or
principal amount of other Marketable Securities as shall from time to time
be sufficient to effect the conversion of all applicable outstanding
Securities into such Common Stock or other Marketable Securities at any
time (assuming that, at the time of the computation of such number of
shares or securities, all such Securities would be held by a single
Holder); PROVIDED, HOWEVER, that nothing contained herein shall preclude
the Company from satisfying its obligations in respect of the conversion of
the Securities by delivery of purchased shares of Common Stock or other
Marketable Securities which are held in the treasury of the Company. The
Company shall from time to time, in accordance with the laws of the State
of Delaware, use its best efforts to cause the authorized amount of the
Common Stock or other Marketable Securities to be increased if the
aggregate of the authorized amount of the Common Stock or other Marketable
Securities remaining unissued and the issued shares of such Common Stock or
other Marketable Securities in its treasury (other than any such shares
reserved for issuance in any other connection) shall not be sufficient to
permit the conversion of all Securities.
(b) If any shares of Common Stock or other Marketable Securities
which would be issuable upon conversion of Securities hereunder require
registration with or approval of any governmental authority before such
shares or securities may be issued upon such conversion, the Company will
in good faith and as expeditiously as possible endeavor to cause such
shares or securities to be duly registered or approved, as the case may be.
The Company will endeavor to list the shares of Common Stock or other
Marketable Securities required to be delivered upon conversion of the
Securities prior to such delivery upon the principal national securities
exchange upon which the outstanding Common Stock or other Marketable
Securities are listed at the time of such delivery.
SECTION 12.08. TAXES ON CONVERSION. The Company shall pay any
and all documentary, stamp or similar issue or transfer taxes that may be
payable in respect of the issue or delivery of shares of Common Stock or
other Marketable Securities on conversion of Securities pursuant hereto.
The Company shall not, however, be required to pay any such tax which may
be payable in respect of any transfer involved in the issue or delivery of
shares of Common Stock or other Marketable Securities or the portion, if
any, of the Securities which is not so converted in a name other than that
in which the Securities so converted were registered, and no such issue or
delivery shall be made unless and until the person requesting such issue
has paid to the Company the amount of such tax or has established to the
satisfaction of the Company that such tax has been paid.
SECTION 12.09. CONVERSION AFTER RECORD DATE. If any Securities
are surrendered for conversion subsequent to the record date preceding an
Interest Payment Date but on or prior to such Interest Payment Date (except
Securities called for redemption on a Redemption Date between such record
date and Interest Payment Date), the Holder of such Securities at the close
of business on such record date shall be entitled to receive the interest
payable on such Securities on such Interest Payment Date notwithstanding
the conversion thereof. Securities surrendered for conversion during the
period from the close of business on any record date next preceding any
Interest Payment Date to the opening of business on such Interest Payment
Date shall (except in the case of Securities which have been called for
redemption on a Redemption Date within such period) be accompanied by
payment in New York Clearing House funds or other funds acceptable to the
Company of an amount equal to the interest payable on such Interest Payment
Date on the Securities being surrendered for conversion. Except as
provided in this Section 12.09, no adjustments in respect of payments of
interest on Securities surrendered for conversion or any dividends or
distributions or interest on the Common Stock or other Marketable
Securities issued upon conversion shall be made upon the conversion of any
Securities.
SECTION 12.10. CORPORATE ACTION REGARDING PAR VALUE OF COMMON
STOCK. Before taking any action which would cause an adjustment reducing
the applicable Conversion Price below the then par value (if any) of the
shares of Common Stock or other Marketable Securities deliverable upon
conversion of the Securities, the Company will take any corporate action
which may, in the opinion of its counsel, be necessary in order that the
Company may validly and legally issue fully paid and nonassessable shares
of Common Stock or other Marketable Securities at such adjusted Conversion
Price.
SECTION 12.11. COMPANY DETERMINATION FINAL. Any determination
that the Company or the Board of Directors must make pursuant to this
Article is conclusive.
SECTION 12.12. TRUSTEE'S DISCLAIMER. The Trustee has no duty to
determine when an adjustment under this Article should be made, how it
should be made or what it should be. The Trustee makes no representation
as to the validity or value of any securities or assets issued upon
conversion of Securities. The Trustee shall not be responsible for the
Company's failure to comply with this Article. Each Conversion Agent other
than the Company shall have the same protection under this Section as the
Trustee.
ARTICLE XIII
SUBORDINATION
SECTION 13.01. AGREEMENT TO SUBORDINATE. The Company agrees,
and each Securityholder accepting a Security agrees, that the indebtedness
evidenced by the Securities and the payment of the principal of (and
premium, if any) and interest on each and all of the Securities is hereby
expressly subordinated in right of payment, to the extent and in the manner
provided in this Article, to the prior payment in full in cash or cash
equivalent of all Senior Indebtedness and that such subordination is for
the benefit of the holders of Senior Indebtedness.
SECTION 13.02. LIQUIDATION, DISSOLUTION, BANKRUPTCY. Upon any
payment or distribution of all or substantially all of the assets of the
Company, whether voluntary or involuntary, or upon any reorganization,
readjustment, arrangement or similar proceeding relating to the Company or
its property, whether or not the Company is a party thereto and whether in
bankruptcy, insolvency, receivership or similar proceedings, or upon any
assignment by the Company for the benefit of creditors or upon any other
marshaling of the assets and liabilities of the Company:
(a) all Senior Indebtedness shall first be paid in full in cash
or cash equivalents, or provisions made for such payment by deposit
thereof in trust with a bank or banks (either theretofore acting as
trustees under indentures pursuant to which Senior Indebtedness shall
have been issued or as duly appointed paying agents for the purpose),
before any payment or distribution, whether in cash, property or
securities (other than securities of the Company as reorganized or
readjusted, or securities of the Company or any other corporation
provided for by a plan of reorganization or readjustment, the payment
of which is subordinate, at least to the extent provided in this
Article with respect to the Securities, to the payment of all
indebtedness in the nature of Senior Indebtedness, so long as the
rights of the holders of the Senior Indebtedness are not altered
adversely by such reorganization or readjustment ("Equivalent
Securities")), is made on account of the principal of or interest on
the indebtedness evidenced by the Securities;
(b) any payment or distribution of any kind or character in
respect of the principal of (the premium, if any) or interest on the
Securities, whether in cash, property or securities (other than
Equivalent Securities), to which the Holders of the Securities would
be entitled except for the provisions of this Article shall be paid or
delivered by the Company or the liquidating trustee or agent or other
person making such payment or distribution, whether a trustee in
bankruptcy, a receiver or liquidating trustee or other trustee or
agent, directly and ratably to the holders of Senior Indebtedness or
their Representatives, ratably according to the aggregate amounts
remaining unpaid on account of the principal of, and the premium, if
any, and interest on, the Senior Indebtedness held or represented by
each, to the extent necessary to make payment in full of all Senior
Indebtedness remaining unpaid, after giving effect to any concurrent
payment or distribution, or provision therefor, to the holders of such
Senior Indebtedness; and
(c) in the event that, notwithstanding the foregoing, any
payment or distribution of any kind or character in respect of the
principal of (the premium, if any) or interest on the Securities,
whether in cash, property or securities (other than Equivalent
Securities), shall be received by the Trustee or the holders of the
Securities before all Senior Indebtedness is paid in full, or
provision made as aforesaid for its payment, such payment or
distribution shall be held in trust for the ratable benefit of and
shall be ratably paid over or delivered to the holders of Senior
Indebtedness remaining unpaid or unprovided for or their
Representatives, as provided in the foregoing subparagraph (b), for
application to the payment of all principal of, and premium, if any,
and interest on, such Senior Indebtedness remaining unpaid until all
such Senior Indebtedness shall have been paid in full, after giving
effect to any concurrent payment or distribution, or provision
therefor, to the holders of such Senior Indebtedness.
Subject to the payment in full of all Senior Indebtedness or
provisions being made as aforesaid for its payment, the Holders of the
Securities shall be subrogated to the rights of the holders of Senior
Indebtedness to receive payments or distributions of cash, property or
securities of the Company payable or distributable to the holders of the
Senior Indebtedness, until the principal of and interest on the Securities
shall be paid in full. No payment or distribution to the holders of the
Senior Indebtedness of any cash, property or securities to which the
Holders of the Securities would be entitled except for the provisions of
this Article, and no payment over or delivery pursuant to the provisions of
this Article to the holders of the Senior Indebtedness or their
Representatives by the Trustee or the Holders of the Securities, shall, as
between the Company, its creditors other than the holders of Senior
Indebtedness and the Holders of the Securities, be deemed to be a payment
by the Company to or on account of the Senior Indebtedness, and no payments
or distributions to the Trustee or the Holders of the Securities of cash,
property or securities payable or distributable to the holders of Senior
Indebtedness, to which the Trustee or the Holders of the Securities shall
become entitled pursuant to the provisions of the preceding sentence,
shall, as between the Company, its creditors other than the holders of
Senior Indebtedness, and the Holders of the Securities, be deemed to be a
payment by the Company to the Holders of or on account of the Securities.
Upon any distribution of assets or securities of the Company referred to in
this Article, the Trustee, subject to the provisions of Article Six, and
the Holders of the Securities shall be entitled to rely upon any order or
decree made by any court of competent jurisdiction in which such
dissolution, winding up, liquidation or reorganization proceedings are
pending or a certificate of the liquidating trustee or agent or other
person making any payment or distribution to the Trustee or to the Holders
of the Securities for the purpose of ascertaining the persons entitled to
participate in such distribution, the holders of the Senior Indebtedness
and other indebtedness of the Company, the amount thereof or payable
thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article.
SECTION 13.03. DEFAULT ON SENIOR INDEBTEDNESS AND SENIOR
SUBORDINATED INDEBTEDNESS; PAYMENT RESTRICTIONS IN CERTAIN CIRCUMSTANCES.
Subject to the provisions of Section 13.04 hereof, (a) in the event and
during the continuation of any default in the payment of principal of, or
premium, if any, or interest on, or other monetary obligation with respect
to, any Senior Indebtedness beyond any applicable period of grace, or in
the event that any event of default with respect to any Senior Indebtedness
shall have occurred and be continuing, unless and until such default or
event of default shall have been cured or waived or shall have ceased to
exist, no payment of principal or interest shall be made by the Company on
the Securities or (b) in the event and during the continuation of any event
of default under any Senior Subordinated Indebtedness beyond any applicable
period of grace or in the event and during the continuation of any Event of
Default, the Company shall not declare or pay dividends on, make any
distribution with respect to, or redeem, purchase, acquire or make a
liquidation payment with respect to any of its capital stock and the
Company shall not make any payment of interest, principal or premium, if
any, on or repay, repurchase or redeem any debt securities issued by the
Company that rank PARI PASSU with or junior to the Securities; PROVIDED,
HOWEVER, that the restrictions set forth in this Clause (b) shall not apply
to any interest or dividend payment or exchange by the Company, where the
interest or dividend is paid or the exchange is made by way of the issuance
of securities that rank junior to the Securities. Nothing contained in
this Article or elsewhere in this Indenture, or in any of the Securities,
shall, however, (x) prevent the Company from setting aside in trust as
provided in Section 10.03 or depositing with the Trustee, at any time,
except during the pendency of any of the proceedings or upon the happening
of any of the events referred to in the first paragraph of Section 13.02 or
during the continuation of any such default or event of default (not cured
or waived), moneys for the payment of principal of or interest on the
Securities or (y) prevent the application by the Trustee of any moneys
deposited with it hereunder by the Company to the payment of or on account
of the principal of or interest on the Securities, if, at the time of such
deposit, the Trustee did not have written notice of any event prohibiting
the making of such deposit by the Company.
The Company shall give prompt written notice to the Trustee of
any facts which would prohibit the making of any payment of moneys to or by
the Trustee, including any dissolution, winding up, liquidation or
reorganization of the Company within the meaning of this Article. Anything
in this Article or elsewhere in this Indenture contained to the contrary
notwithstanding, the Trustee shall not be charged with knowledge of the
existence of any Senior Indebtedness or of any default or event of default
with respect to any Senior Indebtedness or of any other facts which would
prohibit the making of any payment of moneys to or by the Trustee, unless
and until the Trustee shall have received notice in writing to that effect
signed by an officer of the Company or by a holder of Senior Indebtedness
who shall have been certified by the Company or otherwise established to
the reasonable satisfaction of the Trustee to be such holder or by a
Representative of Senior Indebtedness.
SECTION 13.04. DISPUTES WITH HOLDERS OF CERTAIN SENIOR
INDEBTEDNESS. Any failure by the Company to make any payment on or perform
any other obligation under Senior Indebtedness, other than any indebtedness
incurred by the Company or assumed or guaranteed, directly or indirectly,
by the Company for money borrowed (or any deferral, renewal, extension or
refunding thereof) or any indebtedness or obligation in which the
provisions of this Section shall have been waived by the Company in the
instrument or instruments by which the Company incurred, assumed,
guaranteed or otherwise created such indebtedness or obligation, shall not
be deemed a default or event of default under Section 13.03 hereof for so
long as (a) the Company shall be disputing its obligation to make such
payment or perform such obligation and (b) either (i) such dispute shall
not have resulted in a judgment against the Company or the applicable
Subsidiary that shall have remained undischarged or unbonded and have
remained in force for more than the applicable appeal period or (ii) in the
event of such a judgment, the Company or the applicable Subsidiary shall in
good faith be prosecuting an appeal or other proceeding for review and
which a stay of execution shall have been obtained pending such appeal or
review.
SECTION 13.05. ACCELERATION OF NOTES. If an Event of Default,
other than an Event of Default under paragraph (e) or (f) of Section 5.01,
shall have occurred and be continuing, the Trustee or the Holder of
Securities electing to accelerate the Securities pursuant to Section 5.02
shall give the Representatives of the Senior Indebtedness five days' prior
written notice before accelerating the Securities, which notice shall state
that it is a "Notice of Intent to Accelerate;" PROVIDED, HOWEVER, that the
Trustee or such Holders may so accelerate the Securities immediately
without such notice if at such time payment of any Senior Indebtedness
shall have been accelerated. If payment of the Securities is accelerated
because of an Event of Default, the Company shall promptly notify holders
of Senior Indebtedness (or their Representatives) of the acceleration.
SECTION 13.06. WHEN DISTRIBUTION MUST BE PAID OVER. If a
distribution is made to Securityholders that because of this Article should
not have been made to them, the Securityholders who receive the
distribution shall hold it in trust for holders of Senior Indebtedness and
pay it over to them as their interests may appear.
SECTION 13.07. RELATIVE RIGHTS. This Article defines the
relative rights of Securityholders and holders of Senior Indebtedness.
Nothing in this Indenture shall:
(a) impair, as between the Company and Securityholders, the
obligation of the Company, which is absolute and unconditional, to pay
principal of and interest on the Securities in accordance with their
terms;
(b) affect the relative rights of Securityholders and creditors
of the Company other than holders of Senior Indebtedness; or
(c) prevent the Trustee or any Securityholder from exercising
its available remedies upon an Event of Default, subject to the rights
of holders of Senior Indebtedness to receive distributions otherwise
payable to Securityholders.
If the Company fails because of this Article to pay principal of
or interest on a Security on the due date, the failure is still an Event of
Default.
SECTION 13.08. SUBORDINATION MAY NOT BE IMPAIRED BY COMPANY. No
right of any holder of Senior Indebtedness to enforce the subordination of
the indebtedness evidenced by the Securities shall be impaired by any act
or failure to act by the Company or by its failure to comply with this
Indenture.
SECTION 13.09. DISTRIBUTION OR NOTICE TO REPRESENTATIVE.
Whenever a distribution is to be made or a notice given to holders of
Senior Indebtedness, the distribution may be made and the notice given to
their Representative.
SECTION 13.10. RIGHTS OF TRUSTEE AND PAYING AGENT. The Trustee
or Paying Agent may continue to make payments on the Securities until it
receives notice satisfactory to it that payments may not be made under this
Article. The Company, a Representative or a holder of Senior Indebtedness
who shall have been certified by the Company or otherwise established to
the reasonable satisfaction of the Trustee to be such holder may give the
notice; PROVIDED, HOWEVER, that if an issue of Senior Indebtedness has a
Representative, only the Representative may give the notice on behalf of
the holders of Senior Indebtedness.
The Trustee in its individual or any other capacity may hold
Senior Indebtedness with the same rights it would have if it were not
Trustee. The Security Registrar, the Paying Agent and the Conversion Agent
may do the same with like rights.
SECTION 13.11. NOTICE TO TRUSTEE. The Company shall give prompt
written notice to a Responsible Officer at the address of the Trustee
determined pursuant to Section 1.05 of any fact known to the Company which
would prohibit the making of any payment to or by the Trustee in respect of
the Securities. Notwithstanding the provisions of this Article Thirteen or
any other provision of this Indenture, the Trustee shall not be charged
with knowledge of the existence of any facts which would prohibit the
making of any payment to or by the Trustee in respect of the Securities,
unless and until the Trustee shall have received written notice thereof
from the Company or a holder of Senior Indebtedness or from any
Representative therefor, and, prior to the receipt of any such written
notice, the Trustee, subject to the provisions of Section 6.01, shall be
entitled in all respects to assume that no such facts exist; PROVIDED,
HOWEVER, that if the Trustee shall not have received the notice provided
for in this Section by the close of business on the Business Day
immediately prior to the date upon which by the terms hereof any money may
become payable for any purpose (including, without limitation, the payment
of principal or interest), then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive
such money and to apply the same to the purpose for which such money was
received and shall not be affected by any notice to the contrary which may
be received by it during or after the close of business on such immediately
prior Business Day.
SECTION 13.12. TRUSTEE NOT A FIDUCIARY. The Trustee shall not
be deemed to owe any fiduciary duty to the holders of Senior Indebtedness,
but shall have only such obligations to such holders as are expressly set
forth in this Article Thirteen.
SECTION 13.13. EFFECTUATION OF SUBORDINATION BY TRUSTEE. Each
Holder of Securities, by his acceptance thereof, authorizes and directs the
Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in this Article and
appoints the Trustee his attorney-in-fact for any and all such purposes.
SECTION 13.14. ARTICLE APPLICABLE TO PAYING AGENTS. In case at
any time any Paying Agent other than the Trustee and the Company shall have
been appointed by the Company and be then acting hereunder, the term
"Trustee" as used in this Article shall in such case (unless the context
shall require otherwise) be construed as extending to and including such
Paying Agent within its meaning as fully for all intents and purposes as if
such Paying Agent were named in this Article in addition to or in place of
the Trustee.
SECTION 13.15. TRUSTEE; COMPENSATION NOT PREJUDICED. Nothing in
this Article shall apply to claims of, or payments to, the Trustee pursuant
to Section 6.07.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Indenture
to be duly executed as of the day and year first above written.
TIME WARNER INC.
By
Name:
Title:
Attest:
By:
Name:
Title:
[______________], as Trustee
By
Name:
Title:
Attest:
By:
Name:
Title:
