<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE , 1996
REGISTRATION NO. 33-
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-----------
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
-----------
ARMSTRONG WORLD INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
PENNSYLVANIA 23-0366390
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
313 WEST LIBERTY STREET
LANCASTER, PENNSYLVANIA 17603
(717) 397-0611
(Address of principal executive offices)
L.A. PULKRABEK, ESQUIRE
SENIOR VICE-PRESIDENT, SECRETARY AND GENERAL COUNSEL
313 WEST LIBERTY STREET
LANCASTER, PENNSYLVANIA 17603
(Name and address of agent for service)
717-397-0611
(Telephone number, including area code, of agent for service)
WITH COPIES TO:
Vincent C. Deluzio, Esquire Robert S. Risoleo, Esquire
Buchanan Ingersoll Professional Sullivan & Cromwell
Corporation 125 Broad Street
One Oxford Centre New York, N.Y. 10004
301 Grant Street, 20th Floor (212) 558-4000
Pittsburgh, Pennsylvania 15219-1410
(412) 562-8947
-----------
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of the Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [_]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434
please check the following box. [X]
-----------
CALCULATION OF REGISTRATION FEE
===============================================================================
<TABLE>
<CAPTION>
PROPOSED
MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF SECURITIES AMOUNT TO BE OFFERING PRICE AGGREGATE REGISTRATION
TO BE REGISTERED REGISTERED(1) PER SHARE(2) OFFERING PRICE(2)(3) FEE(3)
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $1.00 par value(4) $250,000,000 100% $250,000,000 $86,208
Class A Preferred Stock, no par
value Depository Shares
Debt Securities(5)
</TABLE>
===============================================================================
(1) In U.S. Dollars or the equivalent thereof in one or more foreign
currencies or currencies units or composite currencies, including the
European Currency Unit.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(o) under the Securities Act of 1933.
(3) The aggregate initial offering price of all securities registered pursuant
to this Registration Statement and offered from time to time will not
exceed $250,000,000. An additional $250,000,000 of Securities has been
previously registered on a Registration Statement on Form S-3 (No. 33-
38837) for which a registration fee in the amount of $62,500 has been
previously paid. The previously registered securities may also be sold
pursuant to the Prospectus contained herein. Any securities registered
hereunder or under Registration Statement No. 33-38837 may be sold
separately or as units with other securities registered hereunder or
thereunder.
(4) Includes Preferred Stock Purchase Rights (the "Rights"). Prior to the
occurrence of certain events, such Rights will not be exercisable or
evidenced separately from the Common Stock.
(5) Or, if Debt Securities are issued at original issue discount, such greater
amount as shall not exceed an aggregate initial offering price of
$250,000,000.
Pursuant to Rule 429 of the rules and regulations of the Securities and
Exchange Commission under the Securities Act of 1933, as amended, the combined
prospectus contained herein also relates to the Registration Statement on Form
S-3 (No. 33-38837).
The registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the registrant
shall file a further amendment that states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to Section 8(a), may
determine.
===============================================================================
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT WITH RESPECT TO THESE SECURITIES HAS BEEN FILED WITH +
+THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR +
+MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR +
+THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF +
+ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
PROSPECTUS (Subject to Completion)
Issued June , 1996
$500,000,000
[LOGO OF ARMSTRONG WORLD INDUSTRIES, INC.]
Armstrong World Industries, Inc.
DEBT SECURITIES
COMMON STOCK
PREFERRED STOCK
DEPOSITARY SHARES
----------
Armstrong World Industries, Inc., a Pennsylvania corporation ("Armstrong" or
the "Company"), may offer and sell from time to time, together or separately,
up to an aggregate initial public offering price of $500,000,000 or the
equivalent thereof in other currencies, foreign currency units or composite
currencies such as the European Currency Unit (the "Specified Currency"),
subject to the limitations set forth below, in one or more Series (a) debt
securities ("Debt Securities"), which may be either senior debt securities
("Senior Debt Securities") or subordinated debt securities ("Subordinated Debt
Securities"), (b) shares of common stock, $1.00 par value per share ("Common
Stock"), (c) shares of Class A preferred stock, no par value per share
("Preferred Stock"), and (d) depositary shares ("Depositary Shares") or any
combination of the foregoing, each in amounts, at prices and on terms to be
determined at the time of sale. The Debt Securities, Common Stock, Preferred
Stock, and Depositary Shares are collectively referred to herein as the
"Securities".
All specific terms of the offering and sale of Securities, including the
initial public offering price, aggregate amount, listing on any securities
exchange or quotation system, risk factors, if any, and the agents,
underwriters or dealers, if any, to be utilized in connection with the sale of
the Securities, will be set forth in an accompanying Prospectus Supplement
("Prospectus Supplement"). With respect to the Debt Securities, the related
Prospectus Supplement will set forth the specific designation, rights and
restrictions, whether they are senior or subordinated, the currencies or
currency units or composite currencies in which they are denominated, the
aggregate principal amount, the maturity, rate and time of payment of interest,
any conversion, exchange, redemption or sinking fund provisions, and any other
terms of the Securities offered thereby. With respect to the Preferred Stock,
the related Prospectus Supplement will set forth the specific designation,
rights, preferences, privileges and restrictions thereof, including dividend
rate or rates (or method of ascertaining the same), dividend payment dates,
voting rights, liquidation preference, any conversion, exchange, redemption or
sinking fund provisions, and any other terms of the Securities offered thereby.
The Prospectus Supplement will also contain information, where applicable,
regarding certain United States federal income tax considerations relating to
the Securities offered thereby.
----------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
----------
The Company may sell the Securities directly, or through agents, underwriters
or dealers designated from time to time, or through a combination of such
methods, which underwriters may include Morgan Stanley & Co. Incorporated,
Goldman Sachs & Co. and Merrill Lynch & Co. or may be a group of underwriters
represented by firms including one or more of such firms and such firms may act
as agents. See "Plan of Distribution." If agents of the Company or underwriters
or any dealers are involved in the sale of Securities in respect of which this
Prospectus is being delivered, the name of such agents, underwriters or
dealers, and any applicable commissions or discounts, will be set forth in or
may be calculated from the Prospectus Supplement relating to such Securities.
The Company reserves the sole right to accept and, together with their
respective agents from time to time, to reject in whole or in part any proposed
purchase of Securities to be made directly or through agents.
----------
The Prospectus may not be used to consummate the sale of Securities unless
accompanied by a Prospectus Supplement.
June , 1996
<PAGE>
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED OR INCORPORATED BY REFERENCE IN
THIS PROSPECTUS AND ANY PROSPECTUS SUPPLEMENT AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED. THIS PROSPECTUS AND ANY PROSPECTUS SUPPLEMENT DO NOT CONSTITUTE AN
OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN
THE SECURITIES DESCRIBED HEREIN OR THEREIN OR AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY SUCH SECURITIES IN ANY CIRCUMSTANCES IN WHICH
SUCH OFFER OR SOLICITATION IS UNLAWFUL. NEITHER THE DELIVERY OF THE PROSPECTUS
OR ANY PROSPECTUS SUPPLEMENT NOR ANY SALE MADE HEREUNDER OR THEREUNDER SHALL,
UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED
OR INCORPORATED BY REFERENCE HEREIN OR THEREIN IS CORRECT AS OF ANY TIME
SUBSEQUENT TO THE DATE OF SUCH INFORMATION.
----------------
TABLE OF CONTENTS
PAGE
Available Information....................................................... 3
Incorporation of Certain Documents by Referance............................. 3
The Company................................................................. 5
Recent Developments......................................................... 5
Use of Proceeds............................................................. 6
Ratios of Earnings to Fixed Charges and Earnings to Combined Fixed Charges
and Preferred Stock Dividends............................................... 6
Description of Debt Securities.............................................. 7
Description of Capital Stock................................................ 19
Description of Depositary Shares............................................ 25
Plan of Distribution........................................................ 27
Validity of Securities...................................................... 28
Experts..................................................................... 28
----------------
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SECURITIES AT
A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH
TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK, PACIFIC AND/OR PHILADELPHIA
STOCK EXCHANGES. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY
TIME.
2
<PAGE>
AVAILABLE INFORMATION
Armstrong is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "1934 Act"), and in accordance therewith
files reports, proxy statements and other information with the Securities and
Exchange Commission (the "SEC" or the "Commission"). Such reports, proxy
statements and other information can be inspected and copied at the public
reference facilities of the SEC at Room 1024, Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549, as well as at the Regional Offices of
the SEC located at Citicorp Center, Suite 1400, 500 West Madison Street, Room
1400, Chicago, Illinois 60661 and Seven World Trade Center, Suite 1300, New
York, New York 10048. Copies of such information can be obtained from the
Public Reference Section of the SEC at 450 Fifth Street, N.W., Washington,
D.C. 20549 at prescribed rates. Such reports, proxy statements and other
information concerning the Company can also be inspected at the offices of the
New York Stock Exchange, Inc., 20 Broad Street, New York, New York 10005, the
offices of the Pacific Stock Exchange, Inc., 301 Pine Street, San Francisco,
California 94104-7098, and the offices of the Philadelphia Stock Exchange,
1900 Market Street, Philadelphia, Pennsylvania 19103, on which exchanges
certain of Armstrong's securities are listed. Armstrong's Common Stock is
listed on the New York, Pacific and Philadelphia Stock Exchanges under the
symbol "ACK."
Armstrong has filed with the SEC two Registration Statements on Form S-3
(the "Registration Statements") under the Securities Act of 1933, as amended
(the "1933 Act"), with respect to the Securities. This Prospectus does not
contain all of the information set forth in the Registration Statements,
certain parts of which are omitted in accordance with the rules and
regulations of the SEC. Reference is hereby made to the Registration
Statements and related exhibits for further information with respect to the
Company and the Securities offered hereby. Statements contained herein
concerning the provisions of documents are necessarily summaries of such
documents, and each statement is qualified in its entirety by reference to the
copy of the applicable document filed with the SEC. The Registration
Statements and the exhibits thereto may be inspected without charge at the
office of the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549, and
copies thereof may be obtained from the SEC at prescribed rates. Electronic
registration statements made through Electronic Data Gathering, Analysis and
Retrieval system are publicly available through the Commission's Web site
(http://wwn. sec. gov.).
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents previously filed with the SEC by Armstrong under the
1934 Act are incorporated herein by reference: (1) the Company's Annual Report
on Form 10-K for the year ended December 31, 1995; (2) the Company's Current
Report on Form 8-K filed on January 16, 1996; (3) the Company's Current Report
on Form 8-K filed on January 16, 1996, as amended by a Form 8-K/A filed on
March 13, 1996; (4) the Company's Quarterly Report on Form 10-Q for the
quarter ended March 31, 1996; (5) the Company's Current Report on Form 8-K
filed on May 13, 1996; (6) the description of the Company's Common Stock
contained in the Company's Quarterly Report on Form 10-Q for the quarter ended
June 30, 1986 and any amendment or reports filed for the purpose of updating
such description; and (7) the description of the Company's Preferred Stock
Purchase Rights, set forth in the Registration Statement on Form 8-A/A dated
March 15, 1996.
All documents filed by Armstrong with the SEC pursuant to Section 13(a),
13(c), 14 or 15(d) of the 1934 Act subsequent to the date of this Prospectus
and prior to the termination of the offering or offerings of the Securities
offered hereby shall be deemed to be incorporated by reference in this
Prospectus and to be part hereof
3
<PAGE>
from the date of filing of such documents. Any statement incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained herein or in any
other subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute part of this Prospectus. All information
appearing in this Prospectus is qualified in its entirety by the information
and financial statements (including the notes thereto) contained in the
documents incorporated by reference herein.
Armstrong will provide without charge, upon written or oral request, to each
person, including any beneficial owner, to whom a copy of this Prospectus is
delivered, a copy of any or all of the documents incorporated by reference in
this Prospectus (other than exhibits to such documents unless such exhibits
are specifically incorporated by reference into such documents). Requests
should be directed to L.A. Pulkrabek, Senior Vice-President, Secretary and
General Counsel, Armstrong World Industries, Inc., 313 West Liberty Street,
Lancaster, Pennsylvania 17603-2717 (telephone 717-397-0611).
4
<PAGE>
THE COMPANY
Armstrong World Industries, Inc. is a Pennsylvania corporation incorporated
in 1891. The Company is a manufacturer of interior furnishings, including
floor coverings, and building products which are sold primarily for use in the
furnishing, refurbishing, repair, modernization and construction of
residential, commercial and institutional buildings. It also manufactures
various industrial and other products. In late 1995, Armstrong sold its
furniture business and combined its ceramic tile business with Dal-Tile
International Inc. ("Dal-Tile"), retaining a minority equity interest in the
combined company. Unless the context indicates otherwise, the term "Company"
means Armstrong World Industries, Inc. and its consolidated subsidiaries.
RECENT DEVELOPMENTS
On May 10, 1996, a three-judge panel of the U.S. Court of Appeals for the
Third Circuit issued a decision in an appeal from a preliminary injunction by
the District Court enjoining the members of the settlement class action
(Georgine v. Amchem) from litigating asbestos-related personal injury claims
in the tort system. The decision was adverse to members of the Center for
Claims Resolution, including the Company, who are defendants in the class
action. The settlement class action is discussed in the Company's annual
report on Form 10-K for the year ended December 31, 1995, and quarterly report
on Form 10-Q for the quarter ended March 31, 1996.
The Court of Appeals decision--which will not become effective until that
Court issues its mandate--ruled against maintaining the settlement class
action, ordered that the preliminary injunction issued by the Federal District
Court be vacated, and ordered the District Court to decertify the class. Judge
Edward Becker, writing for the Third Circuit panel, ruled broadly that the
case does not meet the requirements for class certification under Federal Rule
of Civil Procedure 23, concluding that a class action cannot be certified for
purposes of settlement unless it can be certified for full-scale litigation.
The Company believes that the Court erred in several important respects. The
Center membership intends to pursue all appellate remedies, including
petitioning for rehearing before the Third Circuit en banc and, if necessary,
for review by the U.S. Supreme Court.
Judge Becker recognized that the issues in the class action are of
significant importance. He said at the beginning of his opinion, "Every decade
presents a few great cases that force the judicial system to choose between
forging a solution to a major social problem on the one hand, and preserving
its institutional values on the other. This is such a case." While petitions
for rehearing are rarely granted, the Center's counsel believes there are
substantial grounds for the Third Circuit to accept rehearing en banc and, if
necessary, for the Supreme Court to review the decision. In addition to this
case being of significant importance, the panel's ruling is not consistent
with rulings of several other Circuit Courts that have considered Rule 23
issues in comparable cases.
The Company remains optimistic that a future claimants settlement class
action may ultimately be approved; however, as noted above, the courts may not
uphold the settlement class action, and may not uphold the companion insurance
action or, even if upheld, there is a potential that judicial action might
result in substantive modification to the settlement. The Center's counsel
believes that there are substantial legal grounds for securing a rehearing or,
if necessary, securing review by the Supreme Court given the unique nature and
importance of the case and the conflicting rulings of the other Circuit
Courts. Also encouraging is the perception of other judicial support to afford
a path through the federal court system for comparable litigation.
Despite Center efforts to reverse Judge Becker's decision, the District
Court's injunction precluding class members from litigating against the Center
defendants in the tort system may be lifted because either the rehearing
before the Third Circuit is denied or a stay of the Circuit Court decision
pending further appeal to the Supreme Court is not granted. If the injunction
is lifted, a large number of new asbestos-related personal injury lawsuits
might be filed within a short period of time against the Center members,
including the Company; a
5
<PAGE>
number of such new cases could be included in several large state court
consolidations scheduled for trial in late summer. If the request for
rehearing and, if necessary, appeal to the Supreme Court are not ultimately
successful, despite the pendency of the injunction, the number of subsequent
pending cases in the tort system against the Company would likely increase
absent successful negotiation of an alternative settlement arrangement
comparable to Georgine. In due course, the consequences from a lifting of the
injunction could result in presently undeterminable, but likely higher,
liability and defense costs under a claims resolution mechanism alternative to
the Georgine settlement which the Company believes would likely be negotiated.
The Company believes that any after-tax impact of the difference between such
likely higher liability and defense costs resulting from the
potential lifting of the injunction associated with the Georgine class action
settlement or its ultimate dissolution and the probable insurance recovery,
would not be material either to the financial condition of the Company or to
its liquidity although it could be material to earnings if it is determined in
a future period to be appropriate to record a reserve for this difference.
The foregoing reflects a period of potential uncertainty, and, even though
uncertainties still remain as to the potential number of unasserted claims,
liability resulting therefrom, and the ultimate scope of its insurance
coverage, after consideration of the above factors and the factors discussed
under "Legal Proceedings" in the Company's quarterly report on Form 10-Q for
the quarter ended March 31, 1996, including the Wellington Agreement, the
referenced settlements with other insurance carriers, the results of the trial
phase and the intermediate appellate stage of the California insurance
coverage litigation, the remaining reserve, the establishment of the Center,
the Georgine settlement class action and the likelihood that if Georgine is
not ultimately upheld, an alternative to Georgine would be negotiated, and its
experience, the Company believes the asbestos-related lawsuits and claims
against the Company would not be material either to the financial condition of
the Company or to its liquidity, although as stated above, the net effect of
any future liabilities recorded in excess of insurance assets could be
material to earnings in such future period.
The foregoing paragraph contains forward looking statements (within the
meaning of the Private Securities Litigation Reform Act of 1995) regarding the
Company's earnings, liquidity and financial condition and the likelihood that
an alternative to Georgine will be negotiated. Actual results may differ
materially as a result of the uncertainties identified in the preceding
paragraph and in the referenced Form 10-Q, or if the factors identified in the
preceding paragraph and in the referenced Form 10-Q, on which the Company's
conclusions are based, do not conform to the Company's expectations.
USE OF PROCEEDS
Except as otherwise described in the Prospectus Supplement, Armstrong
intends to use the net proceeds from the sale of the Securities offered hereby
for general corporate purposes, which may include additions to working
capital, refinancing existing indebtedness, capital expenditures and possible
acquisitions. Armstrong has
not allocated a specific portion of the net proceeds for any particular use at
this time. Specific information concerning the use of proceeds from the sale
of any Securities may be included in the Prospectus Supplement relating to
such Securities.
RATIOS OF EARNINGS TO FIXED CHARGES AND EARNINGS TO COMBINED FIXED CHARGES AND
PREFERRED STOCK DIVIDENDS
The following table sets forth the Company's consolidated ratios of earnings
to fixed charges for the indicated periods.(1)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
YEAR ENDED DECEMBER 31, MARCH 31, 1996
------------------------------------------------------------- ------------------
1991 1992 1993 1994 1995
---- ------ ---- ---- ----
<S> <C> <C> <C> <C> <C>
2.62 N/A(2) 2.55 9.05 1.21 8.47
</TABLE>
- --------
(1) Excluding restructuring charges for all periods and the pre-tax loss on
the ceramic business formation for 1995, the ratios would have been 2.87,
2.99, 4.62, 9.05 and 7.66 for 1991, 1992, 1993, 1994 and 1995,
respectively.
(2) Earnings were inadequate to cover fixed charges by $66.3 million.
6
<PAGE>
The following table sets forth the Company's consolidated ratio of earnings
to combined fixed charges and preferred dividends for the indicated
periods:(1)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
YEAR ENDED DECEMBER 31, MARCH 31, 1996
--------------------------------------------------------------- ------------------
1991 1992 1993 1994 1995
---- ------ ---- ---- ------
<S> <C> <C> <C> <C> <C>
1.90 N/A(2) 1.76 5.75 N/A(3) 5.28
</TABLE>
- --------
(1) Excluding restructuring charges for all periods and the pre-tax loss on
the ceramic business formation for 1995, the ratios would have been 2.08,
2.13, 3.19, 5.75 and 5.15 for 1991, 1992, 1993, 1994 and 1995,
respectively.
(2) Earnings were inadequate to cover fixed charges and preferred stock
dividends by $85.6 million.
(3) Earnings were inadequate to cover fixed charges plus preferred stock
dividends by $10.6 million.
The ratio of earnings to fixed charges has been computed by dividing
earnings by fixed charges. The ratio of earnings to fixed charges and
preferred stock dividends has been computed by dividing earnings by the sum of
fixed charges and preferred stock dividend requirements. For purposes of
calculating these ratios, earnings consist of consolidated earnings from
continuing business operations before income taxes plus fixed charges. Fixed
charges consist of interest expense, one-third of rent expense which is deemed
to be representative of interest and amortization of finance costs. In June
1989, the Company established an Employee Stock Ownership Plan (the "ESOP").
The Company is the guarantor of a $270 million loan to the ESOP. Contributions
made by the Company to the ESOP and dividends paid by the Company on the
convertible preferred stock purchased by the ESOP are used by the ESOP to pay
installments of principal and interest on the ESOP loan. Such contributions
and dividends are not included in the above ratios of earnings to fixed
charges or ratios to combined fixed charges and preferred stock dividends.
Interest expense on the ESOP loan was approximately $23.2 million, $22.9
million, $22.3 million, $21.7 million and $21.0 million for the years ended
December 31, 1991, 1992, 1993, 1994 and 1995, respectively. Part of the
contributions made by the Company represent payroll deductions made by
participants in the ESOP.
DESCRIPTION OF DEBT SECURITIES
The Senior Debt Securities are to be issued under an Indenture, to be dated
as of , 1996 (the "Senior Indenture"), between the Company and Mellon
Bank, N.A. , as Trustee (the "Trustee" or "Mellon"). The Subordinated Debt
Securities are to be issued under a separate Indenture, to be dated as of ,
1996 (the "Subordinated Indenture"), also between the Company and Mellon as
Trustee. The Senior Indenture and Subordinated Indenture are sometimes
referred to collectively as the "Indentures". Copies of the Senior Indenture
and Subordinated Indentures are filed as exhibits to the Registration
Statement of which this Prospectus is a part. The Debt Securities may be
issued from time to time in one or more series. The particular terms of each
series, or of Debt Securities forming a part of a series, which are offered by
a Prospectus Supplement will be described in such Prospectus Supplement.
The following summaries of certain provisions of the Indentures do not
purport to be complete and are subject, and are qualified in their entirety by
reference, to all the provisions of the Indentures, including the definitions
therein of certain terms, and, with respect to any particular Debt Securities,
to the description of the terms thereof included in the Prospectus Supplement
relating thereto. Wherever particular Sections or defined terms of the
Indentures are referred to herein or in a Prospectus Supplement, such Sections
or defined terms are incorporated by reference herein or therein, as the case
may be.
GENERAL
The Indentures will provide that Debt Securities in separate series may be
issued thereunder from time to time without limitation as to aggregate
principal amount. The Company may specify a maximum aggregate
7
<PAGE>
principal amount for the Debt Securities of any series. (Section 301) The Debt
Securities are to have such terms and provisions which are not inconsistent
with the Indentures, including as to maturity, principal and interest, as the
Company may determine. Unless otherwise specified in the applicable Prospectus
Supplement, the Senior Debt Securities when issued will be unsecured and
unsubordinated obligations of the Company and will rank on a parity with all
other unsecured and unsubordinated indebtedness of the Company. The
Subordinated Debt Securities when issued will be subordinated in right of
payment to the prior payment in full of all Senior Debt of the Company, as
described under "Subordination of Subordinated Debt Securities" and in the
applicable Prospectus Supplement.
The applicable Prospectus Supplement will set forth whether the Debt
Securities offered shall be Senior Debt Securities or Subordinated Debt
Securities, the price or prices at which the Debt Securities to be offered
will be issued and will describe the following terms of such offered Debt
Securities: (1) the title of such Debt Securities; (2) any limit on the
aggregate principal amount of such Debt Securities or the series of which they
are a part; (3) the Person to whom any interest on a Debt Security of the
series shall be payable, if other than the Person in whose name that Debt
Security (or one or more predecessor Debt Securities) is registered at the
close of business on the Regular Record Date for such interest; (4) the date
or dates on which the principal of any of such Debt Securities will be
payable; (5) the rate or rates at which any of such Debt Securities will bear
interest, if any, the date or dates from which any such interest will accrue,
the Interest Payment Dates on which any such interest will be payable and the
Regular Record Date for any such interest payable on any Interest Payment
Date; (6) the place or places where the principal of and any premium and
interest on any of such Debt Securities will be payable; (7) the period or
periods within which, the price or prices at which and the terms and
conditions on which any of such Debt Securities may be redeemed, in whole or
in part, at the option of the Company; (8) the obligation, if any, of the
Company to redeem or purchase any of such Debt Securities pursuant to any
sinking fund or analogous provision or at the option of the Holder thereof,
and the period or periods within which, the price or prices at which and the
terms and conditions on which any of such Debt Securities will be redeemed or
purchased, in whole or in part, pursuant to any such obligation; (9) the
denominations in which any of such Debt Securities will be issuable, if other
than denominations of $1,000 and any integral multiple thereof; (10) if the
amount of principal of or any premium or interest on any of such Debt
Securities may be determined with reference to an index or pursuant to a
formula, the manner in which such amounts will be determined; (11) if other
than the currency of the United States of America, the currency, currencies or
currency units in which the principal of or any premium or interest on any of
such Debt Securities will be payable (and the manner in which the equivalent
of the principal amount thereof in the currency of the United States of
America is to be determined for any purpose, including for the purpose of
determining the principal amount deemed to be Outstanding at any time); (12)
if the principal of or any premium or interest on any of such Debt Securities
is to be payable, at the election of the Company or the Holder thereof, in one
or more currencies or currency units other than those in which such Debt
Securities are stated to be payable, the currency, currencies or currency
units in which payment of any such amount as to which such election is made
will be payable, the periods within which and the terms and conditions upon
which such election is to be made and the amount so payable (or the manner in
which such amount is to be determined); (13) if other than the entire
principal amount thereof, the portion of the principal amount of any of such
Debt Securities which will be payable upon declaration of acceleration of the
Maturity thereof; (14) if the principal amount payable at the Stated Maturity
of any of such Debt Securities will not be determinable as of any one or more
dates prior to the Stated Maturity, the amount which will be deemed to be such
principal amount as of any such date for any purpose, including the principal
amount thereof which will be due and payable upon any Maturity other than the
Stated Maturity or which will be deemed to be Outstanding as of any such date
(or, in any such case, the manner in which such deemed principal amount is to
be determined); (15) if applicable, that such Debt Securities, in whole or any
specified part, are defeasible pursuant to the provisions of the Indentures
described under "Defeasance and Covenant Defeasance--Defeasance and Discharge"
or "Defeasance and Covenant Defeasance--Covenant Defeasance", or under both
such captions; (16) if applicable, the terms of any right to convert Debt
Securities into shares of Common Stock of the Company or other securities or
property; (17) whether any of such Debt Securities will be issuable, in whole
or in part, in the form of one or more Global Securities, defined below, and,
if so, the respective Depositaries for such Global Securities, the form of any
legend or legends to be borne by any such Global Security in addition to or in
lieu of
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the legend referred to under "Form, Exchange and Transfer--Global Securities"
and, if different from those described under such caption, any circumstances
under which any such Global Security may be exchanged, in whole or in part,
for Debt Securities registered, and any transfer of such Global Security, in
whole or in part, may be registered, in the names of Persons other than the
Depositary for such Global Security or its nominee; (18) any addition to or
change in the Events of Default applicable to any of such Debt Securities and
any change in the right of the Trustee or the Holders to declare the principal
amount of any of such Debt Securities due and payable; (19) any addition to or
change in the covenants in the Indentures described under "Certain Restrictive
Covenants" applicable to any of such Debt Securities; and (20) any other terms
of such Debt Securities not inconsistent with the provisions of the applicable
Indenture. (Section 301)
Debt Securities, including Original Issue Discount Securities, may be sold
at a substantial discount below their principal amount. Certain special United
States federal income tax considerations (if any) applicable to Debt
Securities sold at an original issue discount will be described in a
Prospectus Supplement under "United States Taxation". In addition, certain
special United States federal income tax or other considerations (if any)
applicable to any Debt Securities which are denominated in a currency or
currency unit other than United States dollars will be described in a
Prospectus Supplement under "United States Taxation".
Unless otherwise set forth in the applicable Prospectus Supplement, neither
the Indentures nor the Debt Securities will contain provisions which would
afford holders of the Debt Securities protection in the event of a takeover,
recapitalization, or similar restructuring involving the Company that could
adversely affect such holders.
CONVERSION RIGHTS
The terms on which Debt Securities of any series are convertible into Common
Stock or other securities or property will be set forth in the Prospectus
Supplement relating thereto. Such terms shall include provisions as to whether
conversion is mandatory or at the option of the holder and may include
provisions pursuant to which the number of shares of Common Stock or other
securities or property to be received by the Holders of Debt Securities would
be calculated according to the market price of Common Stock or other
securities or property as of a time stated in the applicable Prospectus
Supplement. (Article Fourteen)
SUBORDINATION OF SUBORDINATED DEBT SECURITIES
Unless otherwise indicated in the Prospectus Supplement, the following
provisions will apply to the Subordinated Debt Securities.
The Subordinated Debt Securities will, to the extent set forth in the
Subordinated Indenture, be subordinate in right of payment to the prior
payment in full of all Senior Debt, including the Senior Debt Securities. Upon
any payment or distribution of assets to creditors upon any liquidation,
dissolution, winding up, reorganization, assignment for the benefit of
creditors, marshalling of assets or any bankruptcy, insolvency, debt
restructuring or similar proceedings in connection with any insolvency or
bankruptcy proceeding of the Company, the holders of Senior Debt will first be
entitled to receive payment in full of principal of (and premium, if any) and
interest, if any, on such Senior Debt before the Holders of the Subordinated
Debt Securities will be entitled to receive or retain any payment in respect
of the principal of (and premium, if any) or interest, if any, on the
Subordinated Debt Securities. (Section 1502)
By reason of such subordination, in the event of liquidation or insolvency,
creditors of the Company who are not holders of Senior Debt or Holders of
Subordinated Debt Securities may recover less, ratably, than holders of Senior
Debt and may recover more, ratably, than the Holders of the Subordinated Debt
Securities.
In the event of the acceleration of the maturity of any Subordinated Debt
Securities, the holders of all Senior Debt outstanding at the time of such
acceleration will first be entitled to receive payment in full of all amounts
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due thereon before the Holders of the Subordinated Debt Securities will be
entitled to receive any payment upon the principal of (or premium, if any) or
interest, if any, on the Subordinated Debt Securities. (Section 1503)
No payments on account of principal (or premium, if any) or interest, if
any, in respect of the Subordinated Debt Securities may be made if there shall
have occurred and be continuing a default in any payment with respect to
Senior Debt, or an event of default with respect to any Senior Debt resulting
in the acceleration of the maturity thereof, or if any judicial proceeding
shall be pending with respect to any such default. (Section 1504) For purposes
of the subordination provisions, the payment, issuance and delivery of cash,
property or securities (other than stock and certain subordinated securities
of the Company) upon conversion of a Subordinated Debt Security will be deemed
to constitute payment on account of the principal of such Subordinated Debt
Security.
"Senior Debt" means the principal of (and premium, if any) and interest, if
any, (including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company to the extent that
such claim for post-petition interest is allowed in such proceeding) on Debt
(as defined under "Restrictive Covenants--Limitation on Liens"), whether
incurred on or prior to the date of the Subordinated Indenture or thereafter
incurred, unless, in the instrument creating or evidencing the same or
pursuant to which the same is outstanding, it is provided that such
obligations are not superior in right of payment to the Subordinated Debt
Securities or to other Debt which is pari passu with, or subordinated to, the
Subordinated Debt Securities; provided, however, that Senior Debt shall not be
deemed to include the Subordinated Debt Securities.
The Subordinated Indenture does not limit or prohibit the incurrence of
additional Senior Debt, which may include indebtedness that is senior to the
Subordinated Debt Securities, but subordinate to other obligations of the
Company. The Senior Debt Securities, when issued, will constitute Senior Debt.
The Prospectus Supplement may further describe the provisions, if any,
applicable to the subordination of the Subordinated Debt Securities of a
particular series.
FORM, EXCHANGE AND TRANSFER
The Debt Securities of each series will be issuable only in fully registered
form, without coupons, and, unless otherwise specified in the applicable
Prospectus Supplement, only in denominations of $1,000 and integral multiples
thereof. (Section 302)
At the option of the Holder, subject to the terms of the Indentures and the
limitations applicable to Global Securities, Debt Securities of each series
will be exchangeable for other Debt Securities of the same series of any
authorized denomination and of a like tenor and aggregate principal amount.
(Section 305)
Subject to the terms of the Indentures and the limitations applicable to
Global Securities, Debt Securities may be presented for exchange as provided
above or for registration of transfer (duly endorsed or with the form of
transfer endorsed thereon duly executed) at the office of the Security
Registrar or at the office of any transfer agent designated by the Company for
such purpose. No service charge will be made for any registration of transfer
or exchange of Debt Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. Such transfer or exchange will be effected upon the Security
Registrar or such transfer agent, as the case may be, being satisfied with the
documents of title and identity of the person making the request. The Company
has appointed the Trustee as Security Registrar. Any transfer agent (in
addition to the Security Registrar) initially designated by the Company for
any Debt Securities will be named in the applicable Prospectus Supplement.
(Section 305) The Company may at any time designate additional transfer agents
or rescind the designation of any transfer agent or approve a change in the
office through which any transfer agent acts, except that the Company will be
required to maintain a transfer agent in each Place of Payment for the Debt
Securities of each series. (Section 1002)
If the Debt Securities of any series (or of any series and specified terms)
are to be redeemed in part, the Company will not be required to (i) issue,
register the transfer of or exchange any Debt Security of that series
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(or of that series and specified terms, as the case may be) during a period
beginning at the opening of business 15 days before the day of mailing of a
notice of redemption of any such Debt Security that may be selected for
redemption and ending at the close of business on the day of such mailing or
(ii) register the transfer of or exchange any Debt Security so selected for
redemption, in whole or in part, except the unredeemed portion of any such
Debt Security being redeemed in part. (Section 305)
GLOBAL SECURITIES
Some or all of the Debt Securities of any series may be represented, in
whole or in part, by one or more global securities which will have an
aggregate principal amount equal to that of the Debt Securities represented
thereby (a "Global Security"). Each Global Security will be registered in the
name of a Depositary or a nominee thereof identified in the applicable
Prospectus Supplement, will be deposited with such Depositary or nominee or a
custodian therefor and will bear a legend regarding the restrictions on
exchanges and registration of transfer thereof referred to below and any such
other matters as may be provided for pursuant to the Indentures.
Notwithstanding any provision of the Indentures or any Debt Security
described herein, no Global Security may be exchanged, in whole or in part,
for Debt Securities registered, and no transfer of a Global Security, in whole
or in part, may be registered, in the name of any Person other than the
Depositary for such Global Security or any nominee of such Depositary unless
(i) the Depositary has notified the Company that it is unwilling or unable to
continue as Depositary for such Global Security or has ceased to be qualified
to act as such as required by the Indentures, (ii) there shall have occurred
and be continuing an Event of Default with respect to the Debt Securities
represented by such Global Security or (iii) there shall exist such
circumstances, if any, in addition to or in lieu of those described above as
may be described in the applicable Prospectus Supplement. All securities
issued in exchange for a Global Security or any portion thereof will be
registered in such names as the Depositary may direct. (Sections 204 and 305)
As long as the Depositary, or its nominee, is the registered Holder of a
Global Security, the Depositary or such nominee, as the case may be, will be
considered the sole owner and Holder of such Global Security and the Debt
Securities represented thereby for all purposes under the Debt Securities and
the Indentures. Except in the limited circumstances referred to above, owners
of beneficial interests in a Global Security will not be entitled to have such
Global Security or any Debt Securities represented thereby registered in their
names, will not receive or be entitled to receive physical delivery of
certificated Debt Securities in exchange therefor and will not be considered
to be the owners or Holders of such Global Security or any Debt Securities
represented thereby for any purpose under the Debt Securities or the
Indentures. All payments of principal of and any premium and interest on a
Global Security will be made to the Depositary or its nominee, as the case may
be, as the Holder thereof. The laws of some jurisdictions require that certain
purchasers of securities take physical delivery of such securities in
definitive form. These laws may impair the ability to transfer beneficial
interests in a Global Security.
Ownership of beneficial interests in a Global Security will be limited to
institutions that have accounts with the Depositary or its nominee
("participants") and to persons that may hold beneficial interests through
participants. In connection with the issuance of any Global Security, the
Depositary will credit, on its book-entry registration and transfer system,
the respective principal amounts of Debt Securities represented by the Global
Security to the accounts of its participants. Ownership of beneficial
interests in a Global Security will be shown only on, and the transfer of
those ownership interests will be effected only through, records maintained by
the Depositary (with respect to participants' interests) or any such
participant (with respect to interests of persons held by such participants on
their behalf). Payments, transfers, exchanges and other matters relating to
beneficial interests in a Global Security may be subject to various policies
and procedures adopted by the Depositary from time to time. None of the
Company, the Trustee or any agent of the Company or the Trustee will have any
responsibility or liability for any aspect of the Depositary's or any
participant's records relating to, or for payments made on account of,
beneficial interests in a Global Security, or for maintaining, supervising or
reviewing any records relating to such beneficial interests.
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PAYMENT AND PAYING AGENTS
Unless otherwise indicated in the applicable Prospectus Supplement, payment
of interest on a Debt Security on any Interest Payment Date will be made to
the Person in whose name such Debt Security (or one or more Predecessor Debt
Securities) is registered at the close of business on the Regular Record Date
for such interest. (Section 307)
Unless otherwise indicated in the applicable Prospectus Supplement,
principal of and any premium and interest on the Debt Securities of a
particular series will be payable at the office of such Paying Agent or Paying
Agents as the Company may designate for such purpose from time to time, except
that at the option of the Company payment of any interest may be made by check
mailed to the address of the Person entitled thereto as such address appears
in the Security Register. Unless otherwise indicated in the applicable
Prospectus Supplement, the corporate trust office of the Trustee in The City
of New York will be designated as the Company's sole Paying Agent for payments
with respect to Debt Securities of each series. Any other Paying Agents
initially designated by the Company for the Debt Securities of a particular
series will be named in the applicable Prospectus Supplement. The Company may
at any time designate additional Paying Agents or rescind the designation of
any Paying Agent or approve a change in the office through which any Paying
Agent acts, except that the Company will be required to maintain a Paying
Agent in each Place of Payment for the Debt Securities of a particular series.
(Section 1002)
All moneys paid by the Company to a Paying Agent for the payment of the
principal of or any premium or interest on any Debt Security which remain
unclaimed at the end of two years after such principal, premium or interest
has become due and payable will be repaid to the Company, and the Holder of
such Debt Security thereafter may look only to the Company for payment
thereof. (Section 1003)
RESTRICTIVE COVENANTS
Limitation on Liens. The Senior Indenture will provide that, except as
otherwise provided in the next succeeding paragraph, the Company shall not,
and shall not permit any Restricted Subsidiary to, issue, assume or guarantee
any indebtedness for borrowed money ("Debt") secured by any mortgage, pledge,
security interest, lien or other encumbrance (a "Lien") upon any Principal
Property of the Company or of any Restricted Subsidiary or upon any shares of
stock or Debt of any Restricted Subsidiary (whether such Principal Property,
shares of stock or Debt are now owned or hereafter acquired) without in any
such case effectively providing concurrently with the issuance, assumption or
guaranty of any such Debt that the Senior Debt Securities (together with, if
the Company shall so determine, any other indebtedness of or guaranty by the
Company or such Restricted Subsidiary then existing or thereafter created
which is not subordinate to the Senior Debt Securities) shall be secured
equally and ratably with (or, at the option of the Company, prior to) such
Debt, so long as such Debt shall be so secured; provided, however, that the
foregoing restrictions shall not prevent, restrict or apply to (and there
shall be excluded from secured Debt in any computation made for purposes of
the "Limitation on Liens" covenant) Debt secured by (A) Liens on property,
shares of stock or indebtedness of any corporation existing at the time such
corporation becomes a Restricted Subsidiary or arising thereafter (i)
otherwise than in connection with the borrowing of money arranged thereafter
and (ii) pursuant to contractual commitments entered into prior to and not in
contemplation of such corporation's becoming a Restricted Subsidiary; (B)
Liens on any property (including shares of stock or Debt) existing at the time
of acquisition thereof (including acquisition through merger or consolidation)
or securing the payment of all or any part of the purchase price or
construction cost thereof or securing any Debt incurred prior to, at the time
of or within 180 days after, the acquisition of such property, shares of stock
or Debt or the completion of any such construction, whichever is later, for
the purpose of financing all or any part of the purchase price or construction
costs thereof (provided such Liens are limited to such property, improvements
thereon and the land upon which such property and improvements are located and
any other property not then constituting a Principal Property); (C) Liens on
any property to secure all or any part of the cost of development, operations,
construction, alteration, repair or improvement of all or any part of such
property, or to secure Debt incurred prior to, at the time of or within 180
days after, the completion of such development, operation, construction,
alteration, repair or improvement,
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whichever is later, for the purpose of financing all or any part of such cost
(provided such Liens are limited to such property, improvements thereon and
the land upon which such property and improvements are located and any other
property not then constituting a Principal Property); (D) Liens which secure
Debt owing by a Restricted Subsidiary to the Company or to another Restricted
Subsidiary or by the Company to a Restricted Subsidiary; (E) Liens securing
indebtedness of a corporation which becomes a successor of the Company in
accordance with the provisions described under "Consolidation, Merger and Sale
of Assets"; (F) Liens on property of the Company or a Restricted Subsidiary in
favor of the United States of America or any State thereof, or any department
agency or instrumentality or political subdivision of the United States of
America or any State thereof, or in favor of any other country or any
political subdivision thereof, to secure partial, progress, advance or other
payments pursuant to any contract or statute or to secure any indebtedness
incurred for the purpose of financing all or any part of the purchase price or
the cost of construction of the property subject to such Liens, or in favor of
any trustee or mortgagee for the benefit of holders of indebtedness of any
such entity incurred for any such purpose; (G) Liens existing at ,
1996; and (H) any extension, renewal or replacement (or successive extension,
renewals or replacements), in whole or in part, of any Lien referred to in the
foregoing clauses (A) to (G), inclusive, or of any Debt secured thereby;
provided that such extension, renewal or replacement Lien shall be limited to
all or any part of the same property that secured the Lien extended, renewed
or replaced (plus any improvements on such property) and shall secure no
larger amount of Debt than that existing at the time of such extension,
renewal or replacement.
Notwithstanding the foregoing restrictions, the Company and any one or more
Restricted Subsidiaries may issue, assume or guarantee Debt secured by a Lien
which would otherwise be subject to the foregoing restrictions if at the time
it does so (the "Incurrence Time") the aggregate amount of such Debt plus all
other Debt of the Company and its Restricted Subsidiaries secured by a Lien
which would otherwise be subject to the foregoing restrictions (not including
Debt permitted to be secured under clauses (A) through (H) of the next
preceding paragraph), plus the aggregate Attributable Debt (determined as of
the Incurrence Time) of Sale and Leaseback Transactions (other than Sale and
Leaseback Transactions permitted by clause (1) under "--Limitations on Sale
and Leaseback Transactions") entered into after , 1996 and in
existence at the Incurrence Time (less the aggregate amount of proceeds of
such Sale and Leaseback Transactions which shall have been applied in
accordance with clause (3) under "Limitations on Sale and Leaseback
Transactions"), does not exceed 15% of Consolidated Net Tangible Assets.
Limitations on Sale and Leaseback Transactions. The Senior Indenture will
provide that the Company shall not itself, and shall not permit any Restricted
Subsidiary to, enter into any arrangements after , 1996 with any
bank, insurance company or other lender or investor (other than the Company or
another Restricted Subsidiary) providing for the leasing as lessee by the
Company or by any such Restricted Subsidiary of any Principal Property (except
a lease for a temporary period not to exceed three years by the end of which
it is intended the use of such Principal Property by the lessee will be
discontinued), which was or is owned by the Company or a Restricted Subsidiary
and which has been or is to be sold or transferred by the Company or a
Restricted Subsidiary more than 180 days after the completion of construction
and commencement of full operation thereof by the Company or such Restricted
Subsidiary, to such lender or investor or to any Person to whom funds have
been or are to be advanced by such lender or investor on the security of such
Principal Property (herein called a "Sale and Leaseback Transaction") unless
(1) the Company or such Restricted Subsidiary would (at the time of entering
into such arrangement) be entitled pursuant to clauses (A) through (H) above
under "--Limitation on Liens", without equally and ratably securing the Senior
Debt Securities, to issue, assume or guarantee indebtedness secured by a Lien
on such Principal Property; or (2) the Attributable Debt of the Company and
its Restricted Subsidiaries in respect of such Sale and Leaseback Transaction
and all other Sale and Leaseback Transactions entered into after ,
1996 (other than such Sale and Leaseback Transactions as are permitted by
clause (1) or clause (3) of this paragraph), plus the aggregate principal
amount of Debt secured by Liens on Principal Properties then outstanding
(excluding any such Debt secured by Liens covered in subdivisions (A) through
(H) under "--Limitation on Liens") which do not equally and ratably secure the
Senior Debt Securities, would not exceed 15% of Consolidated Net Tangible
Assets; or (3) the Company, within 180 days after the sale or transfer,
applies or causes a Restricted Subsidiary
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to apply an amount equal to the greater of the net proceeds of such sale or
transfer or fair market value of the Principal Property so sold and leased
back at the time of entering into such Sale and Leaseback Transaction (in
either case as determined by the Board of Directors) to the retirement of
Senior Debt Securities or other indebtedness of the Company (other than
indebtedness subordinated to the Senior Debt Securities) or indebtedness of a
Restricted Subsidiary, for money borrowed, having a stated maturity more than
12 months from the date of such application or which is extendible at the
option of the obligor thereon to a date more than 12 months from the date of
such application, provided that the amount to be so applied shall be reduced
by (i) the principal amount of Senior Debt Securities delivered within 180
days after such sale or transfer to the Trustee for retirement and
cancellation, and (ii) the principal amount of any such indebtedness of the
Company or a Restricted Subsidiary other than Senior Debt Securities
voluntarily retired by the Company or a Restricted Subsidiary within 180 days
after such sale or transfer; provided, further, that notwithstanding the
foregoing, no retirement referred to in this clause (3) may be affected by
payment at Maturity.
Notwithstanding the foregoing, where the Company or any Restricted
Subsidiary is the lessee in any Sale and Leaseback Transaction, Attributable
Debt shall not include any Debt resulting from the guarantee by the Company or
any other Restricted Subsidiary of the lessee's obligation thereunder.
CERTAIN DEFINITIONS
The term "Attributable Debt" means, in respect of a Sale and Leaseback
Transaction and as of any particular time, the present value (discounted at
the rate of interest implicit in the terms of the lease involved in such Sale
and Leaseback Transaction, as determined in good faith by the Company) of the
obligation of the lessee thereunder for net rental payments (excluding,
however, any amounts required to be paid by such lessee, whether or not
designated as rent or additional rent, on account of maintenance and repairs,
services, insurance, taxes, assessments, water rates or similar charges or any
amounts required to be paid by such lessee thereunder contingent upon monetary
inflation or the amount of sales, maintenance and repairs, insurance, taxes,
assessments, water rates or similar charges) during the remaining term of such
lease (including any period for which such lease has been extended or may, at
the option of the lessor, be extended).
The term "Consolidated Net Tangible Assets" means the aggregate amount of
assets (less applicable reserves and other properly deductible items) after
deducting therefrom (a) all goodwill, trade names, trademarks, patents,
unamortized debt discount and expense and other like intangibles, and (b) all
current liabilities, all as reflected in the Company's latest audited
consolidated balance sheet contained in the Company's most recent annual
report to its stockholders under Rule 14a-3 of the Exchange Act prior to the
time as of which "Consolidated Net Tangible Assets" shall be determined.
The term "Maturity", when used with respect to any security, means the date
on which the principal of such security or an installment of principal becomes
due and payable as therein or herein provided, whether at the Stated Maturity
or by declaration of acceleration, call for redemption or otherwise.
The term "Principal Property" means any single manufacturing plant, research
laboratory or other similar facility located within the United States of
America (other than its territories and possessions) and owned by, or leased
to, the Company or any Restricted Subsidiary, the book value of the property,
plant and equipment of which (as shown, net of depreciation, on the books of
the owner or owners) is not less than 2% of the Consolidated Net Tangible
Assets at the end of the most recent fiscal year of the Company, reflected in
the latest audited consolidated statement of financial position contained in
the Company's most recent annual report to its stockholders under Rule 14a-3
of the Exchange Act, except (a) any such plant or facility (i) owned or leased
jointly or in common with one or more Persons other than the Company and its
Subsidiaries, in which the interest of the Company and its Restricted
Subsidiaries does not exceed 50%, or (ii) which the Board of Directors
determines by Board Resolution in good faith is not of material importance to
the total business conducted, or assets owned, by the Company and its
Subsidiaries as an entirety, or (b) any portion of any such plant or facility
which the Board of Directors determines by Board Resolution in good faith not
to be of material importance to the use or operation thereof.
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The term "Restricted Subsidiary" means any Subsidiary substantially all the
property of which is located, or substantially all of the business of which is
carried on, within the United States of America (other than its territories
and possessions) which shall at the time, directly or indirectly through one
or more Subsidiaries or in combination with one or more other Subsidiaries,
own or be a lessee of a Principal Property.
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Indentures will provide that the Company may not consolidate with or
merge into, or convey, transfer or lease its properties and assets
substantially as an entirety to, any Person (a "successor Person"), and may
not permit any Person to merge into, or convey, transfer or lease its
properties and assets substantially as an entirety to, the Company, unless (i)
the successor Person (if any) is a corporation, partnership, trust or other
entity organized and validly existing under the laws of any domestic
jurisdiction and assumes the Company's obligations on the Debt Securities and
under the Indentures, (ii) immediately after giving effect to the 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,
(iii) if, as a result of the transaction, property of the Company or a
Restricted Subsidiary would become subject to a Lien that would not be
permitted under "Restrictive Covenants--Limitations on Liens", the Company
takes such steps as shall be necessary to secure the Senior Debt Securities,
if any, equally and ratably with (or prior to) the indebtedness secured by
such Lien, and (iv) certain other conditions are met. (Section 801)
EVENTS OF DEFAULT
Each of the following will constitute an Event of Default under the
Indentures with respect to Debt Securities of any series: (a) failure to pay
principal of or any premium on any Debt Security of that series when due (with
respect to Subordinated Debt Securities, whether or not such payment is
prohibited by the subordination provisions of the Subordinated Indenture); (b)
failure to pay any interest on any Debt Securities of that series when due,
continued for 30 days (with respect to Subordinated Debt Securities whether or
not such payment is prohibited by the subordination provision of the
Subordinated Indenture); (c) failure to deposit any sinking fund payment, when
due, in respect of any Debt Security of that series (with respect to
Subordinated Debt Securities, whether or not such deposit is prohibited by the
subordination provisions of the Subordinated Indenture); (d) failure to
perform any other covenant of the Company in the Indentures (other than a
covenant included in the Indentures solely for the benefit of a series other
than that series), continued for 60 days after written notice has been given
by the Trustee, or the Holders of at least 25% in principal amount of the
Outstanding Debt Securities of that series, as provided in the Indentures; (e)
certain events in bankruptcy, insolvency or reorganization; and (f) any other
Event of Default specified in the applicable Prospectus Supplement. (Section
501)
If an Event of Default (other than an Event of Default described in clause
(e) above) with respect to the Debt Securities of any series at the time
Outstanding shall occur and be continuing, either the Trustee or the Holders
of at least 25% in aggregate principal amount of the Outstanding Securities of
that series by notice as provided in the Indentures may declare the principal
amount of the Debt Securities of that series (or, in the case of any Debt
Security that is an Original Issue Discount Security or the principal amount
of which is not then determinable, such portion of the principal amount of
such Debt Security, or such other amount in lieu of such principal amount, as
may be specified in the terms of such Debt Security) to be due and payable
immediately. If an Event of Default described in clause (e) above with respect
to the Debt Securities of any series at the time Outstanding shall occur, the
principal amount of all the Debt Securities of that series (or, in the case of
any such Original Issue Discount Security or other Debt Security, such
specified amount) will automatically, and without any action by the Trustee or
any Holder, become immediately due and payable. After any such acceleration,
but before a judgment or decree based on acceleration, the Holders of a
majority in aggregate principal amount of the Outstanding Securities of that
series may, under certain circumstances, rescind and annul such acceleration
if all Events of Default, other than the non-payment of accelerated principal
(or other specified amount), have been
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cured or waived as provided in the Indentures. (Section 502) For information
as to waiver of defaults, see "Modification and Waiver".
Subject to the provisions of the Indentures relating to the duties of the
Trustee, in case an Event of Default shall occur and be continuing the Trustee
will be under no obligation to exercise any of its rights or powers under the
Indentures at the request or direction of any of the Holders, unless such
Holders shall have offered to the Trustee reasonable indemnity. (Section 603)
Subject to such provisions for the indemnification of the Trustee, the Holders
of a majority in aggregate principal amount of the Outstanding Securities of
any series will 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
Debt Securities of that series. (Section 512)
No Holder of a Debt Security of any series will have any right to institute
any proceeding with respect to the Indentures, or for the appointment of a
receiver or a trustee, or for any other remedy thereunder, unless (i) such
Holder has previously given to the Trustee written notice of a continuing
Event of Default with respect to the Debt Securities of that series, (ii) the
Holders of at least 25% in aggregate principal amount of the Outstanding
Securities of that series have made written request, and such Holder or
Holders have offered reasonable indemnity, to the Trustee to institute such
proceeding as trustee and (iii) the Trustee has failed to institute such
proceeding, and has not received from the Holders of a majority in aggregate
principal amount of the Outstanding Securities of that series a direction
inconsistent with such request, within 60 days after such notice, request and
offer. (Section 507) However, such limitations do not apply to a suit
instituted by a Holder of a Debt Security for the enforcement of payment of
the principal of or any premium or interest on such Debt Security on or after
the applicable due date specified in such Debt Security. (Section 508)
The Company will be required to furnish to the Trustee annually a statement
by certain of its officers as to whether or not the Company, to their
knowledge, is in default in the performance or observance of any of the terms,
provisions and conditions of the Indentures and, if so, specifying all such
known defaults. (Section 1004)
MODIFICATION AND WAIVER
Modifications and amendments of the Indentures may be made by the Company
and the Trustee with the consent of the Holders of a majority in aggregate
principal amount of the Outstanding Securities of each series affected by such
modification or amendment; provided, however, that no such modification or
amendment may, without the consent of the Holder of each Outstanding Security
affected thereby, (a) change the Stated Maturity of the principal of, or any
installment of principal of or interest on, any Debt Security, (b) reduce the
principal amount of, or any premium or interest on, any Debt Security, (c)
reduce the amount of principal of an Original Issue Discount Security or any
other Debt Security payable upon acceleration of the Maturity thereof, (d)
change the place or currency of payment of principal of, or any premium or
interest on, any Debt Security, (e) impair the right to institute suit for the
enforcement of any payment on or with respect to any Debt Security, (f), in
the case of Subordinated Debt Securities, modify the subordination provisions
in a manner adverse to the Holders of the Subordinated Debt Securities, (g)
reduce the percentage in principal amount of Outstanding Securities of any
series, the consent of whose Holders is required for modification or amendment
of the Indentures, (h) reduce the percentage in principal amount of
Outstanding Securities of any series necessary for waiver of compliance with
certain provisions of the Indentures or for waiver of certain defaults, or (i)
modify such provisions with respect to modification and waiver. (Section 902)
The Holders of a majority in principal amount of the Outstanding Securities
of any series may waive compliance by the Company with certain restrictive
provisions of the Indentures. (Sections 1010 and 1008 of the Senior Indenture
and the Subordinated Indenture, respectively.) The Holders of a majority in
principal amount of the Outstanding Securities of any series may waive any
past default under the Indentures, except a default in the payment of
principal, premium or interest and certain covenants and provisions of the
Indentures which cannot be amended without the consent of the Holder of each
Outstanding Security of such series affected. (Section 513)
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The Indentures will provide that in determining whether the Holders of the
requisite principal amount of the Outstanding Securities have given or taken
any direction, notice, consent, waiver or other action under the Indentures as
of any date, (i) the principal amount of an Original Issue Discount Security
that will be deemed to be Outstanding will be the amount of the principal
thereof that would be due and payable as of such date upon acceleration of the
Maturity thereof to such date, (ii) if, as of such date, the principal amount
payable at the Stated Maturity of a Debt Security is not determinable (for
example, because it is based on an index), the principal amount of such Debt
Security deemed to be Outstanding as of such date will be an amount determined
in the manner prescribed for such Debt Security, and (iii) the principal
amount of a Debt Security denominated in one or more foreign currencies or
currency units that will be deemed to be Outstanding will be the U.S. dollar
equivalent, determined as of such date in the manner prescribed for such Debt
Security, of the principal amount of such Debt Security (or, in the case of a
Debt Security described in clause (i) or (ii) above, of the amount described
in such clause). Certain Debt Securities, including those for whose payment or
redemption money has been deposited or set aside in trust for the Holders and
those that have been fully defeased pursuant to Section 1302, will not be
deemed to be Outstanding. (Section 101)
Except in certain limited circumstances, the Company will be entitled to set
any day as a record date for the purpose of determining the Holders of
Outstanding Securities of any series entitled to give or take any direction,
notice, consent, waiver or other action under the Indentures, in the manner
and subject to the limitations provided in the Indentures. In certain limited
circumstances, the Trustee will be entitled to set a record date for action by
Holders. If a record date is set for any action to be taken by Holders of a
particular series, such action may be taken only by persons who are Holders of
Outstanding Securities of that series on the record date. To be effective,
such action must be taken by Holders of the requisite principal amount of such
Debt Securities within a specified period following the record date. For any
particular record date, this period will be 180 days or such shorter period as
may be specified by the Company (or the Trustee, if it set the record date),
and may be shortened or lengthened (but not beyond 180 days) from time to
time. (Section 104)
DEFEASANCE AND COVENANT DEFEASANCE
If and to the extent indicated in the applicable Prospectus Supplement, the
Company may elect, at its option at any time, to have the provisions of
Section 1302, relating to defeasance and discharge of indebtedness, or Section
1303, relating to defeasance of certain restrictive covenants in the
Indentures, applied to the Debt Securities of any series, or to any specified
part of a series. (Section 1301)
Defeasance and Discharge. The Indentures will provide that, upon the
Company's exercise of its option (if any) to have Section 1302 applied to any
Debt Securities, with respect to any Subordinated Debt Securities, the
provisions of Article Fifteen of the Subordinated Indenture relating to
subordination will cease to be effective and, with respect to any Debt
Securities, the Company will be discharged from all its obligations with
respect thereto (except for certain obligations to exchange or register the
transfer of Debt Securities, to replace stolen, lost or mutilated Debt
Securities, to maintain paying agencies and to hold moneys for payment in
trust) upon the deposit in trust for the benefit of the Holders of such Debt
Securities of money or U.S. Government Obligations, or both, which, through
the payment of principal and interest in respect thereof in accordance with
their terms, will provide money in an amount sufficient to pay the principal
of and any premium and interest on such Debt Securities on the respective
Stated Maturities in accordance with the terms of the Indentures and such Debt
Securities. Such defeasance or discharge may occur only if, among other
things, the Company has delivered to the Trustee an Opinion of Counsel to the
effect that the Company has received from, or there has been published by, the
United States Internal Revenue Service a ruling, or there has been a change in
tax law, in either case to the effect that Holders of such Debt Securities
will not recognize gain or loss for federal income tax purposes as a result of
such deposit, defeasance and discharge and will be subject to federal income
tax on the same amount, in the same manner and at the same times as would have
been the case if such deposit, defeasance and discharge were not to occur.
(Sections 1302 and 1304)
Defeasance of Certain Covenants. The Indentures will provide that, upon the
Company's exercise of its option (if any) to have Section 1303 applied to any
Debt Securities, the Company may omit to comply with
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certain restrictive covenants, including those described under "Restrictive
Covenants" and in the last sentence under "Consolidation, Merger and Sale of
Assets" and any that may be described in the applicable Prospectus Supplement,
and the occurrence of certain Events of Default, which are described above in
clause (d) (with respect to such restrictive covenants) under "Events of
Default" and any that may be described in the applicable Prospectus
Supplement, will be deemed not to be or result in an Event of Default, in each
case with respect to such Debt Securities, and, in the case of the
Subordinated Indenture, the provisions of Article Fifteen relating to
subordination will cease to be effective with respect to any Subordinated Debt
Securities. The Company, in order to exercise such option, will be required to
deposit, in trust for the benefit of the Holders of such Debt Securities,
money or U.S. Government Obligations, or both, which, through the payment of
principal and interest in respect thereof in accordance with their terms, will
provide money in an amount sufficient to pay the principal of and any premium
and interest on such Debt Securities on the respective Stated Maturities in
accordance with the terms of the Indentures and such Debt Securities. The
Company will also be required, among other things, to deliver to the Trustee
an Opinion of Counsel to the effect that Holders of such Debt Securities will
not recognize gain or loss for federal income tax purposes as a result of such
deposit and defeasance of certain obligations and will be subject to federal
income tax on the same amount, in the same manner and at the same times as
would have been the case if such deposit and defeasance were not to occur. In
the event the Company exercised this option with respect to any Debt
Securities and such Debt Securities were declared due and payable because of
the occurrence of any Event of Default, the amount of money and U.S.
Government Obligations so deposited in trust would be sufficient to pay
amounts due on such Debt Securities at the time of their respective Stated
Maturities but may not be sufficient to pay amounts due on such Debt
Securities upon any acceleration resulting from such Event of Default. In such
case, the Company would remain liable for such payments. (Sections 1303 and
1304)
NOTICES
Notices to Holders of Debt Securities will be given by mail to the addresses
of such Holders as they may appear in the Security Register. (Sections 101 and
106)
TITLE
The Company, the Trustee and any agent of the Company or the Trustee may
treat the Person in whose name a Debt Security is registered as the absolute
owner thereof (whether or not such Debt Security may be overdue) for the
purpose of making payment and for all other purposes. (Section 308)
GOVERNING LAW
The Indentures and the Debt Securities will be governed by, and construed in
accordance with, the law of the State of New York. (Section 112)
REGARDING THE TRUSTEE
The Trustee is the trustee for the Debt Securities to be issued. The Trustee
is also trustee under the Company's ESOP, as defined below, as discussed more
fully herein. In addition, Chemical Mellon Shareholder Services, L.L.C., an
affiliate of the Trustee, is the Rights Agent under the Company's Rights Plan,
as defined below, as discussed more fully herein. The Trustee also provides
cash management and other banking and advisory services to the Company in the
normal course of business.
Upon the occurrence of an Event of Default or an event which, after notice
or lapse of time or both, would become an Event of Default, or upon the
occurrence of a default under such other indenture, the Trustee may be deemed
to have a conflicting interest with respect to the Debt Securities for
purposes of the Trust Indenture Act of 1939 and, unless the Trustee is able to
eliminate any such conflicting interest, the Trustee may be required to resign
as Trustee under either the Subordinated Indenture or the Senior Indenture. In
that event, the Company would be required to appoint a successor trustee for
such Indenture.
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DESCRIPTION OF CAPITAL STOCK
GENERAL
The authorized capital stock of the Company consists of 200,000,000 shares
of Common Stock, par value $1.00 per share, and 20,000,000 shares of Class A
Preferred Stock, without par value. The following description of the capital
stock of the Company is a summary, and as such, it does not purport to be
complete and is subject, and qualified in its entirety by reference to, the
more complete descriptions contained in (i) the Articles of Incorporation of
the Company, as amended (the "Articles"), the Bylaws of the Company, as
amended (the "Bylaws"), and the Rights Agreement, effective March 21, 1996,
between the Company and Chemical Mellon Shareholder Services, L.L.C., as
Rights Agent (the "Rights Agreement"), copies of each of which are
incorporated by reference as exhibits to the Registration Statement of which
this Prospectus is a part, and (ii) the certificate of designation relating to
each series of Preferred Stock, which will be filed with the SEC at, or prior
to, the time of the offering of such series of Preferred Stock.
COMMON STOCK
Dividends. Subject to the rights and preferences that may be applicable to
any outstanding Preferred Stock, the holders of Common Stock are entitled to
receive dividends, when, if and as declared by the Board of Directors of the
Company, out of funds legally available therefor.
Voting Rights. The holders of Common Stock are entitled to one vote per
share on all matters to be voted upon by shareholders, except that
shareholders are entitled to cumulate their votes in the election of
directors. Under cumulative voting, a shareholder has the right to multiply
the total number of shares which the shareholder is entitled to vote by the
number of directors to be elected and to cast the whole number of votes so
determined for one nominee or to distribute them among different nominees. The
Bylaws require shareholders desiring to nominate persons for election as a
director to give advance notice of such nominations to the Company.
Other than in the election of directors, whenever any corporate action is to
be taken by vote of the shareholders of the Company, or by a class of such
shareholders of the Company, generally, it shall be authorized upon receiving
the affirmative vote of a majority of the votes cast by such shareholders, or
by such class of shareholders, entitled to vote thereon. The Articles and
Bylaws require, however, the approval by the holders of at least 80% of the
votes which all shareholders of the Company would be entitled to cast at an
annual election of directors, voting together as a single class, for the
removal of any director, class of directors or the entire Board of Directors
(subject to nonremoval if sufficient votes are cast against removal) or for
any change to any provision of the Articles or Bylaws providing for the number
of directors, the classification of directors or the filling of vacancies on
the Board of Directors, unless any such change is unanimously approved by the
Board of Directors of the Company. In addition, the Bylaws of the Company may
be amended only by a vote of two-thirds of the Board of Directors then in
office, subject to the power of the shareholders to change such action.
The Bylaws provide for the Board of Directors to be divided into three
classes of directors, each class as nearly equal in number as possible, with
one class being elected each year for a three-year term. The classification of
the Board helps to ensure continuity and stability of corporate leadership and
policy; however, it also has the effect of making it more difficult for a
person to acquire control of the Company because at least two annual meetings
are necessary to effect a change in a majority of the Company's directors.
Further, while cumulative voting enables minority shareholders to gain
representation on the Board, the existence of a classified Board increases the
number of shares required to elect at least one director.
Other Information. The Common Stock does not carry preemptive rights, is not
redeemable, does not have any conversion rights, is not subject to further
calls and is not subject to any sinking fund provisions. In the event of a
liquidation, dissolution or winding up of the Company, the holders of Common
Stock are entitled to share ratably in all assets remaining after the payment
of the liabilities and the liquidation preferences of any outstanding
Preferred Stock. The shares of Common Stock currently outstanding are freely
alienable, fully paid
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and nonassessable. Except in certain circumstances as discussed below under
"Description of Capital Stock--Certain Provisions Affecting Control of the
Company," the Common Stock is not subject to discriminatory provisions based
on ownership thresholds.
CLASS A PREFERRED STOCK
The Class A Preferred Stock, other than Series One Preferred Stock and ESOP
Preferred Stock as discussed below, will have the dividend, conversion,
redemption, voting and liquidation rights set forth below unless otherwise
provided in the Prospectus Supplement relating to a particular series of the
Preferred Stock. Reference is made to the Prospectus Supplement relating to
the particular series of the Preferred Stock offered thereby for specific
terms, including: (i) the title and liquidation preference per share of such
Preferred Stock and the number of shares offered; (ii) the price at which such
Preferred Stock will be issued; (iii) the dividend rate (or method of
calculation), the dates on which dividends shall be payable and the dates from
which dividends shall commence to accumulate; (iv) any redemption or sinking
fund provisions of such Preferred Stock; (v) any conversion provisions of such
Preferred Stock; (vi) the voting rights, if any, of such Preferred Stock; and
(vii) any additional dividend, liquidation, redemption, sinking fund and other
special or relative rights, preferences, qualifications, privileges,
limitations, options and restrictions of such Preferred Stock. The Class A
Preferred Stock is available for possible future financing and acquisition
transactions, to pay stock dividends or make distributions, to fund employee
benefit plans and for other general corporate purposes. Under certain
circumstances, the Class A Preferred Stock could be used to create voting
impediments for persons seeking to gain control of the Company.
Dividends. The Preferred Stock will be preferred over the Common Stock (but
may be subordinated as to the other series of Preferred Stock) as to the
payment of dividends. Before any dividends or distributions on the Common
Stock shall be declared and set apart for payment or paid, the holders of
shares of each series of Preferred Stock shall be entitled to receive
dividends (either in cash, shares of Common Stock or Preferred Stock, or
otherwise), when, as and if declared by the Board of Directors, at the rate
and on the date or dates as set forth in the Prospectus Supplement. With
respect to each series of Preferred Stock, the dividends on each share of such
series shall be cumulative from the date of issuance of such shares unless
some other date is set forth in the Prospectus Supplement relating to any such
series. Accruals of dividends shall not bear interest.
Conversion. Shares of any series of Preferred Stock will be convertible into
shares of Common Stock or into shares of any other series of Preferred Stock
to the extent set forth in the Prospectus Supplement relating to any such
series.
Redemption. Shares of any series of Preferred Stock will be redeemable to
the extent set forth in the Prospectus Supplement relating to any such series,
which may or may not include any restrictions on the repurchase or redemption
thereof while there is any arrearage in the payment of dividends.
Voting Rights. Unless otherwise provided in the Prospectus Supplement, the
holders of shares of Preferred Stock will be entitled to one vote for each
share of Preferred Stock held by them on all matters presented to
shareholders.
Liquidation. The Preferred Stock will be preferred over the Common Stock
(but may be subordinated as to other series of Preferred Stock, as described
herein) as to assets so that the holders of each series of Preferred Stock
will be entitled to be paid, upon the voluntary or involuntary liquidation,
dissolution or winding up of the Company and before any distribution is made
to the holders of Common Stock, the amount set forth in the Prospectus
Supplement relating to any such series, but in such case the holders of such
series of Preferred Stock will not be entitled to any other or further
payment.
Other Information. Unless otherwise provided in the Prospectus Supplement,
the Preferred Stock will not carry any preemptive rights, will not be, upon
issuance, subject to further calls and will not be, upon issuance, subject to
any sinking fund provisions. The Preferred Stock will be, when issued, fully
paid and nonassessable. Unless otherwise provided in the Prospectus
Supplement, and except in certain circumstances as discussed below
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under "Description of Capital Stock--Certain Provisions Affecting Control of
the Company," the Preferred Stock will not be, upon issuance, subject to
discriminatory provisions based on ownership thresholds.
SERIES ONE PREFERRED STOCK AND PREFERRED STOCK PURCHASE RIGHTS
Preferred Stock Purchase Rights. The Series One Preferred Stock, which is a
series of Class A Preferred Stock, is issuable pursuant to the exercise of
rights to purchase Series One Preferred Stock ("Rights"). The Series One
Preferred Stock is not being offered hereby, although the Rights will attach
to any Common Stock which may be sold pursuant to this Prospectus and any
Prospectus Supplement. On March 21, 1996, the Board of Directors of the
Company paid a distribution of one Right for each outstanding share of Common
Stock of the Company to shareholders of record on January 19, 1996, and with
respect to each share of Common Stock that may be issued by the Company prior
to the date on which the Rights first become exercisable (or the earlier
redemption or expiration of the Rights), subject to adjustment in certain
events. In general, the Rights become exercisable ten days after a person or
group either acquires beneficial ownership of shares representing 20% or more
of the voting power of the Company or announces a tender or exchange offer
that would result in such person or group beneficially owning shares
representing 28% or more of the voting power of the Company. When the Rights
become exercisable, each Right entitles its holder (other than such 20%
shareholder or tender or exchange offeror) to buy one one-hundredth of a newly
issued share of Series One Preferred Stock at a purchase price of $300,
subject to adjustment. If, after the Rights become exercisable, any person or
group becomes the beneficial owner of 28% or more of the voting power of the
Company or if the Company is the surviving corporation in a merger with a
person or group that owns 20% or more of the voting power of the Company, then
each owner of a Right (other than such 20% or 28% shareholder) will be
entitled to purchase shares of Armstrong's Common Stock having a value equal
to twice the exercise price of the Right. In addition, if, after the Rights
become exercisable, the Company is a party to a merger and is not the
surviving company or 50% or more of the Company's assets or earnings power are
sold in a single or series of related transactions, then each owner of a Right
will be entitled to purchase shares of the acquiring person having a value
equal to twice the exercise price of the Right. Until the Rights first become
exercisable, the Rights attach to and trade with shares of the Company's
Common Stock. Generally, the Rights are redeemable at the option of the
Company for $.05 per Right at any time prior to the tenth day following a
public announcement that a person or group has acquired beneficial ownership
of 20% or more of the voting power of the Company. The Rights expire by their
terms on March 21, 2006, unless earlier redeemed.
The terms of the Rights are set forth in the Rights Agreement which has been
filed with the SEC as an Exhibit to a Registration Statement on Form 8-A/A
filed on March 15, 1996, and is incorporated herein by reference.
Dividends. Subject to the rights and preferences of the holders of any other
series of Class A Preferred Stock, the holders of Series One Preferred Stock
are entitled to receive cumulative, quarterly dividends, without interest,
when and as declared by the Board of Directors of the Company, out of funds
legally available therefor, in preference to the holders of Common Stock and
in an amount per share equal to the greater of $36.00 or 100 times, as
adjusted, the aggregate per share amount of all cash and non-cash dividends or
other distributions, other than a dividend or distribution payable in shares
of Common Stock, paid on the Common Stock in the immediately preceding
quarter.
Conversion Rights. In the event the Company enters into any consolidation,
merger, combination or other transaction in which the Common Stock is
exchanged for or changed into other stock or securities, cash and/or any other
property, then the Series One Preferred Stock will be at the same time,
similarly exchanged for or converted into an amount per share equal to 100
times, as adjusted, the aggregate amount for or into which the Common Stock is
exchanged or converted.
Voting Rights. Holders of Series One Preferred Stock have no voting rights
except as may be provided by law.
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Redemption. The Series One Preferred Stock may be redeemed at the option of
the Board of Directors of the Company, as a whole, but not in part, at any
time, at a cash price per share equal to 100 times, as adjusted, the average
market value, as defined, of the Common Stock, plus all accrued but unpaid
dividends. The Company is not entitled, however, to purchase or otherwise
acquire shares of the Series One Preferred Stock if the quarterly dividend in
respect thereof is accrued and has not been paid or declared and a sum
sufficient for the payment thereof set apart unless all shares of such stock
at the time outstanding are purchased or otherwise acquired.
Liquidation. Subject to the rights and preferences of the holders of any
other series of Class A Preferred Stock, upon any voluntary or involuntary
liquidation, dissolution or winding up of the Company, the holders of Series
One Preferred Stock are entitled to $100 per share, plus all accrued and
unpaid dividends, plus an amount equal to the holder's pro rata share of
assets that would be available for distribution after payment of all
liabilities, liquidation preferences and distributions on the Common Stock, if
any, as determined according to a formula and subject to adjustment in certain
events. The amount payable to the holders of Series One Preferred Stock as so
determined is prior to any payment or distribution to the holders of Common
Stock.
Other Information. The Series One Preferred Stock does not carry any
preemptive rights, will not be subject, upon issuance, to any sinking fund
provisions and will not be subject, upon issuance, to any further calls. Upon
issuance, the shares of the Series One Preferred Stock will be freely
alienable, fully paid and nonassessable. Except in certain circumstances as
discussed below under "Description of Capital Stock--Certain Provisions
Affecting Control of the Company," the Series One Preferred Stock will be,
upon issuance, freely alienable and not subject to discriminatory provisions
based on ownership thresholds.
ESOP PREFERRED STOCK
In 1989, the Board of Directors of the Company established a series of Class
A Preferred Stock, without par value, designated as Series A ESOP Convertible
Preferred Stock (the "ESOP Preferred Stock"), in connection with the adoption
of the Company's Employee Stock Ownership Plan (the "Plan"). The ESOP
Preferred Stock is not being offered hereby.
Dividends. Subject to the rights and preferences of the holders of any other
series of Class A Preferred Stock, the holders of ESOP Preferred Stock are
entitled to receive cumulative (without interest), semi-annual (in arrears),
cash dividends, if, when and as declared by the Board of Directors of the
Company, out of funds legally available therefor, in an amount equal to $3.462
per share ("ESOP Preferred Dividends"). ESOP Preferred Dividends on
outstanding shares of ESOP Preferred Stock will accrue on a daily basis
whether or not the Company may legally declare and pay a dividend at the time.
Such dividend rights rank prior to the dividend rights of the holders of the
Series One Preferred Stock.
Conversion. A holder of shares of ESOP Preferred Stock is entitled, at any
time, to cause any or all shares of ESOP Preferred Stock to be converted into
shares of Common Stock at a conversion ratio of one share of Common Stock for
each one share of ESOP Preferred Stock, as adjusted. Whenever the Company
issues shares of Common Stock upon conversion of shares of the ESOP Preferred
Stock, the Company will also issue Rights to purchase Series One Preferred
Stock in accordance with the terms of the Rights Agreement (see "Description
Of Capital Stock--Series One Preferred Stock and Preferred Stock Purchase
Rights") or any rights issued to holders of the Common Stock in addition to or
in replacement therefore, but only if such rights are issued and outstanding
and held by other holders of Common Stock and such rights have not expired or
been redeemed or exchanged. In the event any shares of the ESOP Preferred
Stock are transferred to any party other than the trustee of the Plan, such
shares are similarly and automatically converted into shares of Common Stock.
The Company is required at all times to reserve and keep available out of its
authorized and unissued Common Stock the number of shares issuable upon
conversion of all shares of ESOP Preferred Stock then outstanding. See also
"Description of Capital Stock--ESOP Preferred Stock--Fundamental
Transactions."
Redemption. The ESOP Preferred Stock may be redeemed at the option of the
Board of Directors of the Company, in whole or in part (either pro rata to
each holder or chosen by lot, as may be determined by the
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Board of Directors of the Company), by giving to the holder thereof not less
than 20 days' nor more than 60 days' prior written notice of such redemption
(setting forth certain specified information) at the following redemption
prices per share:
<TABLE>
<CAPTION>
12 MONTH PERIOD
BEGINNING JUNE 15 REDEMPTION PRICE
----------------- ----------------
<S> <C>
1995 $49.13
1996 $48.79
1997 $48.44
1998 $48.10
</TABLE>
and thereafter at $47.75 per share plus, in each case, accrued but unpaid
dividends.
The Company may redeem any or all of the ESOP Preferred Stock at a
redemption price of $47.75 per share, plus accrued but unpaid dividends if, at
any time (i) dividends on the ESOP Preferred Stock are no longer tax
deductible, (ii) the Internal Revenue Service (the "IRS") determines that the
Plan is not a qualified plan, (iii) the interest income exclusion for Plan
lenders is reduced below 50%, (iv) the Company determines in good faith that
the ESOP Preferred Stock does not comply with the one-share one-vote rule of
Rule 19(c)-4 of the SEC, or (v) the Company terminates the Plan or future
contributions to the Plan.
There is no restriction on the repurchase or redemption of ESOP Preferred
Stock while there is any arrearage in the payment of dividends. The ESOP
Preferred Stock is redeemable at the option of the Trustee, who is the holder
thereof, when and to the extent necessary to provide for (i) any distribution
required to be made under the Plan or (ii) payment on the indebtedness of the
Plan, but only to remedy or prevent a default thereunder, at a redemption
price of $47.75 per share, plus accrued but unpaid dividends. See also
"Description of Capital Stock--ESOP Preferred Stock--Fundamental
Transactions."
Voting Rights. The holders of ESOP Preferred Stock are entitled to vote on
all matters submitted to a vote of the holders of Common Stock, voting
together on an as-if-converted basis. See "Description of Capital Stock--
Common Stock--Voting Rights" for a description of voting rights with respect
to Common Stock and this ESOP Preferred Stock on an as-if-converted basis.
The affirmative vote of holders of a majority of the ESOP Preferred Stock,
voting as a series, is required for (i) any amendment to the Articles that
would (a) change adversely the preferences, qualifications, limitations or
special or relative rights of the ESOP Preferred Stock, (b) authorize a new
class or series of shares senior to the ESOP Preferred Stock as to dividends
or assets, or (c) increase the number of authorized shares of any class or
series senior to the ESOP Preferred Stock as to dividends or assets, and (ii)
any merger, consolidation, division or share exchange, or sale, lease or
exchange of all or substantially all of the assets of the Company, which would
effectively result in a change in the Articles in any of the foregoing
manners.
Liquidation. Subject to the rights and preferences of the holders of any
other series of Class A Preferred Stock, upon any voluntary or involuntary
liquidation, dissolution, or winding up of the Company, the holders of ESOP
Preferred Stock are entitled to $47.75 per share, plus all accrued and unpaid
dividends thereon. The amount payable to the holders of ESOP Preferred Stock
as so determined is prior to any payment or distribution to the holders of
Series One Preferred Stock and the Common Stock.
Fundamental Transactions. In the event the Company consummates a
consolidation, merger or similar transaction, however named, in which the
Common Stock of the Company is exchanged, changed, reclassified or converted
by operation of law into stock or securities of any successor or resulting
company that constitutes qualifying employer securities for purposes of the
Internal Revenue Code, as amended, and the Employee Retirement Income Security
Act of 1974, as amended, or their successors ("qualifying employer
securities"), the shares of ESOP Preferred Stock will be assumed by and shall
become preferred stock of such successor or resulting company with the same
preferences, voting rights, qualifications, privileges, limitations, options,
conversion or other special rights which the ESOP Preferred Stock had
immediately prior to the transaction.
23
<PAGE>
In the event the Company consummates a consolidation, merger or similar
transaction, however named, in which the Common Stock of the Company is
exchanged, changed, reclassified or converted by operation of law into cash,
property or stock or securities of any successor or resulting company that
does not constitute qualifying employer securities, holders of ESOP Preferred
Stock have the right to elect to have their ESOP Preferred Stock converted
into the stock, securities, cash or property in the transaction or to have the
Company redeem their ESOP Preferred Stock at a redemption price of $47.75 per
share, plus all accrued and unpaid dividends.
Other Information. The ESOP Preferred Stock does not carry any preemptive
rights, is not subject, or upon issuance, will not be subject, to further
calls and is not subject, or upon issuance, will not be subject, to any
sinking fund provisions. The issued and outstanding shares of the ESOP
Preferred Stock are, and the authorized but unissued shares of the ESOP
Preferred Stock upon issuance will be, fully paid and nonassessable. Except in
certain circumstances as discussed above in this section and below under
"Description of Capital Stock--Certain Provisions Affecting Control of the
Company," the ESOP Preferred Stock is not, or upon issuance will not, be
subject to discriminatory provisions based on ownership thresholds.
CERTAIN PROVISIONS AFFECTING CONTROL OF THE COMPANY
General. Certain provisions of the Company's Articles, Bylaws and the PBCL
operate only with respect to extraordinary corporate transactions, such as
mergers, reorganizations, tender offers, sales or transfers of substantially
all of the Company's assets or the liquidation of the Company, and could have
the effect of delaying or preventing a change in control of the Company in
certain circumstances.
Certain Provisions of the Articles. The Articles provide that a Business
Combination (as defined below) with an Interested Shareholder (as defined
below) requires the affirmative vote of shareholders entitled to cast at least
a majority of the votes which all shareholders, other than the Interested
Shareholder, would be entitled to cast at an annual election of directors,
voting together as a single class, unless the transaction is approved by a
majority of the Disinterested Directors (as defined below) or the transaction
meets certain fair price and procedural requirements. An "Interested
Shareholder" is, with certain exceptions, any person, or his assignee or
successor (not including Armstrong or an affiliate of Armstrong), who is (or
was within the previous two years) the beneficial owner of more than ten
percent of the voting power of the outstanding voting stock, together with
such person's affiliates and associates. A "Business Combination" includes,
among other transactions, the following: (i) the merger or consolidation of
the Company with the Interested Shareholder; (ii) the sale of all or
substantially all of the assets of the Company to the Interested Shareholder
or its affiliates or associates; (iii) the issuance of securities of the
Company to an Interested Shareholder having a value equal to greater than ten
percent of the assets of the Company; (iv) the adoption of any plan for the
liquidation or dissolution of the Company proposed by or on behalf of the
Interested Shareholder; or (v) any reclassification or recapitalization of
securities which effectively increases the proportional equity share of the
Interested Shareholder. The term "Disinterested Director" means a director who
is neither affiliated with nor a representative of an Interested Shareholder
and (i) was a director prior to the time an Interested Shareholder became
such, (ii) was recommended or elected to fill a vacancy created by an increase
in the size of the Board of Directors by a majority of the Disinterested
Directors then in office, or (iii) was a successor of a Disinterested Director
and was recommended or elected to succeed a Disinterested Director by a
majority of the Disinterested Directors then in office. Certain other
provisions of the Articles and Bylaws which could have the effect of delaying
or preventing a Change in Control of the Company are described above under the
captions "Description of Capital Stock--Common Stock" and "Description of
Capital Stock--Class A Preferred Stock."
Certain Provisions of the PBCL. The Company is governed by certain "anti-
takeover" provisions in the Pennsylvania Business Corporation Law (the
"PBCL"), including the following: (i) provisions which prohibit certain
business combinations (as defined in the PBCL) involving a corporation that
has voting shares registered under the Exchange Act and an "interested
shareholder" (generally defined to include a person who beneficially owns
shares representing at least twenty percent of the votes that all shareholders
would be entitled to cast in an election of directors of the corporation)
unless certain conditions are satisfied or an exemption is applicable; (ii)
provisions concerning a "control-share acquisition" in which the voting rights
of certain shareholders of the
24
<PAGE>
corporation (specifically, a shareholder who acquires 20%, 33 1/3% or 50% or
more of the voting power of the corporation ) are conditioned upon the consent
of a majority vote at a meeting of the independent shareholders of the
corporation after disclosure by such shareholder of certain information, and
with respect to which such shareholder is effectively deprived of voting
rights if consent is not obtained; (iii) provisions pursuant to which any
profit realized by a "controlling person or group," generally defined as a 20%
beneficial owner, from the disposition of any equity securities within twenty-
four months prior to, and eighteen months succeeding, the acquisition of such
control is recoverable by the corporation; (iv) provisions pursuant to which
severance payments are to be made by the corporation to any eligible employee
of a covered corporation whose employment is terminated, other than for
willful misconduct, with ninety days before, or twenty-four months after, a
control-share acquisition; (v) provisions pursuant to which any holder of
voting shares of a registered corporation who objects to a "control
transaction" (generally defined as the acquisition by a person or group (the
"controlling person or group") that would entitle the holders thereof to cast
at least 20% of the votes that all shareholders would be entitled to cast in
an election of the directors of the corporation) is entitled to make a written
demand on the controlling person or group for payment of the fair value of the
voting shares of the corporation held by the shareholder; (vi) a set of
interrelated provisions which are designed to support the validity of actions
taken by the Board of Directors in response to takeover bids, including
specifically the Board's authority to "accept, reject or take no action" with
respect to a takeover bid, and permitting the unfavorable disparate treatment
of a takeover bidder; and (viii) provisions which allow the directors broad
discretion in considering the best interests of the corporation, such as the
short and long-term interests of the corporation and the resources, intent and
conduct of any person seeking to acquire the corporation.
DESCRIPTION OF DEPOSITARY SHARES
General. The Company may, at its option, elect to offer fractional shares of
Preferred Stock, rather than full shares of Preferred Stock. In the event such
option is exercised, the Company will issue to purchasers receipts for
Depositary Shares, each of which will represent a fraction (to be set forth in
the Prospectus Supplement relating to a particular series of Preferred Stock)
of a share of a particular series of Preferred Stock.
The shares of any series of the Preferred Stock underlying the Depositary
Shares will be deposited under a separate Deposit Agreement (the "Deposit
Agreement") between the Company and a bank or trust company selected by the
Company having its principal office in the United States and having a combined
capital and surplus of at least $50,000,000 (the "Depositary"). The Prospectus
Supplement relating to a series of Depositary Shares will set forth the name
and address of the Depositary. Subject to the terms of the Deposit Agreement,
each owner of a Depositary Share will be entitled, in proportion to the
applicable fractional interest in a share of Preferred Stock underlying such
Depositary Share, to all the rights and preferences of the Preferred Stock
underlying such Depositary Share (including dividend, voting, redemption,
conversion and liquidation rights). The Depositary Shares will be evidenced by
Depositary Receipts issued pursuant to the Deposit Agreement.
Pending the preparation of definitive engraved Depositary Receipts, the
Depositary may, upon the written order of the Company, issue temporary
Depositary Receipts substantially identical to (and entitling the holders
thereof to all the rights pertaining to) the definitive Depositary Receipts
but not in definitive form. Definitive Depositary Receipts will be prepared
thereafter without unreasonable delay, and temporary Depositary Receipts will
be exchangeable for definitive Depositary Receipts at the Company's expense.
Upon surrender of Depositary Receipts at the office of the Depositary and
upon payment of the charges provided in the Deposit Agreement and subject to
the terms thereof, a holder of Depositary Shares is entitled to have the
Depositary deliver to such holder the whole shares of Preferred Stock
underlying the Depositary Shares evidenced by the surrendered Depositary
Receipts.
Dividends. The Depositary will distribute all cash dividends or other cash
distributions received in respect of the Preferred Stock to the record holders
of Depositary Shares relating to such Preferred Stock in proportion to the
numbers of such Depositary Shares owned by such holders on the relevant record
date. The Depositary
25
<PAGE>
shall distribute only such amount, however, as can be distributed without
attributing to any holder of Depositary Shares a fraction of one cent, and any
balance not so distributed shall be added to and treated as part of the next
sum received by the Depositary for distribution to record holders of
Depositary Shares.
In the event of a distribution other than in cash, the Depositary will
distribute property received by it to the record holders of Depositary Shares
entitled thereto, unless the Depositary determines that it is not feasible to
make such distribution, in which case the Depositary may, with the approval of
the Company, sell such property and distribute the net proceeds from such sale
to such holders.
Conversion and Exchange. If any Preferred Stock underlying the Depositary
Shares is subject to provisions relating to its conversion or exchange as set
forth in a Prospectus Supplement relating thereto, each record holder of
Depositary Shares will have the right or obligation to convert or exchange
such Depositary Shares into other securities of the Company or rights or
payments pursuant to the terms thereof.
Redemption. After the date fixed for redemption as may be set forth in any
Prospectus Supplement relating to the Depositary Shares, the Depositary Shares
so called for redemption will no longer be deemed to be outstanding, and all
rights of the holders of the Depositary Shares will cease, except the right to
receive the moneys payable upon such redemption and any money or other
property to which the holders of such redeemed Depositary Shares were entitled
upon surrender to the Depositary of the Depositary Receipts in respect
thereof. Unless otherwise provided in the Prospectus Supplement or in the
Deposit Agreement, the Depositary Shares will not be subject to any
restriction on the repurchase or redemption thereof while there is any
arrearage in the payment of dividends.
Voting Rights. Upon receipt of notice of any meeting at which the holders of
the Preferred Stock are entitled to vote, the Depositary will mail the
information contained in such notice of meeting to the record holders of the
Depositary Shares relating to such Preferred Stock. Each record holder of such
Depositary Shares on the record date (which will be the same date as the
record date for the Preferred Stock) will be entitled to instruct the
Depositary as to the exercise of the voting rights pertaining to the number of
shares of Preferred Stock underlying such holder's Depositary Shares. The
Depositary will endeavor, insofar as practicable, to vote the number of shares
of Preferred Stock underlying such Depositary Shares in accordance with such
instructions, and the Company will agree to take all action which may be
deemed necessary by the Depositary in order to enable the Depositary to do so.
The Depositary will abstain from voting shares of Preferred Stock to the
extent it does not receive specific instructions from the holders of
Depositary Shares relating to such Preferred Stock.
Other Information. Unless otherwise provided in the Prospectus Supplement or
the Deposit Agreement, the Depositary Shares will not carry any conversion
rights, will not be subject, upon issuance, to any sinking fund provisions,
will not carry any liquidation or preemption rights and will not be, upon
issuance, subject to any further calls. The Depositary Shares will be, when
issued, freely alienable, fully paid and nonassessable. Unless otherwise
provided in the Prospectus Supplement or the Deposit Agreement, and except in
certain circumstances as described above under "Description of Capital Stock--
Anti-Takeover Provisions," the Preferred Stock will not be, upon issuance,
subject to discriminatory provisions based on ownership thresholds.
Amendment and Termination of the Deposit Agreement. The form of Depositary
Receipt evidencing the Depositary Shares and any provision of the Deposit
Agreement may at any time be amended by agreement between the Company and the
Depositary. However, any amendment which materially and adversely alters the
rights of the existing holders of Depositary Shares will not be effective
unless such amendment has been approved by the record holders of at least a
majority of the Depositary Shares then outstanding. A Deposit Agreement may be
terminated by the Company Depositary only if (i) all outstanding Depositary
Shares relating thereto have been redeemed or (ii) there has been a final
distribution in respect of the Preferred Stock of the relevant series in
connection with any liquidation, dissolution or winding up of the Company and
such distribution has been distributed to the holders of the related
Depositary Shares.
26
<PAGE>
Charges of Depositary. The Company will pay all transfer and other taxes and
governmental charges arising solely from the existence of the depositary
arrangements. The Company will also pay charges of the Depositary in
connection with the initial deposit of the Preferred Stock and any redemption
of the Preferred Stock. Holders of Depositary Shares will pay transfer and
other taxes and governmental charges and such other charges as are expressly
provided in the Deposit Agreement to be for their accounts.
Miscellaneous. The Depositary will forward to the holders of Depositary
Shares all reports and communications which are delivered to the Depositary
and which are required to be furnished to the holders of the Preferred Stock.
Neither the Depositary nor the Company will be liable if either is prevented
or delayed by law or any circumstance beyond its control in performing its
obligations under the Deposit Agreement. The obligations of the Company and
the Depositary under the Deposit Agreement will be limited to performance in
good faith of their duties thereunder and they will not be obligated to
prosecute or defend any legal proceeding in respect of any Depositary Shares
or Preferred Stock unless satisfactory indemnity is furnished. Either may rely
upon written advice of its counsel or accountants, or information provided by
persons presenting Preferred Stock for deposit, holders of Depositary Shares
or other persons believed to be competent and on documents believed to be
genuine.
Resignation and Removal of Depositary. The Depositary may resign at any time
by delivering to the Company notice of its election to do so, and the Company
may at any time remove the Depositary, any such resignation or removal to take
effect upon the appointment of a successor Depositary and the Company's
acceptance of such appointment. Such successor Depositary must be appointed
within 90 days after delivery of the notice of resignation or removal and must
be a bank or trust company having its principal office in the United States
and having a combined capital and surplus of at least $50,000,000.
PLAN OF DISTRIBUTION
The Company may sell the Securities being offered hereby in any of four
ways: (i) directly to purchasers, (ii) through agents, (iii) through
underwriters, and (iv) through dealers. Offers to purchase Securities may be
made by potential investors or their agents on an unsolicited basis or may be
solicited directly by the Company or agents designated by the Company from
time to time. The applicable Prospectus Supplement or Prospectus Supplements
will set forth the terms of the offering of the Securities, including the name
or names of any agents, underwriters or dealers, the purchase price of the
Securities and the proceeds to be received by the Company from such sale, any
underwriting discounts and other items constituting underwriters' compensation
and any discounts and commissions allowed or reallowed or paid to dealers or
agents. Any initial public offering price and any discounts or concessions
allowed or reallowed or paid to dealers or agents may be changed from time to
time.
In connection with the sale of Securities, underwriters or agents may
receive compensation from the Company in the form of underwriting discounts or
commissions. Underwriters may sell Securities to or through dealers, and such
dealers may receive compensation in the form of discounts, concessions or
commissions from the underwriters. Underwriters, dealers and agents
participating in the distribution of Securities may be deemed to be
underwriters, and any discounts and commissions received by them and any
profit realized by them on resale of the Securities may be deemed to be
underwriting discounts and commissions, under the Securities Act of 1933, as
amended. Such underwriters, dealers and agents may be entitled under
agreements which may be entered into by the Company to indemnification by the
Company against and contribution toward certain liabilities, including
liabilities under the Securities Act of 1933, as amended.
The Securities may be distributed in one or more transactions from time to
time at a fixed price or prices, which may be changed, or from time to time at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices.
27
<PAGE>
If so indicated in the applicable Prospectus Supplement or Prospectus
Supplements, the Company will authorize dealers or other persons acting as the
Company's agents to solicit offers by certain institutions to purchase
Securities from the Company at the public offering price set forth in the
applicable Prospectus Supplement or Prospectus Supplements pursuant to delayed
delivery contracts ("Contracts") providing for payment and delivery on the
future date or dates stated in the applicable Prospectus Supplement or
Prospectus Supplements. Each Contract will be for an amount not less than, and
the aggregate amount of Securities sold pursuant to Contracts shall be not
less nor more than, the respective amounts stated in the applicable Prospectus
Supplement or Prospectus Supplements. Institutions with whom Contracts, when
authorized, may be made include commercial and savings banks, insurance
companies, pension funds, investment companies, educational and charitable
institutions, and other institutions, but will in all cases be subject to the
approval of the Company. The obligations of any purchaser under any Contract
will not be subject to any conditions except (1) the purchase by an
institution of the Securities covered by its Contract shall not at the time of
delivery be prohibited under the laws of any jurisdiction in the United States
to which such institution is subject and (2) if Securities are being sold to
underwriters, the Company shall have sold to such underwriters the total
principal amount of such Securities less the principal amount thereof covered
by Contracts. Underwriter and such other persons will not have any
responsibility in respect of the validity or performance of Contracts.
The Securities (other than Common Stock) will be a new issue of securities
with no established trading market. If so indicated in the applicable
Prospectus Supplement, any underwriters or agents to or through whom
Securities are sold by the Company for public offering and sale may make a
market in such Securities, but such underwriters and agents will not be
obligated to do so and may discontinue any market-making at any time without
notice. No assurance can be given as to the liquidity of the trading market
for any Securities, other than Common Stock.
Certain of the underwriters, dealers and/or agents and their associates may
be customers of, engage in transactions with and perform services for the
Company, including its subsidiaries, in the ordinary course of business.
VALIDITY OF SECURITIES
Unless indicated otherwise in a Prospectus Supplement relating thereto, the
validity of the Securities will be passed upon for Armstrong by Buchanan
Ingersoll Professional Corporation, Pittsburgh, Pennsylvania, and for the
underwriters or agents, as the case may be, by Sullivan & Cromwell, New York,
New York. Sullivan and Cromwell will rely upon the opinion of Buchanan
Ingersoll Professional Corporation as to all matters of Pennsylvania law.
EXPERTS
The consolidated financial statements and schedule of the Company and its
subsidiaries as of December 31, 1995 and 1994 and for each of the fiscal years
in the three-year period ended December 31, 1995, have been incorporated by
reference herein and in the Registration Statement in reliance upon the report
of KPMG Peat Marwick L.L.P., independent certified public accountants,
incorporated by reference herein, and upon the authority of said firm as
experts in accounting and auditing.
With respect to the unaudited interim financial information for the periods
ended March 31, 1996 and 1995, incorporated by reference herein, the
independent certified public accountants have reported that they applied
limited procedures in accordance with professional standards for a review of
such information. However, their separate report included in the Company's
quarterly report on Form 10-Q for the quarter ended March 31, 1996, and
incorporated by reference herein, states that they did not audit and they do
not express an opinion on that interim financial information. Accordingly, the
degree of reliance on their report on such information should be restricted in
light of the limited nature of the review procedures applied. The accountants
are not subject to the
28
<PAGE>
liability provisions of section 11 of the 1933 Act for their report on the
unaudited interim financial information because that report is not a "report"
or a "part" of the registration statement prepared or certified by the
accountants within the meaning of sections 7 and 11 of the 1933 Act.
The consolidated financial statements of Dal-Tile International Inc.
incorporated by reference in the Company's Current Report on Form 8-K, as
amended, for the fiscal year ended December 31, 1994, have been audited by
Ernst & Young L.L.P., independent auditors, as set forth in their report
thereon (which contains an explanatory paragraph with respect to a change in
the method of accounting for income taxes as discussed in Note 8 to the
consolidated financial statements) incorporated therein and herein by
reference. Such consolidated financial statements are incorporated herein by
reference in reliance upon such report given upon the authority of such firm
as experts in accounting and auditing.
29
<PAGE>
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.*
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee**.............. $86,208
Legal fees and expenses............................................ 75,000
Rating agencies' fees.............................................. 150,000
Printing fees and expenses......................................... 80,000
Trustee's fees and expenses........................................ 15,000
Accounting fees and expenses....................................... 35,000
Blue Sky fees and expenses......................................... 20,000
Transfer Agent's and registrar's fees and expenses................. 25,000
Miscellaneous...................................................... 13,792
-------
Total**.......................................................... 500,000
</TABLE>
- --------
* All amounts are estimated except for the registration fee.
** A Securities and Exchange Commission filing fee of $62,500 was previously
paid when Registration Statement 33-38837 was initially filed. In addition,
approximately $290,000 of expenses not reflected in Item 14 was previously
paid in connection with Registration Statement 33-38837.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Subchapter D of Chapter 17 of the PBCL provides in general that a
corporation may indemnify any person, including its directors, officers and
employees, who was or is a party or is threatened to be made a party to any
threatened, pending or completed action or proceeding, whether civil,
criminal, administrative or investigative (including actions by or in the
right of the corporation) by reason of the fact that he or she is or was a
representative of or serving at the request of the corporation, against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him or her in connection with
the action or proceeding if he or she is determined by the board of directors,
or in certain circumstances by independent legal counsel to the shareholders,
to have acted in good faith and in a manner he or she reasonably believed to
be in, or not opposed to, the best interests of the corporation and, with
respect to any criminal proceeding, had no reason to believe his conduct was
unlawful. In the case of actions by or in the right of the corporation,
indemnification is not permitted in respect of any claim, issue or matter as
to which the person has been adjudged to be liable to the corporation except
to the extent a court determines that the person is fairly and reasonably
entitled to indemnification. In any case, to the extent that the person has
been successful on the merits or otherwise in defense of any claim, issue or
matter, he or she shall be indemnified against expenses (including attorneys'
fees) actually and reasonably incurred by him or her in connection therewith.
Subchapter D of Chapter 17 also provides that the indemnification permitted or
required thereby is not exclusive of any other rights to which a person
seeking indemnification may be entitled.
Article IX of the Company's By-laws, as amended, provides that the Company
shall indemnify any person who was or is made a party to, or threatened to be
made a party to, or is involved in, any action, suit, or proceeding (including
actions by or in the right of the Company) by reason of the fact that he or
she is or was a director or officer of the Company (or is or was serving at
the request of the Company as a director, officer, trustee, employee, or agent
of a related enterprise including service with respect to an employee benefit
plan or is or was serving at the specific written request of the Company as a
director, officer, trustee, employee, or agent of an unrelated enterprise)
against all expenses and liability he or she actually incurs, including,
without limitation, judgments and amounts paid or to be paid in settlement of
or in actions brought by or in the right of the Company, to the fullest extent
permitted by law. Article IX also provides that directors and officers shall
be entitled to payment in advance of expenses incurred in defending any such
action, suit, or proceeding, upon receipt of an undertaking to repay all
amounts so advanced if it is ultimately determined that they are not entitled
II-1
<PAGE>
to be indemnified or, in the case of criminal action, a majority of the Board
of Directors so determines. In addition, the Company has entered into
indemnification agreements with each of its directors which entitle the
director to indemnification for certain expenses to the fullest extent
permitted by law.
The By-laws of Armstrong also provide pursuant to Section 1713 of the PBCL
that a director of Armstrong shall not be personally liable for monetary
damages as such for any action taken, or any failure to take any action,
unless: (1) the director has breached or failed to perform the duties of
his/her office under Section 1712 of the 1988 BCL (relating to standard of
conduct and justifiable reliance); and (2) the breach or failure to perform
constitutes self-dealing, willful misconduct or recklessness. This limitation
on the personal liability of directors of Armstrong does not apply to: (1) the
responsibility or liability of a director pursuant to any criminal statute; or
(2) the liability of a director for the payment of taxes pursuant to local,
state or Federal law.
Armstrong and its subsidiaries also carry insurance insuring their officers
and directors against certain liabilities which they might incur as directors
or officers of the Company or of any other organization which they serve at
its request, including certain liabilities under the Securities Act of 1933.
ITEM 16. EXHIBITS
This Registration Statement includes the following Exhibits:
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
------- ----------------------
<C> <C> <S>
1.1 -- Form of Underwriting Agreement for Debt Securities and Preferred
Stock
1.2 -- Form of Underwriting Agreement for Common Stock
3.1 -- Articles of Incorporation, as amended
3.2 -- By-laws, as amended
4.1 -- Form of Indenture for Senior Debt Securities
4.2 -- Form of Indenture for Subordinated Debt Securities
4.3 -- Form of Deposit Agreement
4.4 -- Rights Agreement between the Company and Chemical Mellon
Shareholder Services, L.L.C. effective as of March 21, 1996
5.1 -- Opinion of Buchanan Ingersoll Professional Corporation
12.1 -- Calculation of Ratios of Earnings to Fixed Charges
12.2 -- Calculation of Ratios of Earnings to Fixed Charges and Preferred
Stock Dividends
15.1 -- Letter re: unaudited interim financial information
23.1 -- Consent of Buchanan Ingersoll Professional Corporation (contained
in its opinion filed as Exhibit 5 to this Registration Statement)
23.2 -- Consent of KPMG Peat Marwick L.L.P.
23.3 -- Consent of Ernst & Young L.L.P.
24.1 -- Powers of Attorney
24.2 -- Certified copy of the resolution of the Company's Board of
Directors authorizing the execution of the Registration Statement
on behalf of the Company by power of attorney
25.1 -- Statement of Eligibility on Form T-1 with respect to the Senior
Debt Securities
25.2 -- Statement of Eligibility on Form T-1 with respect to the
Subordinated Debt Securities
</TABLE>
II-2
<PAGE>
ITEM 17. UNDERTAKINGS
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the
information set forth in the registration statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement.
provided, however, that paragraphs (i) and (ii) above do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by Armstrong pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(4) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant's annual
report pursuant to section 13(a) or section 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(5) To deliver or cause to be delivered with the prospectus, to each
person to whom the prospectus is sent or given, the latest annual
report to security holders that is incorporated by reference in the
prospectus and furnished pursuant to and meeting the requirements
of Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of
1934; and, where interim financial information required to be
presented by Article 3 of Regulations S-X is not set forth in the
prospectus, to deliver, or cause to be delivered to each person to
whom the prospectus is sent or given, the latest quarterly report
that is specifically incorporated by reference in the prospectus to
provide such interim financial information.
(6) That, for purposes of determining any liability under the
Securities Act of 1933, the information omitted from the form of
prospectus filed as part of this registration statement in reliance
upon Rule 430A and contained in a form of prospectus filed by the
registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the
Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.
(7) That, for the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains
a form of prospectus shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
II-3
<PAGE>
(8) To file an application for the purpose of determining the
eligibility of the trustee to act under subsection (a) of section
310 of the Trust Indenture Act ("Act") in accordance with the rules
and regulations prescribed by the Commission under section
305(b)(2) of the Act.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 (the "Act") may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the County of Lancaster, Commonwealth of Pennsylvania, on this
nineteenth day of June, 1996.
ARMSTRONG WORLD INDUSTRIES, INC.
/s/ Frank A. Riddick, III
By:----------------------------------
Frank A. Riddick, III
Senior Vice-President, Finance, and
Chief Financial Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
<TABLE>
<S> <C> | <C>
George A. Lorch Chairman of the Board and President |
(Principal Executive Officer) |
|
Frank A. Riddick, III Senior Vice-President, Finance, and Chief |
Financial Officer (Principal Financial Officer) |
|
Bruce A. Leech, Jr. Controller (Principal Accounting Officer) |
|
H. Jesse Arnelle Director |
|
Van C. Campbell Director | /s/ Frank A. Riddick, III
| Attorney-in-Fact
Donald C. Clark Director |
|
E. Allen Deaver Director |
|
Ursala F. Fairbairn Director |
|
James E. Marley Director |
|
J. Phillip Samper Director |
|
Jerre L. Stead Director |
|
</TABLE>
II-5
<PAGE>
EXHIBIT INDEX
Unless otherwise noted, the following exhibits are filed herewith:
<TABLE>
<CAPTION>
PAGE
NUMBER IN
SEQUENTIAL
NUMBERING
EXHIBIT NO. DESCRIPTION SYSTEM
----------- ----------- ----------
<C> <C> <S> <C>
1.1 -- Form of Underwriting Agreement for Debt
Securities and Preferred Stock
1.2 -- Form of Underwriting Agreement for Common Stock
3.1 -- Articles of Incorporation, as amended, previously
filed as an exhibit to the Company's Annual
Report on Form 10-K for the fiscal year ended
December 31, 1995, file no. 1-2116, filed with
the Commission on March 28, 1996
3.2 -- By-laws, as amended, previously filed as an
exhibit to the Company's Annual Report on Form
10-K for the fiscal year ended December 31, 1995,
file no. 1-2116, filed with the Commission on
March 28, 1996
4.1 -- Form of Indenture for Senior Debt Securities
4.2 -- Form of Indenture for Subordinated Debt
Securities
4.3 -- Form of Deposit Agreement*
4.4 -- Rights Agreement between the Company and Chemical
Mellon Shareholder Services, effective as of
March 21, 1996, previously filed as an exhibit to
Form 8A/A, filed with the Commission on March 15,
1996, file no. 1-2116
5.1 -- Opinion of Buchanan Ingersoll Professional
Corporation*
12.1 -- Calculation of Ratios of Earnings to Fixed
Charges
12.2 -- Calculation of Ratios of Earnings to Fixed
Charges and Preferred Stock Dividends
15.1 -- Letter re: unaudited interim financial
information
23.1 -- Consent of Buchanan Ingersoll Professional
Corporation (contained in its opinion filed as
Exhibit 5 to this Registration Statement)*
23.2 -- Consent of KPMG Peat Marwick L.L.P.
23.3 -- Consent of Ernst & Young L.L.P.
24.1 -- Powers of Attorney
24.2 -- Certified copy of the resolution of the Company's
Board of Directors authorizing the execution of
the Registration Statement on behalf of the
Company by power of attorney
25.1 -- Statement of Eligibility on Form T-1 with respect
to the Senior Debt Securities
25.2 -- Statement of Eligibility on Form T-1 with respect
to the Subordinated Debt Securities
</TABLE>
- --------
* To be filed.
II-6
<PAGE>
S&C Draft of May 10, 1996
EXHIBIT 1.1
ARMSTRONG WORLD INDUSTRIES, INC.
UNDERWRITING AGREEMENT
DEBT SECURITIES AND PREFERRED STOCK
, 1996
----------------
From time to time, Armstrong World Industries, Inc., a Pennsylvania
corporation (the "Company"), may enter into one or more underwriting agreements
that provide for the sale of designated securities (the "Offered Securities") to
the several underwriters named therein. The standard provisions set forth
herein may be incorporated by reference in any such underwriting agreement (an
"Underwriting Agreement"). The Underwriting Agreement, including the provisions
incorporated therein by reference, is herein sometimes referred to as this
Agreement. Terms defined in the Underwriting Agreement are used herein as
therein defined.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement, including a prospectus, relating to,
among other securities, the Debt Securities and Preferred Stock and has filed
with, or transmitted for filing to, or shall promptly hereafter file with or
transmit for filing to, the Commission a prospectus supplement (the "Prospectus
Supplement") specifically relating to the Offered Securities pursuant to Rule
424 under the Securities Act of 1933, as amended (the "Securities Act"). The
term "Registration Statement" means the registration statement, including the
exhibits thereto, as amended to the date of this Agreement. The term "Basic
Prospectus" means the prospectus included in the Registration Statement. The
term "Prospectus" means the Basic Prospectus together with the Prospectus
Supplement. The term "preliminary prospectus" means a preliminary prospectus
supplement specifically relating to the Offered Securities, together with the
Basic Prospectus. As used herein, the terms "Basic Prospectus," "Prospectus"
and "preliminary prospectus" shall include in each case the documents, if any,
incorporated by reference therein. The terms "supplement," "amendment" and
"amend" as used herein shall include all documents deemed to be incorporated by
reference in the Prospectus that are filed subsequent to the date of the Basic
Prospectus by the Company with the Commission pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act").
<PAGE>
The term "Contract Securities" means the Offered Securities that are
Debt Securities to be purchased pursuant to the delayed delivery contracts
substantially in the form of Schedule I hereto, with such changes therein as the
Company may approve (the "Delayed Delivery Contracts"). The term "Underwriters'
Securities" means the Offered Securities other than Contract Securities.
The term "Indenture" means the Indentures dated as of , 1996,
--------
and , 1996, by and between the Company and Mellon Bank, N.A., said
---------
Indentures governing the terms of the Senior Debt Securities and the
Subordinated Debt Securities, respectively. As used herein, the term "Indenture"
will apply to each Indenture both individually and collectively.
1. Representations and Warranties. The Company represents and
------------------------------
warrants to and agrees with each of the Underwriters that:
(a) The Registration Statement has become effective; no stop order
suspending the effectiveness of the Registration Statement is in effect, and, to
the Company's knowledge after reasonable investigation, no proceedings for such
purpose are pending before or threatened by the Commission.
(b) (i) Each document, if any, filed or to be filed pursuant to the
Exchange Act and incorporated by reference in the Prospectus complied or will
comply when so filed in all material respects with the Exchange Act and the
applicable rules and regulations of the Commission thereunder, (ii) each part of
the Registration Statement, when such part became effective, did not contain,
and each such part, as amended or supplemented, if applicable, will not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading, (iii) the Registration Statement and the Prospectus comply, and, as
amended or supplemented, if applicable, will comply in all material respects
with the Securities Act and the applicable rules and regulations of the
Commission thereunder and (iv) the Prospectus does not contain and, as amended
or supplemented, if applicable, will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, except that the representations and warranties set forth in this
Section 1(b) do not apply (A) to statements or omissions in the Registration
Statement or the Prospectus based upon information furnished to the Company in
writing by any such Underwriter through the Manager expressly for use therein or
(B) to that part of the Registration Statement that constitutes the Statement of
Eligibility (Form T-1) under the Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act"), of the Trustee.
(c) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property and to
conduct its business as described in the Prospectus and is duly qualified to
transact
2
<PAGE>
business and is in good standing in each jurisdiction in which the conduct
of its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or be in
good standing would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(d) Each "significant subsidiary" (as that term is used in Rule
1-02(w) of Regulation S-X under the Securities Act) (a "Material Subsidiary") of
the Company has been duly incorporated, is validly existing as a corporation in
good standing under the laws of the jurisdiction of its incorporation, has the
corporate power and authority to own its property and to conduct its business as
described in the Prospectus and is duly qualified to transact business and is in
good standing in each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing would not have
a material adverse effect on the Company and its subsidiaries, taken as a whole.
(e) This Agreement has been duly authorized, executed and delivered by
the Company.
(f) The Indenture has been duly qualified under the Trust Indenture
Act and has been duly authorized, executed and delivered by the Company and is a
valid and binding agreement of the Company, enforceable in accordance with its
terms except as (i) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and (ii) rights
of acceleration and the availability of equitable remedies may be limited by
equitable principles of general applicability.
(g) The Delayed Delivery Contracts have been duly authorized,
executed and delivered by the Company and are valid and binding agreements of
the Company, enforceable in accordance with their respective terms except as (i)
the enforceability thereof may be limited by bankruptcy, insolvency or similar
laws affecting creditors' rights generally and (ii) the availability of
equitable remedies may be limited by equitable principles of general
applicability.
(h) If the Offered Securities are Debt Securities, such Debt
Securities have been duly authorized and, when executed and authenticated in
accordance with the provisions of the Indenture and delivered to and paid for by
the Underwriters in accordance with the terms of the Underwriting Agreement, in
the case of the Underwriters' Securities, or by institutional investors in
accordance with the terms of the Delayed Delivery Contracts, in the case of the
Contract Securities, will be entitled to the benefits
3
<PAGE>
of the Indenture and will be valid and binding obligations of the Company
enforceable in accordance with their terms except as (i) the enforceability
thereof may be limited by bankruptcy, insolvency or similar laws affecting
creditors' rights generally and (ii) rights of acceleration, if any, and the
availability of equitable remedies may be limited by equitable principles of
general applicability.
(i) If the Offered Securities are Preferred Stock, such Preferred
Stock has been duly authorized and, when delivered to and paid for by the
Underwriters in accordance with the terms of the Underwriting Agreement, will
have been validly issued, fully paid and nonassessable and the shareholders of
the Company have no preemptive rights with respect to the Preferred Stock.
(j) The execution and delivery by the Company of, and the performance
by the Company of its obligations under, this Agreement, the Indenture, the
Offered Securities, and the Delayed Delivery Contracts will not contravene any
provision of applicable law or the articles of incorporation or by-laws of the
Company or any agreement or other instrument binding upon the Company or any of
its subsidiaries that is material to the Company and its subsidiaries, taken as
a whole, or any judgment, order or decree of any governmental body, agency or
court having jurisdiction over the Company or any subsidiary, and no consent,
approval, authorization or order of, or qualification with, any governmental
body or agency is required for the performance by the Company of its obligations
under this Agreement, the Indenture, the Offered Securities, or the Delayed
Delivery Contracts, except such as may be required by Rule 424(b) under the
Securities Act or the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Offered Securities.
(k) There has not occurred any material adverse change, or, to the
Company's knowledge, any development involving a prospective material adverse
change, in the condition, financial or otherwise, or in the earnings, business
or operations of the Company and its subsidiaries, taken as a whole, from that
set forth in the Prospectus (exclusive of any amendments or supplements thereto
subsequent to the date of this Agreement).
(l) There are no legal or governmental proceedings pending or
threatened to which the Company or any of its subsidiaries is a party or to
which any of the properties of the Company or any of its subsidiaries is subject
that are required to be described in the Registration Statement or the
Prospectus and are not so described or any statutes, regulations, contracts or
other documents that are required to be described in the Registration Statement
or the Prospectus or to be filed or incorporated by reference as exhibits to the
Registration Statement
4
<PAGE>
that are not described, filed or incorporated as required.
(m) Each preliminary prospectus filed as part of the registration
statement as originally filed or as part of any amendment thereto, or filed
pursuant to Rule 424 under the Securities Act, complied when so filed in all
material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder.
(n) The Company is not an "investment company" or an entity
"controlled" by an "investment company" as such terms are defined in the
Investment Company Act of 1940, as amended.
(o) The Company has complied with all provisions of Section 517.075,
Florida Statutes relating to doing business with the Government of Cuba or with
any person or affiliate located in Cuba.
2. Delayed Delivery Contracts. If the Prospectus provides for sales
--------------------------
of Offered Securities pursuant to Delayed Delivery Contracts, the Company hereby
authorizes the Underwriters to solicit offers to purchase Contract Securities on
the terms and subject to the conditions set forth in the Prospectus pursuant to
Delayed Delivery Contracts. Delayed Delivery Contracts may be entered into only
with institutional investors approved by the Company of the types set forth in
the Prospectus. On the Closing Date, the Company will pay to the Manager as
compensation for the accounts of the Underwriters the commission set forth in
the Underwriting Agreement in respect of the Contract Securities. The
Underwriters will not have any responsibility in respect of the validity or the
performance of any Delayed Delivery Contracts.
If the Company executes and delivers Delayed Delivery Contracts with
institutional investors, the aggregate amount of Offered Securities to be
purchased by the several Underwriters shall be reduced by the aggregate amount
of Contract Securities; such reduction shall be applied to the commitment of
each Underwriter pro rata in proportion to the amount of Offered Securities set
forth opposite such Underwriter's name in the Underwriting Agreement, except to
the extent that the Manager determines that such reduction shall be applied in
other proportions and so advises the Company; provided, however, that the total
-------- -------
amount of Offered Securities to be purchased by all Underwriters shall be the
aggregate amount set forth above, less the aggregate amount of Contract
Securities.
3. Terms of Public Offering. The Company is advised by the Manager
------------------------
that the Underwriters propose to make a public offering of their respective
portions of the Underwriters' Securities as soon after this Agreement has been
entered into as in the Manager's
5
<PAGE>
judgment is advisable. The terms of the public offering of the Underwriters'
Securities are set forth in the Prospectus.
4. Payment and Delivery. Except as otherwise provided in this
--------------------
Section 4, payment for the Underwriters' Securities shall be made by check or
wire transfer payable to the order of the Company in federal (same day) funds at
the time and place set forth in the Underwriting Agreement, upon delivery to the
Manager for the respective accounts of the several Underwriters of the
Underwriters' Securities registered in such names and in such denominations as
the Manager shall request in writing not less than two full business days prior
to the date of delivery, with any transfer taxes payable in connection with the
transfer of the Underwriters' Securities to the Underwriters duly paid.
5. Conditions to the Underwriters' Obligations. The several
-------------------------------------------
obligations of the Underwriters are subject to the following conditions:
(a) Subsequent to the execution and delivery of the Underwriting
Agreement and prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading or
of any review for a possible change that does not indicate the
direction of the possible change, in the rating accorded any of the
Company's securities by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act; and
(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, business or operations of
the Company and its subsidiaries, taken as a whole, from that set
forth in the Prospectus (exclusive of any amendments or supplements
thereto subsequent to the date of this Agreement) that, in the
reasonable judgment of the Manager, is material and adverse and that
makes it, in the reasonable judgment of the Manager, impracticable to
market the Offered Securities on the terms and in the manner
contemplated in the Prospectus.
(b) The Underwriters shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer of
the Company, to the effect set forth in clause (a)(i) above and to the
effect that the representations and warranties of the Company contained in
this Agreement are true and correct as of the Closing Date and that the
Company
6
<PAGE>
has complied with all of the agreements and satisfied all of the conditions
on its part to be performed or satisfied hereunder on or before the Closing
Date.
The officer signing and delivering such certificate may rely upon the
best of his or her knowledge as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date an
opinion of Buchanan Ingersoll Professional Corporation, outside counsel for
the Company, dated the Closing Date, substantially to the effect that:
(i) the Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and
authority to own its property and to conduct its business as described
in the Prospectus.
(ii) this Agreement has been duly authorized, executed and
delivered by the Company;
(iii) the Indenture has been duly qualified under the Trust
Indenture Act and has been duly authorized, executed and delivered by
the Company and is a valid and binding agreement of the Company,
enforceable in accordance with its terms except as (a) the
enforceability thereof may be limited by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and (b) rights of
acceleration and the availability of equitable remedies may be limited
by equitable principles of general applicability;
(iv) the Delayed Delivery Contracts have been duly
authorized, executed and delivered by the Company and are valid and
binding agreements of the Company, enforceable in accordance with
their respective terms except as (a) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting creditors'
rights generally and (b) the availability of equitable remedies may be
limited by equitable principles of general applicability;
(v) if the Offered Securities are Debt Securities, such Debt
Securities have been duly authorized and, when executed and
authenticated in accordance with the provisions of the Indenture and
delivered to and paid for by the Underwriters in accordance with the
terms of the Underwriting Agreement,
7
<PAGE>
in the case of Underwriters' Securities, or by institutional investors
in accordance with the terms of the Delayed Delivery Contracts, in the
case of the Contract Securities, will be entitled to the benefits of
the Indenture, will conform to the description thereof contained in
the Prospectus and the Indenture and will be valid and binding
obligations of the Company enforceable in accordance with their terms
except as (a) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and
(b) rights of acceleration, if any, and the availability of equitable
remedies may be limited by equitable principles of general
applicability;
(vi) if the Offered Securities are Preferred Stock, such
Preferred Stock has been duly authorized and, when delivered to and
paid for by the Underwriters in accordance with the terms of the
Underwriting Agreement, such Preferred Stock will have been validly
issued, fully paid and nonassessable, will conform to the description
thereof contained in the Prospectus and the shareholders of the
Company have no preemptive rights with respect to the Preferred Stock.
(vii) the statements in the Prospectus under the captions
"Description of Debt Securities", "Description of Depositary Shares",
and "Description of Preferred Stock" fairly present the information
called for and fairly summarize the matters referred to therein;
(viii) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement,
the Indenture, the Offered Securities and the Delayed Delivery
Contracts will not contravene any provision of applicable law (except
to the extent that the federal securities laws may limit or restrict
any indemnification provisions set forth in this Agreement) or the
articles of incorporation or by-laws of the Company, and no consent,
approval, authorization or order of, or qualification with, any
governmental body or agency is required for the performance by the
Company of its obligations under this Agreement, the Indenture, the
Offered Securities or the Delayed Delivery Contract, except for the
registration of the Offered Securities under the Securities Act and
except such as may be required by Rule 424(b) under the Securities Act
or the securities or Blue Sky laws of the various states in connection
with the offer and sale of the Offered Securities;
(ix) such counsel is of the opinion ascribed to it in the
Prospectus under the caption "Taxation";
(x) the Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in
the Investment Company Act of
8
<PAGE>
1940, as amended; and
(xi) such counsel (A) is of the opinion that the
Registration Statement and the Prospectus and any further amendments
and supplements thereto made by the Company prior to the delivery of
the Offered Securities (other than the financial statements and
related schedules and other financial data therein) comply as to form
in all material respects with the requirements of the Securities Act
and the Exchange Act, as the case may be, and the rules and
regulations thereunder, and (B) is of the further opinion that,
although such counsel (i) is not passing upon and does not assume any
responsibility for the accuracy or completeness of the statements
contained in the Registration Statement or the Prospectus, and (ii)
has not made an independent investigation of facts for the purpose of
rendering its opinion, during the course of preparation of the
Registration Statement and the Prospectus, nothing came to such
counsel's attention which would cause them to believe that the
Registration Statement, at the time it became effective and as amended
or supplemented, contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading or that the
Prospectus, as of the date of the Prospectus and as of the date such
opinion is delivered, contains any untrue statement of a material fact
or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading; provided, however, that such counsel need
not express any opinion as to (1) that part of the Registration
Statement which constitutes the Statement of Eligibility (Form T-1
under the Trust Indenture Act) of the Trustee, (2) the financial
statements, including the notes and schedules thereto, and any
financial data contained or referred to in, or incorporated by
reference in, the Registration Statement or the Prospectus, or (3) the
information contained in or omitted from the Registration Statement or
Prospectus in reliance upon and in conformity with written information
furnished to the Company relating to any Underwriter by or on behalf
of any of the Underwriters for use in connection with the preparation
of the Registration Statement or the Prospectus.
In rendering its opinion, Buchanan Ingersoll Professional Corporation may
rely (i) as to matters of New York law, on the opinion of Sullivan &
Cromwell referred to in Section 5(e) hereof, and (ii) as to factual
matters, on certificates of
9
<PAGE>
officers of the Company and its subsidiaries and on certificates of public
officials.
(d) The Underwriters shall have received on the Closing Date an
opinion of the General Counsel of the Company, dated the Closing Date, to
the effect that:
(i) each Material Subsidiary is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its
property and to conduct its business as described in the Prospectus;
and each of the Company and each of its Material Subsidiaries is duly
qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent
that the failure to be so qualified or be in good standing would not
have a material adverse effect on the Company and its subsidiaries,
taken as a whole;
(ii) the statements (A) in the Registration Statement
under Item 15, (B) in "Item 3 - Legal Proceedings" of the Company's
most recent annual report on Form 10-K incorporated by reference in
the Prospectus and (C) in "Item 1 - Legal Proceedings" of Part II of
the Company's quarterly reports on Form 10-Q, if any, filed since such
annual report, in each case insofar as such statements constitute
summaries of the legal matters, documents or proceedings referred to
therein, and, in each case, as modified by any subsequently filed
Current Report on Form 8-K, and in the Prospectus under "Recent
Developments", fairly present the information called for with respect
to such legal matters, documents and proceedings and fairly summarize
the matters referred to therein;
(iii) after due inquiry, such counsel does not know of any
legal or governmental proceedings pending or threatened to which the
Company or any of its Material Subsidiaries is a party or to which any
of the properties of the Company or any of its Material Subsidiaries
is subject that are required to be described in the Registration
Statement or the Prospectus and are not so described or of any
statutes, regulations, contracts or other documents that are required
to be described in the Registration Statement or the Prospectus or to
be filed or incorporated by reference as exhibits to the Registration
Statement that are not described, filed or incorporated as required;
and
10
<PAGE>
(iv) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement,
the Indenture, the Offered Securities and the Delayed Delivery
Contracts will not contravene any provision of the articles of
incorporation or by-laws of the Company or, to the best of such
counsel's knowledge, any agreement or other instrument binding upon
the Company or any of its subsidiaries that is material to the Company
and its subsidiaries, taken as a whole, or, to the best of such
counsel's knowledge, any judgment, order or decree of any governmental
body, agency or court having jurisdiction over the Company or any
subsidiary.
With respect to the subparagraph (xi) of paragraph (c) above,
Buchanan Ingersoll may state that their opinion and belief are based upon
their participation in the preparation of the Registration Statement and
Prospectus and any amendments or supplements thereto and documents
incorporated therein by reference and review and discussion of the contents
thereof, but are without independent check or verification, except as
specified.
The opinion of Buchanan Ingersoll described in paragraph (c)
above shall be rendered to the Underwriters at the request of the Company
and shall so state therein.
(e) The Underwriters shall have received on the Closing Date an
opinion of Sullivan & Cromwell, counsel for the Underwriters, dated the
Closing Date, covering the matters referred to in subparagraphs (ii),
(iii), (iv), (v) and (vi) of paragraph (c) above. In rendering such
opinion, Sullivan & Cromwell may rely as to the incorporation of the
Company and all other matters of Pennsylvania law upon the opinion of
Buchanan Ingersoll referred to in paragraph (c) above. The Underwriter
also shall have received a letter from Sullivan & Cromwell to the effect
that each part of the Registration Statement and the Prospectus, as of the
effective date of such part, appeared on its face to be appropriately
responsive in all material respects to the requirements of the Act, the
Trust Indenture Act and the applicable rules and regulations
11
<PAGE>
of the Commission thereunder; and nothing that came to such counsel's
attention in the course of their review of the Registration Statement and
Prospectus has caused such counsel to believe that the Registration
Statement, as of its effective date, or the Prospectus, as of the date of
the Prospectus, contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading; and nothing that
has come to such counsel's attention in the course of the limited
procedures described in such letter has caused them to believe that the
Prospectus, as of the date and time of delivery of such letter, contained
any untrue statement of a material fact or omitted to state any material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. Such counsel may
state that they do not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement or the Prospectus except for those made under the captions
"Description of Debt Securities" and "Description of Preferred Stock" in
the Prospectus insofar as they related to provisions of documents therein
described and that they do not express any opinion or belief as to the
financial statements or other financial data contained in the Registration
Statement or the Prospectus, or as to the statement of the eligibility of
the Trustee.
(f) The Underwriters shall have received on the Closing Date a
letter, dated the Closing Date, in form and substance satisfactory to the
Underwriters, from the Company's independent public accountants, containing
statements and information of the type ordinarily included in accountants'
"comfort letters" to underwriters with respect to the financial statements
and certain financial information contained in or incorporated by reference
into the Prospectus.
6. Covenants of the Company. In further consideration of the
------------------------
agreements of the Underwriters herein contained, the Company covenants with each
Underwriter as follows:
(a) To furnish the Manager, without charge, 2 signed copies of the
Registration Statement (including exhibits thereto) and for delivery to
each other Underwriter a conformed copy of the Registration Statement
(without exhibits thereto) and, during the period mentioned in paragraph
(c) below, as many copies of the Prospectus, any documents incorporated by
reference therein and any supplements and amendments thereto or to the
Registration Statement as the Manager may reasonably request.
12
<PAGE>
(b) Before amending or supplementing the Registration Statement or
the Prospectus with respect to the Offered Securities, to furnish to the
Manager a copy of each such proposed amendment or supplement and not to
file any such proposed amendment or supplement to which the Manager
reasonably objects.
(c) If, during such period after the first date of the public
offering of the Offered Securities as the Prospectus is required by law to
be delivered in connection with sales by an Underwriter or dealer, any
event shall occur or condition exist as a result of which it is necessary
to amend or supplement the Prospectus in order to make the statements
therein, in the light of the circumstances when the Prospectus is delivered
to a purchaser, not misleading, or if it is necessary to amend or
supplement the Prospectus to comply with applicable law, the Company will
forthwith prepare and file with the Commission and furnish, at its own
expense, to the Underwriters and to the dealers (whose names and addresses
the Manager will furnish to the Company) to which Offered Securities may
have been sold by the Manager on behalf of the Underwriters and to any
other dealers upon request, either amendments or supplements to the
Prospectus so that the statements in the Prospectus as so amended or
supplemented will not, in the light of the circumstances when the
Prospectus is delivered to a purchaser, be misleading or so that the
Prospectus, as amended or supplemented, will comply with applicable law.
(d) To cooperate with Underwriter's counsel to qualify the Offered
Securities for offer and sale under the securities or Blue Sky laws of such
jurisdictions as the Manager shall reasonably request and to maintain such
qualification for as long as the Manager shall reasonably request; provided
--------
that in connection therewith the Company shall not be required to qualify
as a foreign corporation or file a general consent to service of process in
any jurisdiction.
(e) To make generally available to the Company's security holders and
to the Manager as soon as practicable an earning statement covering a
twelve month period beginning on the first day of the first full fiscal
quarter after the date of this Agreement, which earning statement shall
satisfy the provisions of Section 11(a) of the Securities Act and the rules
and regulations of the Commission thereunder. If such fiscal quarter is
the last fiscal quarter of the Company's fiscal year, such earning
statement shall be made available not later than 90 days after the close of
the period covered thereby and in all other cases shall be made available
not later than 45 days after the close of the period covered
13
<PAGE>
thereby.
(f) During the period beginning on the date of the Underwriting
Agreement and continuing to and including the Closing Date, not to offer,
sell, contract to sell or otherwise dispose of any preferred stock of the
Company (if the Offered Securities are preferred stock) or debt securities
of the Company (if the Offered Securities are Debt Securities) or warrants
to purchase preferred stock or debt securities of the Company, as the case
may be, substantially similar to the Offered Securities (other than (i) the
Offered Securities, (ii) commercial paper issued in the ordinary course of
business, and (iii) the Company's ESOP Preferred Stock and the Series One
Preferred Stock issuable pursuant to the Company's Rights Plan, as
defined), without the prior written consent of the Manager.
(g) To pay all expenses incident to the performance of its obligations
under this Agreement, including: (i) the preparation and filing of the
Registration Statement and the Prospectus and all amendments and
supplements thereto; (ii) the preparation, issuance and delivery of the
Offered Securities; (iii) the fees and disbursements of the Company's
counsel and accountants and of the Trustee and its counsel; (iv) the
qualification of the Offered Securities under state securities or Blue Sky
laws in accordance with the provisions of Section 6(d), including filing
fees and the fees and disbursements of counsel for the Underwriters in
connection therewith and in connection with the preparation of any Blue Sky
or Legal Investment Memoranda; (v) the printing and delivery to the
Underwriters in quantities as hereinabove stated of copies of the
Registration Statement and all amendments thereto and of any preliminary
prospectus and the Prospectus and any amendments or supplements thereto;
(vi) the printing and delivery to the Underwriters of copies of any Blue
Sky or Legal Investment Memoranda; (vii) any fees charged by rating
agencies for the rating of the Offered Securities; (viii) the filing fees
and expenses, if any, incurred with respect to any filing with the National
Association of Securities Dealers, Inc. made in connection with the Offered
Securities; (ix) all document production charges and expenses of counsel to
the Underwriters incurred in connection with the preparation of this
Agreement and the Indenture.
7. Indemnification and Contribution. (a) The Company agrees to
--------------------------------
indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act from and against any and all
losses, claims, damages and liabilities (including, without limitation, any
legal or other
14
<PAGE>
expenses reasonably incurred by any Underwriter or any such controlling person
in connection with defending or investigating any such action or claim) caused
by any untrue statement or alleged untrue statement of a material fact contained
in the Registration Statement or any amendment thereof, any preliminary
prospectus or the Prospectus (as amended or supplemented if the Company shall
have furnished any amendments or supplements thereto), or caused by any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, (A) except
insofar as such losses, claims, damages or liabilities are caused by any such
untrue statement or omission or alleged untrue statement or omission based upon
information relating to any Underwriter furnished to the Company in writing by
such Underwriter through the Manager expressly for use therein, or (B) except
that the Company shall not be liable to any Underwriter under this Section 7 to
the extent that any such loss, claim, liability or judgment results solely from
an untrue statement of a material fact contained in, or the omission of a
material fact from, a preliminary Prospectus if such untrue statement or
omission was completely corrected in the applicable Prospectus Supplement prior
to the written confirmation of the sale of the Offered Securities giving rise to
such loss, claim, liability or judgment if the Company shall sustain the burden
of proving (x) that such Underwriter sold the Offered Securities to the person
alleging such loss, claim, damage or liability without sending or giving the
applicable Prospectus Supplement at or prior to the time of written confirmation
of the sale of the Offered Securities giving rise to such loss, claim, liability
or judgment, (y) that the Company had furnished copies of the applicable
Prospectus Supplement to such Underwriter reasonably prior to the written
confirmation of such sale, and (z) such Underwriter would not have been subject
to such liability if it had delivered the applicable Prospectus Supplement to
such person at or prior to the time of written confirmation of such sale.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement and each person, if any, who controls the Company within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the foregoing indemnity from the Company to
such Underwriter, but only with reference to information relating to such
Underwriter furnished to the Company in writing by such Underwriter through the
Manager expressly for use in the Registration Statement, any preliminary
prospectus, the Prospectus or any amendments or supplements thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to either paragraph (a)
15
<PAGE>
or (b) of this Section 7, such person (the "indemnified party") shall promptly
notify the person against whom such indemnity may be sought (the "indemnifying
party") in writing and the indemnifying party, upon request of the indemnified
party, shall retain counsel reasonably satisfactory to the indemnified party to
represent the indemnified party and any others the indemnifying party may
designate in such proceeding and shall pay the fees and disbursements of such
counsel related to such proceeding. In any such proceeding, any indemnified
party shall have the right to retain its own counsel, but the fees and expenses
of such counsel shall be at the expense of such indemnified party unless (i) the
indemnifying party and the indemnified party shall have mutually agreed to the
retention of such counsel or (ii) the named parties to any such proceeding
(including any impleaded parties) include both the indemnifying party and the
indemnified party and representation of both parties by the same counsel would
be inappropriate due to actual or potential differing interests between them.
It is understood that the indemnifying party shall not, in respect of the legal
expenses of any indemnified party in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the fees and expenses of
more than one separate firm (in addition to any local counsel) for all such
indemnified parties and that all such fees and expenses shall be reimbursed as
they are incurred. Such firm shall be designated in writing by the Manager, in
the case of parties indemnified pursuant to paragraph (a) above, and by the
Company, in the case of parties indemnified pursuant to paragraph (b) above.
The indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement of any pending
or threatened proceeding in respect of which any indemnified party is or could
have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such proceeding.
(d) To the extent the indemnification provided for in paragraph (a)
or (b) of this Section 7 is unavailable to an indemnified party or insufficient
in respect of any losses, claims, damages or liabilities referred to therein,
then each indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the
16
<PAGE>
Company on the one hand and the Underwriters on the other hand from the offering
of the Offered Securities or (ii) if the allocation provided by clause (i) above
is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of the Company on the one hand and of the Underwriters on the
other hand in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Underwriters on the other hand in connection with the offering of the
Offered Securities shall be deemed to be in the same respective proportions as
the net proceeds from the offering of such Offered Securities (before deducting
expenses) received by the Company and the total underwriting discounts and
commissions received by the Underwriters, in each case as set forth in the table
on the cover of the Prospectus Supplement, bear to the aggregate public offering
price of the Offered Securities. The relative fault of the Company on the one
hand and the Underwriters on the other hand shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company or by the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Underwriters' respective obligations to
contribute pursuant to this Section 7 are several in proportion to the
respective principal amounts of Offered Securities they have purchased
hereunder, and not joint.
(e) The Company and the Underwriters agree that it would not be just
or equitable if contribution pursuant to this Section 7 were determined by pro
---
rata allocation (even if the Underwriters were treated as one entity for such
- ----
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in paragraph (d) of this Section 7. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Offered Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages that such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning
17
<PAGE>
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
remedies provided for in this Section 7 are not exclusive and shall not limit
any rights or remedies which may otherwise be available to any indemnified party
at law or in equity.
(f) The indemnity and contribution provisions contained in this
Section 7 and the representations, warranties and other statements of the
Company contained in this Agreement shall remain operative and in full force and
effect regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of any Underwriter or any person controlling
any Underwriter or the Company, its officers or directors or any person
controlling the Company and (iii) acceptance of and payment for any of the
Offered Securities.
8. Termination. This Agreement shall be subject to termination by
-----------
notice given by the Manager to the Company, if (a) after the execution and
delivery of the Underwriting Agreement and prior to the Closing Date (i) trading
generally shall have been suspended or materially limited on or by, as the case
may be, any of the New York Stock Exchange, the American Stock Exchange or the
National Association of Securities Dealers, Inc., (ii) trading of any securities
of the Company shall have been suspended on any exchange or in any over-the-
counter market, (iii) a general moratorium on commercial banking activities in
New York shall have been declared by either Federal or New York State
authorities or (iv) there shall have occurred any outbreak or escalation of
hostilities or any change in financial markets or any calamity or crisis that,
in the reasonable judgment of the Manager, is material and adverse and (b) in
the case of any of the events specified in clauses (a)(i) through (iv), such
event, singly or together with any other such event, makes it, in the reasonable
judgment of the Manager, impracticable to market the Offered Securities on the
terms and in the manner contemplated in the Prospectus.
9. Defaulting Underwriters. If, on the Closing Date, any one or more
-----------------------
of the Underwriters shall fail or refuse to purchase Underwriters' Securities
that it has or they have agreed to purchase hereunder on such date, and the
aggregate principal amount (if Debt Securities) or number of shares (if
Preferred Stock) of Underwriters' Securities which such defaulting Underwriter
or Underwriters agreed but failed or refused to purchase is not more than one-
tenth of the aggregate principal amount (if Debt Securities) or number of shares
(if Preferred Stock) of the Underwriters' Securities to be purchased on such
date, the other Underwriters shall be obligated severally in the proportions
that the principal amount (if Debt Securities) or number of shares (if Preferred
Stock) of Underwriters' Securities
18
<PAGE>
set forth opposite their respective names in the Underwriting Agreement bears to
the aggregate principal amount (if Debt Securities) or number of shares (if
Preferred Stock) of Underwriters' Securities set forth opposite the names of all
such non-defaulting Underwriters, or in such other proportions as the Manager
may specify, to purchase the Underwriters' Securities which such defaulting
Underwriter or Underwriters agreed but failed or refused to purchase on such
date; provided that in no event shall the principal amount (if Debt Securities)
--------
or number of shares (if Preferred Stock) of Underwriters' Securities that any
Underwriter has agreed to purchase pursuant to this Agreement be increased
pursuant to this Section 9 by an amount in excess of one-ninth of such principal
amount (if Debt Securities) or number of shares (if Preferred Stock) of
Underwriters' Securities without the written consent of such Underwriter. If,
on the Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase Underwriters' Securities and the aggregate principal amount (if Debt
Securities) or number of shares (if Preferred Stock) of Underwriters' Securities
with respect to which such default occurs is more than one-tenth of the
aggregate principal amount (if Debt Securities) or number of shares (if
Preferred Stock) of Underwriters' Securities to be purchased on such date, and
arrangements satisfactory to the Manager and the Company for the purchase of
such Underwriters' Securities are not made within 36 hours after such default,
this Agreement shall terminate without liability on the part of any non-
defaulting Underwriter or the Company. In any such case either the Manager or
the Company shall have the right to postpone the Closing Date, but in no event
for longer than seven days, in order that the required changes, if any, in the
Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. Any action taken under this paragraph shall not
relieve any defaulting Underwriter from liability in respect of any default of
such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of
them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason the Company shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
10. Counterparts. This Agreement may be signed in two or more
------------
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the
19
<PAGE>
same instrument.
11. Applicable Law. This Agreement shall be governed by and
--------------
construed in accordance with the internal laws of the State of New York.
12. Headings. The headings of the sections of this Agreement have
--------
been inserted for convenience of reference only and shall not be deemed a part
of this Agreement.
20
<PAGE>
UNDERWRITING AGREEMENT
, 1996
-----------
Armstrong World Industries, Inc.
313 West Liberty Street
Lancaster, Pennsylvania 17603
Dear Sirs and Mesdames:
We (the "Manager") are acting on behalf of the underwriter or
underwriters (including ourselves) named below (such underwriter or underwriters
being herein called the "Underwriters"), and we understand that Armstrong World
Industries, Inc., a Pennsylvania corporation (the "Company"), proposes to issue
and sell [[Currency and Principal Amount] aggregate initial offering price of
[Full title of Debt Securities]] [No. of Shares of [Full Title of Preferred
Stock ("Preferred Stock")]] the "Offered Securities.") [The Debt Securities
will be issued pursuant to the provisions of an Indenture dated as of
, 199 (the "Indenture") between the Company and [NAME OF
- ------------------- -
TRUSTEE], as Trustee (the "Trustee").]
Subject to the terms and conditions set forth or incorporated by
reference herein, the Company hereby agrees to sell to the several Underwriters,
and each Underwriter agrees, severally and not jointly, to purchase from the
Company the principal amount of Debt Securities set forth below opposite their
names at a purchase price of [ % of the principal amount of Debt Securities]
----
[ , plus accrued interest, if any, from [Date of Offered Securities] to the
----
date of payment and delivery]* [the number of shares of Preferred Stock set
forth below opposite their names at a purchase price of per share]:
--------
- ---------------
* To be added only if the transaction does not close "flat" (i.e., when the
purchaser pays accrued interest on the debt security at closing). Unless
otherwise provided in the Debt Securities, accrued interest, if any, will
be computed on the basis of a 360-day year of twelve 30-day months.
<PAGE>
<TABLE>
<CAPTION>
[Principal Amount of Debt Securities]
Name [Number of Shares of Preferred Stock]
---- ------------------------------------
<S> <C>
Morgan Stanley & Co.
Incorporated
Morgan Stanley & Co. International Limited
[Insert syndicate list]
Total . . . . . . . .
</TABLE>
[The principal amount of Debt Securities to be purchased by the
several Underwriters shall be reduced by the aggregate principal amount of Debt
Securities sold pursuant to delayed delivery contracts.]**
The Underwriters will pay for the Offered Securities [(less any
Offered Securities sold pursuant to delayed delivery contracts)] upon delivery
thereof at [office] at a.m. (New York time) on , 199 , or at
------ ---------- -
such other time, not later than 5:00 p.m. (New York time) on , 199 ,
--------- -
as shall be designated by the Manager. The time and date of such payment and
delivery are hereinafter referred to as the Closing Date.***
- -----------------
** To be added only if delayed delivery contracts are contemplated in the case
of Debt Securities.
*** This paragraph would have to be modified for any Offered Securities that
are to be issued in bearer form.
2
<PAGE>
The Offered Securities shall have the terms set forth in the
Prospectus dated , 199 , and the Prospectus Supplement dated
----------- -
, 199 , including the following:
- ------------ -
[Terms of Debt Securities
Maturity Date:
Interest Rate:
Redemption Provisions:
Interest Payment Dates: and
------------ --
commencing
------------ --
,
------------ -- ----
[(Interest accrues from
, )]****
-------- -- ----
Form and Denomination:
[Other Terms:]]
[Terms of Preferred Stock
Title:
Number of Shares:
Dividend Rate:
Optional Redemption:
Sinking Fund:
Listing: [None.] [ Stock Exchange.]]
[The commission to be paid to the Underwriters in respect of the
Offered Securities purchased pursuant to delayed delivery contracts arranged by
the Underwriters shall be % of the principal amount of the Debt Securities so
---
purchased.]*****
All provisions contained in the document entitled Armstrong World
Industries, Inc. Underwriting Agreement Standard Provisions
- ---------------
**** To be added only if the transaction does not close flat.
***** To be added only if delayed delivery contracts are contemplated.
3
<PAGE>
(Debt Securities and Preferred Stock) dated _______, 1996, a copy of which is
attached hereto, are herein incorporated by reference in their entirety and
shall be deemed to be a part of this Agreement to the same extent as if such
provisions had been set forth in full herein, except that (i) if any term
defined in such document is otherwise defined herein, the definition set forth
herein shall control, (ii) all references in such document to a type of security
that is not an Offered Security shall not be deemed to be a part of this
Agreement, and (iii) all references in such document to a type of agreement that
has not been entered into in connection with the transactions contemplated
hereby shall not be deemed to be a part of this Agreement.
4
<PAGE>
[SIGNATURE PAGE WHERE MORGAN STANLEY & CO. INCORPORATED
-------------------------------------------------------
OR MORGAN STANLEY & CO. INTERNATIONAL LIMITED
---------------------------------------------
IS A CO-LEAD MANAGER]
---------------------
Please confirm your agreement by having an authorized officer sign a
copy of this Agreement in the space set forth below.
Very truly yours,
[MORGAN STANLEY & CO. INCORPORATED]
[MORGAN STANLEY & CO. INTERNATIONAL LIMITED]
[Name of Other Lead Managers]
Acting severally on behalf of themselves
and the several Underwriters named herein
By: [MORGAN STANLEY & CO. INCORPORATED]
[MORGAN STANLEY & CO. INTERNATIONAL LIMITED]
By:
--------------------------------
Name:
Title:
Accepted:
Armstrong World Industries, Inc.
By:
-------------------------------
Name:
Title:
5
<PAGE>
SIGNATURE PAGE WHERE MORGAN STANLEY & CO. INCORPORATED
------------------------------------------------------
OR MORGAN STANLEY & CO. INTERNATIONAL LIMITED
---------------------------------------------
IS SOLE MANAGER]
----------------
Please confirm your agreement by having an authorized officer sign a
copy of this Agreement in the space set forth below.
Very truly yours,
[MORGAN STANLEY & CO. INCORPORATED]
[MORGAN STANLEY & CO. INTERNATIONAL LIMITED]
Acting severally on behalf of itself
and the several Underwriters named herein
By:
------------------------------
Name:
Title:
Accepted:
Armstrong World Industries, Inc.
By:
-----------------------------
Name:
Title:
6
<PAGE>
Schedule I
DELAYED DELIVERY CONTRACT
, 199
-------- -
Dear Sirs and Mesdames:
The undersigned hereby agrees to purchase from Armstrong World
Industries, Inc., a Pennsylvania corporation (the "Company"), and the Company
agrees to sell to the undersigned the Company's securities described in Schedule
A annexed hereto (the "Securities"), offered by the Company's Prospectus dated
, 19 and Prospectus Supplement dated , 19 ,
- ------------------ -- ---------------- --
receipt of copies of which are hereby acknowledged, at a purchase price stated
in Schedule A and on the further terms and conditions set forth in this
Agreement. The undersigned does not contemplate selling Securities prior to
making payment therefor.
The undersigned will purchase from the Company Securities in the
principal amount and numbers on the delivery dates set forth in Schedule A.
Each such date on which Securities are to be purchased hereunder is hereinafter
referred to as a "Delivery Date."
Payment for the Securities which the undersigned has agreed to
purchase on each Delivery Date shall be made to the Company or its order by
certified or official bank check in New York Clearing House funds at the office
of , New York, N.Y., at 10:00 A.M. (New York time)
------------------------------
on the Delivery Date, upon delivery to the undersigned of the Securities to be
purchased by the undersigned on the Delivery Date, in such denominations and
registered in such names as the undersigned may designate by written or
telegraphic communication addressed to the Company not less than five full
business days prior to the Delivery Date.
The obligation of the undersigned to take delivery of and make payment
for the Securities on the Delivery Date shall be subject to the conditions that
(1) the purchase of Securities to be
1
<PAGE>
made by the undersigned shall not at the time of delivery be prohibited under
the laws of the jurisdiction to which the undersigned is subject and (2) the
Company shall have sold, and delivery shall have taken place to the underwriters
(the "Underwriters") named in the Prospectus Supplement referred to above of,
such part of the Securities as is to be sold to them. Promptly after completion
of sale and delivery to the Underwriters, the Company will mail or deliver to
the undersigned as its address set forth below notice to such effect,
accompanied by a copy of the opinion of counsel for the Company delivered to the
Underwriters in connection therewith.
Failure to take delivery of and make payment for Securities by any
purchaser under any other Delayed Delivery Contract shall not relieve the
undersigned of its obligations under this agreement.
This Agreement will inure to the benefit of and be binding upon the
parties hereto and their respective successors, but will not be assignable by
either party hereto without the written consent of the other.
If this Agreement is acceptable to the Company, it is requested that
the Company sign the form of acceptance below and mail or deliver one of the
counterparts hereof to the undersigned at its address set forth below. This
will become a binding agreement, as of the date first above written, between the
Company and the undersigned when such counterpart is so mailed or delivered.
2
<PAGE>
This Agreement shall be governed by and construed in accordance with
the internal laws of the State of New York.
Yours very truly,
---------------------------
(Purchaser)
By
------------------------
-------------------------
(Title)
-------------------------
-------------------------
(Address)
Accepted:
Armstrong World Industries, Inc.
By
-----------------------------
3
<PAGE>
PURCHASER --- PLEASE COMPLETE AT TIME OF SIGNING
The name and telephone and department of the representative of the
Purchaser with whom details of delivery on the Delivery Date may be discussed is
as follows: (Please print.)
Telephone No.
Name (Including Area Code) Department
---- --------------------- ----------
- ---------------------- ----------------------------- ------------------
4
<PAGE>
SCHEDULE A
----------
Securities:
- ----------
Principal Amounts or Numbers to be Purchased:
- --------------------------------------------
Purchase Price:
- --------------
Delivery
- --------
<PAGE>
Exhibit 1.2
Shares
---------------
ARMSTRONG WORLD INDUSTRIES, INC.
COMMON STOCK (PAR VALUE $1.00 PER SHARE)
UNDERWRITING AGREEMENT
, 1996
- ----------
<PAGE>
, 1996
-------------
Morgan Stanley & Co.
Incorporated
[NAMES OF OTHER CO-MANAGERS]
c/o Morgan Stanley & Co.
Incorporated
1585 Broadway
New York, New York 10036
Dear Sirs and Mesdames:
Armstrong World Industries, Inc., a Pennsylvania corporation (the
"Company"), proposes to issue and sell to the several Underwriters named in
Schedule I hereto (the "Underwriters") shares of its Common
---------------
Stock (par value $1.00 per share) (the "Firm Shares"). The Company also
proposes to issue and sell to the several Underwriters not more than an
additional shares of its Common Stock (par value $1.00 per share)
--------------
(the "Additional Shares") if and to the extent that you, as Managers of the
offering, shall have determined to exercise, on behalf of the Underwriters, the
right to purchase such shares of common stock granted to the Underwriters in
Section 2 hereof. The Firm Shares and the Additional Shares are hereinafter
collectively referred to as the "Shares." The shares of Common Stock (par value
$1.00 per share) of the Company to be outstanding after giving effect to the
sales contemplated hereby are hereinafter referred to as the "Common Stock."
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement, including a prospectus, relating to,
among other securities, the Shares, and has filed with, or transmitted for
filing to, or shall promptly hereafter file with or transmit for filing to, the
Commission a prospectus supplement (the "Prospectus Supplement") specifically
relating to the Shares pursuant to Rule 424 under the Securities Act of 1933,
as amended (the "Securities Act"). The term "Registration Statement" means the
registration statement, including the exhibits thereto, as amended to the date
of this Agreement including the information (if any) deemed to be part of the
registration statement at the time of effectiveness pursuant to Rule 430A under
the Securities
2
<PAGE>
Act. The term "Basic Prospectus" means the prospectus included in the
Registration Statement. The term "Prospectus" means the Basic Prospectus
together with the Prospectus Supplement. The term "preliminary prospectus"
means a preliminary prospectus supplement specifically relating to the Shares,
together with the Basic Prospectus. As used herein, the terms "Basic
Prospectus," "Prospectus" and "preliminary prospectus" shall include in each
case the documents, if any, incorporated by reference therein. The terms
"supplement," "amendment" and "amend" as used herein shall include all documents
deemed to be incorporated by reference in the Prospectus that are filed
subsequent to the date of the Basic Prospectus by the Company with the
Commission pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act")./1/
1. Representations and Warranties. The Company represents and
------------------------------
warrants to and agrees with each of the Underwriters that:
(a) The Registration Statement has become effective; no stop order
suspending the effectiveness of the Registration Statement is in effect,
and, to the Company's knowledge after reasonable investigation, no
proceedings for such purpose are pending before or threatened by the
Commission.
(b) (i) Each document, if any, filed or to be filed pursuant to the
Exchange Act and incorporated by reference in the Prospectus complied or
will comply when so filed in all material respects with the Exchange Act
and the applicable rules and regulations
- -------------------
/1/ If prospectus delivery will be accomplished using Rule 434 under the
Securities Act, the above definition of Prospectus should be replaced with the
following:
The Prospectus (as described in Rule 434(a)(1) under the Securities Act) in the
form first used to confirm sales of Shares is hereinafter referred to as the
"Distributed Prospectus"; the prospectus included in the Registration Statement
at the time of its effectiveness (including the information, if any, deemed to
be a part of the Registration Statement at the time of effectiveness pursuant to
Rule 430A under the Securities Act) is hereinafter referred to as the "Filed
Prospectus"; and the Distributed Prospectus and the Filed Prospectus are
hereinafter referred to collectively as the "Prospectus."
3
<PAGE>
of the Commission thereunder, (ii) The Registration Statement, when it
became effective, did not contain and, as amended or supplemented, if
applicable, will not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading, (iii) the Registration
Statement and the Prospectus comply and, as amended or supplemented, if
applicable, will comply in all material respects with the Securities Act
and the applicable rules and regulations of the Commission thereunder and
(iv) the Prospectus does not contain and, as amended or supplemented, if
applicable, will not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading,
except that the representations and warranties set forth in this paragraph
1(b) do not apply to statements or omissions in the Registration Statement
or the Prospectus based upon information furnished to the Company in
writing by such Underwriter through you expressly for use therein.
(c) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property
and to conduct its business as described in the Prospectus and is duly
qualified to transact business and is in good standing in each jurisdiction
in which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the failure
to be so qualified or be in good standing would not have a material adverse
effect on the Company and its subsidiaries, taken as a whole.
(d) Each "significant subsidiary" (as that term is used in Rule 1-
02(w) of Regulation S-X under the Securities Act) (a "Material Subsidiary")
of the Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property
and to conduct its business as described in the Prospectus and is duly
qualified to transact business and is in good standing in each jurisdiction
in which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the failure
to be so qualified or be in good standing
4
<PAGE>
would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(e) This Agreement has been duly authorized, executed and delivered
by the Company.
(f) The authorized capital stock of the Company conforms as to legal
matters to the description thereof contained in the Prospectus.
(g) The shares of Common Stock outstanding prior to the issuance of
the Shares have been duly authorized and are validly issued, fully paid and
non-assessable.
(h) The Shares have been duly authorized and, when issued and
delivered in accordance with the terms of this Agreement, will be validly
issued, fully paid and non-assessable, and the issuance of such Shares will
not be subject to any preemptive or similar rights.
(i) The execution and delivery by the Company of, and the performance
by the Company of its obligations under, this Agreement will not contravene
any provision of applicable law or the articles of incorporation or by-laws
of the Company or any agreement or other instrument binding upon the
Company or any of its subsidiaries that is material to the Company and its
subsidiaries, taken as a whole, or any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the Company or
any subsidiary, and no consent, approval, authorization or order of, or
qualification with, any governmental body or agency is required for the
performance by the Company of its obligations under this Agreement, except
such as may be required by Rule 424(b) under the Securities Act or the
securities or Blue Sky laws of the various states in connection with the
offer and sale of the Shares.
(j) There has not occurred any material adverse change, or, to the
Company's knowledge, any development involving a prospective material
adverse change, in the condition, financial or otherwise, or in the
earnings, business or operations of the Company and its subsidiaries, taken
as a whole, from that set forth in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this
Agreement).
5
<PAGE>
(k) There are no legal or governmental proceedings pending or
threatened to which the Company or any of its subsidiaries is a party or to
which any of the properties of the Company or any of its subsidiaries is
subject that are required to be described in the Registration Statement or
the Prospectus and are not so described or any statutes, regulations,
contracts or other documents that are required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not described or filed as required.
(l) Each preliminary prospectus filed as part of the registration
statement as originally filed or as part of any amendment thereto, or filed
pursuant to Rule 424 under the Securities Act, complied when so filed in
all material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder.
(m) The Company is not and, after giving effect to the offering and
sale of the Shares and the application of the proceeds thereof as described
in the Prospectus, will not be an "investment company" as such term is
defined in the Investment Company Act of 1940, as amended.
(n) There are no contracts, agreements or understandings between the
Company and any person granting such person the right to require the
Company to file a registration statement under the Securities Act with
respect to any securities of the Company or to require the Company to
include such securities with the Shares registered pursuant to the
Registration Statement.
(o) The Company has complied with all provisions of Section 517.075,
Florida Statutes relating to doing business with the Government of Cuba or
with any person or affiliate located in Cuba.
2. Agreements to Sell and Purchase. The Company hereby agrees to
--------------------------------
sell to the several Underwriters, and each Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees, severally and not jointly, to purchase from the
Company the respective numbers of Firm Shares set forth in Schedule I hereto
opposite its name at $ a share (the "Purchase Price").
------
6
<PAGE>
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to sell
to the Underwriters the Additional Shares, and the Underwriters shall have a
one-time right to purchase, severally and not jointly, up to
---------------
Additional Shares at the Purchase Price. If you, on behalf of the Underwriters,
elect to exercise such option, you shall so notify the Company in writing not
later than 30 days after the date of this Agreement, which notice shall specify
the number of Additional Shares to be purchased by the Underwriters and the date
on which such shares are to be purchased. Such date may be the same as the
Closing Date (as defined below) but not earlier than the Closing Date nor later
than ten business days after the date of such notice. Additional Shares may be
purchased as provided in Section 4 hereof solely for the purpose of covering
over-allotments made in connection with the offering of the Firm Shares. If any
Additional Shares are to be purchased, each Underwriter agrees, severally and
not jointly, to purchase the number of Additional Shares (subject to such
adjustments to eliminate fractional shares as you may determine) that bears the
same proportion to the total number of Additional Shares to be purchased as the
number of Firm Shares set forth in Schedule I hereto opposite the name of such
Underwriter bears to the total number of Firm Shares.
The Company hereby agrees that, without the prior written consent of
Morgan Stanley & Co. Incorporated on behalf of the Underwriters, it will not,
during the period ending [180] days after the date of the Prospectus, (i) offer,
pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to
purchase or otherwise transfer or dispose of, directly or indirectly, any shares
of Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock or (ii) enter into any swap or other arrangement
that transfers to another, in whole or in part, any of the economic consequences
of ownership of the Common Stock, whether any such transaction described in
clause (i) or (ii) above is to be settled by delivery of Common Stock or such
other securities, in cash or otherwise. The foregoing sentence shall not apply
to (A) the Shares to be sold hereunder or (B) the issuance by the Company of
shares of Common Stock upon the exercise of an option or warrant or the
conversion of a security outstanding on the date hereof of which the
Underwriters have been advised in writing.
7
<PAGE>
3. Terms of Public Offering. The Company is advised by you that the
-------------------------
Underwriters propose to make a public offering of their respective portions of
the Shares as soon after the Registration Statement and this Agreement have
become effective as in your judgment is advisable. The Company is further
advised by you that the Shares are to be offered to the public initially at
$ a share (the "Public Offering Price") and to certain dealers
-------------
selected by you at a price that represents a concession not in excess of $
------
a share under the Public Offering Price, and that any Underwriter may allow, and
such dealers may reallow, a concession, not in excess of $ a share, to any
-----
Underwriter or to certain other dealers.
4. Payment and Delivery. Payment for the Firm Shares shall be made
---------------------
by check or wire transfer payable to the order of the Company in federal (same
day) funds in New York City against delivery of such Firm Shares for the
respective accounts of the several Underwriters at 10:00 A.M., New York City
time, on , 19 ,/2/ or at such other time on the same or such other
------------ --
date, not later than , 19 ,/3/ as shall be designated in writing by
--------- --
you. The time and date of such payment are hereinafter referred to as the
"Closing Date."
Payment for any Additional Shares shall be made by check or wire
transfer payable to the order of the Company in federal (same day) funds
available in New York City against delivery of such Additional Shares for the
respective accounts of the several Underwriters at 10:00 A.M., New York City
time, on the date specified in the notice described in Section 2 or at such
other time on the same or on such other date, in any event not later than
, 19 ,/4/ as shall be designated in writing by you. The time and date
- ------- --
of such payment are hereinafter referred to as the "Option Closing Date."
Certificates for the Firm Shares and Additional Shares shall be in
definitive form and registered in such
- -------------------
/2/ Insert date 3 business days or, in the event the offering is priced after
4:30 P.M. Eastern Time, 4 business days after date of Underwriting Agreement.
/3/ Insert date 5 business days after the date inserted in accordance with
note 6 above.
/4/ Insert date 10 business days after the expiration of the green shoe
option.
8
<PAGE>
names and in such denominations as you shall request in writing not later than
one full business day prior to the Closing Date or the Option Closing Date, as
the case may be. The certificates evidencing the Firm Shares and Additional
Shares shall be delivered to you on the Closing Date or the Option Closing Date,
as the case may be, for the respective accounts of the several Underwriters,
with any transfer taxes payable in connection with the transfer of the Shares to
the Underwriters duly paid, against payment of the Purchase Price therefor.
5. Conditions to the Underwriters' Obligations. The several
--------------------------------------------
obligations of the Underwriters are subject to the
following conditions:
(a) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor shall any
notice have been given of any intended or potential downgrading or of
any review for a possible change that does not indicate the direction
of the possible change, in the rating accorded any of the Company's
securities by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act; and
(ii) there shall not have occurred any change, or any development
involving a prospective change, in the condition, financial or
otherwise, or in the earnings, business or operations of the Company
and its subsidiaries, taken as a whole, from that set forth in the
Prospectus (exclusive of any amendments or supplements thereto
subsequent to the date of this Agreement) that, in your reasonable
judgment, is material and adverse and that makes it, in your
reasonable judgment, impracticable to market the Shares on the terms
and in the manner contemplated in the Prospectus.
(b) The Underwriters shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer of
the Company, to the effect set forth in clause (a)(i) above and to the
effect that the representations and warranties of the Company contained in
this Agreement are true and correct as of the Closing Date and that the
Company has complied with all of the agreements and satisfied all
9
<PAGE>
of the conditions on its part to be performed or satisfied hereunder on
or before the Closing Date.
The officer signing and delivering such certificate may rely upon the best
of his or her knowledge as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date an
opinion of Buchanan Ingersoll Professional Corporation, outside counsel for
the Company, dated the Closing Date, substantially to the effect that:
(i) the Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and
authority to own its property and to conduct its business as described
in the Prospectus.
(ii) the authorized capital stock of the Company conforms as
to legal matters to the description thereof contained in the
Prospectus;
(iii) the shares of Common Stock outstanding prior to the
issuance of the Shares have been duly authorized and are validly
issued, fully paid and non-assessable;
(iv) the Shares have been duly authorized and, when issued
and delivered in accordance with the terms of this Agreement, will be
validly issued, fully paid and non-assessable, and the issuance of
such Shares will not be subject to any preemptive or similar rights;
(v) this Agreement has been duly authorized, executed and
delivered by the Company;
(vi) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement
will not contravene any provision of applicable law (except to the
extent that the federal securities laws may limit or restrict any
indemnification provisions set forth in this Agreement) or the
articles of incorporation or by-laws of the Company, and no consent,
approval, authorization or order of, or qualification with, any
governmental body or agency is required for the performance by the
Company of its obligations under this Agreement, except for the
registration of the Shares under the Securities Act and except such as
may be required by Rule 424(b) under the Securities Act or the
securities or Blue Sky laws of the various states in connection with
the offer and sale of the Shares;
(vii) the statements in the Prospectus under the caption
"Description of Capital Stock" fairly present the information called
for and fairly summarize the matters referred to therein;
10
<PAGE>
(viii) the Company is not and, after giving effect to the
offering and sale of the Shares and the application of the proceeds
thereof as described in the Prospectus, will not be an "investment
company" as such term is defined in the Investment Company Act of
1940, as amended;
(ix) such counsel is of the opinion ascribed to it in the
Prospectus under the caption "Taxation";
(x) such counsel (A) is of the opinion that the Registration
Statement and the Prospectus and any further amendments and
supplements thereto made by the Company prior to the delivery of the
Shares (other than the financial statements and related schedules and
other financial data therein) comply as to form in all material
respects with the requirements of the Securities Act and the Exchange
Act, as the case may be, and the rules and regulations thereunder, and
(B) is of the further opinion that, although such counsel (i) is not
passing upon and does not assume any responsibility for the accuracy
or completeness of the statements contained in the Registration
Statement or the Prospectus, and (ii) has not made an independent
investigation of facts for the purpose of rendering its opinion,
during the course of preparation of the Registration Statement and the
Prospectus, nothing came to such counsel's attention which would cause
them to believe that the Registration Statement, at the time it became
effective and as amended or supplemented, contained any untrue
statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading or that the Prospectus, as of the date of the
Prospectus and as of the date such opinion is delivered, contains any
untrue statement of a material fact or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made,
11
<PAGE>
not misleading; provided, however that such counsel need not express
--------- -------
any opinion as to (1) the financial statements, including the notes
and schedules thereto, and any financial data contained or referred to
in, or incorporated by reference in, the Registration Statement or the
Prospectus, or (2) the information contained in or omitted from the
Registration Statement or Prospectus in reliance upon and in
conformity with written information furnished to the Company relating
to any Underwriter by or on behalf of any of the Underwriters for use
in connection with the preparation of the Registration Statement or
the Prospectus./5/
In rendering its opinion, Buchanan Ingersoll may rely (i) as to matters of
New York law, on the opinion of Sullivan & Cromwell referred to in Section
5(e) hereof, and (ii) as to factual matters, on certificates of officers of
the Company and its subsidiaries and on certificates of public officials.
(d) The Underwriters shall have received on the Closing Date an
opinion of the General Counsel of the Company, dated the Closing Date, to
the effect that:
(i) each Material Subsidiary is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its
property and to conduct its business as described in the Prospectus;
and each of the Company and each of its Material Subsidiaries is duly
qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent
that the failure to be so qualified or be in good standing would not
have a material adverse effect on the Company and its subsidiaries,
taken as a whole;
- -------------------
/5/ If prospectus delivery will be accomplished using Rule 434 under the
Securities Act, consider adding the following to the opinions of Company
counsel and Morgan Stanley's counsel:
"The Distributed Prospectus is not materially different from the
Filed Prospectus."
12
<PAGE>
(ii) the statements in the Registration Statement in Items 14 and
15, in each case insofar as such statements constitute summaries of
the legal matters, documents or proceedings referred to therein,
fairly present the information called for with respect to such legal
matters, documents and proceedings and fairly summarize the matters
referred to therein;
(iii) after due inquiry, such counsel does not know of any
legal or governmental proceedings pending or threatened to which the
Company or any of its Material Subsidiaries is a party or to which any
of the properties of the Company or any of its Material Subsidiaries
is subject that are required to be described in the Registration
Statement or the Prospectus and are not so described or of any
statutes, regulations, contracts or other documents that are required
to be described in the Registration Statement or the Prospectus or to
be filed as exhibits to the Registration Statement that are not
described or filed as required; and
(iv) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement
will not contravene any provision of the articles of incorporation or
by-laws of the Company or, to the best of such counsel's knowledge,
any agreement or other instrument binding upon the Company or any of
its subsidiaries that is material to the Company and its subsidiaries,
taken as a whole, or, to the best of such counsel's knowledge, any
judgment, order or decree of any governmental body, agency or court
having jurisdiction over the Company or any subsidiary.
13
<PAGE>
With respect to subparagraph (ix) of paragraph (c) above, Buchanan
Ingersoll may state that their opinion and belief are based upon their
participation in the preparation of the Registration Statement and
Prospectus and any amendments or supplements thereto and review and
discussion of the contents thereof, but are without independent check or
verification, except as specified.
The opinion of Buchanan & Ingersoll described in paragraph (c) above
shall be rendered to the Underwriters at the request of the Company and
shall so state therein.
(e) The Underwriters shall have received on the Closing Date an
opinion of Sullivan & Cromwell, counsel for the Underwriters, dated the
Closing Date, covering the matters referred to in subparagraphs (iv) and
(v) of paragraph (c) above. In rendering such opinion, Sullivan & Cromwell
may rely as to the incorporation of the Company and all other matters of
Pennsylvania law upon the opinion of Buchanan Ingersoll referred to in
paragraph (c) above. The Underwriter also shall have received a letter
from Sullivan & Cromwell to the effect that each part of the Registration
Statement and the Prospectus, as of the effective date of such part,
appeared on its face to be appropriately responsive in all material
respects to the requirements of the Securities Act and the applicable rules
and regulations of the Commission thereunder; and nothing that came to such
counsel's attention in the course of their review of the Registration
Statement and Prospectus has caused such counsel to believe that the
Registration Statement, as of its effective date, or the Prospectus, as of
the date of the Prospectus, contained any untrue statement of a material
fact or omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading; and nothing that
has come to such counsel's attention in the course of the limited
procedures described in such letter has caused them to believe that the
Prospectus, as of the date and time of delivery of such letter, contained
any untrue statement of a material fact or omitted to state any material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. Such counsel may
state that they
14
<PAGE>
do not assume any responsibility for the accuracy, completeness or fairness
of the statements contained in the Registration Statement or the Prospectus
except for those made under the captions "Description of Capital Stock" in
the Prospectus insofar as they related to provisions of documents therein
described and that they do not express any opinion or belief as to the
financial statements or other financial data contained in the Registration
Statement or the Prospectus.
(f) The Underwriters shall have received, on each of the date hereof
and the Closing Date, a letter dated the date hereof or the Closing Date,
as the case may be, in form and substance satisfactory to the Underwriters,
from KPMG Peat Marwick LLP, independent public accountants, containing
statements and information of the type ordinarily included in accountants'
"comfort letters" to underwriters with respect to the financial statements
and certain financial information contained in the Registration Statement
and the Prospectus; provided that the letter delivered on the Closing Date
--------
shall use a "cut-off date" not earlier than the date hereof.
(g) The "lock-up" agreements, each substantially in the form of
Exhibit A hereto, between you and [certain shareholders,] officers and
directors of the Company relating to sales and certain other dispositions
of shares of Common Stock or certain other securities, delivered to you on
or before the date hereof, shall be in full force and effect on the Closing
Date.
The several obligations of the Underwriters to purchase Additional
Shares hereunder are subject to the delivery to you on the Option Closing Date
of such documents as you may reasonably request with respect to the good
standing of the Company, the due authorization and issuance of the Additional
Shares and other matters related to the issuance of the Additional Shares.
6. Covenants of the Company. In further consideration of the
-------------------------
agreements of the Underwriters herein contained, the Company covenants with each
Underwriter as follows:
15
<PAGE>
(a) To furnish to you, without charge, ______ /6/ signed copies
of the Registration Statement (including exhibits thereto) and for delivery
to each other Underwriter a conformed copy of the Registration Statement
(without exhibits thereto) and to furnish to you in New York City, without
charge, prior to 10:00 A.M. New York City time on the business day next
succeeding the date of this Agreement and during the period mentioned in
paragraph (c) below, as many copies of the Prospectus,/7/ any documents
incorporated by reference therein, and any supplements and amendments
thereto or to the Registration Statement as you may reasonably request.
(b) Before amending or supplementing the Registration Statement or
the Prospectus, to furnish to you a copy of each such proposed amendment or
supplement and not to file any such proposed amendment or supplement to
which you reasonably object, and to file with the Commission within the
applicable period specified in Rule 424(b) under the Securities Act any
prospectus required to be filed pursuant to such Rule.
(c) If, during such period after the first date of the public
offering of the Shares as the Prospectus is required by law to be delivered
in connection with sales by an Underwriter or dealer, any event shall occur
or condition exist as a result of which it is necessary to amend or
supplement the Prospectus in order to make the statements therein, in the
light of the circumstances when the Prospectus is delivered to a purchaser,
not misleading, or if it is necessary to amend or supplement the Prospectus
to comply with applicable law, the Company will forthwith prepare and file
with the Commission and furnish, at its own expense, to the Underwriters
and to the dealers (whose names and addresses you will furnish to the
Company) to which Shares may have been sold by you on behalf of the
Underwriters and to any other dealers upon request, either amendments or
supplements to the Prospectus so that the statements in the Prospectus as
so amended or
- -------------------
/6/ Insert number of Co-Managers (including Morgan Stanley) plus one.
/7/ If prospectus delivery will be accomplished using Rule 434 under the
Securities Act, replace the term "Prospectus" with "Distributed
Prospectus."
16
<PAGE>
supplemented will not, in the light of the circumstances when the
Prospectus is delivered to a purchaser, be misleading or so that the
Prospectus, as amended or supplemented, will comply with applicable law.
(d) To cooperate with Underwriter's counsel to qualify the Shares for
offer and sale under the securities or Blue Sky laws of such jurisdictions
as you shall reasonably request; provided that in connection therewith the
--------
Company shall not be required to qualify as a foreign corporation or file a
general consent to service of process in any jurisdiction.
(e) To make generally available to the Company's security holders and
to you as soon as practicable an earning statement covering the twelve-
month period ending , 19 /8/ that satisfies the provisions of
-------- --
Section 11(a) of the Securities Act and the rules and regulations of the
Commission thereunder. If such fiscal quarter is the last fiscal quarter
of the Company's fiscal year, such earning statement shall be made
available not later than 90 days after the close of the period covered
thereby and in all other cases shall be made available not later than 45
days after the close of the period covered thereby.
(f) Whether or not the transactions contemplated in this Agreement are
consummated or this Agreement is terminated, to pay or cause to be paid all
expenses incident to the performance of its obligations under this
Agreement, including: (i) the fees, disbursements and expenses of the
Company's counsel and the Company's accountants in connection with the
registration and delivery of the Shares under the Securities Act and all
other fees or expenses in connection with the preparation and filing of the
Registration Statement, any preliminary prospectus, the Prospectus and
amendments and supplements to any of the foregoing, including all printing
costs associated therewith, and the mailing and delivering of copies
thereof to the Underwriters and dealers, in the quantities hereinabove
specified, (ii) all costs and expenses related to the transfer and delivery
of the Shares to the Underwriters, including any transfer or other taxes
payable thereon, (iii) the cost of printing or
- -------------------
/8/ Insert date one year after the end of the Company's fiscal quarter in which
the closing will occur.
17
<PAGE>
producing any Blue Sky or Legal Investment memorandum in connection with
the offer and sale of the Shares under state securities laws and all
expenses in connection with the qualification of the Shares for offer and
sale under state securities laws as provided in Section 6(d) hereof,
including filing fees and the reasonable fees and disbursements of counsel
for the Underwriters in connection with such qualification and in
connection with the Blue Sky or Legal Investment memorandum, (iv) all
filing fees and disbursements of counsel to the Underwriters incurred in
connection with the review and qualification of the offering of the Shares
by the National Association of Securities Dealers, Inc., (v) all fees and
expenses in connection with the preparation and filing of the registration
statement on Form 8-A relating to the Common Stock and all costs and
expenses incident to listing the Shares on the NYSE, (vi) the cost of
printing certificates representing the Shares, (vii) the costs and charges
of any transfer agent, registrar or depositary, (viii) the costs and
expenses of the Company relating to investor presentations on any "road
show" undertaken in connection with the marketing of the offering of the
Shares, including, without limitation, expenses associated with the
production of road show slides and graphics, fees and expenses of any
consultants engaged in connection with the road show presentations with the
prior approval of the Company, travel and lodging expenses of the
representatives and officers of the Company and any such consultants, and
the cost of any aircraft chartered in connection with the road show, and
(ix) all other costs and expenses incident to the performance of the
obligations of the Company hereunder for which provision is not otherwise
made in this Section. It is understood, however, that except as provided
in this Section, Section 7 entitled "Indemnity and Contribution", and the
last paragraph of Section 9 below, the Underwriters will pay all of their
costs and expenses, including fees and disbursements of their counsel,
stock transfer taxes payable on resale of any of the Shares by them and any
advertising expenses connected with any offers they may make.
7. Indemnity and Contribution. (a) The Company agrees to indemnify
---------------------------
and hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of either Section 15 of the Securities Act or
Section 20 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), from and against any and all losses, claims, damages and liabilities
(including, without
18
<PAGE>
limitation, any legal or other expenses reasonably incurred in connection with
defending or investigating any such action or claim) caused by any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or any amendment thereof, any preliminary prospectus or
the Prospectus (as amended or supplemented if the Company shall have furnished
any amendments or supplements thereto), or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, (A) except insofar as
such losses, claims, damages or liabilities are caused by any such untrue
statement or omission or alleged untrue statement or omission based upon
information relating to any Underwriter furnished to the Company in writing by
such Underwriter through you expressly for use therein, or (B) except that the
Company shall not be liable to any Underwriter under this Section 7 to the
extent that any such loss, claim, liability or judgment results solely from an
untrue statement of a material fact contained in, or the omission of a material
fact from, a preliminary Prospectus if such untrue statement or omission was
completely corrected in the applicable Prospectus Supplement prior to the
written confirmation of the sale of the Shares giving rise to such loss, claim,
liability or judgment if the Company shall sustain the burden of proving (x)
that such Underwriter sold the Shares to the person alleging such loss, claim,
damage or liability without sending or giving the applicable Prospectus
Supplement at or prior to the time of written confirmation of the sale of the
Shares giving rise to such loss, claim, liability or judgment, (y) that the
Company had furnished copies of the applicable Prospectus Supplement to such
Underwriter reasonably prior to the written confirmation of such sale, and (z)
such Underwriter would not have been subject to such liability if it had
delivered the applicable Prospectus Supplement to such person at or prior to the
time of written confirmation of such sale.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement and each person, if any, who controls the Company
within the meaning of either Section 15 of the Securities Act or Section
20 of the Exchange Act to the same extent as the foregoing indemnity from
the Company to such Underwriter, but only with reference to information
relating to such Underwriter furnished to the Company in writing by such
Underwriter through you expressly for use in the
19
<PAGE>
Registration Statement, any preliminary prospectus, the Prospectus or any
amendments or supplements thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may
be sought pursuant to paragraph (a) or (b) of this Section 7, such person
(the "indemnified party") shall promptly notify the person against whom
such indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party and any others the indemnifying party may designate in
such proceeding and shall pay the fees and disbursements of such counsel
related to such proceeding. In any such proceeding, any indemnified party
shall have the right to retain its own counsel, but the fees and expenses
of such counsel shall be at the expense of such indemnified party unless
(i) the indemnifying party and the indemnified party shall have mutually
agreed to the retention of such counsel or (ii) the named parties to any
such proceeding (including any impleaded parties) include both the
indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the
indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related proceedings
in the same jurisdiction, be liable for the fees and expenses of more than
one separate firm (in addition to any local counsel) for all such
indemnified parties and that all such fees and expenses shall be reimbursed
as they are incurred. Such firm shall be designated in writing by Morgan
Stanley & Co. Incorporated, in the case of parties indemnified pursuant to
paragraph (a) of this Section 7, and by the Company, in the case of parties
indemnified pursuant to paragraph (b) of this Section 7. The indemnifying
party shall not be liable for any settlement of any proceeding effected
without its written consent, but if settled with such consent or if there
be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by
reason of such settlement or judgment. No indemnifying party shall, without
the prior written consent of the indemnified party, effect any settlement
of any pending or threatened proceeding in respect of which any indemnified
party is or could have been a party and indemnity could have been sought
hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party
20
<PAGE>
from all liability on claims that are the subject matter of such
proceeding.
(d) To the extent the indemnification provided for in paragraph (a)
or (b) of this Section 7 is unavailable to an indemnified party or
insufficient in respect of any losses, claims, damages or liabilities
referred to therein, then each indemnifying party under such paragraph, in
lieu of indemnifying such indemnified party thereunder, shall contribute to
the amount paid or payable by such indemnified party as a result of such
losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the
one hand and the Underwriters on the other hand from the offering of the
Shares or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company on the one hand and of the
Underwriters on the other hand in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Underwriters on the other
hand in connection with the offering of the Shares shall be deemed to be in
the same respective proportions as the net proceeds from the offering of
the Shares (before deducting expenses) received by the Company and the
total underwriting discounts and commissions received by the Underwriters,
in each case as set forth in the table on the cover of the Prospectus, bear
to the aggregate Public Offering Price of the Shares. The relative fault of
the Company on the one hand and the Underwriters on the other hand shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Company or by the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement
or omission. The Underwriters' respective obligations to contribute
pursuant to this Section 7 are several in proportion to the respective
number of Shares they have purchased hereunder, and not joint.
(e) The Company and the Underwriters agree that it would not be just
or equitable if contribution pursuant to this Section 7 were determined by
pro rata allocation (even if the Underwriters were treated as one entity
--- ----
for such purpose) or by any other method of allocation that does
21
<PAGE>
not take account of the equity considerations referred to in paragraph (d)
of this Section 7. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages and liabilities referred to in the
immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of this
Section 7, no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Shares
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages that such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation. The remedies provided for in this
Section 7 are not exclusive and shall not limit any rights or remedies
which may otherwise be available to any indemnified party at law or in
equity.
(f) The indemnity and contribution provisions contained in this
Section 7 and the representations, warranties and other statements of the
Company contained in this Agreement shall remain operative and in full
force and effect regardless of (i) any termination of this Agreement, (ii)
any investigation made by or on behalf of any Underwriter or any person
controlling any Underwriter or by or on behalf of the Company, its officers
or directors or any person controlling the Company and (iii) acceptance of
and payment for any of the Shares.
8. Termination. This Agreement shall be subject to termination by
------------
notice given by you to the Company, if (a) after the execution and delivery of
this Agreement and prior to the Closing Date (i) trading generally shall have
been suspended or materially limited on or by, as the case may be, any of the
New York Stock Exchange, the American Stock Exchange or the National Association
of Securities Dealers, Inc., (ii) trading of any securities of the Company shall
have been suspended on any exchange or in any over-the-counter market, (iii) a
general moratorium on commercial banking activities in New York shall have been
declared by either Federal or New York State authorities or (iv) there shall
have occurred any outbreak or escalation of hostilities or any change in
financial markets or any calamity or crisis that, in your reasonable judgment,
is
22
<PAGE>
material and adverse and (b) in the case of any of the events specified in
clauses (a)(i) through (iv), such event, singly or together with any other such
event, makes it, in your reasonable judgment, impracticable to market the Shares
on the terms and in the manner contemplated in the Prospectus.
9. Effectiveness; Defaulting Underwriters. This Agreement shall
---------------------------------------
become effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date or the Option Closing Date, as the case may
be, any one or more of the Underwriters shall fail or refuse to purchase Shares
that it has or they have agreed to purchase hereunder on such date, and the
aggregate number of Shares which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase is not more than one-tenth of the
aggregate number of the Shares to be purchased on such date, the other
Underwriters shall be obligated severally in the proportions that the number of
Firm Shares set forth opposite their respective names in Schedule I bears to the
aggregate number of Firm Shares set forth opposite the names of all such non-
defaulting Underwriters, or in such other proportions as you may specify, to
purchase the Shares which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase on such date; provided that in no event shall the
--------
number of Shares that any Underwriter has agreed to purchase pursuant to this
Agreement be increased pursuant to this Section 9 by an amount in excess of one-
ninth of such number of Shares without the written consent of such Underwriter.
If, on the Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase Firm Shares and the aggregate number of Firm Shares with respect to
which such default occurs is more than one-tenth of the aggregate number of Firm
Shares to be purchased, and arrangements satisfactory to you and the Company for
the purchase of such Firm Shares are not made within 36 hours after such
default, this Agreement shall terminate without liability on the part of any
non-defaulting Underwriter or the Company. In any such case either you or the
Company shall have the right to postpone the Closing Date, but in no event for
longer than seven days, in order that the required changes, if any, in the
Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. If, on the Option Closing Date, any Underwriter
or Underwriters shall fail or refuse to purchase Additional Shares and the
aggregate number of Additional Shares with respect to which such default occurs
is more than one-tenth of the aggregate number of Additional Shares to be
23
<PAGE>
purchased, the non-defaulting Underwriters shall have the option to (i)
terminate their obligation hereunder to purchase Additional Shares or (ii)
purchase not less than the number of Additional Shares that such non-defaulting
Underwriters would have been obligated to purchase in the absence of such
default. Any action taken under this paragraph shall not relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of
them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason the Company shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
10. Counterparts. This Agreement may be signed in two or more
-------------
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
11. Applicable Law. This Agreement shall be governed by and
---------------
construed in accordance with the internal laws of the State of New York.
24
<PAGE>
12. Headings. The headings of the sections of this Agreement have
---------
been inserted for convenience of reference only and shall not be deemed a part
of this Agreement.
Very truly yours,
Armstrong World Industries, Inc.
By
-----------------------------
Name:
Title:
Accepted as of the date hereof
Morgan Stanley & Co. Incorporated
[NAMES OF OTHER CO-MANAGERS]
Acting severally on behalf
of themselves and the
several Underwriters named
herein.
By Morgan Stanley & Co.
Incorporated
By
---------------------------
Name:
Title:
25
<PAGE>
SCHEDULE I
Number of
Firm Shares
Underwriter To Be Purchased
----------- ---------------
Morgan Stanley & Co. Incorporated
[NAMES OF OTHER CO-MANAGERS]
[NAMES OF OTHER UNDERWRITERS]
---------------
Total ........
===============
<PAGE>
Exhibit A
---------
[Form of Lock-Up Letter]
, 1996
-------------
Morgan Stanley & Co. Incorporated
[NAMES OF OTHER CO-MANAGERS]
c/o Morgan Stanley & Co. Incorporated
1585 Broadway
New York, NY 10036
Dear Sirs and Mesdames:
The undersigned understands that Morgan Stanley & Co. Incorporated
("Morgan Stanley") proposes to enter into an Underwriting Agreement (the
"Underwriting Agreement") with Armstrong World Industries, Inc., a Pennsylvania
corporation (the "Company"), providing for the public offering (the "Public
Offering") by the several Underwriters, including Morgan Stanley (the
"Underwriters"), of shares (the "Shares") of the Common Stock (par value
-------
$1.00 per share) of the Company (the "Common Stock").
To induce the Underwriters that may participate in the Public Offering
to continue their efforts in connection with the Public Offering, the
undersigned hereby agrees that, without the prior written consent of Morgan
Stanley on behalf of the Underwriters, it will not, during the period commencing
on the date hereof and ending [180] days after the date of the final prospectus
relating to the Public Offering (the "Prospectus"), (1) offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase, or
otherwise transfer or dispose of, directly or indirectly, any shares of Common
Stock or any securities convertible into or exercisable or exchangeable for
Common Stock (whether such shares or any such securities are now owned by the
undersigned or are hereafter acquired), or (2) enter into any swap or other
arrangement that transfers to another, in whole or in part, any of the economic
consequences of ownership of the Common Stock, whether any such transaction
described in clause (1) or (2) above is to be settled by delivery of Common
Stock or such other securities, in cash or otherwise. The foregoing
<PAGE>
sentence shall not apply to the sale of any Shares to the Underwriters pursuant
to the Underwriting Agreement. In addition, the undersigned agrees that,
without the prior written consent of Morgan Stanley on behalf of the
Underwriters, it will not, during the period commencing on the date hereof and
ending [180] days after the date of the Prospectus, make any demand for or
exercise any right with respect to, the registration of any shares of Common
Stock or any security convertible into or exercisable or exchangeable for Common
Stock.
Whether or not the Public Offering actually occurs depends on a number
of factors, including market conditions. Any Public Offering will only be made
pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriters.
Very truly yours,
-------------------------
(Name)
-------------------------
(Address)
<PAGE>
Exhibit 4.1
================================================================================
Armstrong World Industries, Inc.
TO
Mellon Bank, N.A.
Trustee
--------------
Indenture
Dated as of .............., 1996
--------------
Senior Debt Securities
================================================================================
<PAGE>
TABLE OF CONTENTS
----------
Page
----
Recitals of the Company...................................................... 1
ARTICLE ONE
Definitions and Other Provisions of General Application
Section 101. Definitions:
Act.......................................................... 2
Affiliate; control........................................... 2
Attributable Debt............................................ 2
Authenticating Agent......................................... 2
Board of Directors........................................... 2
Board Resolution............................................. 2
Business Day................................................. 2
Commission................................................... 2
Common Stock................................................. 3
Company...................................................... 3
Company Request; Company Order............................... 3
Consolidated Net Tangible Assets............................. 3
Corporate Trust Office....................................... 3
corporation.................................................. 3
Covenant Defeasance.......................................... 3
Debt......................................................... 3
Defaulted Interest........................................... 3
Defeasance................................................... 3
Depositary................................................... 4
Event of Default............................................. 4
Exchange Act................................................. 4
Expiration Date.............................................. 4
Global Security.............................................. 4
Holder....................................................... 4
Indenture.................................................... 4
interest..................................................... 4
Interest Payment Date........................................ 4
Investment Company Act....................................... 4
Lien......................................................... 4
Maturity..................................................... 4
Notice of Default............................................ 4
Officers' Certificate........................................ 4
- -------------
NOTE: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
<PAGE>
Page
----
Opinion of Counsel........................................... 5
Original Issue Discount Security............................. 5
Outstanding.................................................. 5
Paying Agent................................................. 6
Person....................................................... 6
Place of Payment............................................. 6
Predecessor Security......................................... 6
Principal Property........................................... 6
Redemption Date.............................................. 6
Redemption Price............................................. 7
Regular Record Date.......................................... 7
Restricted Subsidiary........................................ 7
Sale and Leaseback Transaction............................... 7
Securities................................................... 7
Securities Act............................................... 7
Security Register and Security Registrar..................... 7
Special Record Date.......................................... 7
Stated Maturity.............................................. 7
Subsidiary................................................... 7
Trust Indenture Act.......................................... 7
Trustee...................................................... 7
U.S. Government Obligation................................... 8
Vice President............................................... 8
Section 102. Compliance Certificates and Opinions......................... 8
Section 103. Form of Documents Delivered to Trustee....................... 8
Section 104. Acts of Holders; Record Dates................................ 9
Section 105. Notices, Etc., to Trustee and Company........................ 11
Section 106. Notice to Holders; Waiver.................................... 11
Section 107. Conflict with Trust Indenture Act............................ 12
Section 108. Effect of Headings and Table of Contents..................... 12
Section 109. Successors and Assigns....................................... 12
Section 110. Separability Clause.......................................... 12
Section 111. Benefits of Indenture........................................ 12
Section 112. Governing Law................................................ 13
Section 113. Legal Holidays............................................... 13
ARTICLE TWO
Security Forms
Section 201. Forms Generally............................................. 13
Section 202. Form of Face of Security.................................... 14
-ii-
<PAGE>
Page
----
Section 203. Form of Reverse of Security................................. 15
Section 204. Form of Legend for Global Securities........................ 20
Section 205. Form of Trustee's Certificate of Authentication............. 21
Section 206. Form of Conversion Notice................................... 21
ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series........................ 22
Section 302. Denominations............................................... 25
Section 303. Execution, Authentication, Delivery and Dating.............. 25
Section 304. Temporary Securities........................................ 27
Section 305. Registration, Registration of Transfer and Exchange......... 27
Section 306. Mutilated, Destroyed, Lost and Stolen Securities............ 29
Section 307. Payment of Interest; Interest Rights Preserved.............. 30
Section 308. Persons Deemed Owners....................................... 31
Section 309. Cancellation................................................ 31
Section 310. Computation of Interest..................................... 32
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture..................... 32
Section 402. Application of Trust Money.................................. 33
ARTICLE FIVE
Remedies
Section 501. Events of Default........................................... 33
Section 502. Acceleration of Maturity; Rescission and Annulment.......... 35
Section 503. Collection of Indebtedness and Suits for
Enforcement by Trustee...................................... 36
Section 504. Trustee May File Proofs of Claim............................ 36
Section 505. Trustee May Enforce Claims Without Possession
of Securities............................................... 37
Section 506. Application of Money Collected.............................. 37
Section 507. Limitation on Suits......................................... 38
-iii-
<PAGE>
Page
----
Section 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest....................................... 38
Section 509. Restoration of Rights and Remedies.......................... 39
Section 510. Rights and Remedies Cumulative.............................. 39
Section 511. Delay or Omission Not Waiver................................ 39
Section 512. Control by Holders.......................................... 39
Section 513. Waiver of Past Defaults..................................... 40
Section 514. Undertaking for Costs....................................... 40
Section 515. Waiver of Usury, Stay or Extension Laws..................... 40
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities......................... 41
Section 602. Notice of Defaults.......................................... 41
Section 603. Certain Rights of Trustee................................... 41
Section 604. Not Responsible for Recitals or Issuance of Securities...... 42
Section 605. May Hold Securities......................................... 42
Section 606. Money Held in Trust......................................... 43
Section 607. Compensation and Reimbursement.............................. 43
Section 608. Conflicting Interests....................................... 43
Section 609. Corporate Trustee Required; Eligibility..................... 43
Section 610. Resignation and Removal; Appointment of Successor........... 44
Section 611. Acceptance of Appointment by Successor...................... 45
Section 612. Merger, Conversion, Consolidation or Succession
to Business................................................ 46
Section 613. Preferential Collection of Claims Against Company........... 47
Section 614. Appointment of Authenticating Agent......................... 47
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee Names and Addresses
of Holders................................................. 48
Section 702. Preservation of Information; Communications
to Holders................................................. 49
Section 703. Reports by Trustee.......................................... 49
Section 704. Reports by Company.......................................... 49
-iv-
<PAGE>
Page
----
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. Company May Consolidate, Etc., Only on
Certain Terms............................................... 50
Section 802. Successor Substituted........................................ 51
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of Holders.......... 51
Section 902. Supplemental Indentures With Consent of Holders............. 52
Section 903. Execution of Supplemental Indentures........................ 53
Section 904. Effect of Supplemental Indentures........................... 54
Section 905. Conformity with Trust Indenture Act......................... 54
Section 906. Reference in Securities to Supplemental Indentures.......... 54
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest.................. 54
Section 1002. Maintenance of Office or Agency............................. 54
Section 1003. Money for Securities Payments to Be Held in Trust........... 55
Section 1004. Statement by Officers as to Default......................... 56
Section 1005. Existence................................................... 56
Section 1006. Maintenance of Properties................................... 56
Section 1007. Payment of Taxes and Other Claims........................... 57
Section 1008. Limitations on Liens........................................ 57
Section 1009. Limitations on Sale and Leaseback Transactions.............. 59
Section 1010. Waiver of Certain Covenants................................. 60
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article.................................... 60
Section 1102. Election to Redeem; Notice to Trustee....................... 60
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Page
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Section 1103. Selection by Trustee of Securities to Be Redeemed.......... 61
Section 1104. Notice of Redemption....................................... 62
Section 1105. Deposit of Redemption Price................................ 62
Section 1106. Securities Payable on Redemption Date...................... 63
Section 1107. Securities Redeemed in Part................................ 63
ARTICLE TWELVE
Sinking Funds
Section 1201. Applicability of Article................................... 63
Section 1202. Satisfaction of Sinking Fund Payments with Securities...... 64
Section 1203. Redemption of Securities for Sinking Fund.................. 64
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Company's Option to Effect Defeasance or
Covenant Defeasance....................................... 64
Section 1302. Defeasance and Discharge................................... 65
Section 1303. Covenant Defeasance........................................ 65
Section 1304. Conditions to Defeasance or Covenant Defeasance............ 66
Section 1305. Deposited Money and U.S. Government Obligations
to Be Held in Trust; Miscellaneous Provisions............. 67
Section 1306. Reinstatement.............................................. 68
ARTICLE FOURTEEN
Conversion of Securities
Section 1401. Applicability of Article................................... 68
Section 1402. Exercise of Conversion Privilege........................... 69
Section 1403. No Fractional Shares....................................... 70
Section 1404. Adjustment of Conversion Price............................. 70
Section 1405. Notice of Certain Corporate Actions........................ 71
Section 1406. Reservation of Shares of Common Stock...................... 71
Section 1407. Payment of Certain Taxes Upon Conversion................... 72
Section 1408. Nonassessability........................................... 72
Section 1409. Effect of Consolidation or Merger on Conversion Privilege.. 72
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Section 1410. Duties of Trustee Regarding Conversion..................... 73
Section 1411. Repayment of Certain Funds Upon Conversion................. 74
Testimonium................................................................. 75
Signatures and Seals........................................................ 75
Acknowledgements............................................................ 76
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....................................
Certain Sections of this Indenture relating to Sections 310 through 318,
inclusive, of the Trust Indenture Act of 1939:
Trust Indenture
Act Section Indenture Section
(S) 310(a)(1) ............................................... 609
(a)(2) ............................................... 609
(a)(3) ............................................... Not Applicable
(a)(4) ............................................... Not Applicable
(b) ............................................... 608
610
(S) 311(a) ............................................... 613
(b) ............................................... 613
(S) 312(a) ............................................... 701
............................................... 702
(b) ............................................... 702
(c) 702
(S) 313(a) ............................................... 703
(b) ............................................... 703
(c) ............................................... 703
(d) ............................................... 703
(S) 314(a) ............................................... 704
(a)(4) ............................................... 101
1004
(b) ............................................... Not Applicable
(c)(1) ............................................... 102
(c)(2) ............................................... 102
(c)(3) ............................................... Not Applicable
(d) ............................................... Not Applicable
(e) ............................................... 102
(S) 315(a) ............................................... 601
(b) ............................................... 602
(c) ............................................... 601
(d) ............................................... 601
(e) ............................................... 514
(S) 316(a) ............................................... 101
(a)(1)(A) ............................................... 502
512
(a)(1)(B) ............................................... 513
(a)(2) ............................................... Not Applicable
(b) ............................................... 508
(c) ............................................... 104
(S) 317(a)(1) ............................................... 503
(a)(2) ............................................... 504
(b) ............................................... 1003
(S) 318(a) ............................................... 107
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Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Indenture.
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<PAGE>
INDENTURE, dated as of ............, 1996, between Armstrong World
Industries, Inc., a corporation duly organized and existing under the laws of
the Commonwealth of Pennsylvania (herein called the "Company"), having its
principal executive office at 313 West Liberty Street, Lancaster, Pennsylvania
17603, and Mellon Bank, N.A., a national banking association duly organized and
existing under the laws of the United States of America, as Trustee (herein
called the "Trustee").
Recitals of the Company
The Company has duly authorized the execution and delivery of this Indenture
to provide for the issuance from time to time of its unsecured debentures, notes
or other evidences of indebtedness (herein called the "Securities"), to be
issued in one or more series as in this Indenture provided.
All things necessary to make this Indenture a valid agreement of the Company,
in accordance with its terms, have been done.
Now, Therefore, This Indenture Witnesseth:
For and in consideration of the premises and the purchase of the Securities
by the Holders thereof, it is mutually agreed, for the equal and proportionate
benefit of all Holders of the Securities or of series thereof, as follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly provided or
unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to them
in this Article and include the plural as well as the singular;
(2) all other terms used herein which are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to
them therein;
(3) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles,
and, except as otherwise herein expressly provided, the term "generally
accepted accounting principles" with respect to any computation required or
permitted hereunder shall mean such accounting principles as are generally
accepted at the date of such computation;
<PAGE>
(4) unless the context otherwise requires, any reference to an "Article"
or a "Section" refers to an Article or a Section, as the case may be, of this
Indenture; and
(5) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
"Act", when used with respect to any Holder, has the meaning specified in
Section 104.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Attributable Debt" means, in respect of a Sale and Leaseback Transaction and
as of any particular time, the present value (discounted at the rate of interest
implicit in the terms of the lease involved in such Sale and Leaseback
Transaction, as determined in good faith by the Company) of the obligation of
the lessee thereunder for net rental payments (excluding, however, any amounts
required to be paid by such lessee, whether or not designated as rent or
additional rent, on account of maintenance and repairs, services, insurance,
taxes, assessments, water rates or similar charges or any amounts required to be
paid by such lessee thereunder contingent upon monetary inflation or the amount
of sales, maintenance and repairs, insurance, taxes, assessments, water rates or
similar charges) during the remaining term of such lease (including any period
for which such lease has been extended or may, at the option of the lessor, be
extended).
"Authenticating Agent" means any Person authorized by the Trustee pursuant to
Section 614 to act on behalf of the Trustee to authenticate Securities of one or
more series.
"Board of Directors" means either the board of directors of the Company or
any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the Secretary or
an Assistant Secretary of the Company to have been duly adopted by the Board of
Directors and to be in full force and effect on the date of such certification,
and delivered to the Trustee.
"Business Day", when used with respect to any Place of Payment, means each
Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions in that Place of Payment are authorized or obligated by law
or executive order to close.
"Commission" means the Securities and Exchange Commission, from time to time
constituted, created under the Exchange Act, or, if at any time after the
execution of this instrument such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
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"Common Stock" includes any stock of any class of the Company which has no
preference in respect of dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding-up of the Company
and which is not subject to redemption by the Company. However, subject to the
provisions of Section 1409, shares issuable on conversions of Securities shall
include only shares of the class designated as Common Stock of the Company at
the date of this Indenture or shares of any class or classes resulting from any
reclassification or reclassifications thereof and which have no preference in
respect of dividends or of amounts payable in the event of any voluntary or
involuntary liquidation, dissolution or winding-up of the Company and which are
not subject to redemption by the Company; provided that if at any time there
shall be more than one such resulting class, the shares of each such class then
so issuable shall be substantially in the proportion which the total number of
shares of such class resulting from all such reclassifications bears to the
total number of shares of all such classes resulting from all such
reclassifications.
"Company" means the Person named as the "Company" in the first paragraph of
this instrument until a successor Person shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor Person.
"Company Request" or "Company Order" means a written request or order signed
in the name of the Company by its Chairman of the Board, its Vice Chairman of
the Board, its President or a Vice President, and by its Treasurer, an Assistant
Treasurer, its Secretary or an Assistant Secretary, and delivered to the
Trustee.
"Consolidated Net Tangible Assets" means the aggregate amount of assets (less
applicable reserves and other properly deductible items) after deducting
therefrom (a) all goodwill, trade names, trademarks, patents, unamortized debt
discount and expense and other like intangibles, and (b) all current
liabilities, all as reflected in the Company's latest audited consolidated
balance sheet contained in the Company's most recent annual report to its
stockholders under Rule 14a-3 of the Exchange Act prior to the time as of which
"Consolidated Net Tangible Assets" shall be determined.
"Corporate Trust Office" means the corporate trust office of the Trustee at
Two Mellon Bank Center, Room 325, Pittsburgh, Pennsylvania 15259 at which at any
particular time its corporate trust business shall be administered.
"corporation" means a corporation, association, company, joint-stock company
or business trust.
"Covenant Defeasance" has the meaning specified in Section 1303.
"Debt" means indebtedness for borrowed money.
"Defaulted Interest" has the meaning specified in Section 307.
"Defeasance" has the meaning specified in Section 1302.
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<PAGE>
"Depositary" means, with respect to Securities of any series issuable in
whole or in part in the form of one or more Global Securities, a clearing agency
registered under the Exchange Act that is designated to act as Depositary for
such Securities as contemplated by Section 301.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934 and any statute
successor thereto, in each case as amended from time to time.
"Expiration Date" has the meaning specified in Section 104.
"Global Security" means a Security that evidences all or part of the
Securities of any series and bears the legend set forth in Section 204 (or such
legend as may be specified as contemplated by Section 301 for such Securities).
"Holder" means a Person in whose name a Security is registered in the
Security Register.
"Indenture" means this instrument as originally executed and as it may from
time to time be supplemented or amended by one or more indentures supplemental
hereto entered into pursuant to the applicable provisions hereof, including, for
all purposes of this instrument and any such supplemental indenture, the
provisions of the Trust Indenture Act that are deemed to be a part of and govern
this instrument and any such supplemental indenture, respectively. The term
"Indenture" shall also include the terms of particular series of Securities
established as contemplated by Section 301.
"interest", when used with respect to an Original Issue Discount Security
which by its terms bears interest only after Maturity, means interest payable
after Maturity.
"Interest Payment Date", when used with respect to any Security, means the
Stated Maturity of an instalment of interest on such Security.
"Investment Company Act" means the Investment Company Act of 1940 and any
statute successor thereto, in each case as amended from time to time.
"Lien" means any mortgage, pledge, security interest, lien or other
encumbrance.
"Maturity", when used with respect to any Security, means the date on which
the principal of such Security or an instalment of principal becomes due and
payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, call for redemption or otherwise.
"Notice of Default" means a written notice of the kind specified in Section
501(4) or 501(5).
"Officers' Certificate" means a certificate signed by the Chairman of the
Board, a Vice Chairman of the Board, the President or a Vice President, and by
the Treasurer, an Assistant
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<PAGE>
Treasurer, the Secretary or an Assistant Secretary, of the Company, and
delivered to the Trustee. One of the officers signing an Officers' Certificate
given pursuant to Section 1004 shall be the principal executive, financial or
accounting officer of the Company.
"Opinion of Counsel" means a written opinion of counsel, who may be counsel
for the Company, and who shall be acceptable to the Trustee.
"Original Issue Discount Security" means any Security which provides for an
amount less than the principal amount thereof to be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to Section 502.
"Outstanding", when used with respect to Securities, means, as of the date of
determination, all Securities theretofore authenticated and delivered under this
Indenture, except:
(1) Securities theretofore cancelled by the Trustee or delivered to the
Trustee for cancellation;
(2) Securities for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Trustee or any Paying Agent
(other than the Company) in trust or set aside and segregated in trust by the
Company (if the Company shall act as its own Paying Agent) for the Holders of
such Securities; provided that, if such Securities are to be redeemed, notice
of such redemption has been duly given pursuant to this Indenture or provision
therefor satisfactory to the Trustee has been made;
(3) Securities as to which Defeasance has been effected pursuant to
Section 1302; and
(4) Securities which have been paid pursuant to Section 306 or in exchange
for or in lieu of which other Securities have been authenticated and delivered
pursuant to this Indenture, other than any such Securities in respect of which
there shall have been presented to the Trustee proof satisfactory to it that
such Securities are held by a bona fide purchaser in whose hands such
Securities are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given, made or taken any
request, demand, authorization, direction, notice, consent, waiver or other
action hereunder as of any date, (A) the principal amount of an Original Issue
Discount Security which shall be deemed to be Outstanding shall be the amount of
the principal thereof which would be due and payable as of such date upon
acceleration of the Maturity thereof to such date pursuant to Section 502, (B)
if, as of such date, the principal amount payable at the Stated Maturity of a
Security is not determinable, the principal amount of such Security which shall
be deemed to be Outstanding shall be the amount as specified or determined as
contemplated by Section 301, (C) the principal amount of a Security denominated
in one or more foreign currencies or currency units which shall be deemed to be
Outstanding shall be the U.S. dollar equivalent, determined as of such date in
the manner provided as contemplated by Section 301, of the principal amount of
such Security (or, in the case of a Security described in Clause (A) or (B)
above, of the amount
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<PAGE>
determined as provided in such Clause), and (D) Securities owned by the Company
or any other obligor upon the Securities or any Affiliate of the Company or of
such other obligor shall be disregarded and deemed not to be Outstanding, except
that, in determining whether the Trustee shall be protected in relying upon any
such request, demand, authorization, direction, notice, consent, waiver or other
action, only Securities which the Trustee knows to be so owned shall be so
disregarded. Securities so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Company or any other obligor upon the Securities or any
Affiliate of the Company or of such other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal of or any premium or interest on any Securities on behalf of the
Company.
"Person" means any individual, corporation, partnership, joint venture,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"Place of Payment", when used with respect to the Securities of any series,
means the place or places where the principal of and any premium and interest on
the Securities of that series are payable as specified as contemplated by
Section 301.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 306 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.
"Principal Property" means any single manufacturing plant, research
laboratory or other similar facility located within the United States of America
(other than its territories and possessions) and owned by, or leased to, the
Company or any Restricted Subsidiary, the book value of the property, plant and
equipment of which (as shown, net of depreciation, on the books of the owner or
owners) is not less than 2% of the Consolidated Net Tangible Assets at the end
of the most recent fiscal year of the Company, reflected in the latest audited
consolidated statement of financial position contained in the Company's most
recent annual report to its stockholders under Rule 14a-3 of the Exchange Act,
except (a) any such plant or facility (i) owned or leased jointly or in common
with one or more Persons other than the Company and its Subsidiaries, in which
the interest of the Company and its Restricted Subsidiaries does not exceed 50%,
or (ii) which the Board of Directors determines by Board Resolution in good
faith is not of material importance to the total business conducted, or assets
owned, by the Company and its Subsidiaries as an entirety, or (b) any portion of
any such plant or facility which the Board of Directors determines by Board
Resolution in good faith not to be of material importance to the use or
operation thereof.
"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.
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<PAGE>
"Redemption Price", when used with respect to any Security to be redeemed,
means the price at which it is to be redeemed pursuant to this Indenture.
"Regular Record Date" for the interest payable on any Interest Payment Date
on the Securities of any series means the date specified for that purpose as
contemplated by Section 301.
"Restricted Subsidiary" means any Subsidiary substantially all the property
of which is located, or substantially all of the business of which is carried
on, within the United States of America (other than its territories and
possessions) which shall at the time, directly or indirectly through one or more
Subsidiaries or in combination with one or more other Subsidiaries, own or be a
lessee of a Principal Property.
"Sale and Leaseback Transaction" has the meaning specified in Section 1009.
"Securities" has the meaning stated in the first recital of this Indenture
and more particularly means any Securities authenticated and delivered under
this Indenture.
"Securities Act" means the Securities Act of 1933 and any statute successor
thereto, in each case as amended from time to time.
"Security Register" and "Security Registrar" have the respective meanings
specified in Section 305.
"Special Record Date" for the payment of any Defaulted Interest means a date
fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Security or any instalment
of principal thereof or interest thereon, means the date specified in such
Security as the fixed date on which the principal of such Security or such
instalment of principal or interest is due and payable.
"Subsidiary" means a corporation more than 50% of the outstanding voting
stock of which is owned, directly or indirectly, by the Company or by one or
more other Subsidiaries, or by the Company and one or more other Subsidiaries.
For the purposes of this definition, "voting stock" means stock which ordinarily
has voting power for the election of directors, whether at all times or only so
long as no senior class of stock has such voting power by reason of any
contingency.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trustee" means the Person named as the "Trustee" in the first paragraph of
this instrument until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Trustee" shall mean or
include each Person who
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<PAGE>
is then a Trustee hereunder, and if at any time there is more than one such
Person, "Trustee" as used with respect to the Securities of any series shall
mean the Trustee with respect to Securities of that series.
"U.S. Government Obligation" has the meaning specified in Section 1304.
"Vice President", when used with respect to the Company or the Trustee, means
any vice president, whether or not designated by a number or a word or words
added before or after the title "vice president".
Section 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to take any
action under any provision of this Indenture, the Company shall furnish to the
Trustee such certificates and opinions as may be required under the Trust
Indenture Act. Each such certificate or opinion shall be given in the form of an
Officers' Certificate, if to be given by an officer of the Company, or an
Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirements set forth in
this Indenture.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture shall include,
(1) a statement that each individual signing such certificate or opinion
has read such covenant or condition and the definitions herein relating
thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he or she
has made such examination or investigation as is necessary to enable him or her
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(4) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
Section 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or covered
by an opinion of, any specified Person, it is not necessary that all such
matters be certified by, or covered by the opinion of, only one such Person, or
that they be so certified or covered by only one document, but one such Person
may certify or give an opinion with respect to some matters and one or more
other such Persons as to other matters, and any such Person may certify or give
an opinion as to such matters in one or several documents.
-8-
<PAGE>
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 or her 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 104. Acts of Holders; Record Dates.
Any request, demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Indenture to be given, made or taken
by Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 601) conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such instrument or
writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him or her the execution thereof. Where such
execution is by a signer acting in a capacity other than his or her individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his or her authority. The fact and date of the execution of any such
instrument or writing, or the authority of the Person executing the same, may
also be proved in any other manner which the Trustee deems sufficient.
The ownership of Securities shall be proved by the Security Register.
Any request, demand, authorization, direction, notice, consent, waiver or
other Act of the Holder of any Security shall bind every future Holder of the
same Security and the Holder of every Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or
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<PAGE>
the Company in reliance thereon, whether or not notation of such action is made
upon such Security.
The Company may set any day as a record date for the purpose of determining
the Holders of Outstanding Securities of any series entitled to give, make or
take any request, demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Indenture to be given, made or taken
by Holders of Securities of such series, provided that the Company may not set a
record date for, and the provisions of this paragraph shall not apply with
respect to, the giving or making of any notice, declaration, request or
direction referred to in the next paragraph. If any record date is set pursuant
to this paragraph, the Holders of Outstanding Securities of the relevant series
on such record date, and no other Holders, shall be entitled to take the
relevant action, whether or not such Holders remain Holders after such record
date; provided that no such action shall be effective hereunder unless taken on
or prior to the applicable Expiration Date by Holders of the requisite principal
amount of Outstanding Securities of such series on such record date. Nothing in
this paragraph shall be construed to prevent the Company from setting a new
record date for any action for which a record date has previously been set
pursuant to this paragraph (whereupon the record date previously set shall
automatically and with no action by any Person be cancelled and of no effect),
and nothing in this paragraph shall be construed to render ineffective any
action taken by Holders of the requisite principal amount of Outstanding
Securities of the relevant series on the date such action is taken. Promptly
after any record date is set pursuant to this paragraph, the Company, at its own
expense, shall cause notice of such record date, the proposed action by Holders
and the applicable Expiration Date to be given to the Trustee in writing and to
each Holder of Securities of the relevant series in the manner set forth in
Section 106.
The Trustee may set any day as a record date for the purpose of determining
the Holders of Outstanding Securities of any series entitled to join in the
giving or making of (i) any Notice of Default, (ii) any declaration of
acceleration referred to in Section 502, (iii) any request to institute
proceedings referred to in Section 507(2) or (iv) any direction referred to in
Section 512, in each case with respect to Securities of such series. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of such series on such record date, and no other Holders, shall be
entitled to join in such notice, declaration, request or direction, whether or
not such Holders remain Holders after such record date; provided that no such
action shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date. Nothing in this paragraph shall
be construed to prevent the Trustee from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities of the relevant
series on the date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Trustee, at the Company's expense, shall cause
notice of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Company in writing and to each Holder of
Securities of the relevant series in the manner set forth in Section 106.
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With respect to any record date set pursuant to this Section, the party
hereto which sets such record dates may designate any day as the "Expiration
Date" and from time to time may change the Expiration Date to any earlier or
later day; provided that no such change shall be effective unless notice of the
proposed new Expiration Date is given to the other party hereto in writing, and
to each Holder of Securities of the relevant series in the manner set forth in
Section 106, on or prior to the existing Expiration Date. If an Expiration Date
is not designated with respect to any record date set pursuant to this Section,
the party hereto which set such record date shall be deemed to have initially
designated the 180th day after such record date as the Expiration Date with
respect thereto, subject to its right to change the Expiration Date as provided
in this paragraph. Notwithstanding the foregoing, no Expiration Date shall be
later than the 180th day after the applicable record date.
Without limiting the foregoing, a Holder entitled hereunder to take any
action hereunder with regard to any particular Security may do so with regard to
all or any part of the principal amount of such Security or by one or more duly
appointed agents each of which may do so pursuant to such appointment with
regard to all or any part of such principal amount.
Section 105. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice, consent, waiver or Act
of Holders or other document provided or permitted by this Indenture to be made
upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient for
every purpose hereunder if made, given, furnished or filed in writing to or
with the Trustee at its Corporate Trust Office, Attention: Corporate Trust
Group, or
(2) the Company by the Trustee or by any Holder shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to the Company addressed to it
at the address of its principal office specified in the first paragraph of this
instrument or at any other address previously furnished in writing to the
Trustee by the Company, Attention: Chief Financial Officer.
Section 106. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, such notice
shall be sufficiently given (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to each Holder affected by such
event, at its address as it appears in the Security Register, not later than the
latest date (if any), and not earlier than the earliest date (if any),
prescribed for the giving of such notice. In any case where notice to Holders is
given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. Where this Indenture provides for notice
in any manner, such notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and such waiver shall be
the equivalent of such notice. Waivers of notice by Holders shall be filed with
the
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<PAGE>
Trustee, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by reason of
any other cause it shall be impracticable to give such notice by mail, then such
notification as shall be made with the approval of the Trustee shall constitute
a sufficient notification for every purpose hereunder.
Section 107. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a provision of
the Trust Indenture Act which is required under such Act to be a part of and
govern this Indenture, the latter provision shall control. If any provision of
this Indenture modifies or excludes any provision of the Trust Indenture Act
which may be so modified or excluded, the latter provision shall be deemed to
apply to this Indenture as so modified or to be excluded, as the case may be.
Section 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
Section 109. Successors and Assigns.
All covenants and agreements in this Indenture by the Company shall bind its
successors and assigns, whether so expressed or not.
Section 110. Separability Clause.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 111. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied, shall
give to any Person, other than the parties hereto and their successors
hereunder and the Holders, any benefit or any legal or equitable right, remedy
or claim under this Indenture.
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Section 112. Governing Law.
This Indenture and the Securities shall be governed by and construed in
accordance with the law of the State of New York.
Section 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security or the last date on which a Holder has the right to
convert a Security at a particular conversion price shall not be a Business Day
at any Place of Payment, then (notwithstanding any other provision of this
Indenture or of the Securities (other than a provision of any Security which
specifically states that such provision shall apply in lieu of this Section))
payment of interest or principal (and premium, if any) or, if applicable to a
particular series of Securities, conversion need not be made at such Place of
Payment on such date, but may be made on the next succeeding Business Day at
such Place of Payment with the same force and effect as if made on the Interest
Payment Date or Redemption Date, at the Stated Maturity or on such last day for
conversion.
ARTICLE TWO
Security Forms
Section 201. Forms Generally.
The Securities of each series shall be in substantially the form set forth in
this Article, or in such other form as shall be established by or pursuant to a
Board Resolution or in one or more indentures supplemental hereto, in each case
with such appropriate insertions, omissions, substitutions and other variations
as are required or permitted by this Indenture, and may have such letters,
numbers or other marks of identification and such legends or endorsements placed
thereon as may be required to comply with the rules of any securities exchange
or Depositary therefor or as may, consistently herewith, be determined by the
officers executing such Securities, as evidenced by their execution thereof. If
the form of Securities of any series is established by action taken pursuant to
a Board Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Company Order
contemplated by Section 303 for the authentication and delivery of such
Securities. Any such Board Resolution or record of such action shall have
attached thereto a true and correct copy of the form of Security referred to
therein approved by or pursuant to such Board Resolution.
The definitive Securities shall be printed, lithographed or engraved on steel
engraved borders or may be produced in any other manner, all as determined by
the officers executing such Securities, as evidenced by their execution of such
Securities.
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<PAGE>
Section 202. Form of Face of Security.
...........................................
....................................................
No. ......... $ ........
Armstrong World Industries, Inc., a corporation duly organized and existing
under the laws of Pennsylvania (herein called the "Company", which term includes
any successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to
..............................................., or registered assigns, the
principal sum of ...................................... Dollars on
........................................................ [if the Security is to
bear interest prior to Maturity, insert -- , and to pay interest thereon from
............. or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, semi-annually on ............ and
............ in each year, commencing ........., at the rate of ....% per
annum, until the principal hereof is paid or made available for payment [if
applicable, insert -- , provided that any principal and premium, and any such
instalment of interest, which is overdue shall bear interest at the rate of ...%
per annum (to the extent that the payment of such interest shall be legally
enforceable), from the dates such amounts are due until they are paid or made
available for payment, and such interest shall be payable on demand]. The
interest so payable, and punctually paid or duly provided for, on any Interest
Payment Date will, as provided in such Indenture, be paid to the Person in whose
name this Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest, which shall be
the ....... or ....... (whether or not a Business Day), as the case may be, next
preceding such Interest Payment Date. Any such interest not so punctually paid
or duly provided for will forthwith cease to be payable to the Holder on such
Regular Record Date and may either be paid to the Person in whose name this
Security (or one or more Predecessor Securities) is registered at the close of
business on a Special Record Date for the payment of such Defaulted Interest to
be fixed by the Trustee, notice whereof shall be given to Holders of Securities
of this series not less than 10 days prior to such Special Record Date, or be
paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities of this series
may be listed, and upon such notice as may be required by such exchange, all as
more fully provided in said Indenture].
[If the Security is not to bear interest prior to Maturity, insert -- The
principal of this Security shall not bear interest except in the case of a
default in payment of principal upon acceleration, upon redemption or at Stated
Maturity and in such case the overdue principal and any overdue premium shall
bear interest at the rate of ....% per annum (to the extent that the payment of
such interest shall be legally enforceable), from the dates such amounts are due
until they are paid or made available for payment. Interest on any overdue
principal or premium shall be payable on demand. [Any such interest on overdue
principal or premium which is not paid on demand shall bear interest at the rate
of ......% per annum (to the extent that the payment of such interest on
interest shall be legally enforceable), from the date of
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<PAGE>
such demand until the amount so demanded is paid or made available for payment.
Interest on any overdue interest shall be payable on demand.]]
Payment of the principal of (and premium, if any) and [if applicable, insert
- -- any such] interest on this Security will be made at the office or agency of
the Company maintained for that purpose in ............, in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts [if applicable, insert -- ;
provided, however, that at the option of the Company payment of interest may be
made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register].
Reference is hereby made to the further provisions of this Security set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
In Witness Whereof, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated:
.................................
By.................................
Attest:
..............................
Section 203. Form of Reverse of Security.
This Security is one of a duly authorized issue of securities of the Company
(herein called the "Securities"), issued and to be issued in one or more series
under an Indenture, dated as of ............... (herein called the "Indenture",
which term shall have the meaning assigned to it in such instrument), between
the Company and ..................., as Trustee (herein called the "Trustee",
which term includes any successor trustee under the Indenture), and reference is
hereby made to the Indenture and all indentures supplemental thereto for a
statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee and the Holders of the Securities and of
the terms upon which the Securities are, and are to be, authenticated and
delivered. This Security is one of the series designated on the face hereof [if
applicable, insert -- , limited in aggregate principal amount to $...........].
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<PAGE>
[If applicable, insert -- The Securities of this series are subject to
redemption upon not less than 30 days' notice by mail, [if applicable, insert --
(1) on ........... in any year commencing with the year ...... and ending with
the year ...... through operation of the sinking fund for this series at a
Redemption Price equal to 100% of the principal amount, and (2)] at any time [if
applicable, insert -- on or after .........., 19..], as a whole or in part, at
the election of the Company, at the following Redemption Prices (expressed as
percentages of the principal amount): If redeemed [if applicable, insert -- on
or before ..............., ...%, and if redeemed] during the 12-month period
beginning ............. of the years indicated,
<TABLE>
<CAPTION>
Redemption Redemption
Year Price Year Price
- ---- ---------- ---- ----------
<S> <C> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to .....% of the principal amount,
together in the case of any such redemption [if applicable, insert -- (whether
through operation of the sinking fund or otherwise)] with accrued interest to
the Redemption Date, but interest instalments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such Securities,
or one or more Predecessor Securities, of record at the close of business on the
relevant Record Dates referred to on the face hereof, all as provided in the
Indenture.]
[If applicable, insert -- The Securities of this series are subject to
redemption upon not less than 30 days' notice by mail, (1) on ............ in
any year commencing with the year .... and ending with the year .... through
operation of the sinking fund for this series at the Redemption Prices for
redemption through operation of the sinking fund (expressed as percentages of
the principal amount) set forth in the table below, and (2) at any time [if
applicable, insert -- on or after ............], as a whole or in part, at the
election of the Company, at the Redemption Prices for redemption otherwise than
through operation of the sinking fund (expressed as percentages of the principal
amount) set forth in the table below: If redeemed during the 12-month period
beginning ............ of the years indicated,
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<PAGE>
<TABLE>
<CAPTION>
Redemption Price
For Redemption Redemption Price For
Through Operation Redemption Otherwise
of the Than Through Operation
Year Sinking Fund of the Sinking Fund
- ---- ----------------- ----------------------
<S> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to .....% of the principal amount,
together in the case of any such redemption (whether through operation of the
sinking fund or otherwise) with accrued interest to the Redemption Date, but
interest instalments whose Stated Maturity is on or prior to such Redemption
Date will be payable to the Holders of such Securities, or one or more
Predecessor Securities, of record at the close of business on the relevant
Record Dates referred to on the face hereof, all as provided in the Indenture.]
[If applicable, insert -- Notwithstanding the foregoing, the Company may not,
prior to ............., redeem any Securities of this series as contemplated by
[if applicable, insert -- Clause (2) of] the preceding paragraph as a part of,
or in anticipation of, any refunding operation by the application, directly or
indirectly, of moneys borrowed having an interest cost to the Company
(calculated in accordance with generally accepted financial practice) of less
than .....% per annum.]
[If applicable, insert -- The sinking fund for this series provides for the
redemption on ............ in each year beginning with the year ....... and
ending with the year ...... of [if applicable, insert -- not less than
$.......... ("mandatory sinking fund") and not more than] $......... aggregate
principal amount of Securities of this series. Securities of this series
acquired or redeemed by the Company otherwise than through [if applicable,
insert -- mandatory] sinking fund payments may be credited against subsequent
[if applicable, insert -- mandatory] sinking fund payments otherwise required to
be made [if applicable, insert -- , in the inverse order in which they become
due].]
[If the Security is subject to redemption of any kind, insert -- In the event
of redemption of this Security in part only, a new Security or Securities of
this series and of like tenor for the unredeemed portion hereof will be issued
in the name of the Holder hereof upon the cancellation hereof.]
[If applicable, insert -- The Indenture contains provisions for defeasance at
any time of [the entire indebtedness of this Security] [or] [certain restrictive
covenants and Events of Default with respect to this Security] [, in each case]
upon compliance with certain conditions set forth in the Indenture.]
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<PAGE>
[If the Security is convertible into Common Stock of the Company, insert --
Subject to the provisions of the Indenture, the Holder of this Security is
entitled, at its option, at any time on or before [insert date] (except that, in
case this Security or any portion hereof shall be called for redemption, such
right shall terminate with respect to this Security or portion hereof, as the
case may be, so called for redemption at the close of business on the date fixed
for redemption as provided in the Indenture unless the Company defaults in
making the payment due upon redemption), to convert the principal amount of this
Security (or any portion hereof which is $1,000 or an integral multiple
thereof), into fully paid and non-assessable shares (calculated as to each
conversion to the nearest 1/100th of a share) of the Common Stock of the
Company, as said shares shall be constituted at the date of conversion, at the
conversion price of $....... principal amount of Securities for each share of
Common Stock, or at the adjusted conversion price in effect at the date of
conversion determined as provided in the Indenture, upon surrender of this
Security, together with the conversion notice hereon duly executed, to the
Company at the designated office or agency of the Company in
.........................., accompanied (if so required by the Company) by
instruments of transfer, in form satisfactory to the Company and to the Trustee,
duly executed by the Holder or by its duly authorized attorney in writing. Such
surrender shall, if made during any period beginning at the close of business on
a Regular Record Date and ending at the opening of business on the Interest
Payment Date next following such Regular Record Date (unless this Security or
the portion being converted shall have been called for redemption on a
Redemption Date during such period), also be accompanied by payment in funds
acceptable to the Company of an amount equal to the interest payable on such
Interest Payment Date on the principal amount of this Security then being
converted. Subject to the aforesaid requirement for payment and, in the case of
a conversion after the Regular Record Date next preceding any Interest Payment
Date and on or before such Interest Payment Date, to the right of the Holder of
this Security (or any Predecessor Security) of record at such Regular Record
Date to receive an installment of interest (with certain exceptions provided in
the Indenture), no adjustment is to be made on conversion for interest accrued
hereon or for dividends on shares of Common Stock issued on conversion. The
Company is not required to issue fractional shares upon any such conversion, but
shall make adjustment therefor in cash on the basis of the current market value
of such fractional interest as provided in the Indenture. The conversion price
is subject to adjustment as provided in the Indenture. In addition, the
Indenture provides that in case of certain consolidations or mergers to which
the Company is a party or the sale of substantially all of the assets of the
Company, the Indenture shall be amended, without the consent of any Holders of
Securities, so that this Security, if then outstanding, will be convertible
thereafter, during the period this Security shall be convertible as specified
above, only into the kind and amount of securities, cash and other property
receivable upon the consolidation, merger or sale by a holder of the number of
shares of Common Stock into which this Security might have been converted
immediately prior to such consolidation, merger or sale (assuming such holder of
Common Stock failed to exercise any rights of election and received per share
the kind and amount received per share by a plurality of non-electing shares) [,
assuming if such consolidation, merger or sale is prior to ..............,
19...., that this Security were convertible at the time of such consolidation,
merger or sale at the initial conversion price specified above as adjusted from
.............., 19.... to such time pursuant to the Indenture]. In the event of
conversion of this Security in part only, a new Security or Securities for the
unconverted portion hereof shall be issued in the name of the Holder hereof upon
the cancellation hereof.]
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<PAGE>
[If the Security is convertible into other securities of the Company, specify
the conversion features.]
[If the Security is not an Original Issue Discount Security, insert -- If an
Event of Default with respect to Securities of this series shall occur and be
continuing, the principal of the Securities of this series may be declared due
and payable in the manner and with the effect provided in the Indenture.]
[If the Security is an Original Issue Discount Security, insert -- If an
Event of Default with respect to Securities of this series shall occur and be
continuing, an amount of principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture. Such amount shall be equal to -- insert formula for determining the
amount. Upon payment (i) of the amount of principal so declared due and payable
and (ii) of interest on any overdue principal, premium and interest (in each
case to the extent that the payment of such interest shall be legally
enforceable), all of the Company's obligations in respect of the payment of the
principal of and premium and interest, if any, on the Securities of this series
shall terminate.]
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of more than 50% in principal amount of the Securities at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Securities of each series at the time Outstanding, on behalf of the
Holders of all Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture, the Holder of
this Security shall not have the right to institute any proceeding with respect
to the Indenture or for the appointment of a receiver or trustee or for any
other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 25% in principal amount
of the Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable indemnity, and the Trustee
shall not have received from the Holders of a majority in principal amount of
Securities of this series at the time Outstanding a direction inconsistent with
such request, and shall have failed to institute any such proceeding, for 60
days after receipt of such notice, request and offer of indemnity. The foregoing
shall not apply to any suit instituted by the Holder of this Security for the
enforcement of any payment of principal hereof or any premium or interest hereon
on or after the respective due dates expressed herein.
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<PAGE>
No reference herein to the Indenture and no provision of this Security or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and any premium and interest
on this Security at the times, place and rate, and in the coin or currency,
herein prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Security is registrable in the Security Register,
upon surrender of this Security for registration of transfer at the office or
agency of the Company in any place where the principal of and any premium and
interest on this Security are payable, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or its attorney duly
authorized in writing, and thereupon one or more new Securities of this series
and of like tenor, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered form without
coupons in denominations of $....... and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities of this series are exchangeable for a like aggregate principal amount
of Securities of this series and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
All terms used in this Security which are defined in the Indenture shall have
the meanings assigned to them in the Indenture.
Section 204. Form of Legend for Global Securities.
Unless otherwise specified as contemplated by Section 301 for the Securities
evidenced thereby, every Global Security authenticated and delivered hereunder
shall bear a legend in substantially the following form:
This Security is a Global Security within the meaning of the Indenture
hereinafter referred to and is registered in the name of a Depositary or a
nominee thereof. This Security may not be exchanged in whole or in part for a
Security registered, and no transfer of this Security in whole or in part may be
registered, in the name of any Person other than such Depositary or a nominee
thereof, except in the limited circumstances described in the Indenture.
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<PAGE>
Section 205. Form of Trustee's Certificate of Authentication.
The Trustee's certificates of authentication shall be in substantially the
following form:
This is one of the Securities of the series designated herein referred to in
the within-mentioned Indenture.
..........................................,
As Trustee
By.........................................
Authorized Officer
Section 206. Form of Conversion Notice.
To Armstrong World Industries, Inc.:
The undersigned owner of this Security hereby irrevocably exercises the option
to convert this Security, or portion hereof (which is $1,000 or an integral
multiple thereof) below designated, into shares of Common Stock of the Company
in accordance with the terms of the Indenture referred to in this Security, and
directs that the shares issuable and deliverable upon the conversion, together
with any check in payment for fractional shares and any Securities representing
any unconverted principal amount hereof, be issued and delivered to the
registered holder hereof unless a different name has been indicated below. If
this Notice is being delivered on a date after the close of business on a
Regular Record Date and prior to the opening of business on the related Interest
Payment Date (unless this Security or the portion thereof being converted has
been called for redemption on a Redemption Date within such period), this Notice
is accompanied by payment, in funds acceptable to the Company, of an amount
equal to the interest payable on such Interest Payment Date of the principal of
this Security to be converted. If shares are to be issued in the name of a
person other than the undersigned, the undersigned will pay all transfer taxes
payable with respect hereto. Any amount required to be paid by the undersigned
on account of interest accompanies this Security.
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Principal Amount to be Converted
(in an integral multiple of
$1,000, if less than all):
$...................
Dated ..........................
......................................................
Signature(s) must be guaranteed by a commercial bank or trust
company or a member firm of a national stock exchange if
shares of Common Stock are to be delivered, or Securities to
be issued, other than to and in the name of the registered
owner.
.......................................................
Signature Guaranty
Fill in for registration of shares of Common Stock and Security if to be
issued otherwise than to the registered holder.
........................... Social Security or Other Taxpayer
(Name) Identification Number..........
...........................
(Address)
...........................
Please print Name and Address
(including zip code number)
[The above conversion notice is to be modified, as appropriate, for conversion
into other securities or property of the Company.]
ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution and, subject to Section 303,
set forth, or determined in the
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manner provided, in an Officers' Certificate, or established in one or more
indentures supplemental hereto, prior to the issuance of Securities of any
series,
(1) the title of the Securities of the series (which shall distinguish the
Securities of the series from Securities of any other series);
(2) any limit upon the aggregate principal amount of the Securities of the
series which may be authenticated and delivered under this Indenture (except
for Securities authenticated and delivered upon registration of transfer of,
or in exchange for, or in lieu of, other Securities of the series pursuant to
Section 304, 305, 306, 906 or 1107 and except for any Securities which,
pursuant to Section 303, are deemed never to have been authenticated and
delivered hereunder);
(3) the Person to whom any interest on a Security of the series shall be
payable, if other than the Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest;
(4) the date or dates on which the principal of any Securities of the
series is payable;
(5) the rate or rates at which any Securities of the series shall bear
interest, if any, the date or dates from which any such interest shall accrue,
the Interest Payment Dates on which any such interest shall be payable and the
Regular Record Date for any such interest payable on any Interest Payment Date;
(6) the place or places where the principal of and any premium and interest
on any Securities of the series shall be payable;
(7) the period or periods within which, the price or prices at which and
the terms and conditions upon which any Securities of the series may be
redeemed, in whole or in part, at the option of the Company and, if other than
by a Board Resolution, the manner in which any election by the Company to
redeem the Securities shall be evidenced;
(8) the obligation, if any, of the Company to redeem or purchase any
Securities of the series pursuant to any sinking fund or analogous provisions
or at the option of the Holder thereof and the period or periods within which,
the price or prices at which and the terms and conditions upon which any
Securities of the series shall be redeemed or purchased, in whole or in part,
pursuant to such obligation;
(9) if other than denominations of $1,000 and any integral multiple
thereof, the denominations in which any Securities of the series shall be
issuable;
(10) if the amount of principal of or any premium or interest on any
Securities of the series may be determined with reference to an index or
pursuant to a formula, the manner in which such amounts shall be determined;
(11) if other than the currency of the United States of America, the
currency, currencies or currency units in which the principal of or any premium
or interest on any Securities of
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the series shall be payable and the manner of determining the equivalent
thereof in the currency of the United States of America for any purpose,
including for purposes of the definition of "Outstanding" in Section 101;
(12) if the principal of or any premium or interest on any Securities of
the series is to be payable, at the election of the Company or the Holder
thereof, in one or more currencies or currency units other than that or those
in which such Securities are stated to be payable, the currency, currencies or
currency units in which the principal of or any premium or interest on such
Securities as to which such election is made shall be payable, the periods
within which and the terms and conditions upon which such election is to be
made and the amount so payable (or the manner in which such amount shall be
determined);
(13) if other than the entire principal amount thereof, the portion of the
principal amount of any Securities of the series which shall be payable upon
declaration of acceleration of the Maturity thereof pursuant to Section 502;
(14) if the principal amount payable at the Stated Maturity of any
Securities of the series will not be determinable as of any one or more dates
prior to the Stated Maturity, the amount which shall be deemed to be the
principal amount of such Securities as of any such date for any purpose
thereunder or hereunder, including the principal amount thereof which shall be
due and payable upon any Maturity other than the Stated Maturity or which shall
be deemed to be Outstanding as of any date prior to the Stated Maturity (or, in
any such case, the manner in which such amount deemed to be the principal
amount shall be determined);
(15) if applicable, that the Securities of the series, in whole or any
specified part, shall be defeasible pursuant to Section 1302 or Section 1303 or
both such Sections and, if other than by a Board Resolution, the manner in
which any election by the Company to defease such Securities shall be
evidenced;
(16) the terms of any right to convert Securities of the series into shares
of Common Stock of the Company or other securities or property;
(17) if applicable, that any Securities of the series shall be issuable in
whole or in part in the form of one or more Global Securities and, in such
case, the respective Depositaries for such Global Securities, the form of any
legend or legends which shall be borne by any such Global Security in addition
to or in lieu of that set forth in Section 204 and any circumstances in
addition to or in lieu of those set forth in Clause (2) of the last paragraph
of Section 305 in which any such Global Security may be exchanged in whole or
in part for Securities registered, and any transfer of such Global Security in
whole or in part may be registered, in the name or names of Persons other than
the Depositary for such Global Security or a nominee thereof;
(18) any addition to or change in the Events of Default which applies to
any Securities of the series and any change in the right of the Trustee or the
requisite Holders of such Securities to declare the principal amount thereof
due and payable pursuant to Section 502;
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(19) any addition to or change in the covenants set forth in Article Ten
which applies to Securities of the series; and
(20) any other terms of the series (which terms shall not be inconsistent
with the provisions of this Indenture, except as permitted by Section 901(5)).
All Securities of any one series shall be substantially identical except as
to denomination and except as may otherwise be provided in or pursuant to the
Board Resolution referred to above and (subject to Section 303) set forth, or
determined in the manner provided, in the Officers' Certificate referred to
above or in any such indenture supplemental hereto.
If any of the terms of the series are established by action taken pursuant to
a Board Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
Section 302. Denominations.
The Securities of each series shall be issuable only in registered form
without coupons and only in such denominations as shall be specified as
contemplated by Section 301. In the absence of any such specified denomination
with respect to the Securities of any series, the Securities of such series
shall be issuable in denominations of $1,000 and any integral multiple thereof.
Section 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its Chairman of
the Board, its Vice Chairman of the Board, its President or one of its Vice
Presidents, under its corporate seal reproduced thereon attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals who were
at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities of any series executed by the
Company to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities, and the Trustee in accordance
with the Company Order shall authenticate and deliver such Securities. If the
form or terms of the Securities of the series have been established by or
pursuant to one or more Board Resolutions as permitted by Sections 201 and 301,
in authenticating such Securities, and accepting the additional responsibilities
under this
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Indenture in relation to such Securities, the Trustee shall be
entitled to receive, and (subject to Section 601) shall be fully protected in
relying upon, an Opinion of Counsel stating,
(1) if the form of such Securities has been established by or pursuant to
Board Resolution as permitted by Section 201, that such form has been
established in conformity with the provisions of this Indenture;
(2) if the terms of such Securities have been established by or pursuant to
Board Resolution as permitted by Section 301, that such terms have been
established in conformity with the provisions of this Indenture; and
(3) that such Securities, when authenticated and delivered by the Trustee
and issued by the Company in the manner and subject to any conditions specified
in such Opinion of Counsel, will constitute valid and legally binding
obligations of the Company enforceable in accordance with their terms, subject
to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors'
rights and to general equity principles.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 301 and of the preceding paragraph,
if all Securities of a series are not to be originally issued at one time, it
shall not be necessary to deliver the Officers' Certificate otherwise required
pursuant to Section 301 or the Company Order and Opinion of Counsel otherwise
required pursuant to such preceding paragraph at or prior to the authentication
of each Security of such series if such documents are delivered at or prior to
the authentication upon original issuance of the first Security of such series
to be issued.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or be valid
or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such Security
has been duly authenticated and delivered hereunder. Notwithstanding the
foregoing, if any Security shall have been authenticated and delivered hereunder
but never issued and sold by the Company, and the Company shall deliver such
Security to the Trustee for cancellation as provided in Section 309, for all
purposes of this Indenture such Security shall be deemed never to have been
authenticated and delivered hereunder and shall never be entitled to the
benefits of this Indenture.
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Section 304. Temporary Securities.
Pending the preparation of definitive Securities of any series, the Company
may execute, and upon Company Order the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed, typewritten, mimeographed
or otherwise produced, in any authorized denomination, substantially of the
tenor of the definitive Securities in lieu of which they are issued and with
such appropriate insertions, omissions, substitutions and other variations as
the officers executing such Securities may determine, as evidenced by their
execution of such Securities.
If temporary Securities of any series are issued, the Company will cause
definitive Securities of that series to be prepared without unreasonable delay.
After the preparation of definitive Securities of such series, the temporary
Securities of such series shall be exchangeable for definitive Securities of
such series upon surrender of the temporary Securities of such series at the
office or agency of the Company in a Place of Payment for that series, without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities of any series, the Company shall execute and the Trustee
shall authenticate and deliver in exchange therefor one or more definitive
Securities of the same series, of any authorized denominations and of like tenor
and aggregate principal amount. Until so exchanged, the temporary Securities of
any series shall in all respects be entitled to the same benefits under this
Indenture as definitive Securities of such series and tenor.
Section 305. Registration; Registration of Transfer and Exchange.
The Company shall cause to be kept at the Corporate Trust Office of the
Trustee a register (the register maintained in such office and in any other
office or agency of the Company in a Place of Payment being herein sometimes
collectively referred to as the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Securities and of transfers of Securities. The Trustee is hereby
appointed "Security Registrar" for the purpose of registering Securities and
transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security of a series at
the office or agency of the Company in a Place of Payment for that series, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Securities of
the same series, of any authorized denominations and of like tenor and aggregate
principal amount.
At the option of the Holder, Securities of any series may be exchanged for
other Securities of the same series, of any authorized denominations and of like
tenor and aggregate principal amount, upon surrender of the Securities to be
exchanged at such office or agency. Whenever any Securities are so surrendered
for exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Holder making the exchange is entitled to
receive.
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All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of transfer or for
exchange shall (if so required by the Company or the Trustee) be duly endorsed,
or be accompanied by a written instrument of transfer in form satisfactory to
the Company and the Security Registrar duly executed, by the Holder thereof or
its attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or exchange
of Securities, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection with any
registration of transfer or exchange of Securities, other than exchanges
pursuant to Section 304, 906 or 1107 not involving any transfer.
If the Securities of any series (or of any series and specified tenor) are to
be redeemed in part, the Company shall not be required (A) to issue, register
the transfer of or exchange any Securities of that series (or of that series and
specified tenor, as the case may be) during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of any
such Securities selected for redemption under Section 1103 and ending at the
close of business on the day of such mailing, or (B) to register the transfer of
or exchange any Security so selected for redemption in whole or in part, except
the unredeemed portion of any Security being redeemed in part.
The provisions of Clauses (1), (2), (3) and (4) below shall apply only to
Global Securities:
(1) Each Global Security authenticated under this Indenture shall be
registered in the name of the Depositary designated for such Global Security or
a nominee thereof and delivered to such Depositary or a nominee thereof or
custodian therefor, and each such Global Security shall constitute a single
Security for all purposes of this Indenture.
(2) Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Securities registered, and no
transfer of a Global Security in whole or in part may be registered, in the
name of any Person other than the Depositary for such Global Security or a
nominee thereof unless (A) such Depositary (i) has notified the Company that it
is unwilling or unable to continue as Depositary for such Global Security or
(ii) has ceased to be a clearing agency registered under the Exchange Act, (B)
there shall have occurred and be continuing an Event of Default with respect to
such Global Security or (C) there shall exist such circumstances, if any, in
addition to or in lieu of the foregoing as have been specified for this purpose
as contemplated by Section 301.
(3) Subject to Clause (2) above, any exchange of a Global Security for
other Securities may be made in whole or in part, and all Securities issued in
exchange for a Global Security or any portion thereof shall be registered in
such names as the Depositary for such Global Security shall direct.
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(4) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any portion
thereof, whether pursuant to this Section, Section 304, 306, 906 or 1107 or
otherwise, shall be authenticated and delivered in the form of, and shall be, a
Global Security, unless such Security is registered in the name of a Person
other than the Depositary for such Global Security or a nominee thereof.
Section 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee, the Company shall
execute and the Trustee shall authenticate and deliver in exchange therefor a
new Security of the same series and of like tenor and principal amount and
bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i) evidence to
their satisfaction of the destruction, loss or theft of any Security and (ii)
such security or indemnity as may be required by them to save each of them and
any agent of either of them harmless, then, in the absence of notice to the
Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and the Trustee shall authenticate and
deliver, in lieu of any such destroyed, lost or stolen Security, a new Security
of the same series and of like tenor and principal amount and bearing a number
not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has become
or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses
(including the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this Section in lieu of
any destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at
any time enforceable by anyone, and shall be entitled to all the benefits of
this Indenture equally and proportionately with any and all other Securities of
that series duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.
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Section 307. Payment of Interest; Interest Rights Preserved.
Except as otherwise provided as contemplated by Section 301 with respect to
any series of Securities, interest on any Security which is payable, and is
punctually paid or duly provided for, on any Interest Payment Date shall be
paid to the Person in whose name that Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest.
Any interest on any Security of any series which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular Record Date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to the
Persons in whose names the Securities of such series (or their respective
Predecessor Securities) are registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest, which shall be fixed
in the following manner. The Company shall notify the Trustee in writing of
the amount of Defaulted Interest proposed to be paid on each Security of such
series and the date of the proposed payment, and at the same time the Company
shall deposit with the Trustee an amount of money equal to the aggregate
amount proposed to be paid in respect of such Defaulted Interest or shall
make arrangements satisfactory to the Trustee for such deposit prior to the
date of the proposed payment, such money when deposited to be held in trust
for the benefit of the Persons entitled to such Defaulted Interest as in this
Clause provided. Thereupon the Trustee shall fix a Special Record Date for
the payment of such Defaulted Interest which shall be not more than 15 days
and not less than 10 days prior to the date of the proposed payment and not
less than 10 days after the receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly notify the Company of such
Special Record Date and, in the name and at the expense of the Company, shall
cause notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor to be given to each Holder of Securities of such
series in the manner set forth in Section 106, not less than 10 days prior to
such Special Record Date. Notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor having been so mailed, such
Defaulted Interest shall be paid to the Persons in whose names the Securities
of such series (or their respective Predecessor Securities) are registered
at the close of business on such Special Record Date and shall no longer be
payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest on the
Securities of any series in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such Securities may be
listed, and upon such notice as may be required by such exchange, if, after
notice given by the Company to the Trustee of the proposed payment pursuant
to this Clause, such manner of payment shall be deemed practicable by the
Trustee.
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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.
Subject to the provisions of Section 1402, in the case of any Security (or
any part thereof) which is converted after any Regular Record Date and on or
prior to the next succeeding Interest Payment Date (other than any Security the
principal of (or premium, if any, on) which shall become due and payable,
whether at Stated Maturity or by declaration of acceleration prior to such
Interest Payment Date), interest whose Stated Maturity is on such Interest
Payment Date shall be payable on such Interest Payment Date notwithstanding such
conversion and such interest (whether or not punctually paid or duly provided
for) shall be paid to the Person in whose name that Security (or any one or more
Predecessor Securities) is registered at the close of business on such Regular
Record Date. Except as otherwise expressly provided in the immediately preceding
sentence or in Section 1402, in the case of any Security (or any part thereof)
which is converted, interest whose Stated Maturity is after the date of
conversion of such Security or such part thereof shall not be payable.
Section 308. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name such Security is registered as the owner of such Security
for the purpose of receiving payment of principal of and any premium and
(subject to Section 307) any interest on such Security and for all other
purposes whatsoever, whether or not such Security be overdue, and neither the
Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.
Section 309. Cancellation.
All Securities surrendered for payment, redemption, registration of transfer
or exchange or for credit against any sinking fund payment shall, if surrendered
to any Person other than the Trustee, be delivered to the Trustee and shall be
promptly cancelled by it. The Company may at any time deliver to the Trustee for
cancellation any Securities previously authenticated and delivered hereunder
which the Company may have acquired in any manner whatsoever, and may deliver to
the Trustee (or to any other Person for delivery to the Trustee) for
cancellation any Securities previously authenticated hereunder which the Company
has not issued and sold, and all Securities so delivered shall be promptly
cancelled by the Trustee. No Securities shall be authenticated in lieu of or in
exchange for any Securities cancelled as provided in this Section, except as
expressly permitted by this Indenture. All cancelled Securities held by the
Trustee shall be disposed of as directed by a Company Order.
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Section 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301 for Securities
of any series, interest on the Securities of each series shall be computed on
the basis of a 360-day year of twelve 30-day months.
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of further effect
(except as to any surviving rights of registration of transfer or exchange of
Securities herein expressly provided for), and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered (other than (i)
Securities which have been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 306 and (ii) Securities for whose
payment money has theretofore been deposited in trust or segregated and held
in trust by the Company and thereafter repaid to the Company or discharged
from such trust, as provided in Section 1003) have been delivered to the
Trustee for cancellation; or
(B) all such Securities not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity within one
year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the Company,
and the Company, in the case of (i), (ii) or (iii) above, has deposited or
caused to be deposited with the Trustee as trust funds in trust for the
purpose money in an amount sufficient to pay and discharge the entire
indebtedness on such Securities not theretofore delivered to the Trustee for
cancellation, for principal and any premium and interest to the date of such
deposit (in the case of Securities which have become due and payable) or to
the Stated Maturity or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
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(3) the Company has delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel, each stating that all conditions precedent herein provided
for relating to the satisfaction and discharge of this Indenture have been
complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 607, the obligations of
the Trustee to any Authenticating Agent under Section 614 and, if money shall
have been deposited with the Trustee pursuant to subclause (B) of Clause (1) of
this Section, the obligations of the Trustee under Section 402 and the last
paragraph of Section 1003 shall survive.
Section 402. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all money
deposited with the Trustee pursuant to Section 401 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal and any premium and
interest for whose payment such money has been deposited with the Trustee.
ARTICLE FIVE
Remedies
Section 501. Events of Default.
"Event of Default", wherever used herein with respect to Securities of any
series, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(1) default in the payment of any interest upon any Security of that series
when it becomes due and payable, and continuance of such default for a period
of 30 days; or
(2) default in the payment of the principal of or any premium on any
Security of that series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when and as due by
the terms of a Security of that series; or
(4) default in the performance, or breach, of any covenant or warranty of
the Company in this Indenture (other than a covenant or warranty a default in
whose performance or whose breach is elsewhere in this Section specifically
dealt with or which has expressly been included in this Indenture solely for
the benefit of series of Securities other than that
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series), and continuance of such default or breach for a period of 60 days
after there has been given, by registered or certified mail, to the Company by
the Trustee or to the Company and the Trustee by the Holders of at least 25% in
principal amount of the Outstanding Securities of that series a written notice
specifying such default or breach and requiring it to be remedied and stating
that such notice is a "Notice of Default" hereunder; or
(5) the entry by a court having jurisdiction in the premises of (A) a decree
or order for relief in respect of the Company in an involuntary case or
proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or (B) a decree or order adjudging the
Company a bankrupt or insolvent, or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of or in respect
of the Company under any applicable Federal or State law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or of any substantial part of its property, or
ordering the winding up or liquidation of its affairs, and the continuance of
any such decree or order for relief or any such other decree or order
unstayed and in effect for a period of 90 consecutive days; or
(6) the commencement by the Company of a voluntary case or proceeding under
any applicable Federal or State bankruptcy, insolvency, reorganization or other
similar law or of any other case or proceeding to be adjudicated a bankrupt or
insolvent, or the consent by it to the entry of a decree or order for relief in
respect of the Company in an involuntary case or proceeding under any
applicable Federal or State bankruptcy, insolvency, reorganization or other
similar law or to the commencement of any bankruptcy or insolvency case or
proceeding against it, or the filing by it of a petition or answer or consent
seeking reorganization or relief under any applicable Federal or State law, or
the
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consent by it to the filing of such petition or to the appointment of or
taking possession by a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of the Company or of any substantial
part of its property, or the making by it of an assignment for the benefit of
creditors, or the admission by it in writing of its inability to pay its debts
generally as they become due, or the taking of corporate action by the Company
in furtherance of any such action; or
(7) any other Event of Default provided with respect to Securities of that
series.
Section 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in Section
501(5) or 501(6)) with respect to Securities of any series at the time
Outstanding occurs and is continuing, then in every such case the Trustee or
the Holders of not less than 25% in principal amount of the Outstanding
Securities of that series may declare the principal amount of all the
Securities of that series (or, if any Securities of that series are Original
Issue Discount Securities, such portion of the principal amount of such
Securities as may be specified by the terms thereof) to be due and payable
immediately, by a notice in writing to the Company (and to the Trustee if given
by Holders), and upon any such declaration such principal amount (or specified
amount) shall become immediately due and payable. If an Event of Default
specified in Section 501(5) or 501 (6) with respect to Securities of any series
at the time Outstanding occurs, the principal amount of all the Securities of
that series (or, if any Securities of that series are Original Issue Discount
Securities, such portion of the principal amount of such Securities as may be
specified by the terms thereof) shall automatically, and without any
declaration or other action on the part of the Trustee or any Holder, become
immediately due and payable.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in
this Article provided, the Holders of a majority in principal amount of the
Outstanding Securities of that series, by written notice to the Company and the
Trustee, may rescind and annul such declaration and its consequences if
(1) the Company has paid or deposited with the Trustee a sum sufficient to
pay
(A) all overdue interest on all Securities of that series,
(B) the principal of (and premium, if any, on) any Securities of that
series which have become due otherwise than by such declaration of
acceleration and any interest thereon at the rate or rates prescribed
therefor in such Securities,
(C) to the extent that payment of such interest is lawful, interest upon
overdue interest at the rate or rates prescribed therefor in such Securities,
and
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(D) all sums paid or advanced by the Trustee hereunder and the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel;
and
(2) all Events of Default with respect to Securities of that series, other
than the non-payment of the principal of Securities of that series which have
become due solely by such declaration of acceleration, have been cured or
waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Section 503. Collection of Indebtedness and Suits for Enforcement by Trustee.
The Company covenants that if
(1) default is made in the payment of any interest on any Security when such
interest becomes due and payable and such default continues for a period of 30
days, or
(2) default is made in the payment of the principal of (or premium, if any,
on) any Security at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal and any premium and interest and, to the extent that
payment of such interest shall be legally enforceable, interest on any overdue
principal and premium and on any overdue interest, at the rate or rates
prescribed therefor in such Securities, and, in addition thereto, such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel.
If an Event of Default with respect to Securities of any series occurs and is
continuing, the Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the Holders of Securities of such series by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the exercise of any power
granted herein, or to enforce any other proper remedy.
Section 504. Trustee May File Proofs of Claim.
In case of any judicial proceeding relative to the Company (or any other
obligor upon the Securities), its property or its creditors, the Trustee shall
be entitled and empowered, by intervention in such proceeding or otherwise, to
take any and all actions authorized under the Trust Indenture Act in order to
have claims of the Holders and the Trustee allowed in any such proceeding. In
particular, the Trustee shall be authorized to collect and receive any
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moneys or other property payable or deliverable on any such claims and to
distribute the same; and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or other similar official in any such judicial proceeding is hereby
authorized by each Holder to make such payments to the Trustee and, in the event
that the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 607.
No provision of this Indenture shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding; provided, however,
that the Trustee may, on behalf of the Holders, vote for the election of a
trustee in bankruptcy or similar official and be a member of a creditors' or
other similar committee.
Section 505. Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the Securities may be
prosecuted and enforced by the Trustee without the possession of any of the
Securities or the production thereof in any proceeding relating thereto, and any
such proceeding instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment shall, after provision
for the payment of the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, be for the ratable benefit of
the Holders of the Securities in respect of which such judgment has been
recovered.
Section 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall be applied
in the following order, at the date or dates fixed by the Trustee and, in case
of the distribution of such money on account of principal or any premium or
interest, upon presentation of the Securities and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:
First: To the payment of all amounts due the Trustee under Section 607; and
Second: To the payment of the amounts then due and unpaid for principal of
and any premium and interest on the Securities in respect of which or for the
benefit of which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable on such
Securities for principal and any premium and interest, respectively.
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Section 507. Limitation on Suits.
No Holder of any Security of any series shall have any right to institute
any proceeding, judicial or otherwise, with respect to this Indenture, or for
the appointment of a receiver or trustee, or for any other remedy hereunder,
unless
(1) such Holder has previously given written notice to the Trustee of a
continuing Event of Default with respect to the Securities of that series;
(2) the Holders of not less than 25% in principal amount of the Outstanding
Securities of that series shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name as
Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable indemnity
against the costs, expenses and liabilities to be incurred in compliance with
such request;
(4) the Trustee for 60 days after its receipt of such notice, request and
offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given to
the Trustee during such 60-day period by the Holders of a majority in principal
amount of the Outstanding Securities of that series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all of
such Holders.
Section 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest and to Convert.
Notwithstanding any other provision in this Indenture, the Holder of any
Security shall have the right, which is absolute and unconditional, to receive
payment of the principal of and any premium and (subject to Section 307)
interest on such Security on the respective Stated Maturities expressed in such
Security (or, in the case of redemption, on the Redemption Date), to convert
such Securities in accordance with Article Fourteen and to institute suit for
the enforcement of any such payment, and such rights shall not be impaired
without the consent of such Holder.
Section 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to enforce any
right or remedy under this Indenture and such proceeding has been discontinued
or abandoned for any reason,
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or has been determined adversely to the Trustee or to such Holder, then and in
every such case, subject to any determination in such proceeding, the Company,
the Trustee and the Holders shall be restored severally and respectively to
their former positions hereunder and thereafter all rights and remedies of the
Trustee and the Holders shall continue as though no such proceeding had been
instituted.
Section 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Securities in the last paragraph of Section
306, no right or remedy herein conferred upon or reserved to the Trustee or to
the Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Securities to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article or by law to
the Trustee or to the Holders may be exercised from time to time, and as often
as may be deemed expedient, by the Trustee or by the Holders, as the case may
be.
Section 512. Control by Holders.
The Holders of a majority in principal amount of the Outstanding Securities
of any series shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred on the Trustee, with respect to the Securities of
such series, provided that
(1) such direction shall not be in conflict with any rule of law or with this
Indenture, and
(2) the Trustee may take any other action deemed proper by the Trustee which
is not inconsistent with such direction.
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Section 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series may on behalf of the Holders of all the
Securities of such series waive any past default hereunder with respect to such
series and its consequences, except a default
(1) in the payment of the principal of or any premium or interest on any
Security of such series, or
(2) in respect of a covenant or provision hereof which under Article Nine
cannot be modified or amended without the consent of the Holder of each
Outstanding Security of such series affected.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
Section 514. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this Indenture,
or in any suit against the Trustee for any action taken, suffered or omitted by
it as Trustee, a court may require any party litigant in such suit to file an
undertaking to pay the costs of such suit, and may assess costs against any such
party litigant, in the manner and to the extent provided in the Trust Indenture
Act; provided that neither this Section nor the Trust Indenture Act shall be
deemed to authorize any court to require such an undertaking or to make such an
assessment in any suit instituted by the Company or in any suit for the
enforcement of the right to convert any Security in accordance with Article
Fourteen.
Section 515. Waiver of Usury, Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that it will
not at any time insist upon, or plead, or in any manner whatsoever claim or take
the benefit or advantage of, any usury, stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
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ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities.
The duties and responsibilities of the Trustee shall be as provided by the
Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Indenture shall require the Trustee to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. 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 602. Notice of Defaults.
If a default occurs hereunder with respect to Securities of any series, the
Trustee shall give the Holders of Securities of such series notice of such
default as and to the extent provided by the Trust Indenture Act; provided,
however, that in the case of any default of the character specified in Section
501(4) with respect to Securities of such series, no such notice to Holders
shall be given until at least 30 days after the occurrence thereof. For the
purpose of this Section, the term "default" means any event which is, or after
notice or lapse of time or both would become, an Event of Default with respect
to Securities of such series.
Section 603. Certain Rights of Trustee.
Subject to the provisions of Section 601:
(1) the Trustee may rely and shall be protected in acting or refraining from
acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party or parties;
(2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order, and any
resolution of the Board of Directors shall be sufficiently evidenced by a Board
Resolution;
(3) whenever in the administration of this Indenture the Trustee shall deem
it desirable that a matter be proved or established prior to taking, suffering
or omitting any action hereunder, the Trustee (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part, rely
upon an Officers' Certificate;
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(4) the Trustee may consult with counsel and the written advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon;
(5) the Trustee shall be under no obligation to exercise any of the rights or
powers vested in it by this Indenture at the request or direction of any of the
Holders pursuant to this Indenture, unless such Holders shall have offered to
the Trustee reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or
direction;
(6) the Trustee shall not be bound to make any investigation into the facts
or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and, if the Trustee shall determine to
make such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or attorney;
and
(7) the Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder either directly or by or through agents or attorneys and
the Trustee shall not be responsible for any misconduct or negligence on the
part of any agent or attorney appointed with due care by it hereunder.
Section 604. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the Trustee's
certificates of authentication, shall be taken as the statements of the Company,
and neither the Trustee nor any Authenticating Agent assumes any responsibility
for their correctness. The Trustee makes no representations as to the validity
or sufficiency of this Indenture or of the Securities. Neither the Trustee nor
any Authenticating Agent shall be accountable for the use or application by the
Company of Securities or the proceeds thereof.
Section 605. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to Sections
608 and 613, may otherwise deal with the Company with the same rights it would
have if it were not Trustee, Authenticating Agent, Paying Agent, Security
Registrar or such other agent.
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Section 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated from
other funds except to the extent required by law. The Trustee shall be under no
liability for interest on any money received by it hereunder except as otherwise
agreed with the Company.
Section 607. Compensation and Reimbursement.
The Company agrees
(1) to pay to the Trustee from time to time reasonable compensation for all
services rendered by it hereunder (which compensation shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust);
(2) except as otherwise expressly provided herein, to reimburse the Trustee
upon its request for all reasonable expenses, disbursements and advances
incurred or made by the Trustee in accordance with any provision of this
Indenture (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense, disbursement
or advance as may be attributable to its negligence or bad faith; and
(3) to indemnify the Trustee for, and to hold it harmless against, any loss,
liability or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of the
trust or trusts hereunder, including the costs and expenses of defending itself
against any claim or liability in connection with the exercise or performance
of any of its powers or duties hereunder.
Section 608. Conflicting Interests.
If the Trustee has or shall acquire a conflicting interest within the meaning
of the Trust Indenture Act, the Trustee shall either eliminate such interest or
resign, to the extent and in the manner provided by, and subject to the
provisions of, the Trust Indenture Act and this Indenture. To the extent
permitted by such Act, the Trustee shall not be deemed to have a conflicting
interest by virtue of being a trustee under this Indenture with respect to
Securities of more than one series or the trustee under the Indenture, dated as
of the date hereof, between the Company and the Trustee, relating to the
Subordinated Debt Securities, or the trustee under the Indenture, dated as of
March 15, 1988, between the Company and Morgan Guaranty Trust Company of New
York, as trustee, as supplemented by the Supplemental Indenture, dated as of
October 19, 1990, between the Company and The First National Bank of Chicago, as
successor trustee.
Section 609. Corporate Trustee Required; Eligibility.
There shall at all times be one (and only one) Trustee hereunder with respect
to the Securities of each series, which may be Trustee hereunder for Securities
of one or more other series. Each Trustee shall be a Person that is eligible
pursuant to the Trust Indenture Act to
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act as such and has a combined capital and surplus of at least $100,000,000. If
any such Person publishes reports of condition at least annually, pursuant to
law or to the requirements of its supervising or examining authority, then for
the purposes of this Section and to the extent permitted by the Trust Indenture
Act, the combined capital and surplus of such Person shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time the Trustee with respect to the Securities of any
series shall cease to be eligible in accordance with the provisions of this
Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
Section 610. Resignation and Removal; Appointment of Successor.
No resignation or removal of the Trustee and no appointment of a successor
Trustee pursuant to this Article shall become effective until the acceptance of
appointment by the successor Trustee in accordance with the applicable
requirements of Section 611.
The Trustee may resign at any time with respect to the Securities of one or
more series by giving written notice thereof to the Company. If the instrument
of acceptance by a successor Trustee required by Section 611 shall not have
been delivered to the Trustee within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities of such series.
The Trustee may be removed at any time with respect to the Securities of
any series by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series, delivered to the Trustee and to the
Company.
If at any time:
(1) the Trustee shall fail to comply with Section 608 after written request
therefor by the Company or by any Holder who has been a bona fide Holder of a
Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609 and shall fail
to resign after written request therefor by the Company or by any such Holder,
or
(3) the Trustee shall become incapable of acting or shall be adjudged a
bankrupt or insolvent or a receiver of the Trustee or of its property shall be
appointed or any public officer shall take charge or control of the Trustee or
of its property or affairs for the purpose of rehabilitation, conservation or
liquidation,
then, in any such case, (A) the Company by a Board Resolution may remove the
Trustee with respect to all Securities, or (B) subject to Section 514, any
Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Securities and the appointment of a successor Trustee or Trustees.
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If the Trustee shall resign, be removed or become incapable of acting, or if
a vacancy shall occur in the office of Trustee for any cause, with respect to
the Securities of one or more series, the Company, by a Board Resolution, shall
promptly appoint a successor Trustee or Trustees with respect to the Securities
of that or those series (it being understood that any such successor Trustee may
be appointed with respect to the Securities of one or more or all of such series
and that at any time there shall be only one Trustee with respect to the
Securities of any particular series) and shall comply with the applicable
requirements of Section 611. If, within one year after such resignation, removal
or incapability, or the occurrence of such vacancy, a successor Trustee with
respect to the Securities of any series shall be appointed by Act of the Holders
of a majority in principal amount of the Outstanding Securities of such series
delivered to the Company and the retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such appointment in accordance
with the applicable requirements of Section 611, become the successor Trustee
with respect to the Securities of such series and to that extent supersede the
successor Trustee appointed by the Company. If no successor Trustee with respect
to the Securities of any series shall have been so appointed by the Company or
the Holders and accepted appointment in the manner required by Section 611, any
Holder who has been a bona fide Holder of a Security of such series for at least
six months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the appointment of a successor Trustee
with respect to the Securities of such series.
The Company shall give notice of each resignation and each removal of the
Trustee with respect to the Securities of any series and each appointment of a
successor Trustee with respect to the Securities of any series to all Holders of
Securities of such series in the manner provided in Section 106. Each notice
shall include the name of the successor Trustee with respect to the Securities
of such series and the address of its Corporate Trust Office.
Section 611. Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Trustee with respect to
all Securities, every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; but, on the request of the
Company or the successor Trustee, such retiring Trustee shall, upon payment of
its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to such successor Trustee all property and money
held by such retiring Trustee hereunder.
In case of the appointment hereunder of a successor Trustee with respect to
the Securities of one or more (but not all) series, the Company, the retiring
Trustee and each successor Trustee with respect to the Securities of one or more
series shall execute and deliver an indenture supplemental hereto wherein each
successor Trustee shall accept such appointment and which (1) shall contain such
provisions as shall be necessary or desirable to transfer and confirm to, and to
vest in, each successor Trustee all the rights, powers, trusts
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and duties of the retiring Trustee with respect to the Securities of that or
those series to which the appointment of such successor Trustee relates, (2) if
the retiring Trustee is not retiring with respect to all Securities, shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series as to which the retiring
Trustee is not retiring shall continue to be vested in the retiring Trustee, and
(3) shall add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein or
in such supplemental indenture shall constitute such Trustees co-trustees of the
same trust and that each such Trustee shall be trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder administered by
any other such Trustee; and upon the execution and delivery of such supplemental
indenture the resignation or removal of the retiring Trustee shall become
effective to the extent provided therein and each such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee with respect to the
Securities of that or those series to which the appointment of such successor
Trustee relates; but, on request of the Company or any successor Trustee, such
retiring Trustee shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder with
respect to the Securities of that or those series to which the appointment
of such successor Trustee relates.
Upon request of any such successor Trustee, the Company shall execute any and
all instruments for more fully and certainly vesting in and confirming to such
successor Trustee all such rights, powers and trusts referred to in the first or
second preceding paragraph, as the case may be.
No successor Trustee shall accept its appointment unless at the time of such
acceptance such successor Trustee shall be qualified and eligible under this
Article.
Section 612. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the same effect
as if such successor Trustee had itself authenticated such Securities.
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Section 613. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company (or any
other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
Section 614. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents with respect to one
or more series of Securities which shall be authorized to act on behalf of the
Trustee to authenticate Securities of such series issued upon original issue and
upon exchange, registration of transfer or partial redemption thereof or
pursuant to Section 306, and Securities so authenticated shall be entitled to
the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in this Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and shall at all times be a corporation organized and
doing business under the laws of the United States of America, any State thereof
or the District of Columbia, authorized under such laws to act as Authenticating
Agent, having a combined capital and surplus of not less than $50,000,000 and
subject to supervision or examination by Federal or State authority. If such
Authenticating Agent publishes reports of condition at least annually, pursuant
to law or to the requirements of said supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such
Authenticating Agent shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time an
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which such Authenticating Agent shall be
a party, or any corporation succeeding to the corporate agency or corporate
trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time terminate
the agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall give notice of such
appointment in the manner
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provided in Section 106 to all Holders of Securities of the series with respect
to which such Authenticating Agent will serve. Any successor Authenticating
Agent upon acceptance of its appointment hereunder shall become vested with all
the rights, powers and duties of its predecessor hereunder, with like effect as
if originally named as an Authenticating Agent. No successor Authenticating
Agent shall be appointed unless eligible under the provisions of this Section.
The Trustee agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section, and the Trustee
shall be entitled to be reimbursed for such payments, subject to the provisions
of Section 607.
If an appointment with respect to one or more series is made pursuant to this
Section, the Securities of such series may have endorsed thereon, in addition to
the Trustee's certificate of authentication, an alternative certificate of
authentication in the following form:
This is one of the Securities of the series designated therein referred to in
the within-mentioned Indenture.
.......................,
As Trustee
By........................
As Authenticating Agent
By........................
Authorized Officer
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee
(1) semi-annually, not later than January 15 and July 15 in each year, a
list, in such form as the Trustee may reasonably require, of the names and
addresses of the Holders of Securities of each series as of the preceding
January 1 or July 1, as the case may be, and
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(2) at such other times as the Trustee may request in writing, within 30 days
after the receipt by the Company of any such request, a list of similar form
and content as of a date not more than 15 days prior to the time such list is
furnished;
excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.
Section 702. Preservation of Information; Communications to Holders.
The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 701 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 701 upon receipt of a new list so furnished.
The rights of Holders to communicate with other Holders with respect to their
rights under this Indenture or under the Securities, and the corresponding
rights and privileges of the Trustee, shall be as provided by the Trust
Indenture Act.
Every Holder of Securities, by receiving and holding the same, agrees with
the Company and the Trustee that neither the Company nor the Trustee nor any
agent of either of them shall be held accountable by reason of any disclosure of
information as to names and addresses of Holders made pursuant to the Trust
Indenture Act.
Section 703. Reports by Trustee.
The Trustee shall transmit to Holders such reports concerning the Trustee and
its actions under this Indenture as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant thereto.
Reports so required to be transmitted at stated intervals of not more than 12
months shall be transmitted no later than July 1 in each calendar year,
commencing in 1996.
A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange upon which any
Securities are listed, with the Commission and with the Company. The Company
will notify the Trustee when any Securities are listed on any stock exchange.
Section 704. Reports by Company.
The Company shall file with the Trustee and the Commission, and transmit to
Holders, such information, documents and other reports, and such summaries
thereof, as may be required pursuant to the Trust Indenture Act at the times and
in the manner provided pursuant to the Trust Indenture Act; provided that any
such information, documents or reports required
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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.
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other Person or
convey, transfer or lease its properties and assets substantially as an entirety
to any Person, and the Company shall not permit any Person to consolidate with
or merge into the Company or convey, transfer or lease its properties and assets
substantially as an entirety to the Company, unless:
(1) in case the Company shall consolidate with or merge into another Person
or convey, transfer or lease its properties and assets substantially as an
entirety to any Person, the Person formed by such consolidation or into which
the Company is merged or the Person which acquires by conveyance or transfer,
or which leases, the properties and assets of the Company substantially as an
entirety shall be a corporation, partnership or trust, shall be organized and
validly existing under the laws of the United States of America, any State
thereof or the District of Columbia and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the principal of
and any premium and interest on all the Securities and the performance or
observance of every covenant of this Indenture on the part of the Company to be
performed or observed and the conversion rights shall be provided for in
accordance with Article Fourteen, if applicable, or as otherwise specified
pursuant to Section 301, by supplemental indenture satisfactory in form to the
Trustee, executed and delivered to the Trustee, by the Person (if other than
the Company) formed by such consolidation or into which the Company shall have
been merged or by the Person which shall have acquired the Company's assets;
(2) immediately after giving effect to such transaction and treating any
indebtedness which becomes an obligation of the Company or any Subsidiary as a
result of such transaction as having been incurred by the Company or such
Subsidiary at the time of such transaction, no Event of Default, and no event
which, after notice or lapse of time or both, would become an Event of Default,
shall have happened and be continuing;
(3) if, as a result of any such consolidation or merger or such conveyance,
transfer or lease, properties or assets of the Company or any Restricted
Subsidiary would become subject to a Lien which would not be permitted by this
Indenture, the Company or such successor Person, as the case may be, shall take
such steps as shall be necessary effectively to secure the Securities equally
and ratably with (or prior to) all indebtedness secured thereby; and
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(4) the Company has delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel, each stating that such consolidation, merger, conveyance,
transfer or lease and, if a supplemental indenture is required in connection
with such transaction, such supplemental indenture comply with this Article and
that all conditions precedent herein provided for relating to such transaction
have been complied with.
Section 802. Successor Substituted.
Upon any consolidation of the Company with, or merger of the Company into,
any other Person or any conveyance, transfer or lease of the properties and
assets of the Company substantially as an entirety in accordance with Section
801, the successor Person formed by such consolidation or into which the Company
is merged or to which such conveyance, transfer or lease is made shall succeed
to, and be substituted for, and may exercise every right and power of, the
Company under this Indenture with the same effect as if such successor Person
had been named as the Company herein, and thereafter, except in the case of a
lease, the predecessor Person shall be relieved of all obligations and covenants
under this Indenture and the Securities.
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by a Board
Resolution, and the Trustee, at any time and from time to time, may enter into
one or more indentures supplemental hereto, in form satisfactory to the Trustee,
for any of the following purposes:
(1) to evidence the succession of another Person to the Company and the
assumption by any such successor of the covenants of the Company herein and in
the Securities; or
(2) to add to the covenants of the Company for the benefit of the Holders of
all or any series of Securities (and if such covenants are to be for the
benefit of less than all series of Securities, stating that such covenants are
expressly being included solely for the benefit of such series) or to surrender
any right or power herein conferred upon the Company; or
(3) to add any additional Events of Default for the benefit of the Holders of
all or any series of Securities (and if such additional Events of Default are
to be for the benefit of less than all series of Securities, stating that such
additional Events of Default are expressly being included solely for the
benefit of such series); or
(4) to add to or change any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the issuance of Securities
in bearer form, registrable or
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not registrable as to principal, and with or without interest coupons, or to
permit or facilitate the issuance of Securities in uncertificated form; or
(5) to add to, change or eliminate any of the provisions of this Indenture in
respect of one or more series of Securities, provided that any such addition,
change or elimination (A) shall neither (i) apply to any Security of any series
created prior to the execution of such supplemental indenture and entitled to
the benefit of such provision nor (ii) modify the rights of the Holder of any
such Security with respect to such provision or (B) shall become effective only
when there is no such Security Outstanding; or
(6) to secure the Securities; or
(7) to establish the form or terms of Securities of any series as permitted
by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment hereunder by a
successor Trustee with respect to the Securities of one or more series and to
add to or change any of the provisions of this Indenture as shall be necessary
to provide for or facilitate the administration of the trusts hereunder by more
than one Trustee, pursuant to the requirements of Section 611; or
(9) to make provision with respect to the conversion rights of Holders
pursuant to the requirements of Article Fourteen, including providing for the
conversion of the securities into any security (other than the Common Stock of
the Company) or property of the Company; or
(10) to cure any ambiguity, to correct or supplement any provision herein
which may be defective or inconsistent with any other provision herein, or to
make any other provisions with respect to matters or questions arising under
this Indenture, provided that such action pursuant to this Clause (9) shall not
adversely affect the interests of the Holders of Securities of any series in
any material respect.
Section 902. Supplemental Indentures With Consent of Holders.
With the consent of the Holders of more than 50% in principal amount of the
Outstanding Securities of each series affected by such supplemental indenture,
by Act of said Holders delivered to the Company and the Trustee, the Company,
when authorized by a Board Resolution, and the Trustee may enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Indenture or of modifying in any manner the rights of the Holders of
Securities of such series under this Indenture; provided, however, that no such
supplemental indenture shall, without the consent of the Holder of each
Outstanding Security affected thereby,
(1) change the Stated Maturity of the principal of, or any instalment of
principal of or interest on, any Security, or reduce the principal amount
thereof or the rate of interest
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thereon or any premium payable upon the redemption thereof, or reduce the
amount of the principal of an Original Issue Discount Security or any other
Security which would be due and payable upon a declaration of acceleration of
the Maturity thereof pursuant to Section 502, or change any Place of Payment
where, or the coin or currency in which, any Security or any premium or
interest thereon is payable, or impair the right to institute suit for the
enforcement of any such payment on or after the Stated Maturity thereof (or, in
the case of redemption, on or after the Redemption Date), or
(2) reduce the percentage in principal amount of the Outstanding Securities
of any series, the consent of whose Holders is required for any such
supplemental indenture, or the consent of whose Holders is required for any
waiver (of compliance with certain provisions of this Indenture or certain
defaults hereunder and their consequences) provided for in this Indenture, or
(3) modify any of the provisions of this Section, Section 513 or Section
1010, except to increase any such percentage or to provide that certain other
provisions of this Indenture cannot be modified or waived without the consent
of the Holder of each Outstanding Security affected thereby; provided, however,
that this clause shall not be deemed to require the consent of any Holder with
respect to changes in the references to "the Trustee" and concomitant changes
in this Section and Section 1010, or the deletion of this proviso, in
accordance with the requirements of Sections 611 and 901(8), or
(4) if applicable, make any change that adversely affects the right to
convert any security as provided in Article Fourteen or pursuant to Section 301
(except as permitted by Section 901(9)) or decrease the conversion rate or
increase the conversion price of any such security.
A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which modifies the
rights of the Holders of Securities of such series with respect to such covenant
or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
Section 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article or the modifications thereby of the trusts
created by this Indenture, the Trustee shall be entitled to receive, and
(subject to Section 601) shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of such supplemental indenture is authorized
or permitted by this Indenture. The Trustee may, but shall not be obligated to,
enter into any such supplemental indenture which affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise.
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Section 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
Section 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall conform
to the requirements of the Trust Indenture Act.
Section 906. Reference in Securities to Supplemental Indentures.
Securities of any series authenticated and delivered after the execution of
any supplemental indenture pursuant to this Article may, and shall if required
by the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities of any series so modified as to conform, in the opinion of the
Trustee and the Company, to any such supplemental indenture may be prepared and
executed by the Company and authenticated and delivered by the Trustee in
exchange for Outstanding Securities of such series.
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of each series of Securities
that it will duly and punctually pay the principal of and any premium and
interest on the Securities of that series in accordance with the terms of the
Securities and this Indenture.
Section 1002. Maintenance of Office or Agency.
The Company will maintain in each Place of Payment for any series of
Securities an office or agency where Securities of that series may be presented
or surrendered for payment, where Securities of that series may be surrendered
for registration of transfer or exchange, where Securities of that series may be
surrendered for conversion and where notices and demands to or upon the Company
in respect of the Securities of that series and this Indenture may be served.
The Company will give prompt written notice to the Trustee of the location, and
any change in the location, of such office or agency. If at any time the Company
shall fail
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to maintain any such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the Corporate Trust Office of the Trustee, and
the Company hereby appoints the Trustee as its agent to receive all such
presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more other offices or
agencies where the Securities of one or more series may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such designation or rescission shall in
any manner relieve the Company of its obligation to maintain an office or agency
in each Place of Payment for Securities of any series for such purposes. The
Company will give prompt written notice to the Trustee of any such designation
or rescission and of any change in the location of any such other office or
agency.
Section 1003. Money for Securities Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent with respect to
any series of Securities, it will, on or before each due date of the principal
of or any premium or interest on any of the Securities of that series, segregate
and hold in trust for the benefit of the Persons entitled thereto a sum
sufficient to pay the principal and any premium and interest so becoming due
until such sums shall be paid to such Persons or otherwise disposed of as herein
provided and will promptly notify the Trustee of its action or failure so to
act.
Whenever the Company shall have one or more Paying Agents for any series of
Securities, it will, prior to each due date of the principal of or any premium
or interest on any Securities of that series, deposit with a Paying Agent a sum
sufficient to pay such amount, such sum to be held as provided by the Trust
Indenture Act, and (unless such Paying Agent is the Trustee) the Company will
promptly notify the Trustee of its action or failure so to act.
The Company will cause each Paying Agent for any series of Securities other
than the Trustee to execute and deliver to the Trustee an instrument in which
such Paying Agent shall agree with the Trustee, subject to the provisions of
this Section, that such Paying Agent will (1) comply with the provisions of the
Trust Indenture Act applicable to it as a Paying Agent and (2) during the
continuance of any default by the Company (or any other obligor upon the
Securities of that series) in the making of any payment in respect of the
Securities of that series, upon the written request of the Trustee, forthwith
pay to the Trustee all sums held in trust by such Paying Agent for payment in
respect of the Securities of that series.
The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Company
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Company or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
money.
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Any money deposited with the Trustee or any Paying Agent, or then held by the
Company, in trust for the payment of the principal of or any premium or interest
on any Security of any series and remaining unclaimed for two years after such
principal, premium or interest has become due and payable shall be paid to the
Company on Company Request, or (if then held by the Company) shall be discharged
from such trust; and the Holder of such Security shall thereafter, as an
unsecured general creditor, look only to the Company for payment thereof, and
all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the Company cause to
be published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in each Place of
Payment, notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
publication, any unclaimed balance of such money then remaining will be repaid
to the Company.
Section 1004. Statement by Officers as to Default.
The Company will deliver to the Trustee, within 120 days after the end of
each fiscal year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not to the best knowledge of the signers thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions of this Indenture (without regard to any period of
grace or requirement of notice provided hereunder) and, if the Company shall be
in default, specifying all such defaults and the nature and status thereof of
which they may have knowledge.
Section 1005. Existence.
Subject to Article Eight, the Company will do or cause to be done all things
necessary to preserve and keep in full force and effect its existence, rights
(charter and statutory) and franchises; provided, however, that the Company
shall not be required to preserve any such right or franchise if the Board of
Directors shall determine that the preservation thereof is no longer desirable
in the conduct of the business of the Company and that the loss thereof is not
disadvantageous in any material respect to the Holders.
Section 1006. Maintenance of Properties.
The Company will cause all properties used or useful in the conduct of its
business or the business of any Subsidiary to be maintained and kept in good
condition, repair and working order and supplied with all necessary equipment
and will cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of the Company may
be necessary so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided, however, that
nothing in this Section shall prevent the Company from discontinuing the
operation or main-
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tenance of any of such properties if such discontinuance is, in the judgment of
the Company, desirable in the conduct of its business or the business of any
Subsidiary and not disadvantageous in any material respect to the Holders.
Section 1007. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or discharged, before
the same shall become delinquent, (1) all taxes, assessments and governmental
charges levied or imposed upon the Company or any Subsidiary or upon the income,
profits or property of the Company or any Subsidiary, and (2) all lawful claims
for labor, materials and supplies which, if unpaid, might by law become a lien
upon the property of the Company or any Subsidiary; provided, however, that the
Company shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claim whose amount, applicability
or validity is being contested in good faith by appropriate proceedings.
Section 1008. Limitation on Liens.
(1) Except as otherwise provided in Section 1008(2), the Company shall not,
and shall not permit any Restricted Subsidiary to, issue, assume or guarantee
any Debt secured by a Lien upon any Principal Property of the Company or of any
Restricted Subsidiary or upon any shares of stock or Debt of any Restricted
Subsidiary (whether such Principal Property, shares of stock or Debt are now
owned or hereafter acquired) without in any such case effectively providing
concurrently with the issuance, assumption or guaranty of any such Debt that
the Securities (together with, if the Company shall so determine, any other
indebtedness of or guaranty by the Company or such Restricted Subsidiary then
existing or thereafter created which is not subordinate to the Securities)
shall be secured equally and ratably with (or, at the option of the Company,
prior to) such Debt, so long as such Debt shall be so secured; provided,
however, that nothing in this Section 1008 shall prevent, restrict or apply to
(and there shall be excluded from secured Debt in any computation under this
Section 1008) Debt secured by:
(A) Liens on property, shares of stock or indebtedness of any corporation
existing at the time such corporation becomes a Restricted Subsidiary or
arising thereafter (i) otherwise than in connection with the borrowing of
money arranged thereafter and (ii) pursuant to contractual commitments
entered into prior to and not in contemplation of such corporation's becoming
a Restricted Subsidiary;
(B) Liens on any property (including shares of stock or Debt) existing at
the time of acquisition thereof (including acquisition through merger or
consolidation) or securing the payment of all or any part of the purchase
price or construction cost thereof or securing any Debt incurred prior to, at
the time of or within 180 days after, the acquisition of such property,
shares of stock or Debt or the completion of any such construction, whichever
is later, for the purpose of financing all or any part of the purchase price
or construction costs thereof (provided such Liens are limited to such
property, improvements thereon and the land upon which such property and
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improvements are located and any other property not then constituting a
Principal Property);
(C) Liens on any property to secure all or any part of the cost of
development, operations, construction, alteration, repair or improvement of
all of any part of such property, or to secure Debt incurred prior to, at the
time of or within 180 days after, the completion of such development,
operation, construction, alteration, repair or improvement, whichever is
later, for the purpose of financing all of any part of such cost (provided
such Liens are limited to such property, improvements thereon and the land
upon which such property and improvements are located and any other property
not then constituting a Principal Property);
(D) Liens which secure Debt owing by a Restricted Subsidiary to the
Company or to another Restricted Subsidiary or by the Company to a Restricted
Subsidiary;
(E) Liens securing indebtedness of a corporation which becomes a successor
of the Company in accordance with the provisions of Article Eight;
(F) Liens on property of the Company or a Restricted Subsidiary in favor
of the United States of America or any State thereof, or any department
agency or instrumentality or political subdivision of the United States of
America or any State thereof, or in favor of any other country or any
political subdivision thereof, to secure partial, progress, advance or other
payments pursuant to any contract or statute or to secure any indebtedness
incurred for the purpose of financing all or any part of the purchase price
or the cost of construction of the property subject to such Liens, or in
favor of any trustee or mortgagee for the benefit of holders of indebtedness
of any such entity incurred for any such purpose;
(G) Liens existing at May __, 1996; and
(H) any extension, renewal or replacement (or successive extension,
renewals or replacements), in whole or in part, of any Lien referred to in
the foregoing Clauses (A) to (G), inclusive, or of any Debt secured thereby;
provided that such extension, renewal or replacement Lien shall be limited to
all or any part of the same property that secured the Lien extended, renewed
or replaced (plus any improvements on such property) and shall secure no
larger amount of Debt than that existing at the time of such extension,
renewal or replacement.
(2) Notwithstanding the foregoing provisions of this Section 1008, the
Company and any one or more Restricted Subsidiaries may issue, assume or
guarantee Debt secured by a Lien which would otherwise be subject to the
foregoing restrictions if at the time it does so (the "Incurrence Time") the
aggregate amount of such Debt plus all other Debt of the Company and its
Restricted Subsidiaries secured by a Lien which would otherwise be subject to
the foregoing restrictions (not including Debt permitted to be secured under
the foregoing restrictions (not including Debt permitted to be secured under
Clauses (A) through (H) of Section 1008(1)), plus the aggregate Attributable
Debt (determined as of the Incurrence Time) of Sale and Leaseback
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Transactions (other than Sale and Leaseback Transactions permitted by Section
1009(1)) entered into after May __, 1996 and in existence at the Incurrence
Time (less the aggregate amount of proceeds of such Sale and Leaseback
Transactions which shall have been applied in accordance with Section 1009(3)),
does not exceed 15% of Consolidated Net Tangible Assets.
Section 1009. Limitations on Sale and Leaseback Transactions.
The Company shall not itself, and shall not permit any Restricted
Subsidiary to, enter into any arrangements after May __, 1996 with any bank,
insurance company or other lender or investor (other than the Company or another
Restricted Subsidiary) providing for the leasing as lessee by the Company or by
any such Restricted Subsidiary of any Principal Property (except a lease for a
temporary period not to exceed three years by the end of which it is intended
the use of such Principal Property by the lessee will be discontinued), which
was or is owned by the Company or a Restricted Subsidiary and which has been or
is to be sold or transferred by the Company or a Restricted Subsidiary more than
180 days after the completion of construction and commencement of full operation
thereof by the Company or such Restricted Subsidiary, to such lender or investor
or to any Person to whom funds have been or are to be advanced by such lender or
investor on the security of such Principal Property (herein called a "Sale and
Leaseback Transaction") unless:
(1) the Company or such Restricted Subsidiary would (at the time of
entering into such arrangement) be entitled pursuant to Clauses (A) through (G)
of Section 1009(1), without equally and ratably securing the Securities, to
issue, assume or guarantee indebtedness secured by a Lien on such Principal
Property; or
(2) the Attributable Debt of the Company and its Restricted Subsidiaries in
respect of such Sale and Leaseback Transaction and all other Sale and Leaseback
Transactions entered into after May __, 1996 (other than such Sale and
Leaseback Transactions as are permitted by Section 1009(1) or (3)), plus the
aggregate principal amount of Debt secured by Liens on Principal Properties
then outstanding (excluding any such Debt secured by Liens covered in
subdivisions (A) through (H) of Section 1008(1)) which do not equally and
ratably secure the Securities, would not exceed 15% of Consolidated Net
Tangible Assets; or
(3) the Company, within 180 days after the sale or transfer, applies or
causes a Restricted Subsidiary to apply an amount equal to the greater of the
net proceeds of such sale or transfer or fair market value of the Principal
Property so sold and leased back at the time of entering into such Sale and
Leaseback Transaction (in either case as determined by the Board of Directors)
to the retirement of Securities or other indebtedness of the Company (other
than indebtedness subordinated to the Securities) or indebtedness of a
Restricted Subsidiary, for money borrowed, having a stated maturity more than
12 months from the date of such application or which is extendible at the
option of the obligor thereon to a date more than 12 months from the date of
such application, provided that the amount to be so applied shall be reduced by
(i) the principal amount of Securities delivered within 180 days after such
sale or transfer to the Trustee for retirement and cancellation, and (ii) the
principal amount of any such indebtedness of the Company or a Restricted
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Subsidiary other than Securities voluntarily retired by the Company or a
Restricted Subsidiary within 180 days after such sale or transfer.
Notwithstanding the foregoing, no retirement referred to in this Section
1009(3) may be affected by payment at Maturity.
Notwithstanding the foregoing, where the Company or any Restricted Subsidiary is
the lessee in any Sale and Leaseback Transaction, Attributable Debt shall not
include any Debt resulting from the guarantee by the Company or any other
Restricted Subsidiary of the lessee's obligation thereunder.
Section 1010. Waiver of Certain Covenants.
Except as otherwise specified as contemplated by Section 301 for Securities
of such series, the Company may, with respect to the Securities of any series,
omit in any particular instance to comply with any term, provision or condition
set forth in any covenant provided pursuant to Section 301(19), 901(2) or 901(7)
for the benefit of the Holders of such series if before the time for such
compliance the Holders of at least 50% in principal amount of the Outstanding
Securities of such series shall, by Act of such Holders, either waive such
compliance in such instance or generally waive compliance with such term,
provision or condition, but no such waiver shall extend to or affect such term,
provision or condition except to the extent so expressly waived, and, until such
waiver shall become effective, the obligations of the Company and the duties of
the Trustee in respect of any such term, provision or condition shall remain in
full force and effect.
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article.
Securities of any series which are redeemable before their Stated Maturity
shall be redeemable in accordance with their terms and (except as otherwise
specified as contemplated by Section 301 for such Securities) in accordance with
this Article.
Section 1102. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be evidenced by a
Board Resolution or in another manner specified as contemplated by Section 301
for such Securities. In case of any redemption at the election of the Company of
less than all the Securities of any series (including any such redemption
affecting only a single Security), the Company shall, at least 60 days prior to
the Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date, of the
principal amount of Securities of such series to be redeemed and, if applicable,
of the tenor of the Securities to be redeemed. In the case of any redemption of
Securities prior to the
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expiration of any restriction on such redemption provided in the terms of such
Securities or elsewhere in this Indenture, the Company shall furnish the Trustee
with an Officers' Certificate evidencing compliance with such restriction.
Section 1103. Selection by Trustee of Securities to Be Redeemed.
If less than all the Securities of any series are to be redeemed (unless all
the Securities of such series and of a specified tenor are to be redeemed or
unless such redemption affects only a single Security), the particular
Securities to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Trustee, from the Outstanding Securities of such series
not previously called for redemption, by such method as the Trustee shall deem
fair and appropriate and which may provide for the selection for redemption of a
portion of the principal amount of any Security of such series, provided that
the unredeemed portion of the principal amount of any Security shall be in an
authorized denomination (which shall not be less than the minimum authorized
denomination) for such Security. If less than all the Securities of such series
and of a specified tenor are to be redeemed (unless such redemption affects only
a single Security), the particular Securities to be redeemed shall be selected
not more than 60 days prior to the Redemption Date by the Trustee, from the
Outstanding Securities of such series and specified tenor not previously called
for redemption in accordance with the preceding sentence.
If any Security selected for partial redemption is converted in part before
termination of the conversion right with respect to the portion of the Security
so selected, the converted portion of such Security shall be deemed (so far as
may be) to be the portion selected for redemption. Securities which have been
converted during a selection of Securities to be redeemed shall be treated by
the Trustee as Outstanding for the purpose of such selection.
The Trustee shall promptly notify the Company in writing of the Securities
selected for redemption as aforesaid and, in case of any Securities selected for
partial redemption as aforesaid, the principal amount thereof to be redeemed.
The provisions of the two preceding paragraphs shall not apply with respect
to any redemption affecting only a single Security, whether such Security is to
be redeemed in whole or in part. In the case of any such redemption in part, the
unredeemed portion of the principal amount of the Security shall be in an
authorized denomination (which shall not be less than the minimum authorized
denomination) for such Security.
For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Securities shall relate, in the
case of any Securities redeemed or to be redeemed only in part, to the portion
of the principal amount of such Securities which has been or is to be redeemed.
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Section 1104. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage prepaid,
mailed not less than 30 nor more than 60 days prior to the Redemption Date, to
each Holder of Securities to be redeemed, at its address appearing in the
Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Securities of any series consisting of
more than a single Security are to be redeemed, the identification (and, in the
case of partial redemption of any such Securities, the principal amounts) of
the particular Securities to be redeemed and, if less than all the Outstanding
Securities of any series consisting of a single Security are to be redeemed,
the principal amount of the particular Security to be redeemed,
(4) that on the Redemption Date the Redemption Price will become due and
payable upon each such Security to be redeemed and, if applicable, that
interest thereon will cease to accrue on and after said date,
(5) the place or places where each such Security is to be surrendered for
payment of the Redemption Price,
(6) if applicable, the conversion price, that the date on which the right to
convert the principal of the Securities or the portions thereof to be redeemed
will terminate will be the Redemption Date and the place or places where such
Securities may be surrendered for conversion, and
(7) that the redemption is for a sinking fund, if such is the case.
Notice of redemption of Securities to be redeemed at the election of the
Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company and shall be irrevocable.
Section 1105. Deposit of Redemption Price.
Prior to any Redemption Date, the Company shall deposit with the Trustee or
with a Paying Agent (or, if the Company is acting as its own Paying Agent,
segregate and hold in trust as provided in Section 1003) an amount of money
sufficient to pay the Redemption Price of, and (except if the Redemption Date
shall be an Interest Payment Date) accrued interest on, all the Securities which
are to be redeemed on that date.
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Section 1106. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities so to be
redeemed shall, on the Redemption Date, become due and payable at the Redemption
Price therein specified, and from and after such date (unless the Company shall
default in the payment of the Redemption Price and accrued interest) such
Securities shall cease to bear interest. Upon surrender of any such Security for
redemption in accordance with said notice, such Security shall be paid by the
Company at the Redemption Price, together with accrued interest to the
Redemption Date; provided, however, that, unless otherwise specified as
contemplated by Section 301, instalments of interest whose Stated Maturity is on
or prior to the Redemption Date will be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such at the
close of business on the relevant Record Dates according to their terms and the
provisions of Section 307.
If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal and any premium shall, until paid, bear
interest from the Redemption Date at the rate prescribed therefor in the
Security.
Section 1107. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be surrendered at a
Place of Payment therefor (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or its attorney
duly authorized in writing), and the Company shall execute, and the Trustee
shall authenticate and deliver to the Holder of such Security without service
charge, a new Security or Securities of the same series and of like tenor, of
any authorized denomination as requested by such Holder, in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Security so surrendered.
ARTICLE TWELVE
Sinking Funds
Section 1201. Applicability of Article.
The provisions of this Article shall be applicable to any sinking fund for
the retirement of Securities of any series except as otherwise specified as
contemplated by Section 301 for such Securities.
The minimum amount of any sinking fund payment provided for by the terms of
any Securities is herein referred to as a "mandatory sinking fund payment", and
any payment in excess of such minimum amount provided for by the terms of such
Securities is herein referred to as an "optional sinking fund payment". If
provided for by the terms of any
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Securities, the cash amount of any sinking fund payment may be subject to
reduction as provided in Section 1202. Each sinking fund payment shall be
applied to the redemption of Securities as provided for by the terms of such
Securities.
Section 1202. Satisfaction of Sinking Fund Payments with Securities.
The Company (1) may deliver Outstanding Securities of a series (other than
any previously called for redemption) and (2) may apply as a credit Securities
of a series which have been redeemed either at the election of the Company
pursuant to the terms of such Securities or through the application of permitted
optional sinking fund payments pursuant to the terms of such Securities, in each
case in satisfaction of all or any part of any sinking fund payment with respect
to any Securities of such series required to be made pursuant to the terms of
such Securities as and to the extent provided for by the terms of such
Securities; provided that the Securities to be so credited have not been
previously so credited. The Securities to be so credited shall be received and
credited for such purpose by the Trustee at the Redemption Price, as specified
in the Securities so to be redeemed, for redemption through operation of the
sinking fund and the amount of such sinking fund payment shall be reduced
accordingly.
Section 1203. Redemption of Securities for Sinking Fund.
Not less than 60 days prior to each sinking fund payment date for any
Securities, the Company will deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing sinking fund payment for such
Securities pursuant to the terms of such Securities, the portion thereof, if
any, which is to be satisfied by payment of cash and the portion thereof, if
any, which is to be satisfied by delivering and crediting Securities pursuant to
Section 1202 and will also deliver to the Trustee any Securities to be so
delivered. Not less than 30 days prior to each such sinking fund payment date,
the Trustee shall select the Securities to be redeemed upon such sinking fund
payment date in the manner specified in Section 1103 and cause notice of the
redemption thereof to be given in the name of and at the expense of the Company
in the manner provided in Section 1104. Such notice having been duly given, the
redemption of such Securities shall be made upon the terms and in the manner
stated in Sections 1106 and 1107.
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Company's Option to Effect Defeasance or Covenant Defeasance.
The Company may elect, at its option at any time, to have Section 1302 or
Section 1303 applied to any Securities or any series of Securities, as the case
may be, designated pursuant to Section 301 as being defeasible pursuant to such
Section 1302 or 1303, in accordance with
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any applicable requirements provided pursuant to Section 301 and upon
compliance with the conditions set forth below in this Article. Any such
election shall be evidenced by a Board Resolution or in another manner specified
as contemplated by Section 301 for such Securities.
Section 1302. Defeasance and Discharge.
Upon the Company's exercise of its option (if any) to have this Section
applied to any Securities or any series of Securities, as the case may be, the
Company shall be deemed to have been discharged from its obligations with
respect to such Securities as provided in this Section on and after the date the
conditions set forth in Section 1304 are satisfied (hereinafter called
"Defeasance"). For this purpose, such Defeasance means that the Company shall be
deemed to have paid and discharged the entire indebtedness represented by such
Securities and to have satisfied all its other obligations under such Securities
and this Indenture insofar as such Securities are concerned (and the Trustee, at
the expense of the Company, shall execute proper instruments acknowledging the
same), subject to the following which shall survive until otherwise terminated
or discharged hereunder: (1) the rights of Holders of such Securities to
receive, solely from the trust fund described in Section 1304 and as more fully
set forth in such Section, payments in respect of the principal of and any
premium and interest on such Securities when payments are due, (2) the Company's
obligations with respect to such Securities under Sections 304, 305, 306, 1002
and 1003, (3) the rights, powers, trusts, duties and immunities of the Trustee
hereunder and (4) this Article. Subject to compliance with this Article, the
Company may exercise its option (if any) to have this Section applied to any
Securities notwithstanding the prior exercise of its option (if any) to have
Section 1303 applied to such Securities.
Section 1303. Covenant Defeasance.
Upon the Company's exercise of its option (if any) to have this Section
applied to any Securities or any series of Securities, as the case may be, (1)
the Company shall be released from its obligations under Section 801(3),
Sections 1006 through 1009, inclusive, and any covenants provided pursuant to
Section 301(19), 901(2) or 901(7) for the benefit of the Holders of such
Securities and (2) the occurrence of any event specified in Sections 501(4)
(with respect to any of Section 801(3), Sections 1006 through 1009, inclusive,
and any such covenants provided pursuant to Section 301(19), 901(2) or 901(7)),
501(5) and 501(8) shall be deemed not to be or result in an Event of Default, in
each case with respect to such Securities as provided in this Section on and
after the date the conditions set forth in Section 1304 are satisfied
(hereinafter called "Covenant Defeasance"). For this purpose, such Covenant
Defeasance means that, with respect to such Securities, the Company may omit to
comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such specified Section (to the extent so specified
in the case of Section 501(4)), whether directly or indirectly by reason of any
reference elsewhere herein to any such Section or by reason of any reference in
any such Section to any other provision herein or in any other document, but the
remainder of this Indenture and such Securities shall be unaffected thereby.
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Section 1304. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to the application of Section 1302 or
Section 1303 to any Securities or any series of Securities, as the case may be:
(1) The Company shall irrevocably have deposited or caused to be deposited
with the Trustee (or another trustee which satisfies the requirements
contemplated by Section 609 and agrees to comply with the provisions of this
Article applicable to it) as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and dedicated solely
to, the benefits of the Holders of such Securities, (A) money in an amount, or
(B) U.S. Government Obligations which through the scheduled payment of
principal and interest in respect thereof in accordance with their terms will
provide, not later than one day before the due date of any payment, money in an
amount, or (C) a combination thereof, in each case sufficient, in the opinion
of a nationally recognized firm of independent public accountants expressed in
a written certification thereof delivered to the Trustee, to pay and discharge,
and which shall be applied by the Trustee (or any such other qualifying
trustee) to pay and discharge, the principal of and any premium and interest on
such Securities on the respective Stated Maturities, in accordance with the
terms of this Indenture and such Securities. As used herein, "U.S. Government
Obligation" means (x) any security which is (i) a direct obligation of the
United States of America for the payment of which the full faith and credit of
the United States of America is pledged or (ii) an obligation of a Person
controlled or supervised by and acting as an agency or instrumentality of the
United States of America the payment of which is unconditionally guaranteed as
a full faith and credit obligation by the United States of America, which, in
either case (i) or (ii), is not callable or redeemable at the option
of the issuer thereof, and (y) any depositary receipt issued by a bank (as
defined in Section 3(a)(2) of the Securities Act) as custodian with respect to
any U.S. Government Obligation which is specified in Clause (x) above and held
by such bank for the account of the holder of such depositary receipt, or with
respect to any specific payment of principal of or interest on any U.S.
Government Obligation which is so specified and held, provided that (except as
required by law) such custodian is not authorized to make any deduction from
the amount payable to the holder of such depositary receipt from any amount
received by the custodian in respect of the U.S. Government Obligation or the
specific payment of principal or interest evidenced by such depositary receipt.
(2) In the event of an election to have Section 1302 apply to any Securities
or any series of Securities, as the case may be, the Company shall have
delivered to the Trustee an Opinion of Counsel stating that (A) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling or (B) since the date of this instrument, there has been a change in the
applicable Federal income tax law, in either case (A) or (B) to the effect
that, and based thereon such opinion shall confirm that, the Holders of such
Securities will not recognize gain or loss for Federal income tax purposes as a
result of the deposit, Defeasance and discharge to be effected with respect to
such Securities and will be subject to Federal income tax on the same amount,
in the same manner and at the same times as would be the case if such deposit,
Defeasance and discharge were not to occur.
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(3) In the event of an election to have Section 1303 apply to any Securities
or any series of Securities, as the case may be, the Company shall have
delivered to the Trustee an Opinion of Counsel to the effect that the Holders
of such Securities will not recognize gain or loss for Federal income tax
purposes as a result of the deposit and Covenant Defeasance to be effected with
respect to such Securities and will be subject to Federal income tax on the
same amount, in the same manner and at the same times as would be the case if
such deposit and Covenant Defeasance were not to occur.
(4) The Company shall have delivered to the Trustee an Officer's Certificate
to the effect that neither such Securities nor any other Securities of the same
series, if then listed on any securities exchange, will be delisted as a result
of such deposit.
(5) No event which is, or after notice or lapse of time or both would become,
an Event of Default with respect to such Securities or any other Securities
shall have occurred and be continuing at the time of such deposit or, with
regard to any such event specified in Sections 501(6) and (7), at any time on
or prior to the 90th day after the date of such deposit (it being understood
that this condition shall not be deemed satisfied until after such 90th day).
(6) Such Defeasance or Covenant Defeasance shall not cause the Trustee to
have a conflicting interest within the meaning of the Trust Indenture Act
(assuming all Securities are in default within the meaning of such Act).
(7) Such Defeasance or Covenant Defeasance shall not result in a breach or
violation of, or constitute a default under, any other agreement or instrument
to which the Company is a party or by which it is bound.
(8) Such Defeasance or Covenant Defeasance shall not result in the trust
arising from such deposit constituting an investment company within the meaning
of the Investment Company Act unless such trust shall be registered under such
Act or exempt from registration thereunder.
(9) The Company shall have delivered to the Trustee an Officer's Certificate
and an Opinion of Counsel, each stating that all conditions precedent with
respect to such Defeasance or Covenant Defeasance have been complied with.
Section 1305. Deposited Money and U.S. Government Obligations to Be
Held in Trust; Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 1003, all money
and U.S. Government Obligations (including the proceeds thereof) deposited with
the Trustee or other qualifying trustee (solely for purposes of this Section and
Section 1306, the Trustee and any such other trustee are referred to
collectively as the "Trustee") pursuant to Section 1304 in respect of any
Securities shall be held in trust and applied by the Trustee, in accordance with
the provisions of such Securities and this Indenture, to the payment, either
directly or through any such Paying Agent (including the Company acting as its
own Paying Agent) as the
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Trustee may determine, to the Holders of such Securities, of all sums due and to
become due thereon in respect of principal and any premium and interest, but
money so held in trust need not be segregated from other funds except to the
extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or other
charge imposed on or assessed against the U.S. Government Obligations deposited
pursuant to Section 1304 or the principal and interest received in respect
thereof other than any such tax, fee or other charge which by law is for the
account of the Holders of Outstanding Securities.
Anything in this Article to the contrary notwithstanding, the Trustee shall
deliver or pay to the Company from time to time upon Company Request any money
or U.S. Government Obligations held by it as provided in Section 1304 with
respect to any Securities which, in the opinion of a nationally recognized firm
of independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect the Defeasance or Covenant Defeasance, as
the case may be, with respect to such Securities.
Section 1306. Reinstatement.
If the Trustee or the Paying Agent is unable to apply any money in accordance
with this Article with respect to any Securities by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, then the obligations under this
Indenture and such Securities from which the Company has been discharged or
released pursuant to Section 1302 or 1303 shall be revived and reinstated as
though no deposit had occurred pursuant to this Article with respect to such
Securities, until such time as the Trustee or Paying Agent is permitted to apply
all money held in trust pursuant to Section 1305 with respect to such Securities
in accordance with this Article; provided, however, that if the Company makes
any payment of principal of or any premium or interest on any such Security
following such reinstatement of its obligations, the Company shall be subrogated
to the rights (if any) of the Holders of such Securities to receive such payment
from the money so held in trust.
ARTICLE FOURTEEN
Conversion of Securities
Section 1401. Applicability of Article.
The provisions of this Article shall be applicable to the Securities of any
series which are convertible into shares of Common Stock of the Company, and the
issuance of such shares of Common Stock upon the conversion of such Securities,
except as otherwise specified as contemplated by Section 301 for the Securities
of such series.
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Section 1402. Exercise of Conversion Privilege.
In order to exercise a conversion privilege, the Holder of a Security of a
series with such a privilege shall surrender such Security to the Company at the
office or agency maintained for that purpose pursuant to Section 1002,
accompanied by a duly executed conversion notice to the Company substantially in
the form set forth in Section 206 stating that the Holder elects to convert such
Security or a specified portion thereof. Such notice shall also state, if
different from the name and address of such Holder, the name or names (with
address) in which the certificate or certificates for shares of Common Stock
which shall be issuable on such conversion shall be issued. Securities
surrendered for conversion shall (if so required by the Company or the Trustee)
be duly endorsed by or accompanied by instruments of transfer in forms
satisfactory to the Company and the Trustee duly executed by the registered
Holder or its attorney duly authorized in writing; and Securities so surrendered
-----------------------------
for conversion (in whole or in part) during the period from the close of
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business on any Regular Record Date to the opening of business on the next
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succeeding Interest Payment Date (excluding Securities or portions thereof
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called for redemption during such period) shall also be accompanied by payment
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in funds acceptable to the Company of an amount equal to the interest payable on
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such Interest Payment Date on the principal amount of such Security then being
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converted, and such interest shall be payable to such registered Holder
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notwithstanding the conversion of such Security, subject to the provisions of
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Section 307 relating to the payment of Defaulted Interest by the Company. As
promptly as practicable after the receipt of such notice and of any payment
required pursuant to a Board Resolution and, subject to Section 303, set forth,
or determined in the manner provided, in an Officers' Certificate, or
established in one or more indentures supplemental hereto setting forth the
terms of such series of Security, and the surrender of such Security in
accordance with such reasonable regulations as the Company may prescribe, the
Company shall issue and shall deliver, at the office or agency at which such
Security is surrendered, to such Holder or on its written order, a certificate
or certificates for the number of full shares of Common Stock issuable upon the
conversion of such Security (or specified portion thereof), in accordance with
the provisions of such Board Resolution, Officers' Certificate or supplemental
indenture, and cash as provided therein in respect of any fractional share of
such Common Stock otherwise issuable upon such conversion. Such conversion shall
be deemed to have been effected immediately prior to the close of business on
the date on which such notice and such payment, if required, shall have been
received in proper order for conversion by the Company and such Security shall
have been surrendered as aforesaid (unless such Holder shall have so surrendered
such Security and shall have instructed the Company to effect the conversion on
a particular date following such surrender and such Holder shall be entitled to
convert such Security on such date, in which case such conversion shall be
deemed to be effected immediately prior to the close of business on such date)
and at such time the rights of the Holder of such Security as such Security
Holder shall cease and the person or persons in whose name or names any
certificate or certificates for shares of Common Stock of the Company shall be
issuable upon such conversion shall be deemed to have become the Holder or
Holders of record of the shares represented thereby. Except as set forth above
and subject to the final paragraph of Section 307, no payment or adjustment
shall be made upon any conversion on account of any interest accrued on the
Securities (or any part thereof) surrendered for conversion or on account of any
dividends on the Common Stock of the Company issued upon such conversion.
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In the case of any Security which is converted in part only, upon such
conversion the Company shall execute and the Trustee shall authenticate and
deliver to or on the order of the Holder thereof, at the expense of the Company,
a new Security or Securities of the same series, of authorized denominations, in
aggregate principal amount equal to the unconverted portion of such Security.
Section 1403. No Fractional Shares.
No fractional share of Common Stock of the Company shall be issued upon
conversions of Securities of any series. If more than one Security shall be
surrendered for conversion at one time by the same Holder, the number of full
shares which shall be issuable upon conversion shall be computed on the basis of
the aggregate principal amount of the Securities (or specified portions thereof
to the extent permitted hereby) so surrendered. If, except for the provisions of
this Section 1403, any Holder of a Security or Securities would be entitled to a
fractional share of Common Stock of the Company upon the conversion of such
Security or Securities, or specified portions thereof, the Company shall pay to
such Holder an amount in cash equal to the current market value of such
fractional share computed, (i) if such Common Stock is listed or admitted to
unlisted trading privileges on a national securities exchange, on the basis of
the last reported sale price regular way on such exchange on the last trading
day prior to the date of conversion upon which such a sale shall have been
effected, or (ii) if such Common Stock is not at the time so listed or admitted
to unlisted trading privileges on a national securities exchange, on the basis
of the average of the bid and asked prices of such Common Stock in the over-the-
counter market, on the last trading day prior to the date of conversion, as
reported by the National Quotation Bureau, Incorporated or similar organization
if the National Quotation Bureau, Incorporated is no longer reporting such
information, or if not so available, the fair market price as determined by the
Board of Directors. For purposes of this Section, "trading day" shall mean each
Monday, Tuesday, Wednesday, Thursday and Friday other than any day on which the
Common Stock is not traded on the New York Stock Exchange, or if the Common
Stock is not traded on the New York Stock Exchange, on the principal exchange or
market on which the Common Stock is traded or quoted.
Section 1404. Adjustment of Conversion Price.
The conversion price of Securities of any series that is convertible into
Common Stock of the Company shall be adjusted for any stock dividends, stock
splits, reclassifications, combinations or similar transactions in accordance
with the terms of the supplemental indenture or Board Resolutions setting forth
the terms of the Securities of such series.
Whenever the conversion price is adjusted, the Company shall compute the
adjusted conversion price in accordance with terms of the applicable Board
Resolution or supplemental indenture and shall prepare an Officers' Certificate
setting forth the adjusted conversion price and showing in reasonable detail the
facts upon which such adjustment is based, and such certificate shall forthwith
be filed at each office or agency maintained for the purpose of conversion of
Securities pursuant to Section 1002 and, if different, with the Trustee. The
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Company shall forthwith cause a notice setting forth the adjusted conversion
price to be mailed, first class postage prepaid, to each Holder of Securities of
such series at its address appearing on the Security Register and to any
conversion agent other than the Trustee.
Section 1405. Notice of Certain Corporate Actions.
In case:
(1) the Company shall declare a dividend (or any other distribution) on its
Common Stock payable otherwise than in cash out of its retained earnings (other
than a dividend for which approval of any shareholders of the Company is
required); or
(2) the Company shall authorize the granting to the holders of its Common
Stock of rights, options or warrants to subscribe for or purchase any shares of
capital stock of any class or of any other rights (other than any such grant
for which approval of any shareholders of the Company is required); or
(3) of any reclassification of the Common Stock of the Company (other than a
subdivision or combination of its outstanding shares of Common Stock, or of any
consolidation, merger or share exchange to which the Company is a party and for
which approval of any shareholders of the Company is required), or of the sale
of all or substantially all of the assets of the Company; or
(4) of the voluntary or involuntary dissolution, liquidation or winding up of
the Company;
then the Company shall cause to be filed with the Trustee, and shall cause to be
mailed to all Holders at their last addresses as they shall appear in the
Securities Register, at least 20 days (or 10 days in any case specified in
Clause (1) or (2) above) prior to the applicable record date hereinafter
specified, a notice stating (i) the date on which a record is to be taken for
the purpose of such dividend, distribution, rights, options or warrants, or, if
a record is not to be taken, the date as of which the holders of Common Stock of
record to be entitled to such dividend, distribution, rights, options or
warrants are to be determined, or (ii) the date on which such reclassification,
consolidation, merger, share exchange, sale, dissolution, liquidation or winding
up is expected to become effective, and the date as of which it is expected that
holders of Common Stock of record shall be entitled to exchange their shares of
Common Stock for securities, cash or other property deliverable upon such
reclassification, consolidation, merger, share exchange, sale, dissolution,
liquidation or winding up. If at any time the Trustee shall not be the
conversion agent, a copy of such notice shall also forthwith be filed by the
Company with the Trustee.
Section 1406. Reservation of Shares of Common Stock.
The Company shall at all times reserve and keep available, free from
preemptive rights, out of its authorized but unissued Common Stock, for the
purpose of effecting the conversion
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of Securities, the full number of shares of Common Stock of the Company then
issuable upon the conversion of all outstanding Securities of any series that
has conversion rights.
Section 1407. Payment of Certain Taxes Upon Conversion.
The Company will pay any and all taxes that may be payable in respect of the
issue or delivery of shares of its Common Stock on conversion of Securities
pursuant hereto. The Company shall not, however, be required to pay any tax
which may be payable in respect of any transfer involved in the issue and
delivery of shares of its Common Stock in a name other than that of the Holder
of the Security or Securities to be converted, and no such issue or delivery
shall be made unless and until the person requesting such issue has paid to the
Company the amount of any such tax, or has established, to the satisfaction of
the Company, that such tax has been paid.
Section 1408. Nonassessability.
The Company covenants that all shares of its Common Stock which may be issued
upon conversion of Securities will upon issue in accordance with the terms
hereof be duly and validly issued and fully paid and nonassessable.
Section 1409. Effect of Consolidation or Merger on Conversion Privilege.
In case of any consolidation of the Company with, or merger of the Company
into or with any other Person, or in case of any sale of all or substantially
all of the assets of the Company, the Company or the Person formed by such
consolidation or the Person into which the Company shall have been merged or the
Person which shall have acquired such assets, as the case may be, shall execute
and deliver to the Trustee a supplemental indenture providing that the Holder of
each Security then outstanding of any series that is convertible into Common
Stock of the Company shall have the right, which right shall be the exclusive
conversion right thereafter available to said Holder (until the expiration of
the conversion right of such Security), to convert such Security into the kind
and amount of shares of stock or other securities or property (including cash)
receivable upon such consolidation, merger or sale by a holder of the number of
shares of Common Stock of the Company into which such Security might have been
converted immediately prior to such consolidation, merger or sale, subject to
compliance with the other provisions of this Indenture, such Security and such
supplemental indenture. Such supplemental indenture shall provide for
adjustments which shall be as nearly equivalent as may be practicable to the
adjustments provided for in such Security. The above provisions of this Section
shall similarly apply to successive consolidations, mergers or sales. It is
expressly agreed and understood that anything in this Indenture to the contrary
notwithstanding, if, pursuant to such merger, consolidation or sale, holders of
outstanding shares of Common Stock of the Company do not receive shares of
common stock of the surviving corporation but receive other securities, cash or
other property or any combination thereof, Holders of Securities shall not have
the right to thereafter convert their Securities into common stock of the
surviving corporation or the corporation which shall have
-72-
<PAGE>
acquired such assets, but rather, shall have the right upon such conversion to
receive the other securities, cash or other property receivable by a holder of
the number of shares of Common Stock of the Company into which the Securities
held by such holder might have been converted immediately prior to such
consolidation, merger or sale, all as more fully provided in the first sentence
of this Section 1409. Anything in this Section 1409 to the contrary
notwithstanding, the provisions of this Section 1409 shall not apply to a merger
or consolidation of another corporation with or into the Company pursuant to
which both of the following conditions are applicable: (i) the Company is the
surviving corporation and (ii) the outstanding shares of Common Stock of the
Company are not changed or converted into any other securities or property
(including cash) or changed in number or character or reclassified pursuant to
the terms of such merger or consolidation.
As evidence of the kind and amount of shares of stock or other securities or
property (including cash) into which Securities may properly be convertible
after any such consolidation, merger or sale, or as to the appropriate
adjustments of the conversion prices applicable with respect thereto, the
Trustee shall be furnished with and may accept the certificate or opinion of an
independent certified public accountant with respect thereto; and, in the
absence of bad faith on the part of the Trustee, the Trustee may conclusively
rely thereon, and shall not be responsible or accountable to any Holder of
Securities for any provision in conformity therewith or approved by such
independent certified accountant which may be contained in said supplemental
indenture.
Section 1410. Duties of Trustee Regarding Conversion.
Neither the Trustee nor any conversion agent shall at any time be under any
duty or responsibility to any Holder of Securities of any series that is
convertible into Common Stock of the Company to determine whether any facts
exist which may require any adjustment of the conversion price, or with respect
to the nature or extent of any such adjustment when made, or with respect to the
method employed, whether herein or in any supplemental indenture, any
resolutions of the Board of Directors or written instrument executed by one or
more officers of the Company provided to be employed in making the same. Neither
the Trustee nor any conversion agent shall be accountable with respect to the
validity or value (or the kind or amount) of any shares of Common Stock of the
Company, or of any securities or property, which may at any time be issued or
delivered upon the conversion of any Securities and neither the Trustee nor any
conversion agent makes any representation with respect thereto. Subject to the
provisions of Section 601, neither the Trustee nor any conversion agent shall be
responsible for any failure of the Company to issue, transfer or deliver any
shares of its Common Stock or stock certificates or other securities or property
upon the surrender of any Security for the purpose of conversion or to comply
with any of the covenants of the Company contained in this Article Fourteen or
in the applicable supplemental indenture, resolutions of the Board of Directors
or written instrument executed by one or more duly authorized officers of the
Company.
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<PAGE>
Section 1411. Repayment of Certain Funds Upon Conversion.
Any funds which at any time shall have been deposited by the Company or on
its behalf with the Trustee or any other paying agent for the purpose of paying
the principal of, and premium, if any, and interest, if any, on any of the
Securities (including funds deposited for the sinking fund referred to in
Article Twelve hereof) and which shall not be required for such purposes because
of the conversion of such Securities as provided in this Article Fourteen shall
after such conversion be repaid to the Company by the Trustee upon the Company's
written request.
--------------------------------
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<PAGE>
This instrument may be executed in any number of counterparts, each of which
so executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.
In Witness Whereof, the parties hereto have caused this Indenture to be duly
executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
Amstrong World Industries, Inc.
By............................
Attest:
..............................
Mellon Bank, N.A.
By............................
E. D. Renn
Vice President
Attest:
..............................
Authorized Officer
-75-
<PAGE>
Commonwealth of Pennsylvania )
) ss.:
County of Allegheny )
On the ..... day of ............., 1996, before me personally came
E. D. Renn, to me known, who, being by me duly sworn, did depose and say that
she is a Vice President of Mellon Bank, N.A. of one of the corporations
described in and which executed the foregoing instrument; that she knows the
seal of said corporation; that the seal affixed to said instrument is such
corporate seal; that it was so affixed by authority of the Board of Directors of
said corporation; and that she signed her name thereto by like authority.
....................................
Commonwealth of Pennsylvania )
) ss.:
County of .................. )
On the .... day of ..........., ...., before me personally came
..........................., to me known, who, being by me duly sworn, did
depose and say that he is .................... of
................................., one of the corporations described in and
which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Board of Directors of said
corporation; and that he signed his or her name thereto by like authority.
....................................
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<PAGE>
Exhibit 4.2
================================================================================
Armstrong World Industries, Inc.
TO
Mellon Bank, N.A.
Trustee
______________
Indenture
Dated as of .............., 1996
______________
Subordinated Debt Securities
================================================================================
<PAGE>
TABLE OF CONTENTS
__________
Page
----
Recitals of the Company................................................... 1
ARTICLE ONE
Definitions and Other Provisions of General Application
Section 101. Definitions:
Act....................................................... 1
Affiliate; control........................................ 2
Authenticating Agent...................................... 2
Board of Directors........................................ 2
Board Resolution.......................................... 2
Business Day.............................................. 2
Commission................................................ 2
Common Stock.............................................. 2
Company................................................... 3
Company Request; Company Order............................ 3
Corporate Trust Office.................................... 3
corporation............................................... 3
Covenant Defeasance....................................... 3
Debt...................................................... 3
Defaulted Interest........................................ 3
Defeasance................................................ 3
Depositary................................................ 3
Event of Default.......................................... 3
Exchange Act.............................................. 3
Expiration Date........................................... 3
Global Security........................................... 3
Holder.................................................... 3
Indenture................................................. 3
interest.................................................. 4
Interest Payment Date..................................... 4
Investment Company Act.................................... 4
Lien...................................................... 4
Maturity.................................................. 4
Notice of Default......................................... 4
Officers' Certificate..................................... 4
Opinion of Counsel........................................ 4
Original Issue Discount Security.......................... 4
<PAGE>
Page
----
Outstanding............................................... 4
Paying Agent.............................................. 5
Person.................................................... 5
Place of Payment.......................................... 5
Predecessor Security...................................... 6
Principal Property........................................ 6
Redemption Date........................................... 6
Redemption Price.......................................... 6
Regular Record Date....................................... 6
Securities................................................ 6
Securities Act............................................ 6
Security Register and Security Registrar.................. 6
Senior Debt............................................... 6
Special Record Date....................................... 6
Stated Maturity........................................... 6
Subsidiary................................................ 6
Trust Indenture Act....................................... 7
Trustee................................................... 7
U.S. Government Obligation................................ 7
Vice President............................................ 7
Section 102. Compliance Certificates and Opinions...................... 7
Section 103. Form of Documents Delivered to Trustee.................... 8
Section 104. Acts of Holders; Record Dates............................. 8
Section 105. Notices, Etc., to Trustee and Company..................... 10
Section 106. Notice to Holders; Waiver................................. 11
Section 107. Conflict with Trust Indenture Act......................... 11
Section 108. Effect of Headings and Table of Contents.................. 11
Section 109. Successors and Assigns.................................... 11
Section 110. Separability Clause....................................... 12
Section 111. Benefits of Indenture..................................... 12
Section 112. Governing Law............................................. 12
Section 113. Legal Holidays............................................ 12
ARTICLE TWO
Security Forms
Section 201. Forms Generally........................................... 12
Section 202. Form of Face of Security.................................. 13
Section 203. Form of Reverse of Security............................... 15
Section 204. Form of Legend for Global Securities...................... 20
Section 205. Form of Trustee's Certificate of Authentication........... 20
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<PAGE>
Page
----
Section 206. Form of Conversion Notice................................. 20
ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series...................... 21
Section 302. Denominations............................................. 24
Section 303. Execution, Authentication, Delivery and Dating............ 24
Section 304. Temporary Securities...................................... 26
Section 305. Registration, Registration of Transfer and Exchange....... 26
Section 306. Mutilated, Destroyed, Lost and Stolen Securities.......... 28
Section 307. Payment of Interest; Interest Rights Preserved............ 29
Section 308. Persons Deemed Owners..................................... 30
Section 309. Cancellation.............................................. 30
Section 310. Computation of Interest................................... 31
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture..................... 31
Section 402. Application of Trust Money.................................. 32
ARTICLE FIVE
Remedies
Section 501. Events of Default......................................... 32
Section 502. Acceleration of Maturity; Rescission and Annulment........ 34
Section 503. Collection of Indebtedness and Suits for
Enforcement by Trustee.................................. 35
Section 504. Trustee May File Proofs of Claim.......................... 35
Section 505. Trustee May Enforce Claims Without Possession
of Securities........................................... 36
Section 506. Application of Money Collected............................ 36
Section 507. Limitation on Suits....................................... 37
Section 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest and to Convert..................... 37
Section 509. Restoration of Rights and Remedies........................ 37
-iii-
<PAGE>
Page
----
Section 510. Rights and Remedies Cumulative............................ 38
Section 511. Delay or Omission Not Waiver.............................. 38
Section 512. Control by Holders........................................ 38
Section 513. Waiver of Past Defaults................................... 39
Section 514. Undertaking for Costs..................................... 39
Section 515. Waiver of Usury, Stay or Extension Laws................... 39
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities....................... 40
Section 602. Notice of Defaults........................................ 40
Section 603. Certain Rights of Trustee................................. 40
Section 604. Not Responsible for Recitals or Issuance of Securities.... 41
Section 605. May Hold Securities....................................... 41
Section 606. Money Held in Trust....................................... 42
Section 607. Compensation and Reimbursement............................ 42
Section 608. Conflicting Interests..................................... 42
Section 609. Corporate Trustee Required; Eligibility................... 42
Section 610. Resignation and Removal; Appointment of Successor......... 43
Section 611. Acceptance of Appointment by Successor.................... 44
Section 612. Merger, Conversion, Consolidation or Succession
to Business............................................. 45
Section 613. Preferential Collection of Claims Against Company......... 46
Section 614. Appointment of Authenticating Agent....................... 46
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee Names and Addresses
of Holders.............................................. 47
Section 702. Preservation of Information; Communications
to Holders................................................ 48
Section 703. Reports by Trustee........................................ 48
Section 704. Reports by Company........................................ 48
-iv-
<PAGE>
Page
----
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. Company May Consolidate, Etc., Only on
Certain Terms............................................. 49
Section 802. Successor Substituted....................................... 50
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of Holders........ 50
Section 902. Supplemental Indentures With Consent of Holders........... 51
Section 903. Execution of Supplemental Indentures...................... 52
Section 904. Effect of Supplemental Indentures......................... 53
Section 905. Conformity with Trust Indenture Act....................... 53
Section 906. Reference in Securities to Supplemental Indentures........ 53
Section 907. Subordination Unimparied.................................. 53
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest............... 53
Section 1002. Maintenance of Office or Agency.......................... 54
Section 1003. Money for Securities Payments to Be Held in Trust........ 54
Section 1004. Statement by Officers as to Default...................... 55
Section 1005. Existence................................................ 55
Section 1006. Maintenance of Properties................................ 56
Section 1007. Payment of Taxes and Other Claims........................ 56
Section 1008. Waiver of Certain Covenants.............................. 56
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article................................. 57
Section 1102. Election to Redeem; Notice to Trustee.................... 57
Section 1103. Selection by Trustee of Securities to Be Redeemed........ 57
Section 1104. Notice of Redemption..................................... 58
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<PAGE>
Page
----
Section 1105. Deposit of Redemption Price.............................. 59
Section 1106. Securities Payable on Redemption Date.................... 59
Section 1107. Securities Redeemed in Part.............................. 59
ARTICLE TWELVE
Sinking Funds
Section 1201. Applicability of Article.................................. 60
Section 1202. Satisfaction of Sinking Fund Payments with Securities..... 60
Section 1203. Redemption of Securities for Sinking Fund................. 60
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Company's Option to Effect Defeasance or
Covenant Defeasance.................................... 61
Section 1302. Defeasance and Discharge................................. 61
Section 1303. Covenant Defeasance...................................... 62
Section 1304. Conditions to Defeasance or Covenant Defeasance.......... 62
Section 1305. Deposited Money and U.S. Government Obligations
to Be Held in Trust; Miscellaneous Provisions.......... 64
Section 1306. Reinstatement............................................ 65
ARTICLE FOURTEEN
Conversion of Securities
Section 1401. Applicability of Article................................. 65
Section 1402. Exercise of Conversion Privilege......................... 65
Section 1403. No Fractional Shares..................................... 66
Section 1404. Adjustment of Conversion Price........................... 67
Section 1405. Notice of Certain Corporate Actions...................... 67
Section 1406. Reservation of Shares of Common Stock.................... 68
Section 1407. Payment of Certain Taxes Upon Conversion................. 68
Section 1408. Nonassessability......................................... 69
Section 1409. Effect of Consolidation or Merger on Conversion Privilege 69
Section 1410. Duties of Trustee Regarding Conversion................... 70
Section 1411. Repayment of Certain Funds Upon Conversion............... 70
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<PAGE>
Page
----
ARTICLE FIFTEEN
Subordination of Securities
Section 1501. Securities Subordinate to Senior Debt....................... 71
Section 1502. Payment Over of Proceeds Upon Dissolution, Etc.............. 71
Section 1503. Prior Payment to Senior Debt Upon Acceleration
of Securities............................................. 72
Section 1504. No Payment When Senior Debt in Default...................... 72
Section 1505. Payment Permitted If No Default............................. 73
Section 1506. Subrogation to Rights of Holders of Senior Debt............. 73
Section 1507. Provisions Solely to Define Relative Rights................. 74
Section 1508. Trustee to Effectuate Subordination......................... 74
Section 1509. No Waiver of Subordination Provisions....................... 74
Section 1510. Notice to Trustee........................................... 75
Section 1511. Reliance on Judicial Order or Certificate of
Liquidating Agent......................................... 75
Section 1512. Trustee Not Fiduciary for Holders of Senior Debt............ 76
Section 1513. Rights of Trustee as Holder of Senior Debt;
Preservation of Trustee's Rights.......................... 76
Section 1514. Article Applicable to Paying Agents......................... 76
Section 1515. Certain Conversions Deemed Payment.......................... 76
Section 1516. Obligations of Company and Right to Convert
Unconditional............................................. 77
Testimonium............................................................... 78
Signatures and Seals...................................................... 78
Acknowledgements.......................................................... 79
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<PAGE>
..............................................................
Certain Sections of this Indenture relating to Sections 310 through 318,
inclusive, of the Trust Indenture Act of 1939:
Trust Indenture
Act Section Indenture Section
(S) 310(a)(1) ............................................ 609
(a)(2) ............................................ 609
(a)(3) ............................................ Not Applicable
(a)(4) ............................................ Not Applicable
(b) ............................................ 608
610
(S) 311(a) ............................................ 613
(b) ............................................ 613
(S) 312(a) ............................................ 701
702
(b) ............................................ 702
(c) ............................................ 702
(S) 313(a) ............................................ 703
(b) ............................................ 703
(c) ............................................ 703
(d) ............................................ 703
(S) 314(a) ............................................ 704
(a)(4) ............................................ 101
1004
(b) ............................................ Not Applicable
(c)(1) ............................................ 102
(c)(2) ............................................ 102
(c)(3) ............................................ Not Applicable
(d) ............................................ Not Applicable
(e) ............................................ 102
(S) 315(a) ............................................ 601
(b) ............................................ 602
(c) ............................................ 601
(d) ............................................ 601
(e) ............................................ 514
(S) 316(a) ............................................ 101
(a)(1)(A) ............................................ 502
512
(a)(1)(B) ............................................ 513
(a)(2) ............................................ Not Applicable
(b) ............................................ 508
(c) ............................................ 104
(S) 317(a)(1) ............................................ 503
(a)(2) ............................................ 504
(b) ............................................ 1003
(S) 318(a) ............................................ 107
- -------------------
Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Indenture.
-viii-
<PAGE>
INDENTURE, dated as of ............, 1996, between Armstrong World
Industries, Inc., a corporation duly organized and existing under the laws of
the Commonwealth of Pennsylvania (herein called the "Company"), having its
principal executive office at 313 West Liberty Street, Lancaster, Pennsylvania
17603, and Mellon Bank, N.A., a national banking association duly organized and
existing under the laws of the United States of America, as Trustee (herein
called the "Trustee").
Recitals of the Company
The Company has duly authorized the execution and delivery of this Indenture
to provide for the issuance from time to time of its unsecured debentures, notes
or other evidences of indebtedness (herein called the "Securities"), to be
issued in one or more series as in this Indenture provided.
All things necessary to make this Indenture a valid agreement of the Company,
in accordance with its terms, have been done.
Now, Therefore, This Indenture Witnesseth:
For and in consideration of the premises and the purchase of the Securities
by the Holders thereof, it is mutually agreed, for the equal and proportionate
benefit of all Holders of the Securities or of series thereof, as follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly provided or
unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to them
in this Article and include the plural as well as the singular;
(2) all other terms used herein which are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to
them therein;
(3) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles,
and, except as otherwise herein expressly provided, the term "generally
accepted accounting principles" with respect to any computation required or
permitted hereunder shall mean such accounting principles as are generally
accepted at the date of such computation;
<PAGE>
(4) unless the context otherwise requires, any reference to an "Article" or
a "Section" refers to an Article or a Section, as the case may be, of this
Indenture; and
(5) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
"Act", when used with respect to any Holder, has the meaning specified in
Section 104.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Authenticating Agent" means any Person authorized by the Trustee pursuant to
Section 614 to act on behalf of the Trustee to authenticate Securities of one or
more series.
"Board of Directors" means either the board of directors of the Company or
any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the Secretary or
an Assistant Secretary of the Company to have been duly adopted by the Board of
Directors and to be in full force and effect on the date of such certification,
and delivered to the Trustee.
"Business Day", when used with respect to any Place of Payment, means each
Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions in that Place of Payment are authorized or obligated by law
or executive order to close.
"Commission" means the Securities and Exchange Commission, from time to time
constituted, created under the Exchange Act, or, if at any time after the
execution of this instrument such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Common Stock" includes any stock of any class of the Company which has no
preference in respect of dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding-up of the Company
and which is not subject to redemption by the Company. However, subject to the
provisions of Section 1409, shares issuable on conversions of Securities shall
include only shares of the class designated as Common Stock of the Company at
the date of this Indenture or shares of any class or classes resulting from any
reclassification or reclassifications thereof and
which have no preference in respect of dividends or of amounts payable in the
event of any voluntary or involuntary liquidation, dissolution or winding-up of
the Company and which are not subject to redemption by the Company; provided
that if at any time there shall be more than one such resulting class, the
shares of each such class then so issuable shall be substantially in the
proportion which the total number of shares of such class resulting from all
such
-2-
<PAGE>
reclassifications bears to the total number of shares of all such classes
resulting from all such reclassifications.
"Company" means the Person named as the "Company" in the first paragraph of
this instrument until a successor Person shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor Person.
"Company Request" or "Company Order" means a written request or order signed
in the name of the Company by its Chairman of the Board, its Vice Chairman of
the Board, its President or a Vice President, and by its Treasurer, an Assistant
Treasurer, its Secretary or an Assistant Secretary, and delivered to the
Trustee.
"Corporate Trust Office" means the corporate trust office of the Trustee
at Two Mellon Bank Center, Room 325, Pittsburgh, Pennsylvania 15259 at which at
any particular time its corporate trust business shall be administered.
"corporation" means a corporation, association, company, joint-stock company
or business trust.
"Covenant Defeasance" has the meaning specified in Section 1303.
"Debt" means indebtedness for borrowed money.
"Defaulted Interest" has the meaning specified in Section 307.
"Defeasance" has the meaning specified in Section 1302.
"Depositary" means, with respect to Securities of any series issuable in
whole or in part in the form of one or more Global Securities, a clearing agency
registered under the Exchange Act that is designated to act as Depositary for
such Securities as contemplated by Section 301.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934 and any statute
successor thereto, in each case as amended from time to time.
"Expiration Date" has the meaning specified in Section 104.
"Global Security" means a Security that evidences all or part of the
Securities of any series and bears the legend set forth in Section 204 (or such
legend as may be specified as contemplated by Section 301 for such Securities).
"Holder" means a Person in whose name a Security is registered in the
Security Register.
"Indenture" means this instrument as originally executed and as it may from
time to time be supplemented or amended by one or more indentures supplemental
hereto entered into
-3-
<PAGE>
pursuant to the applicable provisions hereof, including, for all purposes of
this instrument and any such supplemental indenture, the provisions of the Trust
Indenture Act that are deemed to be a part of and govern this instrument and any
such supplemental indenture, respectively. The term "Indenture" shall also
include the terms of particular series of Securities established as contemplated
by Section 301.
"interest", when used with respect to an Original Issue Discount Security
which by its terms bears interest only after Maturity, means interest payable
after Maturity.
"Interest Payment Date", when used with respect to any Security, means the
Stated Maturity of an instalment of interest on such Security.
"Investment Company Act" means the Investment Company Act of 1940 and any
statute successor thereto, in each case as amended from time to time.
"Lien" means any mortgage, pledge, security interest, lien or other
encumbrance.
"Maturity", when used with respect to any Security, means the date on which
the principal of such Security or an instalment of principal becomes due and
payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, call for redemption or otherwise.
"Notice of Default" means a written notice of the kind specified in Section
501(4) or 501(5).
"Officers' Certificate" means a certificate signed by the Chairman of the
Board, a Vice Chairman of the Board, the President or a Vice President, and by
the Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary,
of the Company, and delivered to the Trustee. One of the officers signing an
Officers' Certificate given pursuant to Section 1004 shall be the principal
executive, financial or accounting officer of the Company.
"Opinion of Counsel" means a written opinion of counsel, who may be counsel
for the Company, and who shall be acceptable to the Trustee.
"Original Issue Discount Security" means any Security which provides for an
amount less than the principal amount thereof to be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to Section 502.
"Outstanding", when used with respect to Securities, means, as of the date of
determination, all Securities theretofore authenticated and delivered under this
Indenture, except:
(1) Securities theretofore cancelled by the Trustee or delivered to the
Trustee for cancellation;
(2) Securities for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Trustee or any Paying Agent
(other than the Company)
-4-
<PAGE>
in trust or set aside and segregated in trust by the Company (if the Company
shall act as its own Paying Agent) for the Holders of such Securities; provided
that, if such Securities are to be redeemed, notice of such redemption has been
duly given pursuant to this Indenture or provision therefor satisfactory to the
Trustee has been made;
(3) Securities as to which Defeasance has been effected pursuant to
Section 1302; and
(4) Securities which have been paid pursuant to Section 306 or in exchange
for or in lieu of which other Securities have been authenticated and delivered
pursuant to this Indenture, other than any such Securities in respect of which
there shall have been presented to the Trustee proof satisfactory to it that
such Securities are held by a bona fide purchaser in whose hands such
Securities are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given, made or taken any
request, demand, authorization, direction, notice, consent, waiver or other
action hereunder as of any date, (A) the principal amount of an Original Issue
Discount Security which shall be deemed to be Outstanding shall be the amount of
the principal thereof which would be due and payable as of such date upon
acceleration of the Maturity thereof to such date pursuant to Section 502, (B)
if, as of such date, the principal amount payable at the Stated Maturity of a
Security is not determinable, the principal amount of such Security which shall
be deemed to be Outstanding shall be the amount as specified or determined as
contemplated by Section 301, (C) the principal amount of a Security denominated
in one or more foreign currencies or currency units which shall be deemed to be
Outstanding shall be the U.S. dollar equivalent, determined as of such date in
the manner provided as contemplated by Section 301, of the principal amount of
such Security (or, in the case of a Security described in Clause (A) or (B)
above, of the amount determined as provided in such Clause), and (D) Securities
owned by the Company or any other obligor upon the Securities or any Affiliate
of the Company or of such other obligor shall be disregarded and deemed not to
be Outstanding, except that, in determining whether the Trustee shall be
protected in relying upon any such request, demand, authorization, direction,
notice, consent, waiver or other action, only Securities which the Trustee knows
to be so owned shall be so disregarded. Securities so owned which have been
pledged in good faith may be regarded as Outstanding if the pledgee establishes
to the satisfaction of the Trustee the pledgee's right so to act with respect to
such Securities and that the pledgee is not the Company or any other obligor
upon the Securities or any Affiliate of the Company or of such other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal of or any premium or interest on any Securities on behalf of the
Company.
"Person" means any individual, corporation, partnership, joint venture,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"Place of Payment", when used with respect to the Securities of any series,
means the place or places where the principal of and any premium and interest on
the Securities of that series are payable as specified as contemplated by
Section 301.
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<PAGE>
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 306 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.
"Redemption Date", when used with respect to any Security to be redeemed,
means the date fixed for such redemption by or pursuant to this Indenture.
"Redemption Price", when used with respect to any Security to be redeemed,
means the price at which it is to be redeemed pursuant to this Indenture.
"Regular Record Date" for the interest payable on any Interest Payment Date
on the Securities of any series means the date specified for that purpose as
contemplated by Section 301.
"Securities" has the meaning stated in the first recital of this Indenture
and more particularly means any Securities authenticated and delivered under
this Indenture.
"Securities Act" means the Securities Act of 1933 and any statute successor
thereto, in each case as amended from time to time.
"Security Register" and "Security Registrar" have the respective meanings
specified in Section 305.
"Senior Debt" means the principal of (and premium, if any) and interest, if
any, (including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company to the extent that such
claim for post-petition interest is allowed in such proceeding) on Debt, whether
incurred on or prior to the date hereof or hereafter incurred, unless, in the
instrument creating or evidencing the same or pursuant to which the same is
outstanding, it is provided that such obligations are not superior in right of
payment to the Securities or to other Debt which is pari passu with, or
subordinated to, the Securities; provided, however, that Senior Debt shall not
be deemed to include the Securities.
"Special Record Date" for the payment of any Defaulted Interest means a date
fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Security or any instalment
of principal thereof or interest thereon, means the date specified in such
Security as the fixed date on which the principal of such Security or such
instalment of principal or interest is due and payable.
"Subsidiary" means a corporation more than 50% of the outstanding voting
stock of which is owned, directly or indirectly, by the Company or by one or
more other Subsidiaries, or by the Company and one or more other Subsidiaries.
For the purposes of this definition, "voting stock" means stock which ordinarily
has voting power for the election of directors,
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<PAGE>
whether at all times or only so long as no senior class of stock has such voting
power by reason of any contingency.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trustee" means the Person named as the "Trustee" in the first paragraph of
this instrument until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Trustee" shall mean or
include each Person who is then a Trustee hereunder, and if at any time there is
more than one such Person, "Trustee" as used with respect to the Securities of
any series shall mean the Trustee with respect to Securities of that series.
"U.S. Government Obligation" has the meaning specified in Section 1304.
"Vice President", when used with respect to the Company or the Trustee, means
any vice president, whether or not designated by a number or a word or words
added before or after the title "vice president".
Section 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to take any
action under any provision of this Indenture, the Company shall furnish to the
Trustee such certificates and opinions as may be required under the Trust
Indenture Act. Each such certificate or opinion shall be given in the form of an
Officers' Certificate, if to be given by an officer of the Company, or an
Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirements set forth in
this Indenture.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture shall include,
(1) a statement that each individual signing such certificate or opinion
has read such covenant or condition and the definitions herein relating
thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he or she
has made such examination or investigation as is necessary to enable him or her
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(4) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
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Section 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his or her 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 104. Acts of Holders; Record Dates.
Any request, demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Indenture to be given, made or taken
by Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 601) conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such instrument or
writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such
instrument or writing acknowledged to him or her the execution thereof. Where
such execution is by a signer acting in a capacity other than his or her
individual capacity, such certificate or affidavit shall also constitute
sufficient proof of his or her authority. The fact and date of the execution of
any such instrument or writing, or the authority of the
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<PAGE>
Person executing the same, may also be proved in any other manner which the
Trustee deems sufficient.
The ownership of Securities shall be proved by the Security Register.
Any request, demand, authorization, direction, notice, consent, waiver or
other Act of the Holder of any Security shall bind every future Holder of the
same Security and the Holder of every Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or the Company in
reliance thereon, whether or not notation of such action is made upon such
Security.
The Company may set any day as a record date for the purpose of determining
the Holders of Outstanding Securities of any series entitled to give, make or
take any request, demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Indenture to be given, made or taken
by Holders of Securities of such series, provided that the Company may not set
a record date for, and the provisions of this paragraph shall not apply with
respect to, the giving or making of any notice, declaration, request or
direction referred to in the next paragraph. If any record date is set pursuant
to this paragraph, the Holders of Outstanding Securities of the relevant series
on such record date, and no other Holders, shall be entitled to take the
relevant action, whether or not such Holders remain Holders after such record
date; provided that no such action shall be effective hereunder unless taken on
or prior to the applicable Expiration Date by Holders of the requisite
principal amount of Outstanding Securities of such series on such record date.
Nothing in this paragraph shall be construed to prevent the Company from
setting a new record date for any action for which a record date has previously
been set pursuant to this paragraph (whereupon the record date previously set
shall automatically and with no action by any Person be cancelled and of no
effect), and nothing in this paragraph shall be construed to render ineffective
any action taken by Holders of the requisite principal amount of Outstanding
Securities of the relevant series on the date such action is taken. Promptly
after any record date is set pursuant to this paragraph, the Company, at its
own expense, shall cause notice of such record date, the proposed action by
Holders and the applicable Expiration Date to be given to the Trustee in
writing and to each Holder of Securities of the relevant series in the manner
set forth in Section 106.
The Trustee may set any day as a record date for the purpose of determining
the Holders of Outstanding Securities of any series entitled to join in the
giving or making of (i) any Notice of Default, (ii) any declaration of
acceleration referred to in Section 502, (iii) any request to institute
proceedings referred to in Section 507(2) or (iv) any direction referred to in
Section 512, in each case with respect to Securities of such series. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of such series on such record date, and no other Holders, shall be
entitled to join in such notice, declaration, request or direction, whether or
not such Holders remain Holders after such record date; provided that no such
action shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date. Nothing in this paragraph shall
be construed to prevent the Trustee from setting a new record date for any
action for which a record date has previously
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<PAGE>
been set pursuant to this paragraph (whereupon the record date previously set
shall automatically and with no action by any Person be cancelled and of no
effect), and nothing in this paragraph shall be construed to render ineffective
any action taken by Holders of the requisite principal amount of Outstanding
Securities of the relevant series on the date such action is taken. Promptly
after any record date is set pursuant to this paragraph, the Trustee, at the
Company's expense, shall cause notice of such record date, the proposed action
by Holders and the applicable Expiration Date to be given to the Company in
writing and to each Holder of Securities of the relevant series in the manner
set forth in Section 106.
With respect to any record date set pursuant to this Section, the party
hereto which sets such record dates may designate any day as the "Expiration
Date" and from time to time may change the Expiration Date to any earlier or
later day; provided that no such change shall be effective unless notice of the
proposed new Expiration Date is given to the other party hereto in writing, and
to each Holder of Securities of the relevant series in the manner set forth in
Section 106, on or prior to the existing Expiration Date. If an Expiration Date
is not designated with respect to any record date set pursuant to this Section,
the party hereto which set such record date shall be deemed to have initially
designated the 180th day after such record date as the Expiration Date with
respect thereto, subject to its right to change the Expiration Date as provided
in this paragraph. Notwithstanding the foregoing, no Expiration Date shall be
later than the 180th day after the applicable record date.
Without limiting the foregoing, a Holder entitled hereunder to take any
action hereunder with regard to any particular Security may do so with regard
to all or any part of the principal amount of such Security or by one or more
duly appointed agents each of which may do so pursuant to such appointment with
regard to all or any part of such principal amount.
Section 105. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice, consent, waiver or
Act of Holders or other document provided or permitted by this Indenture to be
made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient for
every purpose hereunder if made, given, furnished or filed in writing to or
with the Trustee at its Corporate Trust Office, Attention: Corporate Trust
Group, or
(2) the Company by the Trustee or by any Holder shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to the Company addressed to it
at the address of its principal office specified in the first paragraph of this
instrument or at any other address previously furnished in writing to the
Trustee by the Company, Attention: Chief Financial Officer.
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<PAGE>
Section 106. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at its address as it appears in the Security Register, not later
than the latest date (if any), and not earlier than the earliest date (if any),
prescribed for the giving of such notice. In any case where notice to Holders
is given by mail, neither the failure to mail such notice, nor any defect in
any notice so mailed, to any particular Holder shall affect the sufficiency of
such notice with respect to other Holders. Where this Indenture provides for
notice in any manner, such notice may be waived in writing by the Person
entitled to receive such notice, either before or after the event, and such
waiver shall be the equivalent of such notice. Waivers of notice by Holders
shall be filed with the Trustee, but such filing shall not be a condition
precedent to the validity of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by reason of
any other cause it shall be impracticable to give such notice by mail, then
such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.
Section 107. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a provision of
the Trust Indenture Act which is required under such Act to be a part of and
govern this Indenture, the latter provision shall control. If any provision of
this Indenture modifies or excludes any provision of the Trust Indenture Act
which may be so modified or excluded, the latter provision shall be deemed to
apply to this Indenture as so modified or to be excluded, as the case may be.
Section 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
Section 109. Successors and Assigns.
All covenants and agreements in this Indenture by the Company shall bind
its successors and assigns, whether so expressed or not.
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Section 110. Separability Clause.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 111. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied, shall
give to any Person, other than the parties hereto and their successors
hereunder, the holders of Senior Debt and the Holders, any benefit or any legal
or equitable right, remedy or claim under this Indenture.
Section 112. Governing Law.
This Indenture and the Securities shall be governed by and construed in
accordance with the law of the State of New York.
Section 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security or the last date on which a Holder has the right to
convert a Security at a particular conversion price shall not be a Business Day
at any Place of Payment, then (notwithstanding any other provision of this
Indenture or of the Securities (other than a provision of any Security which
specifically states that such provision shall apply in lieu of this Section))
payment of interest or principal (and premium, if any) or, if applicable to a
particular series of Securities, conversion need not be made at such Place of
Payment on such date, but may be made on the next succeeding Business Day at
such Place of Payment with the same force and effect as if made on the Interest
Payment Date or Redemption Date, at the Stated Maturity or on such last day for
conversion.
ARTICLE TWO
Security Forms
Section 201. Forms Generally.
The Securities of each series shall be in substantially the form set forth
in this Article, or in such other form as shall be established by or pursuant
to a Board Resolution or in one or more indentures supplemental hereto, in each
case with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture, and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or Depositary therefor or as may, consistently herewith, be
determined by the
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<PAGE>
officers executing such Securities, as evidenced by their execution thereof. If
the form of Securities of any series is established by action taken pursuant to
a Board Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Company Order
contemplated by Section 303 for the authentication and delivery of such
Securities. Any such Board Resolution or record of such action shall have
attached thereto a true and correct copy of the form of Security referred to
therein approved by or pursuant to such Board Resolution.
The definitive Securities shall be printed, lithographed or engraved on
steel engraved borders or may be produced in any other manner, all as
determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
Section 202. Form of Face of Security.
..........................................................
..........................................................................
No. ......... $ ........
Armstrong World Industries, Inc., a corporation duly organized and existing
under the laws of Pennsylvania (herein called the "Company", which term includes
any successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to
..............................................., or registered assigns, the
principal sum of ...................................... Dollars on
........................................................ [if the Security is to
bear interest prior to Maturity, insert -- , and to pay interest thereon from
............. or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, semi-annually on ............ and
............ in each year, commencing ........., at the rate of ....% per annum,
until the principal hereof is paid or made available for payment [if applicable,
insert -- , provided that any principal and premium, and any such instalment of
interest, which is overdue shall bear interest at the rate of ...% per annum (to
the extent that the payment of such interest shall be legally enforceable), from
the dates such amounts are due until they are paid or made available for
payment, and such interest shall be payable on demand]. The interest so payable,
and punctually paid or duly provided for, on any Interest Payment Date will, as
provided in such Indenture, be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest, which shall be the ....... or
....... (whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date. Any such interest not so punctually paid or duly provided
for will forthwith cease to be payable to the Holder on such Regular Record Date
and may either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not
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<PAGE>
inconsistent with the requirements of any securities exchange on which the
Securities of this series may be listed, and upon such notice as may be required
by such exchange, all as more fully provided in said Indenture].
[If the Security is not to bear interest prior to Maturity, insert -- The
principal of this Security shall not bear interest except in the case of a
default in payment of principal upon acceleration, upon redemption or at Stated
Maturity and in such case the overdue principal and any overdue premium shall
bear interest at the rate of ....% per annum (to the extent that the payment of
such interest shall be legally enforceable), from the dates such amounts are due
until they are paid or made available for payment. Interest on any overdue
principal or premium shall be payable on demand. [Any such interest on overdue
principal or premium which is not paid on demand shall bear interest at the rate
of ......% per annum (to the extent that the payment of such interest on
interest shall be legally enforceable), from the date of such demand until the
amount so demanded is paid or made available for payment. Interest on any
overdue interest shall be payable on demand.]]
Payment of the principal of (and premium, if any) and [if applicable, insert
- -- any such] interest on this Security will be made at the office or agency of
the Company maintained for that purpose in ............, in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts [if applicable, insert -- ;
provided, however, that at the option of the Company payment of interest may be
made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register].
Reference is hereby made to the further provisions of this Security set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
In Witness Whereof, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated:
......................................................
By...................................................
Attest:
.........................................
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Section 203. Form of Reverse of Security.
This Security is one of a duly authorized issue of securities of the Company
(herein called the "Securities"), issued and to be issued in one or more series
under an Indenture, dated as of ............... (herein called the "Indenture",
which term shall have the meaning assigned to it in such instrument), between
the Company and ..................., as Trustee (herein called the "Trustee",
which term includes any successor trustee under the Indenture), and reference is
hereby made to the Indenture and all indentures supplemental thereto for a
statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee, the holders of Senior Debt and the
Holders of the Securities and of the terms upon which the Securities are, and
are to be, authenticated and delivered. This Security is one of the series
designated on the face hereof [if applicable, insert -- , limited in aggregate
principal amount to $...........].
[If applicable, insert -- The Securities of this series are subject to
redemption upon not less than 30 days' notice by mail, [if applicable, insert --
(1) on ........... in any year commencing with the year ...... and ending with
the year ...... through operation of the sinking fund for this series at a
Redemption Price equal to 100% of the principal amount, and (2)] at any time [if
applicable, insert -- on or after .........., 19..], as a whole or in part, at
the election of the Company, at the following Redemption Prices (expressed as
percentages of the principal amount): If redeemed [if applicable, insert -- on
or before ..............., ...%, and if redeemed] during the 12-month period
beginning ............. of the years indicated,
<TABLE>
<CAPTION>
Redemption Redemption
Year Price Year Price
- ------ ---------- ---- ----------
<S> <C> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to .....% of the principal amount,
together in the case of any such redemption [if applicable, insert -- (whether
through operation of the sinking fund or otherwise)] with accrued interest to
the Redemption Date, but interest instalments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such Securities,
or one or more Predecessor Securities, of record at the close of business on the
relevant Record Dates referred to on the face hereof, all as provided in the
Indenture.]
[If applicable, insert -- The Securities of this series are subject to
redemption upon not less than 30 days' notice by mail, (1) on ............ in
any year commencing with the year .... and ending with the year .... through
operation of the sinking fund for this series at the
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Redemption Prices for redemption through operation of the sinking fund
(expressed as percentages of the principal amount) set forth in the table below,
and (2) at any time [if applicable, insert -- on or after ............], as a
whole or in part, at the election of the Company, at the Redemption Prices for
redemption otherwise than through operation of the sinking fund (expressed as
percentages of the principal amount) set forth in the table below: If redeemed
during the 12-month period beginning ............ of the years indicated,
<TABLE>
<CAPTION>
Redemption Price
For Redemption Redemption Price For
Through Operation Redemption Otherwise
of the Than Through Operation
Year Sinking Fund of the Sinking Fund
- ---- ----------------- ----------------------
<S> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to .....% of the principal amount,
together in the case of any such redemption (whether through operation of the
sinking fund or otherwise) with accrued interest to the Redemption Date, but
interest instalments whose Stated Maturity is on or prior to such Redemption
Date will be payable to the Holders of such Securities, or one or more
Predecessor Securities, of record at the close of business on the relevant
Record Dates referred to on the face hereof, all as provided in the Indenture.]
[If applicable, insert -- Notwithstanding the foregoing, the Company may not,
prior to ............., redeem any Securities of this series as contemplated by
[if applicable, insert -- Clause (2) of] the preceding paragraph as a part of,
or in anticipation of, any refunding operation by the application, directly or
indirectly, of moneys borrowed having an interest cost to the Company
(calculated in accordance with generally accepted financial practice) of less
than .....% per annum.]
[If applicable, insert -- The sinking fund for this series provides for the
redemption on ............ in each year beginning with the year ....... and
ending with the year ...... of [if applicable, insert -- not less than
$.......... ("mandatory sinking fund") and not more than] $......... aggregate
principal amount of Securities of this series. Securities of this series
acquired or redeemed by the Company otherwise than through [if applicable,
insert -- mandatory] sinking fund payments may be credited against subsequent
[if applicable, insert -- mandatory] sinking fund payments otherwise required to
be made [if applicable, insert -- , in the inverse order in which they become
due].]
[If the Security is subject to redemption of any kind, insert -- In the event
of redemption of this Security in part only, a new Security or Securities of
this series and of like tenor for
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<PAGE>
the unredeemed portion hereof will be issued in the name of the Holder hereof
upon the cancellation hereof.]
[If applicable, insert -- The Indenture contains provisions for defeasance at
any time of [the entire indebtedness of this Security] [or] [certain restrictive
covenants and Events of Default with respect to this Security] [, in each case]
upon compliance with certain conditions set forth in the Indenture.]
[If the Security is convertible into Common Stock of the Company, insert --
Subject to the provisions of the Indenture, the Holder of this Security is
entitled, at its option, at any time on or before [insert date] (except that, in
case this Security or any portion hereof shall be called for redemption, such
right shall terminate with respect to this Security or portion hereof, as the
case may be, so called for redemption at the close of business on the date fixed
for redemption as provided in the Indenture unless the Company defaults in
making the payment due upon redemption), to convert the principal amount of this
Security (or any portion hereof which is $1,000 or an integral multiple
thereof), into fully paid and non-assessable shares (calculated as to each
conversion to the nearest 1/100th of a share) of the Common Stock of the
Company, as said shares shall be constituted at the date of conversion, at the
conversion price of $....... principal amount of Securities for each share of
Common Stock, or at the adjusted conversion price in effect at the date of
conversion determined as provided in the Indenture, upon surrender of this
Security, together with the conversion notice hereon duly executed, to the
Company at the designated office or agency of the Company in
.........................., accompanied (if so required by the Company) by
instruments of transfer, in form satisfactory to the Company and to the Trustee,
duly executed by the Holder or by its duly authorized attorney in writing. Such
surrender shall, if made during any period beginning at the close of business on
a Regular Record Date and ending at the opening of business on the Interest
Payment Date next following such Regular Record Date (unless this Security or
the portion being converted shall have been called for redemption on a
Redemption Date during such period), also be accompanied by payment in funds
acceptable to the Company of an amount equal to the interest payable on such
Interest Payment Date on the principal amount of this Security then being
converted. Subject to the aforesaid requirement for payment and, in the case of
a conversion after the Regular Record Date next preceding any Interest Payment
Date and on or before such Interest Payment Date, to the right of the Holder of
this Security (or any Predecessor Security) of record at such Regular Record
Date to receive an installment of interest (with certain exceptions provided in
the Indenture), no adjustment is to be made on conversion for interest accrued
hereon or for dividends on shares of Common Stock issued on conversion. The
Company is not required to issue fractional shares upon any such conversion, but
shall make adjustment therefor in cash on the basis of the current market value
of such fractional interest as provided in the Indenture. The conversion price
is subject to adjustment as provided in the Indenture. In addition, the
Indenture provides that in case of certain consolidations or mergers to which
the Company is a party or the sale of substantially all of the assets of the
Company, the Indenture shall be amended, without the consent of any Holders of
Securities, so that this Security, if then outstanding, will be convertible
thereafter, during the period this Security shall be convertible as specified
above, only into the kind and amount of securities, cash and other property
receivable upon the consolidation, merger or sale by a holder of the number of
shares of Common Stock into which this Security might have been converted
immediately prior to such
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<PAGE>
consolidation, merger or sale (assuming such holder of Common Stock failed to
exercise any rights of election and received per share the kind and amount
received per share by a plurality of non-electing shares) [, assuming if such
consolidation, merger or sale is prior to .............., 19...., that this
Security were convertible at the time of such consolidation, merger or sale at
the initial conversion price specified above as adjusted from ..............,
19.... to such time pursuant to the Indenture]. In the event of conversion of
this Security in part only, a new Security or Securities for the unconverted
portion hereof shall be issued in the name of the Holder hereof upon the
cancellation hereof.]
[If the Security is convertible into other securities of the Company, specify
the conversion features.]
[If the Security is not an Original Issue Discount Security, insert -- If an
Event of Default with respect to Securities of this series shall occur and be
continuing, the principal of the Securities of this series may be declared due
and payable in the manner and with the effect provided in the Indenture.]
[If the Security is an Original Issue Discount Security, insert -- If an
Event of Default with respect to Securities of this series shall occur and be
continuing, an amount of principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture. Such amount shall be equal to -- insert formula for determining the
amount. Upon payment (i) of the amount of principal so declared due and payable
and (ii) of interest on any overdue principal, premium and interest (in each
case to the extent that the payment of such interest shall be legally
enforceable), all of the Company's obligations in respect of the payment of the
principal of and premium and interest, if any, on the Securities of this series
shall terminate.]
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of more than 50% in principal amount of the Securities at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Securities of each series at the time Outstanding, on behalf of the
Holders of all Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture, the Holder of
this Security shall not have the right to institute any proceeding with respect
to the Indenture or for the appointment of a receiver or trustee or for any
other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 25% in principal amount
of the Securities of this series at the time Outstanding shall have made written
request to the
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Trustee to institute proceedings in respect of such Event of Default as Trustee
and offered the Trustee reasonable indemnity, and the Trustee shall not have
received from the Holders of a majority in principal amount of Securities of
this series at the time Outstanding a direction inconsistent with such request,
and shall have failed to institute any such proceeding, for 60 days after
receipt of such notice, request and offer of indemnity. The foregoing shall not
apply to any suit instituted by the Holder of this Security for the enforcement
of any payment of principal hereof or any premium or interest hereon on or after
the respective due dates expressed herein.
No reference herein to the Indenture and no provision of this Security or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and any premium and interest
on this Security at the times, place and rate, and in the coin or currency,
herein prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Security is registrable in the Security Register,
upon surrender of this Security for registration of transfer at the office or
agency of the Company in any place where the principal of and any premium and
interest on this Security are payable, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or its attorney duly
authorized in writing, and thereupon one or more new Securities of this series
and of like tenor, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered form without
coupons in denominations of $....... and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities of this series are exchangeable for a like aggregate principal amount
of Securities of this series and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
All terms used in this Security which are defined in the Indenture shall have
the meanings assigned to them in the Indenture.
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<PAGE>
Section 204. Form of Legend for Global Securities.
Unless otherwise specified as contemplated by Section 301 for the Securities
evidenced thereby, every Global Security authenticated and delivered hereunder
shall bear a legend in substantially the following form:
This Security is a Global Security within the meaning of the Indenture
hereinafter referred to and is registered in the name of a Depositary or a
nominee thereof. This Security may not be exchanged in whole or in part for a
Security registered, and no transfer of this Security in whole or in part may be
registered, in the name of any Person other than such Depositary or a nominee
thereof, except in the limited circumstances described in the Indenture.
Section 205. Form of Trustee's Certificate of Authentication.
The Trustee's certificates of authentication shall be in substantially the
following form:
This is one of the Securities of the series designated herein referred to in
the within-mentioned Indenture.
..........................................,
As Trustee
By.........................................
Authorized Officer
Section 206. Form of Conversion Notice.
To Armstrong World Industries, Inc.:
The undersigned owner of this Security hereby irrevocably exercises the option
to convert this Security, or portion hereof (which is $1,000 or an integral
multiple thereof) below designated, into shares of Common Stock of the Company
in accordance with the terms of the Indenture referred to in this Security, and
directs that the shares issuable and deliverable upon the conversion, together
with any check in payment for fractional shares and any Securities representing
any unconverted principal amount hereof, be issued and delivered to the
registered holder hereof unless a different name has been indicated below. If
this Notice is being delivered on a date after the close of business on a
Regular Record Date and prior to the opening of business on the related Interest
Payment Date (unless this Security or the portion thereof being converted has
been called for redemption on a Redemption Date within such period), this Notice
is accompanied by payment, in funds acceptable to the Company, of an amount
equal to the interest payable on such Interest Payment Date of the principal of
this Security to be converted. If shares are to be issued in the name of a
person other than the
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<PAGE>
undersigned, the undersigned will pay all transfer taxes payable with respect
hereto. Any amount required to be paid by the undersigned on account of interest
accompanies this Security.
Principal Amount to be Converted
(in an integral multiple of
$1,000, if less than all):
$.....................
Dated .....................................
..........................................................
Signature(s) must be guaranteed by a commercial bank or trust
company or a member firm of a national stock exchange if
shares of Common Stock are to be delivered, or Securities to
be issued, other than to and in the name of the registered
owner.
..........................................................
Signature Guaranty
Fill in for registration of shares of Common Stock and Security if to be
issued otherwise than to the registered holder.
............................... Social Security or Other Taxpayer
(Name) Identification Number.................
...............................
(Address)
...............................
Please print Name and Address
(including zip code number)
[The above conversion notice is to be modified, as appropriate, for conversion
into other securities or property of the Company.]
ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is unlimited.
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The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution and, subject to Section 303,
set forth, or determined in the manner provided, in an Officers' Certificate, or
established in one or more indentures supplemental hereto, prior to the issuance
of Securities of any series,
(1) the title of the Securities of the series (which shall distinguish the
Securities of the series from Securities of any other series);
(2) any limit upon the aggregate principal amount of the Securities of the
series which may be authenticated and delivered under this Indenture (except
for Securities authenticated and delivered upon registration of transfer of, or
in exchange for, or in lieu of, other Securities of the series pursuant to
Section 304, 305, 306, 906 or 1107 and except for any Securities which,
pursuant to Section 303, are deemed never to have been authenticated and
delivered hereunder);
(3) the Person to whom any interest on a Security of the series shall be
payable, if other than the Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest;
(4) the date or dates on which the principal of any Securities of the
series is payable;
(5) the rate or rates at which any Securities of the series shall bear
interest, if any, the date or dates from which any such interest shall accrue,
the Interest Payment Dates on which any such interest shall be payable and the
Regular Record Date for any such interest payable on any Interest Payment Date;
(6) the place or places where the principal of and any premium and interest
on any Securities of the series shall be payable;
(7) the period or periods within which, the price or prices at which and
the terms and conditions upon which any Securities of the series may be
redeemed, in whole or in part, at the option of the Company and, if other than
by a Board Resolution, the manner in which any election by the Company to
redeem the Securities shall be evidenced;
(8) the obligation, if any, of the Company to redeem or purchase any
Securities of the series pursuant to any sinking fund or analogous provisions
or at the option of the Holder thereof and the period or periods within which,
the price or prices at which and the terms and conditions upon which any
Securities of the series shall be redeemed or purchased, in whole or in part,
pursuant to such obligation;
(9) if other than denominations of $1,000 and any integral multiple
thereof, the denominations in which any Securities of the series shall be
issuable;
(10) if the amount of principal of or any premium or interest on any
Securities of the series may be determined with reference to an index or
pursuant to a formula, the manner in which such amounts shall be determined;
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<PAGE>
(11) if other than the currency of the United States of America, the
currency, currencies or currency units in which the principal of or any premium
or interest on any Securities of the series shall be payable and the manner of
determining the equivalent thereof in the currency of the United States of
America for any purpose, including for purposes of the definition of
"Outstanding" in Section 101;
(12) if the principal of or any premium or interest on any Securities of
the series is to be payable, at the election of the Company or the Holder
thereof, in one or more currencies or currency units other than that or those
in which such Securities are stated to be payable, the currency, currencies or
currency units in which the principal of or any premium or interest on such
Securities as to which such election is made shall be payable, the periods
within which and the terms and conditions upon which such election is to be
made and the amount so payable (or the manner in which such amount shall be
determined);
(13) if other than the entire principal amount thereof, the portion of the
principal amount of any Securities of the series which shall be payable upon
declaration of acceleration of the Maturity thereof pursuant to Section 502;
(14) if the principal amount payable at the Stated Maturity of any
Securities of the series will not be determinable as of any one or more dates
prior to the Stated Maturity, the amount which shall be deemed to be the
principal amount of such Securities as of any such date for any purpose
thereunder or hereunder, including the principal amount thereof which shall be
due and payable upon any Maturity other than the Stated Maturity or which shall
be deemed to be Outstanding as of any date prior to the Stated Maturity (or, in
any such case, the manner in which such amount deemed to be the principal
amount shall be determined);
(15) if applicable, that the Securities of the series, in whole or any
specified part, shall be defeasible pursuant to Section 1302 or Section 1303 or
both such Sections and, if other than by a Board Resolution, the manner in
which any election by the Company to defease such Securities shall be
evidenced;
(16) the terms of any right to convert Securities of the series into shares
of Common Stock of the Company or other securities or property;
(17) if applicable, that any Securities of the series shall be issuable in
whole or in part in the form of one or more Global Securities and, in such
case, the respective Depositaries for such Global Securities, the form of any
legend or legends which shall be borne by any such Global Security in addition
to or in lieu of that set forth in Section 204 and any circumstances in
addition to or in lieu of those set forth in Clause (2) of the last paragraph
of Section 305 in which any such Global Security may be exchanged in whole or
in part for Securities registered, and any transfer of such Global Security in
whole or in part may be registered, in the name or names of Persons other than
the Depositary for such Global Security or a nominee thereof;
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<PAGE>
(18) any addition to or change in the Events of Default which applies to
any Securities of the series and any change in the right of the Trustee or the
requisite Holders of such Securities to declare the principal amount thereof
due and payable pursuant to Section 502;
(19) any addition to or change in the covenants set forth in Article Ten
which applies to Securities of the series; and
(20) any other terms of the series (which terms shall not be inconsistent
with the provisions of this Indenture, except as permitted by Section 901(5)).
All Securities of any one series shall be substantially identical except as
to denomination and except as may otherwise be provided in or pursuant to the
Board Resolution referred to above and (subject to Section 303) set forth, or
determined in the manner provided, in the Officers' Certificate referred to
above or in any such indenture supplemental hereto.
If any of the terms of the series are established by action taken pursuant to
a Board Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
The Securities shall be subordinated in right of payment to Senior Debt as
provided in Article Fifteen.
Section 302. Denominations.
The Securities of each series shall be issuable only in registered form
without coupons and only in such denominations as shall be specified as
contemplated by Section 301. In the absence of any such specified denomination
with respect to the Securities of any series, the Securities of such series
shall be issuable in denominations of $1,000 and any integral multiple thereof.
Section 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its Chairman of
the Board, its Vice Chairman of the Board, its President or one of its Vice
Presidents, under its corporate seal reproduced thereon attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals who were
at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities of any series executed by the
Company to the Trustee for
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<PAGE>
authentication, together with a Company Order for the authentication and
delivery of such Securities, and the Trustee in accordance with the Company
Order shall authenticate and deliver such Securities. If the form or terms of
the Securities of the series have been established by or pursuant to one or more
Board Resolutions as permitted by Sections 201 and 301, in authenticating such
Securities, and accepting the additional responsibilities under this Indenture
in relation to such Securities, the Trustee shall be entitled to receive, and
(subject to Section 601) shall be fully protected in relying upon, an Opinion of
Counsel stating,
(1) if the form of such Securities has been established by or pursuant to
Board Resolution as permitted by Section 201, that such form has been
established in conformity with the provisions of this Indenture;
(2) if the terms of such Securities have been established by or pursuant to
Board Resolution as permitted by Section 301, that such terms have been
established in conformity with the provisions of this Indenture; and
(3) that such Securities, when authenticated and delivered by the Trustee
and issued by the Company in the manner and subject to any conditions specified
in such Opinion of Counsel, will constitute valid and legally binding
obligations of the Company enforceable in accordance with their terms, subject
to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors'
rights and to general equity principles.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 301 and of the preceding paragraph,
if all Securities of a series are not to be originally issued at one time, it
shall not be necessary to deliver the Officers' Certificate otherwise required
pursuant to Section 301 or the Company Order and Opinion of Counsel otherwise
required pursuant to such preceding paragraph at or prior to the authentication
of each Security of such series if such documents are delivered at or prior to
the authentication upon original issuance of the first Security of such series
to be issued.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or be valid
or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such Security
has been duly authenticated and delivered hereunder. Notwithstanding the
foregoing, if any Security shall have been authenticated and delivered hereunder
but never issued and sold by the Company, and the Company shall deliver such
Security to the Trustee for cancellation as provided in Section 309, for all
purposes of this Indenture such Security
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<PAGE>
shall be deemed never to have been authenticated and delivered hereunder and
shall never be entitled to the benefits of this Indenture.
Section 304. Temporary Securities.
Pending the preparation of definitive Securities of any series, the Company
may execute, and upon Company Order the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed, typewritten, mimeographed
or otherwise produced, in any authorized denomination, substantially of the
tenor of the definitive Securities in lieu of which they are issued and with
such appropriate insertions, omissions, substitutions and other variations as
the officers executing such Securities may determine, as evidenced by their
execution of such Securities.
If temporary Securities of any series are issued, the Company will cause
definitive Securities of that series to be prepared without unreasonable delay.
After the preparation of definitive Securities of such series, the temporary
Securities of such series shall be exchangeable for definitive Securities of
such series upon surrender of the temporary Securities of such series at the
office or agency of the Company in a Place of Payment for that series, without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities of any series, the Company shall execute and the Trustee
shall authenticate and deliver in exchange therefor one or more definitive
Securities of the same series, of any authorized denominations and of like tenor
and aggregate principal amount. Until so exchanged, the temporary Securities of
any series shall in all respects be entitled to the same benefits under this
Indenture as definitive Securities of such series and tenor.
Section 305. Registration; Registration of Transfer and Exchange.
The Company shall cause to be kept at the Corporate Trust Office of the
Trustee a register (the register maintained in such office and in any other
office or agency of the Company in a Place of Payment being herein sometimes
collectively referred to as the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Securities and of transfers of Securities. The Trustee is hereby
appointed "Security Registrar" for the purpose of registering Securities and
transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security of a series at
the office or agency of the Company in a Place of Payment for that series, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Securities of
the same series, of any authorized denominations and of like tenor and aggregate
principal amount.
At the option of the Holder, Securities of any series may be exchanged for
other Securities of the same series, of any authorized denominations and of like
tenor and aggregate principal amount, upon surrender of the Securities to be
exchanged at such office or agency. Whenever any Securities are so surrendered
for exchange, the Company shall execute, and
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<PAGE>
the Trustee shall authenticate and deliver, the Securities which the Holder
making the exchange is entitled to receive.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of transfer or for
exchange shall (if so required by the Company or the Trustee) be duly endorsed,
or be accompanied by a written instrument of transfer in form satisfactory to
the Company and the Security Registrar duly executed, by the Holder thereof or
its attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or exchange
of Securities, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection with any
registration of transfer or exchange of Securities, other than exchanges
pursuant to Section 304, 906 or 1107 not involving any transfer.
If the Securities of any series (or of any series and specified tenor) are to
be redeemed in part, the Company shall not be required (A) to issue, register
the transfer of or exchange any Securities of that series (or of that series and
specified tenor, as the case may be) during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of any
such Securities selected for redemption under Section 1103 and ending at the
close of business on the day of such mailing, or (B) to register the transfer of
or exchange any Security so selected for redemption in whole or in part, except
the unredeemed portion of any Security being redeemed in part.
The provisions of Clauses (1), (2), (3) and (4) below shall apply only to
Global Securities:
(1) Each Global Security authenticated under this Indenture shall be
registered in the name of the Depositary designated for such Global Security or
a nominee thereof and delivered to such Depositary or a nominee thereof or
custodian therefor, and each such Global Security shall constitute a single
Security for all purposes of this Indenture.
(2) Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Securities registered, and no
transfer of a Global Security in whole or in part may be registered, in the
name of any Person other than the Depositary for such Global Security or a
nominee thereof unless (A) such Depositary (i) has notified the Company that it
is unwilling or unable to continue as Depositary for such Global Security or
(ii) has ceased to be a clearing agency registered under the Exchange Act, (B)
there shall have occurred and be continuing an Event of Default with respect to
such Global Security or (C) there shall exist such circumstances, if any, in
addition to or in lieu of the foregoing as have been specified for this purpose
as contemplated by Section 301.
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<PAGE>
(3) Subject to Clause (2) above, any exchange of a Global Security for
other Securities may be made in whole or in part, and all Securities issued in
exchange for a Global Security or any portion thereof shall be registered in
such names as the Depositary for such Global Security shall direct.
(4) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any portion
thereof, whether pursuant to this Section, Section 304, 306, 906 or 1107 or
otherwise, shall be authenticated and delivered in the form of, and shall be, a
Global Security, unless such Security is registered in the name of a Person
other than the Depositary for such Global Security or a nominee thereof.
Section 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee, the Company shall
execute and the Trustee shall authenticate and deliver in exchange therefor a
new Security of the same series and of like tenor and principal amount and
bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i) evidence to
their satisfaction of the destruction, loss or theft of any Security and (ii)
such security or indemnity as may be required by them to save each of them and
any agent of either of them harmless, then, in the absence of notice to the
Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and the Trustee shall authenticate and
deliver, in lieu of any such destroyed, lost or stolen Security, a new Security
of the same series and of like tenor and principal amount and bearing a number
not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has become
or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses
(including the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this Section in lieu of
any destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of that series duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.
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Section 307. Payment of Interest; Interest Rights Preserved.
Except as otherwise provided as contemplated by Section 301 with respect to
any series of Securities, interest on any Security which is payable, and is
punctually paid or duly provided for, on any Interest Payment Date shall be
paid to the Person in whose name that Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest.
Any interest on any Security of any series which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular Record Date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to the
Persons in whose names the Securities of such series (or their respective
Predecessor Securities) are registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest, which shall be fixed
in the following manner. The Company shall notify the Trustee in writing of
the amount of Defaulted Interest proposed to be paid on each Security of such
series and the date of the proposed payment, and at the same time the Company
shall deposit with the Trustee an amount of money equal to the aggregate
amount proposed to be paid in respect of such Defaulted Interest or shall
make arrangements satisfactory to the Trustee for such deposit prior to the
date of the proposed payment, such money when deposited to be held in trust
for the benefit of the Persons entitled to such Defaulted Interest as in this
Clause provided. Thereupon the Trustee shall fix a Special Record Date for
the payment of such Defaulted Interest which shall be not more than 15 days
and not less than 10 days prior to the date of the proposed payment and not
less than 10 days after the receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly notify the Company of such
Special Record Date and, in the name and at the expense of the Company, shall
cause notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor to be given to each Holder of Securities of such
series in the manner set forth in Section 106, not less than 10 days prior to
such Special Record Date. Notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor having been so mailed, such
Defaulted Interest shall be paid to the Persons in whose names the Securities
of such series (or their respective Predecessor Securities) are registered at
the close of business on such Special Record Date and shall no longer be
payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest on the
Securities of any series in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such Securities may be
listed, and upon such notice as may be required by such exchange, if, after
notice given by the Company to the Trustee of the proposed payment pursuant
to this Clause, such manner of payment shall be deemed practicable by the
Trustee.
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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.
Subject to the provisions of Section 1402, in the case of any Security (or
any part thereof) which is converted after any Regular Record Date and on or
prior to the next succeeding Interest Payment Date (other than any Security the
principal of (or premium, if any, on) which shall become due and payable,
whether at Stated Maturity or by declaration of acceleration prior to such
Interest Payment Date), interest whose Stated Maturity is on such Interest
Payment Date shall be payable on such Interest Payment Date notwithstanding such
conversion and such interest (whether or not punctually paid or duly provided
for) shall be paid to the Person in whose name that Security (or any one or more
Predecessor Securities) is registered at the close of business on such Regular
Record Date. Except as otherwise expressly provided in the immediately preceding
sentence or in Section 1402, in the case of any Security (or any part thereof)
which is converted, interest whose Stated Maturity is after the date of
conversion of such Security (or such part thereof) shall not be payable.
Section 308. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name such Security is registered as the owner of such Security
for the purpose of receiving payment of principal of and any premium and
(subject to Section 307) any interest on such Security and for all other
purposes whatsoever, whether or not such Security be overdue, and neither the
Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.
Section 309. Cancellation.
All Securities surrendered for payment, redemption, registration of transfer
or exchange or for credit against any sinking fund payment shall, if surrendered
to any Person other than the Trustee, be delivered to the Trustee and shall be
promptly cancelled by it. The Company may at any time deliver to the Trustee for
cancellation any Securities previously authenticated and delivered hereunder
which the Company may have acquired in any manner whatsoever, and may deliver to
the Trustee (or to any other Person for delivery to the Trustee) for
cancellation any Securities previously authenticated hereunder which the Company
has not issued and sold, and all Securities so delivered shall be promptly
cancelled by the Trustee. No Securities shall be authenticated in lieu of or in
exchange for any Securities cancelled as provided in this Section, except as
expressly permitted by this Indenture. All cancelled Securities held by the
Trustee shall be disposed of as directed by a Company Order.
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Section 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301 for Securities
of any series, interest on the Securities of each series shall be computed on
the basis of a 360-day year of twelve 30-day months.
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of further effect
(except as to any surviving rights of registration of transfer or exchange of
Securities herein expressly provided for), and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered (other than (i)
Securities which have been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 306 and (ii) Securities for whose
payment money has theretofore been deposited in trust or segregated and held
in trust by the Company and thereafter repaid to the Company or discharged
from such trust, as provided in Section 1003) have been delivered to the
Trustee for cancellation; or
(B) all such Securities not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity within one
year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the Company,
and the Company, in the case of (i), (ii) or (iii) above, has deposited or
caused to be deposited with the Trustee as trust funds in trust for the
purpose money in an amount sufficient to pay and discharge the entire
indebtedness on such Securities not theretofore delivered to the Trustee for
cancellation, for principal and any premium and interest to the date of such
deposit (in the case of Securities which have become due and payable) or to
the Stated Maturity or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
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(3) the Company has delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel, each stating that all conditions precedent herein provided
for relating to the satisfaction and discharge of this Indenture have been
complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 607, the obligations of
the Trustee to any Authenticating Agent under Section 614 and, if money shall
have been deposited with the Trustee pursuant to subclause (B) of Clause (1) of
this Section, the obligations of the Trustee under Section 402 and the last
paragraph of Section 1003 shall survive.
Section 402. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all money
deposited with the Trustee pursuant to Section 401 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal and any premium and
interest for whose payment such money has been deposited with the Trustee.
ARTICLE FIVE
Remedies
Section 501. Events of Default.
"Event of Default", wherever used herein with respect to Securities of any
series, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be occasioned by the provisions of Article
Fifteen or be voluntary or involuntary or be effected by operation of law or
pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):
(1) default in the payment of any interest upon any Security of that series
when it becomes due and payable, and continuance of such default for a period
of 30 days; or
(2) default in the payment of the principal of or any premium on any
Security of that series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when and as due by
the terms of a Security of that series; or
(4) default in the performance, or breach, of any covenant or warranty of
the Company in this Indenture (other than a covenant or warranty a default in
whose performance or whose breach is elsewhere in this Section specifically
dealt with or which has expressly been included in this Indenture solely for
the benefit of series of Securities other than that
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series), and continuance of such default or breach for a period of 60 days
after there has been given, by registered or certified mail, to the Company by
the Trustee or to the Company and the Trustee by the Holders of at least 25% in
principal amount of the Outstanding Securities of that series a written notice
specifying such default or breach and requiring it to be remedied and stating
that such notice is a "Notice of Default" hereunder; or
(5) the entry by a court having jurisdiction in the premises of (A) a decree
or order for relief in respect of the Company in an involuntary case or
proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or (B) a decree or order adjudging the
Company a bankrupt or insolvent, or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of or in respect
of the Company under any applicable Federal or State law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or of any substantial part of its property, or
ordering the winding up or liquidation of its affairs, and the continuance of
any such decree or order for relief or any such other decree or order unstayed
and in effect for a period of 90 consecutive days; or
(6) the commencement by the Company of a voluntary case or proceeding under
any applicable Federal or State bankruptcy, insolvency, reorganization or other
similar law or of any other case or proceeding to be adjudicated a bankrupt or
insolvent, or the consent by it to the entry of a decree or order for relief in
respect of the Company in an involuntary case or proceeding under any
applicable Federal or State bankruptcy, insolvency, reorganization or other
similar law or to the commencement of any bankruptcy or insolvency case or
proceeding against it, or the filing by it of a petition or answer or consent
seeking reorganization or relief under any applicable Federal or State law, or
the
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consent by it to the filing of such petition or to the appointment of or
taking possession by a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of the Company or of any substantial
part of its property, or the making by it of an assignment for the benefit of
creditors, or the admission by it in writing of its inability to pay its debts
generally as they become due, or the taking of corporate action by the Company
in furtherance of any such action; or
(7) any other Event of Default provided with respect to Securities of that
series.
Section 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in Section
501(5) or 501(6)) with respect to Securities of any series at the time
Outstanding occurs and is continuing, then in every such case the Trustee or
the Holders of not less than 25% in principal amount of the Outstanding
Securities of that series may declare the principal amount of all the
Securities of that series (or, if any Securities of that series are Original
Issue Discount Securities, such portion of the principal amount of such
Securities as may be specified by the terms thereof) to be due and payable
immediately, by a notice in writing to the Company (and to the Trustee if given
by Holders), and upon any such declaration such principal amount (or specified
amount) shall become immediately due and payable. If an Event of Default
specified in Section 501(5) or 501 (6) with respect to Securities of any
series at the time Outstanding occurs, the principal amount of all the
Securities of that series (or, if any Securities of that series are Original
Issue Discount Securities, such portion of the principal amount of such
Securities as may be specified by the terms thereof) shall automatically, and
without any declaration or other action on the part of the Trustee or any
Holder, become immediately due and payable.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in
this Article provided, the Holders of a majority in principal amount of the
Outstanding Securities of that series, by written notice to the Company and the
Trustee, may rescind and annul such declaration and its consequences if
(1) the Company has paid or deposited with the Trustee a sum sufficient to
pay
(A) all overdue interest on all Securities of that series,
(B) the principal of (and premium, if any, on) any Securities of that
series which have become due otherwise than by such declaration of
acceleration and any interest thereon at the rate or rates prescribed
therefor in such Securities,
(C) to the extent that payment of such interest is lawful, interest upon
overdue interest at the rate or rates prescribed therefor in such Securities,
and
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(D) all sums paid or advanced by the Trustee hereunder and the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel;
and
(2) all Events of Default with respect to Securities of that series, other
than the non-payment of the principal of Securities of that series which have
become due solely by such declaration of acceleration, have been cured or
waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Section 503. Collection of Indebtedness and Suits for Enforcement by Trustee.
The Company covenants that if
(1) default is made in the payment of any interest on any Security when such
interest becomes due and payable and such default continues for a period of 30
days, or
(2) default is made in the payment of the principal of (or premium, if any,
on) any Security at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal and any premium and interest and, to the extent that
payment of such interest shall be legally enforceable, interest on any overdue
principal and premium and on any overdue interest, at the rate or rates
prescribed therefor in such Securities, and, in addition thereto, such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel.
If an Event of Default with respect to Securities of any series occurs and is
continuing, the Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the Holders of Securities of such series by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the exercise of any power
granted herein, or to enforce any other proper remedy.
Section 504. Trustee May File Proofs of Claim.
In case of any judicial proceeding relative to the Company (or any other
obligor upon the Securities), its property or its creditors, the Trustee shall
be entitled and empowered, by intervention in such proceeding or otherwise, to
take any and all actions authorized under the Trust Indenture Act in order to
have claims of the Holders and the Trustee allowed in any such proceeding. In
particular, the Trustee shall be authorized to collect and receive any
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moneys or other property payable or deliverable on any such claims and to
distribute the same; and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or other similar official in any such judicial proceeding is hereby
authorized by each Holder to make such payments to the Trustee and, in the event
that the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 607.
No provision of this Indenture shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding; provided, however,
that the Trustee may, on behalf of the Holders, vote for the election of a
trustee in bankruptcy or similar official and be a member of a creditors' or
other similar committee.
Section 505. Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the Securities may be
prosecuted and enforced by the Trustee without the possession of any of the
Securities or the production thereof in any proceeding relating thereto, and any
such proceeding instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment shall, after provision
for the payment of the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, be for the ratable benefit of
the Holders of the Securities in respect of which such judgment has been
recovered.
Section 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall be applied
in the following order, at the date or dates fixed by the Trustee and, in case
of the distribution of such money on account of principal or any premium or
interest, upon presentation of the Securities and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:
First: To the payment of all amounts due the Trustee under Section 607; and
Second: Subject to Article Fifteen, to the payment of the amounts then due
and unpaid for principal of and any premium and interest on the Securities in
respect of which or for the benefit of which such money has been collected,
ratably, without preference or priority of any kind, according to the amounts
due and payable on such Securities for principal and any premium and interest,
respectively.
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Section 507. Limitation on Suits.
No Holder of any Security of any series shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless
(1) such Holder has previously given written notice to the Trustee of a
continuing Event of Default with respect to the Securities of that series;
(2) the Holders of not less than 25% in principal amount of the Outstanding
Securities of that series shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name as
Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable indemnity
against the costs, expenses and liabilities to be incurred in compliance with
such request;
(4) the Trustee for 60 days after its receipt of such notice, request and
offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given to the
Trustee during such 60-day period by the Holders of a majority in principal
amount of the Outstanding Securities of that series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all of such
Holders.
Section 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest and to Convert.
Notwithstanding any other provision in this Indenture, the Holder of any
Security shall have the right, which is absolute and unconditional, to receive
payment of the principal of and any premium and (subject to Section 307)
interest on such Security on the respective Stated Maturities expressed in such
Security (or, in the case of redemption, on the Redemption Date), to convert
such Securities in accordance with Article Fourteen and to institute suit for
the enforcement of any such payment, and such rights shall not be impaired
without the consent of such Holder.
Section 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to enforce any
right or remedy under this Indenture and such proceeding has been discontinued
or abandoned for any reason,
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or has been determined adversely to the Trustee or to such Holder, then and in
every such case, subject to any determination in such proceeding, the Company,
the Trustee and the Holders shall be restored severally and respectively to
their former positions hereunder and thereafter all rights and remedies of the
Trustee and the Holders shall continue as though no such proceeding had been
instituted.
Section 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Securities in the last paragraph of Section
306, no right or remedy herein conferred upon or reserved to the Trustee or to
the Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Securities to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article or by law to
the Trustee or to the Holders may be exercised from time to time, and as often
as may be deemed expedient, by the Trustee or by the Holders, as the case may
be.
Section 512. Control by Holders.
The Holders of a majority in principal amount of the Outstanding Securities
of any series shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred on the Trustee, with respect to the Securities of
such series, provided that
(1) such direction shall not be in conflict with any rule of law or with this
Indenture, and
(2) the Trustee may take any other action deemed proper by the Trustee which
is not inconsistent with such direction.
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Section 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series may on behalf of the Holders of all the
Securities of such series waive any past default hereunder with respect to such
series and its consequences, except a default
(1) in the payment of the principal of or any premium or interest on any
Security of such series, or
(2) in respect of a covenant or provision hereof which under Article Nine
cannot be modified or amended without the consent of the Holder of each
Outstanding Security of such series affected.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
Section 514. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this Indenture,
or in any suit against the Trustee for any action taken, suffered or omitted by
it as Trustee, a court may require any party litigant in such suit to file an
undertaking to pay the costs of such suit, and may assess costs against any such
party litigant, in the manner and to the extent provided in the Trust Indenture
Act; provided that neither this Section nor the Trust Indenture Act shall be
deemed to authorize any court to require such an undertaking or to make such an
assessment in any suit instituted by the Company or in any suit for the
enforcement of the right to convert any Security in accordance with Article
Fourteen.
Section 515. Waiver of Usury, Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that it will
not at any time insist upon, or plead, or in any manner whatsoever claim or take
the benefit or advantage of, any usury, stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
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ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities.
The duties and responsibilities of the Trustee shall be as provided by the
Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Indenture shall require the Trustee to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. 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 602. Notice of Defaults.
If a default occurs hereunder with respect to Securities of any series, the
Trustee shall give the Holders of Securities of such series notice of such
default as and to the extent provided by the Trust Indenture Act; provided,
however, that in the case of any default of the character specified in Section
501(4) with respect to Securities of such series, no such notice to Holders
shall be given until at least 30 days after the occurrence thereof. For the
purpose of this Section, the term "default" means any event which is, or after
notice or lapse of time or both would become, an Event of Default with respect
to Securities of such series.
Section 603. Certain Rights of Trustee.
Subject to the provisions of Section 601:
(1) the Trustee may rely and shall be protected in acting or refraining from
acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party or parties;
(2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order, and any
resolution of the Board of Directors shall be sufficiently evidenced by a Board
Resolution;
(3) whenever in the administration of this Indenture the Trustee shall deem
it desirable that a matter be proved or established prior to taking, suffering
or omitting any action hereunder, the Trustee (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part, rely
upon an Officers' Certificate;
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(4) the Trustee may consult with counsel and the written advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon;
(5) the Trustee shall be under no obligation to exercise any of the rights or
powers vested in it by this Indenture at the request or direction of any of the
Holders pursuant to this Indenture, unless such Holders shall have offered to
the Trustee reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or
direction;
(6) the Trustee shall not be bound to make any investigation into the facts
or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and, if the Trustee shall determine to
make such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or attorney;
and
(7) the Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder either directly or by or through agents or attorneys and
the Trustee shall not be responsible for any misconduct or negligence on the
part of any agent or attorney appointed with due care by it hereunder.
Section 604. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the Trustee's
certificates of authentication, shall be taken as the statements of the
Company, and neither the Trustee nor any Authenticating Agent assumes any
responsibility for their correctness. The Trustee makes no representations as
to the validity or sufficiency of this Indenture or of the Securities. Neither
the Trustee nor any Authenticating Agent shall be accountable for the use or
application by the Company of Securities or the proceeds thereof.
Section 605. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to
Sections 608 and 613, may otherwise deal with the Company with the same rights
it would have if it were not Trustee, Authenticating Agent, Paying Agent,
Security Registrar or such other agent.
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Section 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated from
other funds except to the extent required by law. The Trustee shall be under no
liability for interest on any money received by it hereunder except as
otherwise agreed with the Company.
Section 607. Compensation and Reimbursement.
The Company agrees
(1) to pay to the Trustee from time to time reasonable compensation for all
services rendered by it hereunder (which compensation shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust);
(2) except as otherwise expressly provided herein, to reimburse the Trustee
upon its request for all reasonable expenses, disbursements and advances
incurred or made by the Trustee in accordance with any provision of this
Indenture (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense, disbursement
or advance as may be attributable to its negligence or bad faith; and
(3) to indemnify the Trustee for, and to hold it harmless against, any loss,
liability or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of the
trust or trusts hereunder, including the costs and expenses of defending itself
against any claim or liability in connection with the exercise or performance
of any of its powers or duties hereunder.
Section 608. Conflicting Interests.
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture. To the extent
permitted by such Act, the Trustee shall not be deemed to have a conflicting
interest by virtue of being a trustee under this Indenture with respect to
Securities of more than one series or the trustee under the Indenture, dated as
of the date hereof, between the Company and the Trustee, relating to the Senior
Debt Securities, or the trustee under the Indenture, dated as of March 15,
1988, between the Company and Morgan Guaranty Trust Company of New York, as
trustee, as supplemented by the Supplemental Indenture, dated as of October 19,
1990, between the Company and The First National Bank of Chicago, as successor
trustee.
Section 609. Corporate Trustee Required; Eligibility.
There shall at all times be one (and only one) Trustee hereunder with
respect to the Securities of each series, which may be Trustee hereunder for
Securities of one or more other series. Each Trustee shall be a Person that is
eligible pursuant to the Trust Indenture Act to
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act as such and has a combined capital and surplus of at least $100,000,000. If
any such Person publishes reports of condition at least annually, pursuant to
law or to the requirements of its supervising or examining authority, then for
the purposes of this Section and to the extent permitted by the Trust Indenture
Act, the combined capital and surplus of such Person shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Trustee with respect to the
Securities of any series shall cease to be eligible in accordance with the
provisions of this Section, it shall resign immediately in the manner and with
the effect hereinafter specified in this Article.
Section 610. Resignation and Removal; Appointment of Successor.
No resignation or removal of the Trustee and no appointment of a successor
Trustee pursuant to this Article shall become effective until the acceptance of
appointment by the successor Trustee in accordance with the applicable
requirements of Section 611.
The Trustee may resign at any time with respect to the Securities of one or
more series by giving written notice thereof to the Company. If the instrument
of acceptance by a successor Trustee required by Section 611 shall not have
been delivered to the Trustee within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities of such series.
The Trustee may be removed at any time with respect to the Securities of
any series by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series, delivered to the Trustee and to the
Company.
If at any time:
(1) the Trustee shall fail to comply with Section 608 after written request
therefor by the Company or by any Holder who has been a bona fide Holder of a
Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609 and shall fail
to resign after written request therefor by the Company or by any such Holder,
or
(3) the Trustee shall become incapable of acting or shall be adjudged a
bankrupt or insolvent or a receiver of the Trustee or of its property shall be
appointed or any public officer shall take charge or control of the Trustee or
of its property or affairs for the purpose of rehabilitation, conservation or
liquidation,
then, in any such case, (A) the Company by a Board Resolution may remove the
Trustee with respect to all Securities, or (B) subject to Section 514, any
Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Securities and the appointment of a successor Trustee or Trustees.
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If the Trustee shall resign, be removed or become incapable of acting, or if
a vacancy shall occur in the office of Trustee for any cause, with respect to
the Securities of one or more series, the Company, by a Board Resolution, shall
promptly appoint a successor Trustee or Trustees with respect to the Securities
of that or those series (it being understood that any such successor Trustee may
be appointed with respect to the Securities of one or more or all of such series
and that at any time there shall be only one Trustee with respect to the
Securities of any particular series) and shall comply with the applicable
requirements of Section 611. If, within one year after such resignation, removal
or incapability, or the occurrence of such vacancy, a successor Trustee with
respect to the Securities of any series shall be appointed by Act of the Holders
of a majority in principal amount of the Outstanding Securities of such series
delivered to the Company and the retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such appointment in accordance
with the applicable requirements of Section 611, become the successor Trustee
with respect to the Securities of such series and to that extent supersede the
successor Trustee appointed by the Company. If no successor Trustee with respect
to the Securities of any series shall have been so appointed by the Company or
the Holders and accepted appointment in the manner required by Section 611, any
Holder who has been a bona fide Holder of a Security of such series for at least
six months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the appointment of a successor Trustee
with respect to the Securities of such series.
The Company shall give notice of each resignation and each removal of the
Trustee with respect to the Securities of any series and each appointment of a
successor Trustee with respect to the Securities of any series to all Holders of
Securities of such series in the manner provided in Section 106. Each notice
shall include the name of the successor Trustee with respect to the Securities
of such series and the address of its Corporate Trust Office.
Section 611. Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Trustee with respect to
all Securities, every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; but, on the request of the
Company or the successor Trustee, such retiring Trustee shall, upon payment of
its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to such successor Trustee all property and money
held by such retiring Trustee hereunder.
In case of the appointment hereunder of a successor Trustee with respect to
the Securities of one or more (but not all) series, the Company, the retiring
Trustee and each successor Trustee with respect to the Securities of one or more
series shall execute and deliver an indenture supplemental hereto wherein each
successor Trustee shall accept such appointment and which (1) shall contain such
provisions as shall be necessary or desirable to transfer and confirm to, and to
vest in, each successor Trustee all the rights, powers, trusts
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and duties of the retiring Trustee with respect to the Securities of that or
those series to which the appointment of such successor Trustee relates, (2) if
the retiring Trustee is not retiring with respect to all Securities, shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series as to which the retiring
Trustee is not retiring shall continue to be vested in the retiring Trustee, and
(3) shall add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein or
in such supplemental indenture shall constitute such Trustees co-trustees of the
same trust and that each such Trustee shall be trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder administered by
any other such Trustee; and upon the execution and delivery of such supplemental
indenture the resignation or removal of the retiring Trustee shall become
effective to the extent provided therein and each such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee with respect to the
Securities of that or those series to which the appointment of such successor
Trustee relates; but, on request of the Company or any successor Trustee, such
retiring Trustee shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder with
respect to the Securities of that or those series to which the appointment of
such successor Trustee relates.
Upon request of any such successor Trustee, the Company shall execute any and
all instruments for more fully and certainly vesting in and confirming to such
successor Trustee all such rights, powers and trusts referred to in the first or
second preceding paragraph, as the case may be.
No successor Trustee shall accept its appointment unless at the time of such
acceptance such successor Trustee shall be qualified and eligible under this
Article.
Section 612. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the same effect
as if such successor Trustee had itself authenticated such Securities.
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Section 613. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company (or any
other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
Section 614. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents with respect to one
or more series of Securities which shall be authorized to act on behalf of the
Trustee to authenticate Securities of such series issued upon original issue and
upon exchange, registration of transfer or partial redemption thereof or
pursuant to Section 306, and Securities so authenticated shall be entitled to
the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in this Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and shall at all times be a corporation organized and
doing business under the laws of the United States of America, any State thereof
or the District of Columbia, authorized under such laws to act as Authenticating
Agent, having a combined capital and surplus of not less than $50,000,000 and
subject to supervision or examination by Federal or State authority. If such
Authenticating Agent publishes reports of condition at least annually, pursuant
to law or to the requirements of said supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such
Authenticating Agent shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time an
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which such Authenticating Agent shall be
a party, or any corporation succeeding to the corporate agency or corporate
trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time terminate
the agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall give notice of such
appointment in the manner
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provided in Section 106 to all Holders of Securities of the series with respect
to which such Authenticating Agent will serve. Any successor Authenticating
Agent upon acceptance of its appointment hereunder shall become vested with all
the rights, powers and duties of its predecessor hereunder, with like effect as
if originally named as an Authenticating Agent. No successor Authenticating
Agent shall be appointed unless eligible under the provisions of this Section.
The Trustee agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section, and the Trustee
shall be entitled to be reimbursed for such payments, subject to the provisions
of Section 607.
If an appointment with respect to one or more series is made pursuant to this
Section, the Securities of such series may have endorsed thereon, in addition to
the Trustee's certificate of authentication, an alternative certificate of
authentication in the following form:
This is one of the Securities of the series designated therein referred to in
the within-mentioned Indenture.
........................................,
As Trustee
By......................................,
As Authenticating Agent
By.......................................
Authorized Officer
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee
(1) semi-annually, not later than January 15 and July 15 in each year, a
list, in such form as the Trustee may reasonably require, of the names and
addresses of the Holders of Securities of each series as of the preceding
January 1 or July 1, as the case may be, and
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(2) at such other times as the Trustee may request in writing, within 30 days
after the receipt by the Company of any such request, a list of similar form
and content as of a date not more than 15 days prior to the time such list is
furnished;
excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.
Section 702. Preservation of Information; Communications to Holders.
The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 701 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 701 upon receipt of a new list so furnished.
The rights of Holders to communicate with other Holders with respect to their
rights under this Indenture or under the Securities, and the corresponding
rights and privileges of the Trustee, shall be as provided by the Trust
Indenture Act.
Every Holder of Securities, by receiving and holding the same, agrees with
the Company and the Trustee that neither the Company nor the Trustee nor any
agent of either of them shall be held accountable by reason of any disclosure of
information as to names and addresses of Holders made pursuant to the Trust
Indenture Act.
Section 703. Reports by Trustee.
The Trustee shall transmit to Holders such reports concerning the Trustee and
its actions under this Indenture as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant thereto.
Reports so required to be transmitted at stated intervals of not more than 12
months shall be transmitted no later than July 1 in each calendar year,
commencing in 1996.
A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange upon which any
Securities are listed, with the Commission and with the Company. The Company
will notify the Trustee when any Securities are listed on any stock exchange.
Section 704. Reports by Company.
The Company shall file with the Trustee and the Commission, and transmit to
Holders, such information, documents and other reports, and such summaries
thereof, as may be required pursuant to the Trust Indenture Act at the times and
in the manner provided pursuant to the Trust Indenture Act; provided that any
such information, documents or reports required
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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.
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other Person or
convey, transfer or lease its properties and assets substantially as an entirety
to any Person, and the Company shall not permit any Person to consolidate with
or merge into the Company or convey, transfer or lease its properties and assets
substantially as an entirety to the Company, unless:
(1) in case the Company shall consolidate with or merge into another Person
or convey, transfer or lease its properties and assets substantially as an
entirety to any Person, the Person formed by such consolidation or into which
the Company is merged or the Person which acquires by conveyance or transfer,
or which leases, the properties and assets of the Company substantially as an
entirety shall be a corporation, partnership or trust, shall be organized and
validly existing under the laws of the United States of America, any State
thereof or the District of Columbia and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the principal of
and any premium and interest on all the Securities and the performance or
observance of every covenant of this Indenture on the part of the Company to be
performed or observed and the conversion rights shall be provided for in
accordance with Article Fourteen, if applicable, or as otherwise specified
pursuant to Section 301, by supplemental indenture satisfactory in form to the
Trustee, executed and delivered to the Trustee, by the Person (if other than
the Company) formed by such consolidation or into which the Company shall have
been merged or by the Person which shall have acquired the Company's assets;
(2) immediately after giving effect to such transaction and treating any
indebtedness which becomes an obligation of the Company or any Subsidiary as a
result of such transaction as having been incurred by the Company or such
Subsidiary at the time of such transaction, no Event of Default, and no event
which, after notice or lapse of time or both, would become an Event of Default,
shall have happened and be continuing;
(3) if, as a result of any such consolidation or merger or such conveyance,
transfer or lease, properties or assets of the Company would become subject to
a Lien which would not be permitted by this Indenture, the Company or such
successor Person, as the case may be, shall take such steps as shall be
necessary effectively to secure the Securities equally and ratably with (or
prior to) all indebtedness secured thereby; and
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(4) the Company has delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel, each stating that such consolidation, merger, conveyance,
transfer or lease and, if a supplemental indenture is required in connection
with such transaction, such supplemental indenture comply with this Article and
that all conditions precedent herein provided for relating to such transaction
have been complied with.
Section 802. Successor Substituted.
Upon any consolidation of the Company with, or merger of the Company into,
any other Person or any conveyance, transfer or lease of the properties and
assets of the Company substantially as an entirety in accordance with Section
801, the successor Person formed by such consolidation or into which the
Company is merged or to which such conveyance, transfer or lease is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Indenture with the same effect as if such successor
Person had been named as the Company herein, and thereafter, except in the case
of a lease, the predecessor Person shall be relieved of all obligations and
covenants under this Indenture and the Securities.
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by a Board
Resolution, and the Trustee, at any time and from time to time, may enter into
one or more indentures supplemental hereto, in form satisfactory to the
Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the Company and the
assumption by any such successor of the covenants of the Company herein and in
the Securities; or
(2) to add to the covenants of the Company for the benefit of the Holders of
all or any series of Securities (and if such covenants are to be for the
benefit of less than all series of Securities, stating that such covenants are
expressly being included solely for the benefit of such series) or to surrender
any right or power herein conferred upon the Company; or
(3) to add any additional Events of Default for the benefit of the Holders of
all or any series of Securities (and if such additional Events of Default are
to be for the benefit of less than all series of Securities, stating that such
additional Events of Default are expressly being included solely for the
benefit of such series); or
(4) to add to or change any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the issuance of Securities
in bearer form, registrable or
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not registrable as to principal, and with or without interest coupons, or to
permit or facilitate the issuance of Securities in uncertificated form; or
(5) to add to, change or eliminate any of the provisions of this Indenture in
respect of one or more series of Securities, provided that any such addition,
change or elimination (A) shall neither (i) apply to any Security of any series
created prior to the execution of such supplemental indenture and entitled to
the benefit of such provision nor (ii) modify the rights of the Holder of any
such Security with respect to such provision or (B) shall become effective only
when there is no such Security Outstanding; or
(6) to secure the Securities; or
(7) to establish the form or terms of Securities of any series as permitted
by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment hereunder by a
successor Trustee with respect to the Securities of one or more series and to
add to or change any of the provisions of this Indenture as shall be necessary
to provide for or facilitate the administration of the trusts hereunder by more
than one Trustee, pursuant to the requirements of Section 611; or
(9) to make provision with respect to the conversion rights of Holders
pursuant to the requirements of Article Fourteen, including providing for the
conversion of the securities into any security (other than the Common Stock of
the Company) or property of the Company; or
(10) to cure any ambiguity, to correct or supplement any provision herein
which may be defective or inconsistent with any other provision herein, or to
make any other provisions with respect to matters or questions arising under
this Indenture, provided that such action pursuant to this Clause (9) shall not
adversely affect the interests of the Holders of Securities of any series in
any material respect.
Section 902. Supplemental Indentures With Consent of Holders.
With the consent of the Holders of more than 50% in principal amount of the
Outstanding Securities of each series affected by such supplemental indenture,
by Act of said Holders delivered to the Company and the Trustee, the Company,
when authorized by a Board Resolution, and the Trustee may enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Indenture or of modifying in any manner the rights of the Holders of
Securities of such series under this Indenture; provided, however, that no such
supplemental indenture shall, without the consent of the Holder of each
Outstanding Security affected thereby,
(1) change the Stated Maturity of the principal of, or any instalment of
principal of or interest on, any Security, or reduce the principal amount
thereof or the rate of interest
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thereon or any premium payable upon the redemption thereof, or reduce the
amount of the principal of an Original Issue Discount Security or any other
Security which would be due and payable upon a declaration of acceleration of
the Maturity thereof pursuant to Section 502, or change any Place of Payment
where, or the coin or currency in which, any Security or any premium or
interest thereon is payable, or impair the right to institute suit for the
enforcement of any such payment on or after the Stated Maturity thereof (or, in
the case of redemption, on or after the Redemption Date), or modify the
provisions of this Indenture with respect to the subordination of the
Securities in a manner adverse to the Holders, or
(2) reduce the percentage in principal amount of the Outstanding Securities
of any series, the consent of whose Holders is required for any such
supplemental indenture, or the consent of whose Holders is required for any
waiver (of compliance with certain provisions of this Indenture or certain
defaults hereunder and their consequences) provided for in this Indenture, or
(3) modify any of the provisions of this Section, Section 513 or Section
1008, except to increase any such percentage or to provide that certain other
provisions of this Indenture cannot be modified or waived without the consent
of the Holder of each Outstanding Security affected thereby; provided, however,
that this clause shall not be deemed to require the consent of any Holder with
respect to changes in the references to "the Trustee" and concomitant changes
in this Section and Section 1008, or the deletion of this proviso, in
accordance with the requirements of Sections 611 and 901(8), or
(4) if applicable, make any change that adversely affects the right to
convert any security as provided in Article Fourteen or pursuant to Section 301
(except as permitted by Section 901(9)) or decrease the conversion rate or
increase the conversion price of any such security.
A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which modifies the
rights of the Holders of Securities of such series with respect to such covenant
or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
Section 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article or the modifications thereby of the trusts
created by this Indenture, the Trustee shall be entitled to receive, and
(subject to Section 601) shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of such supplemental indenture is authorized
or permitted by this Indenture. The Trustee may, but shall not be
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obligated to, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
Section 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
Section 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall conform
to the requirements of the Trust Indenture Act.
Section 906. Reference in Securities to Supplemental Indentures.
Securities of any series authenticated and delivered after the execution of
any supplemental indenture pursuant to this Article may, and shall if required
by the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities of any series so modified as to conform, in the opinion of the
Trustee and the Company, to any such supplemental indenture may be prepared and
executed by the Company and authenticated and delivered by the Trustee in
exchange for Outstanding Securities of such series.
Section 907. Subordination Unimpaired.
No provision in any supplemental indenture which affects the superior
position of the holders of Senior Debt shall be effective against holders of
Senior Debt.
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of each series of Securities
that it will duly and punctually pay the principal of and any premium and
interest on the Securities of that series in accordance with the terms of the
Securities and this Indenture.
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Section 1002. Maintenance of Office or Agency.
The Company will maintain in each Place of Payment for any series of
Securities an office or agency where Securities of that series may be presented
or surrendered for payment, where Securities of that series may be surrendered
for registration of transfer or exchange, where Securities of that series may be
surrendered for conversion and where notices and demands to or upon the Company
in respect of the Securities of that series and this Indenture may be served.
The Company will give prompt written notice to the Trustee of the location, and
any change in the location, of such office or agency. If at any time the Company
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee, and the Company hereby appoints the Trustee as its agent to receive all
such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more other offices or
agencies where the Securities of one or more series may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such designation or rescission shall in
any manner relieve the Company of its obligation to maintain an office or agency
in each Place of Payment for Securities of any series for such purposes. The
Company will give prompt written notice to the Trustee of any such designation
or rescission and of any change in the location of any such other office or
agency.
Section 1003. Money for Securities Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent with respect to
any series of Securities, it will, on or before each due date of the principal
of or any premium or interest on any of the Securities of that series, segregate
and hold in trust for the benefit of the Persons entitled thereto a sum
sufficient to pay the principal and any premium and interest so becoming due
until such sums shall be paid to such Persons or otherwise disposed of as herein
provided and will promptly notify the Trustee of its action or failure so to
act.
Whenever the Company shall have one or more Paying Agents for any series of
Securities, it will, prior to each due date of the principal of or any premium
or interest on any Securities of that series, deposit with a Paying Agent a sum
sufficient to pay such amount, such sum to be held as provided by the Trust
Indenture Act, and (unless such Paying Agent is the Trustee) the Company will
promptly notify the Trustee of its action or failure so to act.
The Company will cause each Paying Agent for any series of Securities other
than the Trustee to execute and deliver to the Trustee an instrument in which
such Paying Agent shall agree with the Trustee, subject to the provisions of
this Section, that such Paying Agent will (1) comply with the provisions of the
Trust Indenture Act applicable to it as a Paying Agent and (2) during the
continuance of any default by the Company (or any other obligor upon the
Securities of that series) in the making of any payment in respect of the
Securities of that series, upon the written request of the Trustee, forthwith
pay to the Trustee all sums held in trust by such Paying Agent for payment in
respect of the Securities of that series.
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The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Company
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Company or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
money.
Any money deposited with the Trustee or any Paying Agent, or then held by the
Company, in trust for the payment of the principal of or any premium or interest
on any Security of any series and remaining unclaimed for two years after such
principal, premium or interest has become due and payable shall be paid to the
Company on Company Request, or (if then held by the Company) shall be discharged
from such trust; and the Holder of such Security shall thereafter, as an
unsecured general creditor, look only to the Company for payment thereof, and
all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the Company cause to
be published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in each Place of
Payment, notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
publication, any unclaimed balance of such money then remaining will be repaid
to the Company.
Section 1004. Statement by Officers as to Default.
The Company will deliver to the Trustee, within 120 days after the end of
each fiscal year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not to the best knowledge of the signers thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions of this Indenture (without regard to any period of
grace or requirement of notice provided hereunder) and, if the Company shall be
in default, specifying all such defaults and the nature and status thereof of
which they may have knowledge.
Section 1005. Existence.
Subject to Article Eight, the Company will do or cause to be done all things
necessary to preserve and keep in full force and effect its existence, rights
(charter and statutory) and franchises; provided, however, that the Company
shall not be required to preserve any such right or franchise if the Board of
Directors shall determine that the preservation thereof is no longer desirable
in the conduct of the business of the Company and that the loss thereof is not
disadvantageous in any material respect to the Holders.
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Section 1006. Maintenance of Properties.
The Company will cause all properties used or useful in the conduct of its
business or the business of any Subsidiary to be maintained and kept in good
condition, repair and working order and supplied with all necessary equipment
and will cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of the Company may
be necessary so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided, however, that
nothing in this Section shall prevent the Company from discontinuing the
operation or maintenance of any of such properties if such discontinuance is, in
the judgment of the Company, desirable in the conduct of its business or the
business of any Subsidiary and not disadvantageous in any material respect to
the Holders.
Section 1007. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or discharged, before
the same shall become delinquent, (1) all taxes, assessments and governmental
charges levied or imposed upon the Company or any Subsidiary or upon the income,
profits or property of the Company or any Subsidiary, and (2) all lawful claims
for labor, materials and supplies which, if unpaid, might by law become a lien
upon the property of the Company or any Subsidiary; provided, however, that the
Company shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claim whose amount, applicability
or validity is being contested in good faith by appropriate proceedings.
Section 1008. Waiver of Certain Covenants.
Except as otherwise specified as contemplated by Section 301 for Securities
of such series, the Company may, with respect to the Securities of any series,
omit in any particular instance to comply with any term, provision or condition
set forth in any covenant provided pursuant to Section 301(19), 901(2) or 901(7)
for the benefit of the Holders of such series if before the time for such
compliance the Holders of at least 50% in principal amount of the Outstanding
Securities of such series shall, by Act of such Holders, either waive such
compliance in such instance or generally waive compliance with such term,
provision or condition, but no such waiver shall extend to or affect such term,
provision or condition except to the extent so expressly waived, and, until such
waiver shall become effective, the obligations of the Company and the duties of
the Trustee in respect of any such term, provision or condition shall remain in
full force and effect.
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ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article.
Securities of any series which are redeemable before their Stated Maturity
shall be redeemable in accordance with their terms and (except as otherwise
specified as contemplated by Section 301 for such Securities) in accordance with
this Article.
Section 1102. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be evidenced by a
Board Resolution or in another manner specified as contemplated by Section 301
for such Securities. In case of any redemption at the election of the Company of
less than all the Securities of any series (including any such redemption
affecting only a single Security), the Company shall, at least 60 days prior to
the Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date, of the
principal amount of Securities of such series to be redeemed and, if applicable,
of the tenor of the Securities to be redeemed. In the case of any redemption of
Securities prior to the expiration of any restriction on such redemption
provided in the terms of such Securities or elsewhere in this Indenture, the
Company shall furnish the Trustee with an Officers' Certificate evidencing
compliance with such restriction.
Section 1103. Selection by Trustee of Securities to Be Redeemed.
If less than all the Securities of any series are to be redeemed (unless all
the Securities of such series and of a specified tenor are to be redeemed or
unless such redemption affects only a single Security), the particular
Securities to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Trustee, from the Outstanding Securities of such series
not previously called for redemption, by such method as the Trustee shall deem
fair and appropriate and which may provide for the selection for redemption of a
portion of the principal amount of any Security of such series, provided that
the unredeemed portion of the principal amount of any Security shall be in an
authorized denomination (which shall not be less than the minimum authorized
denomination) for such Security. If less than all the Securities of such series
and of a specified tenor are to be redeemed (unless such redemption affects only
a single Security), the particular Securities to be redeemed shall be selected
not more than 60 days prior to the Redemption Date by the Trustee, from the
Outstanding Securities of such series and specified tenor not previously called
for redemption in accordance with the preceding sentence.
If any Security selected for partial redemption is converted in part before
termination of the conversion right with respect to the portion of the Security
so selected, the converted portion of such Security shall be deemed (so far as
may be) to be the portion selected for
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redemption. Securities which have been converted during a selection of
Securities to be redeemed shall be treated by the Trustee as Outstanding for the
purpose of such selection.
The Trustee shall promptly notify the Company in writing of the Securities
selected for redemption as aforesaid and, in case of any Securities selected for
partial redemption as aforesaid, the principal amount thereof to be redeemed.
The provisions of the two preceding paragraphs shall not apply with respect
to any redemption affecting only a single Security, whether such Security is to
be redeemed in whole or in part. In the case of any such redemption in part, the
unredeemed portion of the principal amount of the Security shall be in an
authorized denomination (which shall not be less than the minimum authorized
denomination) for such Security.
For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Securities shall relate, in the
case of any Securities redeemed or to be redeemed only in part, to the portion
of the principal amount of such Securities which has been or is to be redeemed.
Section 1104. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage prepaid,
mailed not less than 30 nor more than 60 days prior to the Redemption Date, to
each Holder of Securities to be redeemed, at its address appearing in the
Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Securities of any series consisting of
more than a single Security are to be redeemed, the identification (and, in the
case of partial redemption of any such Securities, the principal amounts) of
the particular Securities to be redeemed and, if less than all the Outstanding
Securities of any series consisting of a single Security are to be redeemed,
the principal amount of the particular Security to be redeemed,
(4) that on the Redemption Date the Redemption Price will become due and
payable upon each such Security to be redeemed and, if applicable, that
interest thereon will cease to accrue on and after said date,
(5) the place or places where each such Security is to be surrendered for
payment of the Redemption Price,
(6) if applicable, the conversion price, that the date on which the right to
convert the principal of the Securities or the portions thereof to be redeemed
will terminate will be the
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Redemption Date and the place or places where such Securities may be
surrendered for conversion, and
(7) that the redemption is for a sinking fund, if such is the case.
Notice of redemption of Securities to be redeemed at the election of the
Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company and shall be irrevocable.
Section 1105. Deposit of Redemption Price.
Prior to any Redemption Date, the Company shall deposit with the Trustee or
with a Paying Agent (or, if the Company is acting as its own Paying Agent,
segregate and hold in trust as provided in Section 1003) an amount of money
sufficient to pay the Redemption Price of, and (except if the Redemption Date
shall be an Interest Payment Date) accrued interest on, all the Securities which
are to be redeemed on that date.
Section 1106. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities so to be
redeemed shall, on the Redemption Date, become due and payable at the Redemption
Price therein specified, and from and after such date (unless the Company shall
default in the payment of the Redemption Price and accrued interest) such
Securities shall cease to bear interest. Upon surrender of any such Security for
redemption in accordance with said notice, such Security shall be paid by the
Company at the Redemption Price, together with accrued interest to the
Redemption Date; provided, however, that, unless otherwise specified as
contemplated by Section 301, instalments of interest whose Stated Maturity is on
or prior to the Redemption Date will be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such at the
close of business on the relevant Record Dates according to their terms and the
provisions of Section 307.
If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal and any premium shall, until paid, bear
interest from the Redemption Date at the rate prescribed therefor in the
Security.
Section 1107. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be surrendered at a
Place of Payment therefor (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or its attorney
duly authorized in writing), and the Company shall execute, and the Trustee
shall authenticate and deliver to the Holder of such Security without service
charge, a new Security or Securities of the same series and of like tenor, of
any authorized denomination as requested by such Holder, in aggregate principal
amount
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equal to and in exchange for the unredeemed portion of the principal of the
Security so surrendered.
ARTICLE TWELVE
Sinking Funds
Section 1201. Applicability of Article.
The provisions of this Article shall be applicable to any sinking fund for
the retirement of Securities of any series except as otherwise specified as
contemplated by Section 301 for such Securities.
The minimum amount of any sinking fund payment provided for by the terms of
any Securities is herein referred to as a "mandatory sinking fund payment", and
any payment in excess of such minimum amount provided for by the terms of such
Securities is herein referred to as an "optional sinking fund payment". If
provided for by the terms of any Securities, the cash amount of any sinking fund
payment may be subject to reduction as provided in Section 1202. Each sinking
fund payment shall be applied to the redemption of Securities as provided for by
the terms of such Securities.
Section 1202. Satisfaction of Sinking Fund Payments with Securities.
The Company (1) may deliver Outstanding Securities of a series (other than
any previously called for redemption) and (2) may apply as a credit Securities
of a series which have been redeemed either at the election of the Company
pursuant to the terms of such Securities or through the application of permitted
optional sinking fund payments pursuant to the terms of such Securities, in each
case in satisfaction of all or any part of any sinking fund payment with respect
to any Securities of such series required to be made pursuant to the terms of
such Securities as and to the extent provided for by the terms of such
Securities; provided that the Securities to be so credited have not been
previously so credited. The Securities to be so credited shall be received and
credited for such purpose by the Trustee at the Redemption Price, as specified
in the Securities so to be redeemed, for redemption through operation of the
sinking fund and the amount of such sinking fund payment shall be reduced
accordingly.
Section 1203. Redemption of Securities for Sinking Fund.
Not less than 60 days prior to each sinking fund payment date for any
Securities, the Company will deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing sinking fund payment for such
Securities pursuant to the terms of such Securities, the portion thereof, if
any, which is to be satisfied by payment of cash and the portion thereof, if
any, which is to be satisfied by delivering and crediting Securities pursuant to
Section 1202
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and will also deliver to the Trustee any Securities to be so delivered. Not less
than 30 days prior to each such sinking fund payment date, the Trustee shall
select the Securities to be redeemed upon such sinking fund payment date in the
manner specified in Section 1103 and cause notice of the redemption thereof to
be given in the name of and at the expense of the Company in the manner provided
in Section 1104. Such notice having been duly given, the redemption of such
Securities shall be made upon the terms and in the manner stated in Sections
1106 and 1107.
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Company's Option to Effect Defeasance or Covenant Defeasance.
The Company may elect, at its option at any time, to have Section 1302 or
Section 1303 applied to any Securities or any series of Securities, as the case
may be, designated pursuant to Section 301 as being defeasible pursuant to such
Section 1302 or 1303, in accordance with any applicable requirements provided
pursuant to Section 301 and upon compliance with the conditions set forth below
in this Article. Any such election shall be evidenced by a Board Resolution or
in another manner specified as contemplated by Section 301 for such Securities.
Section 1302. Defeasance and Discharge.
Upon the Company's exercise of its option (if any) to have this Section
applied to any Securities or any series of Securities, as the case may be, the
Company shall be deemed to have been discharged from its obligations, and the
provisions of Article Fifteen shall cease to be effective, with respect to such
Securities as provided in this Section on and after the date the conditions set
forth in Section 1304 are satisfied (hereinafter called "Defeasance"). For this
purpose, such Defeasance means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by such Securities and to have
satisfied all its other obligations under such Securities and this Indenture
insofar as such Securities are concerned (and the Trustee, at the expense of the
Company, shall execute proper instruments acknowledging the same), subject to
the following which shall survive until otherwise terminated or discharged
hereunder: (1) the rights of Holders of such Securities to receive, solely from
the trust fund described in Section 1304 and as more fully set forth in such
Section, payments in respect of the principal of and any premium and interest on
such Securities when payments are due, (2) the Company's obligations with
respect to such Securities under Sections 304, 305, 306, 1002 and 1003, (3) the
rights, powers, trusts, duties and immunities of the Trustee hereunder and (4)
this Article. Subject to compliance with this Article, the Company may exercise
its option (if any) to have this Section applied to any Securities
notwithstanding the prior exercise of its option (if any) to have Section 1303
applied to such Securities.
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Section 1303. Covenant Defeasance.
Upon the Company's exercise of its option (if any) to have this Section
applied to any Securities or any series of Securities, as the case may be, (1)
the Company shall be released from its obligations under Section 801(3),
Sections 1006 through 1007, inclusive, and any covenants provided pursuant to
Section 301(19), 901(2) or 901(7) for the benefit of the Holders of such
Securities and (2) the occurrence of any event specified in Sections 501(4)
(with respect to any of Section 801(3), Sections 1006 through 1007, inclusive,
and any such covenants provided pursuant to Section 301(19), 901(2) or 901(7)),
501(5) and 501(8) shall be deemed not to be or result in an Event of Default,
and (3) the provisions of Article Fifteen shall cease to be effective, in each
case with respect to such Securities as provided in this Section on and after
the date the conditions set forth in Section 1304 are satisfied (hereinafter
called "Covenant Defeasance"). For this purpose, such Covenant Defeasance means
that, with respect to such Securities, the Company may omit to comply with and
shall have no liability in respect of any term, condition or limitation set
forth in any such specified Section (to the extent so specified in the case of
Section 501(4)) or Article Fifteen, whether directly or indirectly by reason of
any reference elsewhere herein to any such Section or Article or by reason of
any reference in any such Section or Article to any other provision herein or in
any other document, but the remainder of this Indenture and such Securities
shall be unaffected thereby.
Section 1304. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to the application of Section 1302 or
Section 1303 to any Securities or any series of Securities, as the case may be:
(1) The Company shall irrevocably have deposited or caused to be deposited
with the Trustee (or another trustee which satisfies the requirements
contemplated by Section 609 and agrees to comply with the provisions of this
Article applicable to it) as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and dedicated solely
to, the benefits of the Holders of such Securities, (A) money in an amount, or
(B) U.S. Government Obligations which through the scheduled payment of
principal and interest in respect thereof in accordance with their terms will
provide, not later than one day before the due date of any payment, money in an
amount, or (C) a combination thereof, in each case sufficient, in the opinion
of a nationally recognized firm of independent public accountants expressed in
a written certification thereof delivered to the Trustee, to pay and discharge,
and which shall be applied by the Trustee (or any such other qualifying
trustee) to pay and discharge, the principal of and any premium and interest on
such Securities on the respective Stated Maturities, in accordance with the
terms of this Indenture and such Securities. As used herein, "U.S. Government
Obligation" means (x) any security which is (i) a direct obligation of the
United States of America for the payment of which the full faith and credit of
the United States of America is pledged or (ii) an obligation of a Person
controlled or supervised by and acting as an agency or instrumentality of the
United States of America the payment of which is unconditionally guaranteed as
a full faith and credit obligation by the United States of America, which, in
either case (i) or (ii), is not callable or redeemable at the option of the
issuer thereof, and
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(y) any depositary receipt issued by a bank (as defined in
Section 3(a)(2) of the Securities Act) as custodian with respect to any U.S.
Government Obligation which is specified in Clause (x) above and held by such
bank for the account of the holder of such depositary receipt, or with respect
to any specific payment of principal of or interest on any U.S. Government
Obligation which is so specified and held, provided that (except as required by
law) such custodian is not authorized to make any deduction from the amount
payable to the holder of such depositary receipt from any amount received by
the custodian in respect of the U.S. Government Obligation or the specific
payment of principal or interest evidenced by such depositary receipt.
(2) In the event of an election to have Section 1302 apply to any Securities
or any series of Securities, as the case may be, the Company shall have
delivered to the Trustee an Opinion of Counsel stating that (A) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling or (B) since the date of this instrument, there has been a change in the
applicable Federal income tax law, in either case (A) or (B) to the effect
that, and based thereon such opinion shall confirm that, the Holders of such
Securities will not recognize gain or loss for Federal income tax purposes as a
result of the deposit, Defeasance and discharge to be effected with respect to
such Securities and will be subject to Federal income tax on the same amount,
in the same manner and at the same times as would be the case if such deposit,
Defeasance and discharge were not to occur.
(3) In the event of an election to have Section 1303 apply to any Securities
or any series of Securities, as the case may be, the Company shall have
delivered to the Trustee an Opinion of Counsel to the effect that the Holders
of such Securities will not recognize gain or loss for Federal income tax
purposes as a result of the deposit and Covenant Defeasance to be effected with
respect to such Securities and will be subject to Federal income tax on the
same amount, in the same manner and at the same times as would be the case if
such deposit and Covenant Defeasance were not to occur.
(4) The Company shall have delivered to the Trustee an Officer's Certificate
to the effect that neither such Securities nor any other Securities of the same
series, if then listed on any securities exchange, will be delisted as a result
of such deposit.
(5) No event which is, or after notice or lapse of time or both would become,
an Event of Default with respect to such Securities or any other Securities
shall have occurred and be continuing at the time of such deposit or, with
regard to any such event specified in Sections 501(6) and (7), at any time on
or prior to the 90th day after the date of such deposit (it being understood
that this condition shall not be deemed satisfied until after such 90th day).
(6) Such Defeasance or Covenant Defeasance shall not cause the Trustee to
have a conflicting interest within the meaning of the Trust Indenture Act
(assuming all Securities are in default within the meaning of such Act).
(7) Such Defeasance or Covenant Defeasance shall not result in a breach or
violation of, or constitute a default under, any other agreement or instrument
to which the Company is a party or by which it is bound.
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(8) Such Defeasance or Covenant Defeasance shall not result in the trust
arising from such deposit constituting an investment company within the meaning
of the Investment Company Act unless such trust shall be registered under such
Act or exempt from registration thereunder.
(9) At the time of such deposit, (A) no default in the payment of any
principal of or premium or interest on any Senior Debt shall have occurred and
be continuing, (B) no event of default with respect to any Senior Debt shall
have resulted in such Senior Debt becoming, and continuing to be, due and
payable prior to the date on which it would otherwise have become due and
payable (unless payment of such Senior Debt has been made or duly provided
for), and (C) no other event of default with respect to any Senior Debt shall
have occurred and be continuing permitting (after notice or lapse of time or
both) the holders of such Senior Debt (or a trustee on behalf of such holders)
to declare such Senior Debt due and payable prior to the date on which it would
otherwise have become due and payable.
(10) The Company shall have delivered to the Trustee an Officer's Certificate
and an Opinion of Counsel, each stating that all conditions precedent with
respect to such Defeasance or Covenant Defeasance have been complied with.
Section 1305. Deposited Money and U.S. Government Obligations to Be
Held in Trust; Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 1003, all money
and U.S. Government Obligations (including the proceeds thereof) deposited with
the Trustee or other qualifying trustee (solely for purposes of this Section and
Section 1306, the Trustee and any such other trustee are referred to
collectively as the "Trustee") pursuant to Section 1304 in respect of any
Securities shall be held in trust and applied by the Trustee, in accordance with
the provisions of such Securities and this Indenture, to the payment, either
directly or through any such Paying Agent (including the Company acting as its
own Paying Agent) as the Trustee may determine, to the Holders of such
Securities, of all sums due and to become due thereon in respect of principal
and any premium and interest, but money so held in trust need not be segregated
from other funds except to the extent required by law. Money and U.S. Government
Obligations so held in trust shall not be subject to the provisions of Article
Fifteen.
The Company shall pay and indemnify the Trustee against any tax, fee or other
charge imposed on or assessed against the U.S. Government Obligations deposited
pursuant to Section 1304 or the principal and interest received in respect
thereof other than any such tax, fee or other charge which by law is for the
account of the Holders of Outstanding Securities.
Anything in this Article to the contrary notwithstanding, the Trustee shall
deliver or pay to the Company from time to time upon Company Request any money
or U.S. Government Obligations held by it as provided in Section 1304 with
respect to any Securities which, in the opinion of a nationally recognized firm
of independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof
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which would then be required to be deposited to effect the Defeasance or
Covenant Defeasance, as the case may be, with respect to such Securities.
Section 1306. Reinstatement.
If the Trustee or the Paying Agent is unable to apply any money in accordance
with this Article with respect to any Securities by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, then the obligations under this
Indenture and such Securities from which the Company has been discharged or
released pursuant to Section 1302 or 1303 shall be revived and reinstated as
though no deposit had occurred pursuant to this Article with respect to such
Securities, until such time as the Trustee or Paying Agent is permitted to apply
all money held in trust pursuant to Section 1305 with respect to such Securities
in accordance with this Article; provided, however, that if the Company makes
any payment of principal of or any premium or interest on any such Security
following such reinstatement of its obligations, the Company shall be subrogated
to the rights (if any) of the Holders of such Securities to receive such payment
from the money so held in trust.
ARTICLE FOURTEEN
Conversion of Securities
Section 1401. Applicability of Article.
The provisions of this Article shall be applicable to the Securities of any
series which are convertible into shares of Common Stock of the Company, and the
issuance of such shares of Common Stock upon the conversion of such Securities,
except as otherwise specified as contemplated by Section 301 for the Securities
of such series.
Section 1402. Exercise of Conversion Privilege.
In order to exercise a conversion privilege, the Holder of a Security of a
series with such a privilege shall surrender such Security to the Company at the
office or agency maintained for that purpose pursuant to Section 1002,
accompanied by a duly executed conversion notice to the Company substantially in
the form set forth in Section 206 stating that the Holder elects to convert such
Security or a specified portion thereof. Such notice shall also state, if
different from the name and address of such Holder, the name or names (with
address) in which the certificate or certificates for shares of Common Stock
which shall be issuable on such conversion shall be issued. Securities
surrendered for conversion shall (if so required by the Company or the Trustee)
be duly endorsed by or accompanied by instruments of transfer in forms
satisfactory to the Company and the Trustee duly executed by the registered
Holder or its attorney duly authorized in writing; and Securities so surrendered
-----------------------------
for conversion (in whole or in part) during the period from the close of
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business on any Regular Record Date to the opening of business on the next
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succeeding Interest Payment Date (excluding Securities or
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portions thereof called for redemption during such period) shall also be
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accompanied by payment in funds acceptable to the Company of an amount equal to
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the interest payable on such Interest Payment Date on the principal amount of
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such Security then being converted, and such interest shall be payable to such
- ------------------------------------------------------------------------------
registered Holder notwithstanding the conversion of such Security, subject to
- ------------------------------------------------------------------
the provisions of Section 307 relating to the payment of Defaulted Interest by
the Company. As promptly as practicable after the receipt of such notice and of
any payment required pursuant to a Board Resolution and, subject to Section 303,
set forth, or determined in the manner provided, in an Officers' Certificate, or
established in one or more indentures supplemental hereto setting forth the
terms of such series of Security, and the surrender of such Security in
accordance with such reasonable regulations as the Company may prescribe, the
Company shall issue and shall deliver, at the office or agency at which such
Security is surrendered, to such Holder or on its written order, a certificate
or certificates for the number of full shares of Common Stock issuable upon the
conversion of such Security (or specified portion thereof), in accordance with
the provisions of such Board Resolution, Officers' Certificate or supplemental
indenture, and cash as provided therein in respect of any fractional share of
such Common Stock otherwise issuable upon such conversion. Such conversion shall
be deemed to have been effected immediately prior to the close of business on
the date on which such notice and such payment, if required, shall have been
received in proper order for conversion by the Company and such Security shall
have been surrendered as aforesaid (unless such Holder shall have so surrendered
such Security and shall have instructed the Company to effect the conversion on
a particular date following such surrender and such Holder shall be entitled to
convert such Security on such date, in which case such conversion shall be
deemed to be effected immediately prior to the close of business on such date)
and at such time the rights of the Holder of such Security as such Security
Holder shall cease and the person or persons in whose name or names any
certificate or certificates for shares of Common Stock of the Company shall be
issuable upon such conversion shall be deemed to have become the Holder or
Holders of record of the shares represented thereby. Except as set forth above
and subject to the final paragraph of Section 307, no payment or adjustment
shall be made upon any conversion on account of any interest accrued on the
Securities (or any part thereof) surrendered for conversion or on account of
any dividends on the Common Stock of the Company issued upon such conversion.
In the case of any Security which is converted in part only, upon such
conversion the Company shall execute and the Trustee shall authenticate and
deliver to or on the order of the Holder thereof, at the expense of the Company,
a new Security or Securities of the same series, of authorized denominations, in
aggregate principal amount equal to the unconverted portion of such Security.
Section 1403. No Fractional Shares.
No fractional share of Common Stock of the Company shall be issued upon
conversions of Securities of any series. If more than one Security shall be
surrendered for conversion at one time by the same Holder, the number of full
shares which shall be issuable upon conversion shall be computed on the basis of
the aggregate principal amount of the Securities (or specified portions thereof
to the extent permitted hereby) so surrendered. If, except for the provisions of
this Section 1403, any Holder of a Security or Securities would be entitled to
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a fractional share of Common Stock of the Company upon the conversion of such
Security or Securities, or specified portions thereof, the Company shall pay to
such Holder an amount in cash equal to the current market value of such
fractional share computed, (i) if such Common Stock is listed or admitted to
unlisted trading privileges on a national securities exchange, on the basis of
the last reported sale price regular way on such exchange on the last trading
day prior to the date of conversion upon which such a sale shall have been
effected, or (ii) if such Common Stock is not at the time so listed or admitted
to unlisted trading privileges on a national securities exchange, on the basis
of the average of the bid and asked prices of such Common Stock in the over-the-
counter market, on the last trading day prior to the date of conversion, as
reported by the National Quotation Bureau, Incorporated or similar organization
if the National Quotation Bureau, Incorporated is no longer reporting such
information, or if not so available, the fair market price as determined by the
Board of Directors. For purposes of this Section, "trading day" shall mean each
Monday, Tuesday, Wednesday, Thursday and Friday other than any day on which the
Common Stock is not traded on the New York Stock Exchange, or if the Common
Stock is not traded on the New York Stock Exchange, on the principal exchange or
market on which the Common Stock is traded or quoted.
Section 1404. Adjustment of Conversion Price.
The conversion price of Securities of any series that is convertible into
Common Stock of the Company shall be adjusted for any stock dividends, stock
splits, reclassifications, combinations or similar transactions in accordance
with the terms of the supplemental indenture or Board Resolutions setting forth
the terms of the Securities of such series.
Whenever the conversion price is adjusted, the Company shall compute the
adjusted conversion price in accordance with terms of the applicable Board
Resolution or supplemental indenture and shall prepare an Officers' Certificate
setting forth the adjusted conversion price and showing in reasonable detail the
facts upon which such adjustment is based, and such certificate shall forthwith
be filed at each office or agency maintained for the purpose of conversion of
Securities pursuant to Section 1002 and, if different, with the Trustee. The
Company shall forthwith cause a notice setting forth the adjusted conversion
price to be mailed, first class postage prepaid, to each Holder of Securities of
such series at its address appearing on the Security Register and to any
conversion agent other than the Trustee.
Section 1405. Notice of Certain Corporate Actions.
In case:
(1) the Company shall declare a dividend (or any other distribution) on its
Common Stock payable otherwise than in cash out of its retained earnings (other
than a dividend for which approval of any shareholders of the Company is
required); or
(2) the Company shall authorize the granting to the holders of its Common
Stock of rights, options or warrants to subscribe for or purchase any shares of
capital stock of any
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class or of any other rights (other than any such grant for which approval of
any shareholders of the Company is required); or
(3) of any reclassification of the Common Stock of the Company (other than a
subdivision or combination of its outstanding shares of Common Stock, or of any
consolidation, merger or share exchange to which the Company is a party and for
which approval of any shareholders of the Company is required), or of the sale
of all or substantially all of the assets of the Company; or
(4) of the voluntary or involuntary dissolution, liquidation or winding up of
the Company;
then the Company shall cause to be filed with the Trustee, and shall cause to be
mailed to all Holders at their last addresses as they shall appear in the
Securities Register, at least 20 days (or 10 days in any case specified in
Clause (1) or (2) above) prior to the applicable record date hereinafter
specified, a notice stating (i) the date on which a record is to be taken for
the purpose of such dividend, distribution, rights, options or warrants, or, if
a record is not to be taken, the date as of which the holders of Common Stock of
record to be entitled to such dividend, distribution, rights, options or
warrants are to be determined, or (ii) the date on which such reclassification,
consolidation, merger, share exchange, sale, dissolution, liquidation or winding
up is expected to become effective, and the date as of which it is expected that
holders of Common Stock of record shall be entitled to exchange their shares of
Common Stock for securities, cash or other property deliverable upon such
reclassification, consolidation, merger, share exchange, sale, dissolution,
liquidation or winding up. If at any time the Trustee shall not be the
conversion agent, a copy of such notice shall also forthwith be filed by the
Company with the Trustee.
Section 1406. Reservation of Shares of Common Stock.
The Company shall at all times reserve and keep available, free from
preemptive rights, out of its authorized but unissued Common Stock, for the
purpose of effecting the conversion of Securities, the full number of shares of
Common Stock of the Company then issuable upon the conversion of all outstanding
Securities of any series that has conversion rights.
Section 1407. Payment of Certain Taxes Upon Conversion.
The Company will pay any and all taxes that may be payable in respect of the
issue or delivery of shares of its Common Stock on conversion of Securities
pursuant hereto. The Company shall not, however, be required to pay any tax
which may be payable in respect of any transfer involved in the issue and
delivery of shares of its Common Stock in a name other than that of the Holder
of the Security or Securities to be converted, and no such issue or delivery
shall be made unless and until the person requesting such issue has paid to the
Company the amount of any such tax, or has established, to the satisfaction of
the Company, that such tax has been paid.
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Section 1408. Nonassessability.
The Company covenants that all shares of its Common Stock which may be issued
upon conversion of Securities will upon issue in accordance with the terms
hereof be duly and validly issued and fully paid and nonassessable.
Section 1409. Effect of Consolidation or Merger on Conversion Privilege.
In case of any consolidation of the Company with, or merger of the Company
into or with any other Person, or in case of any sale of all or substantially
all of the assets of the Company, the Company or the Person formed by such
consolidation or the Person into which the Company shall have been merged or the
Person which shall have acquired such assets, as the case may be, shall execute
and deliver to the Trustee a supplemental indenture providing that the Holder of
each Security then outstanding of any series that is convertible into Common
Stock of the Company shall have the right, which right shall be the exclusive
conversion right thereafter available to said Holder (until the expiration of
the conversion right of such Security), to convert such Security into the kind
and amount of shares of stock or other securities or property (including cash)
receivable upon such consolidation, merger or sale by a holder of the number of
shares of Common Stock of the Company into which such Security might have been
converted immediately prior to such consolidation, merger or sale, subject to
compliance with the other provisions of this Indenture, such Security and such
supplemental indenture. Such supplemental indenture shall provide for
adjustments which shall be as nearly equivalent as may be practicable to the
adjustments provided for in such Security. The above provisions of this Section
shall similarly apply to successive consolidations, mergers or sales. It is
expressly agreed and understood that anything in this Indenture to the contrary
notwithstanding, if, pursuant to such merger, consolidation or sale, holders of
outstanding shares of Common Stock of the Company do not receive shares of
common stock of the surviving corporation but receive other securities, cash or
other property or any combination thereof, Holders of Securities shall not have
the right to thereafter convert their Securities into common stock of the
surviving corporation or the corporation which shall have acquired such assets,
but rather, shall have the right upon such conversion to receive the other
securities, cash or other property receivable by a holder of the number of
shares of Common Stock of the Company into which the Securities held by such
holder might have been converted immediately prior to such consolidation, merger
or sale, all as more fully provided in the first sentence of this Section 1409.
Anything in this Section 1409 to the contrary notwithstanding, the provisions of
this Section 1409 shall not apply to a merger or consolidation of another
corporation with or into the Company pursuant to which both of the following
conditions are applicable: (i) the Company is the surviving corporation and (ii)
the outstanding shares of Common Stock of the Company are not changed or
converted into any other securities or property (including cash) or changed in
number or character or reclassified pursuant to the terms of such merger or
consolidation.
As evidence of the kind and amount of shares of stock or other securities or
property (including cash) into which Securities may properly be convertible
after any such consolidation, merger or sale, or as to the appropriate
adjustments of the conversion prices applicable with respect thereto, the
Trustee shall be furnished with and may accept the
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certificate or opinion of an independent certified public accountant with
respect thereto; and, in the absence of bad faith on the part of the Trustee,
the Trustee may conclusively rely thereon, and shall not be responsible or
accountable to any Holder of Securities for any provision in conformity
therewith or approved by such independent certified accountant which may be
contained in said supplemental indenture.
Section 1410. Duties of Trustee Regarding Conversion.
Neither the Trustee nor any conversion agent shall at any time be under any
duty or responsibility to any Holder of Securities of any series that is
convertible into Common Stock of the Company to determine whether any facts
exist which may require any adjustment of the conversion price, or with respect
to the nature or extent of any such adjustment when made, or with respect to the
method employed, whether herein or in any supplemental indenture, any
resolutions of the Board of Directors or written instrument executed by one or
more officers of the Company provided to be employed in making the same. Neither
the Trustee nor any conversion agent shall be accountable with respect to the
validity or value (or the kind or amount) of any shares of Common Stock of the
Company, or of any securities or property, which may at any time be issued or
delivered upon the conversion of any Securities and neither the Trustee nor any
conversion agent makes any representation with respect thereto. Subject to the
provisions of Section 601, neither the Trustee nor any conversion agent shall be
responsible for any failure of the Company to issue, transfer or deliver any
shares of its Common Stock or stock certificates or other securities or property
upon the surrender of any Security for the purpose of conversion or to comply
with any of the covenants of the Company contained in this Article Fourteen or
in the applicable supplemental indenture, resolutions of the Board of Directors
or written instrument executed by one or more duly authorized officers of the
Company.
Section 1411. Repayment of Certain Funds Upon Conversion.
Any funds which at any time shall have been deposited by the Company or on
its behalf with the Trustee or any other paying agent for the purpose of paying
the principal of, and premium, if any, and interest, if any, on any of the
Securities (including funds deposited for the sinking fund referred to in
Article Twelve hereof) and which shall not be required for such purposes because
of the conversion of such Securities as provided in this Article Fourteen shall
after such conversion be repaid to the Company by the Trustee upon the Company's
written request.
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ARTICLE FIFTEEN
Subordination of Securities
Section 1501. Securities Subordinate to Senior Debt.
Except as otherwise provided in a supplemental indenture or pursuant to
Section 301 the Company covenants and agrees, and each Holder of a Security, by
its acceptance thereof, likewise covenants and agrees, that, to the extent and
in the manner hereinafter set forth in this Article, the indebtedness
represented by the Securities and the payment of the principal of and any
premium and interest on each and all of the Securities are hereby expressly made
subordinate and subject in right of payment to the prior payment in full of all
Senior Debt.
Section 1502. Payment Over of Proceeds Upon Dissolution, Etc.
In the event of (a) any insolvency or bankruptcy case or proceeding, or any
receivership, liquidation, reorganization, debt restructuring or other similar
case or proceeding in connection therewith, relative to the Company or to its
creditors, as such, or to its assets, or (b) any liquidation, dissolution or
other winding up of the Company, whether voluntary or involuntary and whether or
not involving insolvency or bankruptcy, or (c) any assignment for the benefit of
creditors or any other marshalling of assets and liabilities of the Company,
then and in any such event the holders of Senior Debt shall be entitled to
receive payment in full of all amounts due or to become due on or in respect of
all Senior Debt, or provision shall be made for such payment in money or money's
worth, before the Holders of the Securities are entitled to receive any payment
on account of principal of or any premium or interest on the Securities, and to
that end the holders of Senior Debt or their representative or representatives
or the trustee or trustees under any indenture under which any instruments
evidencing any of such Senior Debt may have been issued shall be entitled to
receive, for application to the payment thereof, any payment or distribution of
any kind or character, whether in cash, property or securities, which may be
payable or deliverable in respect of the Securities in any such case,
proceeding, dissolution, liquidation or other winding up or event, to the extent
necessary to pay all Senior Debt in full, after giving effect to any concurrent
payment or distribution to or for the holders of Senior Debt.
In the event that, notwithstanding the foregoing provisions of this Section,
the Trustee or the Holder of any Security shall have received any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, before all Senior Debt is paid in full or payment
thereof provided for, [and if such fact shall, at or prior to the time of such
payment or distribution, have been made known to the Trustee or, as the case may
be, such Holder,] then and in such event such payment or distribution shall be
paid over or delivered forthwith to the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee, agent or other Person making payment
or distribution of assets of the Company for application to the payment of all
Senior Debt remaining unpaid, to the extent necessary to pay all Senior Debt in
full, after giving effect to any concurrent payment or distribution to or for
the holders of Senior Debt.
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For purposes of this Article only, the words "cash, property or securities"
shall not be deemed to include shares of stock of the Company as reorganized or
readjusted, or securities of the Company or any other corporation provided for
by a plan of reorganization or readjustment which are subordinated in right of
payment to all Senior Debt which may at the time be outstanding to substantially
the same extent as, or to a greater extent than, the Securities are so
subordinated as provided in this Article. The consolidation of the Company with,
or the merger of the Company into, another Person or the liquidation or
dissolution of the Company following the conveyance or transfer of its
properties and assets substantially as an entirety to another Person upon the
terms and conditions set forth in Article Eight shall not be deemed a
dissolution, winding up, liquidation, reorganization, assignment for the benefit
of creditors or marshalling of assets and liabilities of the Company for the
purposes of this Section if the Person formed by such consolidation or into
which the Company is merged or which acquires by conveyance or transfer such
properties and assets substantially as an entirety, as the case may be, shall,
as a part of such consolidation, merger, conveyance or transfer, comply with the
conditions set forth in Article Eight.
Section 1503. Prior Payment to Senior Debt Upon Acceleration of Securities.
In the event that any Securities are declared due and payable before their
Stated Maturity, then and in such event the holders of the Senior Debt
outstanding at the time such Securities so become due and payable shall be
entitled to receive payment in full of all amounts due or to become due on or in
respect of all Senior Debt, or provision shall be made for such payment in money
or money's worth before the Holders of the Securities are entitled to receive
any payment by the Company on account of the principal of or any premium or
interest on the Securities or on account of the purchase or other acquisition of
Securities; provided, however, that nothing in this Section shall prevent the
satisfaction of any sinking fund payment in accordance with Article Twelve by
delivering and crediting pursuant to Section 1202 Securities which have been
acquired (upon redemption or otherwise) prior to such declaration of
acceleration or which have been converted pursuant to Article Fourteen.
In the event that, notwithstanding the foregoing, the Company shall make any
payment to the Trustee or the Holder of any Security prohibited by the foregoing
provisions of this Section, and if such fact shall, at or prior to the time of
such payment, have been made known to the Trustee or, as the case may be, such
Holder, then and in such event such payment shall be paid over and delivered
forthwith to the Company.
The provisions of this Section shall not apply to any payment with respect to
which Section 1502 would be applicable.
Section 1504. No Payment When Senior Debt in Default.
(a) In the event and during the continuation of any default in the payment of
principal of or any premium or interest on any Senior Debt during or beyond any
applicable grace period with respect thereto, or in the event that any default
with respect to any Senior Debt shall have occurred and be continuing permitting
the holders of such Senior Debt (or a trustee
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on behalf of the holders thereof) to declare such Senior Debt due and payable
prior to the date on which it would otherwise have become due and payable,
unless and until such default shall have been cured or waived or shall have
ceased to exist and, if any such Senior Debt shall have been accelerated, such
acceleration shall have been rescinded or annulled, or (b) in the event any
judicial proceeding shall be pending with respect to any such default, then no
payment shall be made by the Company on account of principal of or any premium
or interest on the Securities or on account of the purchase or other acquisition
of Securities; provided, however, that nothing in this Section shall prevent the
satisfaction of any sinking fund payment in accordance with Article Twelve by
delivering and crediting pursuant to Section 1202 Securities which have been
acquired (upon redemption or otherwise) prior to such declaration of
acceleration or which have been converted pursuant to Article Fourteen.
In the event that, notwithstanding the foregoing, the Company shall make any
payment to the Trustee or the Holder of any Security prohibited by the foregoing
provisions of this Section, and if such fact shall, at or prior to the time of
such payment, have been made known to the Trustee or, as the case may be, such
Holder, then and in such event such payment shall be paid over and delivered
forthwith to the Company.
The provisions of this Section shall not apply to any payment with respect to
which Section 1502 would be applicable.
Section 1505. Payment Permitted If No Default.
Nothing contained in this Article or elsewhere in this Indenture or in any of
the Securities shall prevent (a) the Company, at any time except during the
pendency of any case, proceeding, dissolution, liquidation or other winding up,
debt restructuring, assignment for the benefit of creditors or other marshalling
of assets and liabilities of the Company referred to in Section 1502 or under
the conditions described in Section 1503 or 1504, from making payments at any
time of principal of and any premium or interest on the Securities, or (b) the
application by the Trustee of any money deposited with it hereunder to the
payment of or on account of the principal of and any premium or interest on the
Securities or the retention of such payment by the Holders, if, at the time of
such application by the Trustee, it did not have knowledge that such payment
would have been prohibited by the provisions of this Article.
Section 1506. Subrogation to Rights of Holders of Senior Debt.
Subject to the payment in full of all Senior Debt, the Holders of the
Securities shall be subrogated to the rights of the holders of such Senior Debt
to receive payments and distributions of cash, property and securities
applicable to the Senior Debt until the principal of and any premium and
interest on the Securities shall be paid in full. For purposes of such
subrogation, no payments or distributions to the holders of the Senior Debt of
any cash, property or securities to which the Holders of the Securities or the
Trustee would be entitled except for the provisions of this Article, and no
payments over pursuant to the provisions of this Article to the holders of
Senior Debt by Holders of the Securities or the Trustee, shall, as among the
Company, its creditors other than holders of Senior Debt and the Holders of the
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Securities, be deemed to be a payment or distribution by the Company to or on
account of the Senior Debt.
Section 1507. Provisions Solely to Define Relative Rights.
The provisions of this Article are and are intended solely for the purpose of
defining the relative rights of the Holders of the Securities on the one hand
and the holders of Senior Debt on the other hand. Nothing contained in this
Article or elsewhere in this Indenture or in the Securities is intended to or
shall (a) impair, as among the Company, its creditors other than holders of
Senior Debt and the Holders of the Securities, the obligation of the Company,
which is absolute and unconditional (and which, subject to the rights under this
Article of the holders of Senior Debt, is intended to rank equally with all
other general obligations of the Company), to pay to the Holders of the
Securities the principal of and any premium and interest on the Securities as
and when the same shall become due and payable in accordance with their terms;
or (b) affect the relative rights against the Company of the Holders of the
Securities and creditors of the Company other than the holders of Senior Debt;
or (c) prevent the Trustee or the Holder of any Security from exercising all
remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article of the holders of
Senior Debt to receive cash, property and securities otherwise payable or
deliverable to the Trustee or such Holder.
Section 1508. Trustee to Effectuate Subordination.
Each Holder of a Security by its acceptance thereof authorizes and directs
the Trustee on its behalf to take such action as may be necessary or appropriate
to effectuate the subordination provided in this Article and appoints the
Trustee its attorney-in-fact for any and all such purposes.
Section 1509. No Waiver of Subordination Provisions.
No right of any present or future holder of any Senior Debt to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Company or by any act
or failure to act, in good faith, by any such holder, or by any non-compliance
by the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof any such holder may have or be otherwise
charged with.
Without in any way limiting the generality of the foregoing paragraph, the
holders of Senior Debt may, at any time and from time to time, without the
consent of or notice to the Trustee or the Holders of the Securities, without
incurring responsibility to the Holders of the Securities and without impairing
or releasing the subordination provided in this Article or the obligations
hereunder of the Holders of the Securities to the holders of Senior Debt, do any
one or more of the following: (i) change the manner, place or terms of payment
or extend the time of payment of, or renew or alter, Senior Debt, or otherwise
amend or supplement in any
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manner Senior Debt or any instrument evidencing the same or any agreement under
which Senior Debt is outstanding; (ii) sell, exchange, release or otherwise
dispose of any property pledged, mortgaged or otherwise securing Senior Debt;
(iii) release any Person liable in any manner for the collection of Senior Debt;
and (iv) exercise or refrain from exercising any rights against the Company and
any other Person.
Section 1510. Notice to Trustee.
The Company shall give prompt written notice to the Trustee of any fact known
to the Company which would prohibit the making of any payment to or by the
Trustee in respect of the Securities. Notwithstanding the provisions of this
Article or any other provision of this Indenture, the Trustee shall not be
charged with knowledge of the existence of any facts which would prohibit the
making of any payment to or by the Trustee in respect of the Securities, unless
and until the Trustee shall have received written notice thereof from the
Company or a holder of Senior Debt or from any trustee therefor; and, prior to
the receipt of any such written notice, the Trustee, subject to the provisions
of Section 601, shall be entitled in all respects to assume that no such facts
exist; provided, however, that if the Trustee shall not have received the notice
provided for in this Section at least two Business Days prior to the date upon
which by the terms hereof any money may become payable for any purpose
(including, without limitation, the payment of the principal of and any premium
or interest on any Security), then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive such
money and to apply the same to the purpose for which such money was received and
shall not be affected by any notice to the contrary which may be received by it
within two Business Days prior to such date.
[Subject to the provisions of Section 601, the Trustee shall be entitled to
rely on the delivery to it of a written notice by a Person representing himself
to be a holder of Senior Debt (or a trustee therefor) to establish that such
notice has been given by a holder of Senior Debt (or a trustee therefor). In the
event that the Trustee determines in good faith that further evidence is
required with respect to the right of any Person as a holder of Senior Debt to
participate in any payment or distribution pursuant to this Article, the Trustee
may request such Person to furnish evidence to the reasonable satisfaction of
the Trustee as to the amount of Senior Debt held by such Person, the extent to
which such Person is entitled to participate in such payment or distribution and
any other facts pertinent to the rights of such Person under this Article, and
if such evidence is not furnished, the Trustee may defer any payment to such
Person pending judicial determination as to the right of such Person to receive
such payment.]
Section 1511. Reliance on Judicial Order or Certificate of Liquidating Agent.
Upon any payment or distribution of assets of the Company referred to in this
Article, the Trustee, subject to the provisions of Section 601, and the Holders
of the Securities shall be entitled to rely upon any order or decree entered by
any court of competent jurisdiction in which such insolvency, bankruptcy,
receivership, liquidation, reorganization, dissolution, winding up or similar
case or proceeding is pending, or a certificate of the trustee in
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bankruptcy, receiver, liquidating trustee, custodian, assignee for the benefit
of creditors, agent or other Person making such payment or distribution,
delivered to the Trustee or to the Holders of Securities, for the purpose of
ascertaining the Persons entitled to participate in such payment or
distribution, the holders of the Senior Debt 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 1512. Trustee Not Fiduciary for Holders of Senior Debt.
The Trustee, in its capacity as trustee under this Indenture, shall not be
deemed to owe any fiduciary duty to the holders of Senior Debt and shall not be
liable to any such holders if it shall in good faith mistakenly pay over or
distribute to Holders of Securities or to the Company or to any other Person
cash, property or securities to which any holders of Senior Debt shall be
entitled by virtue of this Article or otherwise.
Section 1513. Rights of Trustee as Holder of Senior Debt;
Preservation of Trustee's Rights.
The Trustee in its individual capacity shall be entitled to all the rights
set forth in this Article with respect to any Senior Debt which may at any time
be held by it, to the same extent as any other holder of Senior Debt, and
nothing in this Indenture shall deprive the Trustee of any of its rights as such
holder.
Nothing in this Article shall apply to claims of, or payments to, the Trustee
under or pursuant to Section 607.
Section 1514. Article Applicable to Paying Agents.
In case at any time any Paying Agent other than the Trustee shall have been
appointed by the Company and be then acting hereunder, the term "Trustee" as
used in this Article shall in such case (unless the context otherwise requires)
be construed as extending to and including such Paying Agent within its meaning
as fully for all intents and purposes as if such Paying Agent were named in this
Article in addition to or in place of the Trustee; provided, however, that
Section 1513 shall not apply to the Company or any Affiliate of the Company if
it or such Affiliate acts as Paying Agent.
Section 1515. Certain Conversions Deemed Payment.
For the purposes of this Article only, (1) the issuance and delivery of
junior securities upon conversion of Securities in accordance with Article
Fourteen shall not be deemed to constitute a payment or distribution on account
of the principal of or any premium or interest on Securities or on account of
the purchase or other acquisition of Securities, and (2) the payment, issuance
or delivery of cash, property or securities (other than junior securities)
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upon conversion of a Security shall be deemed to constitute payment on account
of the principal of such Security. For the purposes of this Section, the term
"junior securities" means (a) shares of any stock of any class of the Company
and (b) securities of the Company which are subordinated in right of payment to
all Senior Debt which may be outstanding at the time of issuance or delivery of
such securities to substantially the same extent as, or to a greater extent
than, the Securities are so subordinated as provided in this Article.
Section 1516. Obligations of Company and Right to Convert Unconditional.
Nothing contained in this Article or elsewhere in this Indenture or in the
Securities is intended to or shall impair, as among the Company, its creditors
other than holders of Senior Debt and the Holders of the Securities, the
obligation of the Company, which is absolute and unconditional, to pay to the
Holders of the Securities the principal of and any premium and interest on the
Securities as and when the same shall become due and payable in accordance with
their terms, or affect the relative rights of the Holders of the Securities and
creditors of the Company other than the holders of Senior Debt, nor shall
anything herein or therein prevent the Trustee or the Holder of any Securities
from exercising all remedies otherwise permitted by applicable law upon default
under this Indenture, subject to the rights, if any, under this Article of the
holders of Senior Debt in respect of cash, property or securities of the Company
received upon the exercise of any such remedy.
Nothing contained in this Article or elsewhere in this Indenture or in the
Securities is intended to or shall impair, as among the Company, its creditors
other than holders of Senior Debt and the Holders of the Securities, the right,
which is absolute and unconditional, of the Holder of any Security to convert
such Security in accordance with Article Fourteen.
_____________________________
-77-
<PAGE>
This instrument may be executed in any number of counterparts, each of which
so executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.
In Witness Whereof, the parties hereto have caused this Indenture to be duly
executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
Amstrong World Industries, Inc.
By.......................................
Attest:
..............................
Mellon Bank, N.A.
By.......................................
E. D. Renn, Vice President
Attest:
..............................
Authorized Officer
-78-
<PAGE>
Commonwealth of Pennsylvania )
) ss.:
County of Allegheny )
On the ..... day of ..............., 1996, before me personally came
E. D. Renn, to me known, who, being by me duly sworn, did depose and say that
she is a Vice President of Mellon Bank, N.A. one of the corporations described
in and which executed the foregoing instrument; that she knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Board of Directors of said
corporation; and that she signed her name thereto by like authority.
...............................................
Commonwealth of Pennsylvania )
) ss.:
County of .................. )
On the .... day of ..........., ...., before me personally came
..........................., to me known, who, being by me duly sworn, did
depose and say that he is .................... of
................................., one of the corporations described in and
which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Board of Directors of said
corporation; and that he signed his or her name thereto by like authority.
...............................................
...............................................
-79-
<PAGE>
Exhibit 12.1
Exhibit 12.2
CALCULATION OF THE RATIOS OF EARNINGS TO FIXED CHARGES AND EARNINGS
TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
<TABLE>
<CAPTION> Three Months Ended Year Ended
March 31 December 31
(Amounts in Millions) (Amounts in Millions)
1995 1996 1991 1992 1993 1994 1995
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings (Loss) from continuing businesses $41.3 $54.5 $82.8 ($66.3) $66.6 $265.8 $8.2
before income taxes ----------------- -----------------------------------------------------
Fixed Charges:
Amortized finance costs $0.1 $0.0 $0.3 $0.3 $0.3 $0.2 $0.2
Interest expense $8.0 $6.3 $45.8 $41.6 $38.0 $28.3 $34.0
Operating leases (1/3 of rent expense) $1.2 $1.0 $4.9 $5.6 $4.8 $4.5 $4.4
----------------- -----------------------------------------------------
Total Fixed Charges (excluding Preferred $9.3 $7.3 $51.0 $47.5 $43.1 $33.0 $38.6
Stock Dividends) ================= =====================================================
Adjusted Earnings (Loss) from continuing $50.6 $61.8 $133.8 ($18.8) $109.7 $298.8 $46.8
businesses before income taxes ================= =====================================================
(excluding Preferred Stock Dividends)
================= =====================================================
Ratio of Earnings from continuing 5.44 8.47 2.62 N/A(1) 2.55 9.05 1.21
businesses to fixed charges ================= =====================================================
Preferred Dividends $4.7 $4.4 $19.4 $19.3 $19.2 $19.0 $18.8
Ratio of Earnings from continuing ================= =====================================================
businesses to fixed charges and 3.61 5.28 1.90 N/A(1) 1.76 5.75 N/A(2)
Preferred Stock Dividends ================= =====================================================
</TABLE>
(1) Earnings were inadequate to cover Fixed Charges by $66.3 million and Fixed
Charges plus Preferred Stock Dividends by $85.6 million.
(2) Earnings were inadequate to cover Fixed Charges plus Preferred Stock
Dividends by $10.6 million.
<PAGE>
Exhibit 15.1
Armstrong World Industries, Inc.
Lancaster, Pennsylvania
Gentlemen:
With respect to the Registration Statement filed on Form S-3, we acknowledge our
awareness of the incorporation by reference therein of our report dated May 6,
1996, related to our review of interim financial information.
Pursuant to Rule 436(c) under the Securities Act, such report is not considered
a part of a Registration Statement prepared or certified by an accountant
or a report prepared or certified by an accountant within the meaning of
Sections 7 and 11 of the Securities Act.
Very truly yours,
KPMG PEAT MARWICK L.L.P.
Philadelphia, Pennsylvania
June 19, 1996
<PAGE>
Exhibit 23.2
Consent of Independent Auditors
-------------------------------
The Board of Directors
Armstrong World Industries, Inc.:
We consent to the use of our audit report dated February 16, 1996, on the
consolidated balance sheets of Armstrong World Industries, Inc. and
subsidiaries as of December 31, 1995 and 1994 and the related consolidated
statements of earnings, cash flows and shareholders' equity and related
supplementary information on depreciation rates and schedule for each of
the years in the three-year period ended December 31, 1995, incorporated
herein by reference and to the reference to our firm under the heading
"Experts" in the prospectus.
KPMG PEAT MARWICK L.L.P.
Philadelphia Pennsylvania
June 19, 1996
<PAGE>
Exhibit 23.3
Consent of Independent Auditors
-------------------------------
Armstrong World Industries, Inc.:
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement on Form S-3 pertaining to the Registration of securities
of Armstrong World Industries, Inc. and to the incorporation by reference
therein of our report dated February 21, 1995, with respect to the consolidated
financial statements and schedule of Dal-Tile International Inc. included in its
Annual Report (Form 10-K) for the year ended December 31, 1994, and included in
the Current Report on Form 8-K/A of Armstrong World Industries, Inc.
Ernst & Young LLP
Dallas, Texas
June 19, 1996
<PAGE>
Exhibit 24.1
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that the undersigned director and/or officer of
Armstrong World Industries, Inc. (the "Company") hereby constitutes and
appoints George A. Lorch, Frank A. Riddick and Larry A. Pulkrabek, and each of
them, the undersigned's true and lawful attorneys-in-fact and agents, with full
power of substitution and resubstitution in each, for the undersigned in his or
her name, place and stead, in any and all capacities (including the
undersigned's capacity as a director and/or officer of the Company), granting
unto said attorneys in-fact and agents, and each of them, full power and
authority to do and perform each and every act and thing and to execute any and
all instruments which said attorneys-in-fact and agents, or any of them, may
deem necessary or advisable or which may be required to enable the Company to
comply with the Securities Act of 1933, as amended, and any rules, regulations
or requirements of the Securities and Exchange Commission in respect thereof, in
connection with the registration under said Act of up to $500,000,000 aggregate
amount of Securities (which may include senior or subordinated debt securities,
preferred stock, common stock or depositary shares or securities convertible
into preferred stock, common stock or depositary shares) and the offering
thereof, in one or more series, on a delayed or continuous basis, as fully to
all intents and purposes as the undersigned might or could do in person,
including specifically, but without limiting the generality of the foregoing,
the power and authority to sign the name of the undersigned in the capacity of
director and/or officer of the Company to any registration statement to be filed
with the Securities and Exchange Commission in respect of said Securities, to
any and all amendments and supplements to any such registration statements,
including post-effective amendments thereto, and to any instruments or documents
filed as part of or in connection with any such registration statements or
amendments or supplements thereto, and to file such documents with the
Securities and Exchange Commission; and to do any and all acts and things and to
execute any and all instruments that said attorneys and agents and each of them
may deem necessary or desirable to enable the Company to comply with the
Securities Exchange Act of 1934, as amended, and any requirements of the
Securities and Exchange Commission thereunder, including specifically, but
without limiting the generality of foregoing, power and authority to sign the
name of the undersigned director and/or officer in such capacity, to any
application, report, instrument, certificate, form or other document, and any
and all supplements and amendments thereto, to be filed on behalf of said
corporation with the Securities and Exchange Commission; and the undersigned
hereby ratifies and confirms all that said attorneys-in-fact and agents, or any
of them, or their or his or her substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has subscribed these presents on the date
set forth opposite his or her name below.
Date: April 29, 1996 ________________________________
Signature Title
--------- -----
/s/ George A. Lorch Chairman of the Board, President and Chief
- ------------------------- Executive Officer
George A. Lorch
See Schedule A See Schedule A to Exhibit 24.1
to Exhibit 24.1
<PAGE>
SCHEDULE A TO EXHIBIT 24.1
Pursuant to Instruction 2 to Item 601 of Regulation S-K, the Powers
of Attorney executed by the following directors and officers of the Company,
which are substantially identical in all material respects except as to the
executing party to the Power of Attorney set forth in Exhibit 24.1, are
identified in this Schedule A to Exhibit 24.1.
/s/ Frank A. Riddick, III Senior Vice-President, Finance, and Chief
- ------------------------- Financial Officer (Principal Financial Officer)
Frank A. Riddick, III
/s/ Bruce A. Leech, Jr. Controller (Principal Accounting Officer)
- -------------------------
Bruce A. Leech, Jr.
/s/ H. Jesse Arnelle Director
- -------------------------
H. Jesse Arnelle
/s/ Van C. Campbell Director
- -------------------------
Van C. Campbell
/s/ Donald C. Clark Director
- -------------------------
Donald C. Clark
/s/ E. Allen Deaver Director
- -------------------------
E. Allen Deaver
/s/ Ursala F. Fairbairn Director
- -------------------------
Ursala F. Fairbairn
/s/ James E. Marley Director
- -------------------------
James E. Marley
/s/ J. Philip Samper Director
- -------------------------
J. Philip Samper
/s/ Jerre L. Stead Director
- -------------------------
Jerre L. Stead
<PAGE>
Exhibit 25.1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-----------------------
Form T-1
-----------------------
STATEMENT OF ELIGIBILITY UNDER THE
TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS
TRUSTEE
-----------------------
Check if an application to determine eligibility of
a Trustee pursuant to Section 305(b)(2) [X]
MELLON BANK, N.A.
(Name of Trustee)
25-0659306 U.S.
(I.R.S. Employer Identification No.) (Jurisdiction of incorporation)
One Mellon Bank Center
Pittsburgh, PA 15258-0001
(Address of Principal Executive Office)
Elaine E. Renn
Vice President
MELLON BANK, N.A.
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258-0001
(412) 234-2472
(Name, Address and Telephone Number of Agent for Service)
-----------------------
ARMSTRONG WORLD INDUSTRIES, INC.
(Name of Obligor)
PENNSYLVANIA
(State or Other Jurisdiction of Incorporation or Organization)
23-0366390
(I.R.S. Employer Identification No.)
313 WEST LIBERTY STREET, LANCASTER, PA 17603
(Address of Principal Executive Offices)
SENIOR DEBT SECURITIES
(Title of Indenture Securities)
<PAGE>
1. General information. Furnish the following information as to the trustee --
(a) Name and address of each examining or supervising authority to which
it is subject.
Comptroller of the Currency Washington, D.C.
Federal Reserve Bank of Cleveland Cleveland, Ohio
Federal Deposit Insurance Corporation Washington, D.C.
(b) Whether it is authorized to exercise corporate trust powers.
The trustee is authorized to exercise corporate trust powers.
2. Affiliations with the obligor. If the obligor is an affiliate of the
trustee, describe each such affiliation.
The obligor is not an affiliate of the trustee.
Items 3-15 are not applicable since the Obligor is not in default on securities
issued under Indentures under which the applicant is trustee.
16. List of exhibits. List below all exhibits filed as a part of this
statement of eligibility.
Exhibit 1 - Copy of articles of association of the trustee as now in
effect, filed as Exhibit 1 to trustee's statement of
eligibility and qualification, Registration No. 33-46990,
and incorporated herein by reference.
Exhibit 2 - Copy of certificate of the authority of the trustee to
commence business, copy of certificate of consolidation
with the Union Trust Company of Pittsburgh and copy of
certificate approving merger of Mellon National Bank and
Trust Company into Mellon Bank, N.A. filed as Exhibit
T1A(b) to trustee's statement of eligibility and
qualification, Registration No. 33-13020, and
incorporated herein by reference.
Exhibit 3 - Copy of certificate as to authority of the trustee to
exercise corporate trust powers, filed as Exhibit T1A(c)
to trustee's statement of eligibility and qualification,
Registration No. 33-13020, and incorporated herein by
reference.
Exhibit 4 - Copy of existing by-laws of the trustee, filed as Exhibit
4 to trustee's statement of eligibility and
qualification, Registration No. 33-46990, and
incorporated herein by reference.
Exhibit 5 - Copy of each indenture referred to in Item 4, if the
obligor is in default. Not Applicable.
Exhibit 6 - Consent of the trustee required by Section 321(b) of the
Act, filed as Exhibit T1D to trustee's statement of
eligibility and qualification, Registration No. 33-13020,
and incorporated herein by reference.
Exhibit 7 - Copy of the latest report of condition of the trustee
transmitted electronically pursuant to law or the
requirements of its supervising or examining authority.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
trustee, Mellon Bank, N.A., a national banking association organized and
existing under the laws of the United States of America, has duly caused this
statement of eligibility to be signed on its behalf by the undersigned,
thereunto duly authorized, all in the city of Pittsburgh, and Commonwealth of
Pennsylvania, on the 7th day of June, 1996.
MELLON BANK, N.A.
TRUSTEE
By: /s/ Elaine D. Renn
--------------------------
Elaine D. Renn
Vice President
<PAGE>
EXHIBIT 7
REPORT OF CONDITION
CONSOLIDATING DOMESTIC AND FOREIGN SUBSIDIARIES OF
MELLON BANK, N.A.
FOR MARCH 31, 1996
In the Commonwealth of Pennsylvania, at the close of business on
March 31, 1996; Transmitted electronically in response to call made by
Comptroller of the Currency, under Title 12, United States Code, Section 161.
Charter No. 6301 Northeastern District
STATEMENT OF RESOURCES AND LIABILITIES
(in thousands)
<TABLE>
<S> <C> <C>
Assets
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin........................................ $ 2,551,023
Interest-bearing balances................................................................. 1,238,899
Securities:
Held-to-maturity securities............................................................... 2,439,004
Available-for-sale securities............................................................. 3,099,006
Federal funds sold and securities purchased under agreements
to resell in domestic offices of the bank and of its
Edge and Agreement subsidiaries, and in IBFs:
Federal funds sold........................................................................ 702,797
Securities purchased under agreements to resell........................................... 30,000
Loans and lease financing receivables:
Loans and leases, net of unearned income.................................... $22,883,119
LESS: Allowance for loan and lease losses.................................. 307,557
Loans and leases, net of unearned income, allowance, and reserve.......................... 22,575,562
Assets held in trading accounts............................................................. 267,077
Premises and fixed assets (including capitalized leases).................................... 471,772
Other real estate owned..................................................................... 61,625
Customers' liability to this bank on acceptances outstanding................................ 245,337
Intangible assets........................................................................... 1,092,534
Other assets................................................................................ 1,476,962
Total Assets............................................................. 36,251,598
Liabilities
Deposits:
In domestic offices....................................................................... 22,173,508
Noninterest-bearing...................................................... 6,940,994
Interest-bearing......................................................... 15,232,514
In foreign offices, Edge and Agreement subsidiaries, and IBFs............................. 3,670,489
Noninterest-bearing...................................................... 21,548
Interest-bearing......................................................... 3,648,941
Federal funds purchased and securities sold under agreements
to repurchase in domestic offices of the bank and of its
Edge and Agreement subsidiaries, and in IBFs:
Federal funds purchased................................................................... 2,113,635
Securities sold under agreements to repurchase............................................ 1,256,071
Demand notes issued to the U.S. Treasury.................................................... 319,803
Trading liabilities......................................................................... 247,310
Other borrowed money:
With remaining maturity of one year or less............................................... 1,560,260
With remaining maturity of more than one year............................................. 164,882
Mortgage indebtedness and obligations under capitalized leases.............................. 2,898
Bank's liability on acceptances executed and outstanding.................................... 245,337
Subordinated notes and debentures........................................................... 698,251
Other liabilities........................................................................... 802,115
Total Liabilities.................................................... 33,245,559
Equity Capital
Common stock................................................................................ 167,285
Surplus (exclude all surplus related to preferred stock).................................... 831,676
Undivided profits and capital reserves...................................................... 2,028,643
Net unrealized holding gains (losses) on available-for-sale securities...................... (23,949)
Cumulative foreign currency translation adjustments......................................... (6,616)
Total Equity Capital................................................. 2,997,039
Total Liabilities, Limited-Life Preferred Stock, and Equity Capital.. 36,251,598
</TABLE>
<PAGE>
I, Michael K. Hughey, Senior Vice President and Corporate Controller of the
above-named bank, do hereby declare that this Report of Condition is true and
correct to the best of my knowledge and belief.
Michael K. Hughey
May 6, 1996
We, the undersigned directors, attest to the correctness of this
Statement of Resources and Liabilities. We declare that it has been examined by
us, and to the best of our knowledge and belief has been prepared in conformance
with the instructions and is true and correct.
Frank V. Cahouet
W. Keith Smith
Charles A. Corry
<PAGE>
Exhibit 25.2
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-----------------------
Form T-1
-----------------------
STATEMENT OF ELIGIBILITY UNDER THE
TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS
TRUSTEE
-----------------------
Check if an application to determine eligibility of
a Trustee pursuant to Section 305(b)(2) [X]
MELLON BANK, N.A.
(Name of Trustee)
25-0659306 U.S.
(I.R.S. Employer Identification No.) (Jurisdiction of incorporation)
One Mellon Bank Center
Pittsburgh, PA 15258-0001
(Address of Principal Executive Office)
Elaine E. Renn
Vice President
MELLON BANK, N.A.
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258-0001
(412) 234-2472
(Name, Address and Telephone Number of Agent for Service)
-----------------------
ARMSTRONG WORLD INDUSTRIES, INC.
(Name of Obligor)
PENNSYLVANIA
(State or Other Jurisdiction of Incorporation or Organization)
23-0366390
(I.R.S. Employer Identification No.)
313 WEST LIBERTY STREET, LANCASTER, PA 17603
(Address of Principal Executive Offices)
SUBORDINATED DEBT SECURITIES
(Title of Indenture Securities)
<PAGE>
1. General information. Furnish the following information as to the trustee --
(a) Name and address of each examining or supervising authority to which
it is subject.
Comptroller of the Currency Washington, D.C.
Federal Reserve Bank of Cleveland Cleveland, Ohio
Federal Deposit Insurance Corporation Washington, D.C.
(b) Whether it is authorized to exercise corporate trust powers.
The trustee is authorized to exercise corporate trust powers.
2. Affiliations with the obligor. If the obligor is an affiliate of the
trustee, describe each such affiliation.
The obligor is not an affiliate of the trustee.
Items 3-15 are not applicable since the Obligor is not in default on securities
issued under Indentures under which the applicant is trustee.
16. List of exhibits. List below all exhibits filed as a part of this
statement of eligibility.
Exhibit 1 - Copy of articles of association of the trustee as now in
effect, filed as Exhibit 1 to trustee's statement of
eligibility and qualification, Registration No. 33-46990,
and incorporated herein by reference.
Exhibit 2 - Copy of certificate of the authority of the trustee to
commence business, copy of certificate of consolidation
with the Union Trust Company of Pittsburgh and copy of
certificate approving merger of Mellon National Bank and
Trust Company into Mellon Bank, N.A. filed as Exhibit
T1A(b) to trustee's statement of eligibility and
qualification, Registration No. 33-13020, and
incorporated herein by reference.
Exhibit 3 - Copy of certificate as to authority of the trustee to
exercise corporate trust powers, filed as Exhibit T1A(c)
to trustee's statement of eligibility and qualification,
Registration No. 33-13020, and incorporated herein by
reference.
Exhibit 4 - Copy of existing by-laws of the trustee, filed as Exhibit
4 to trustee's statement of eligibility and
qualification, Registration No. 33-46990, and
incorporated herein by reference.
Exhibit 5 - Copy of each indenture referred to in Item 4, if the
obligor is in default. Not Applicable.
Exhibit 6 - Consent of the trustee required by Section 321(b) of the
Act, filed as Exhibit T1D to trustee's statement of
eligibility and qualification, Registration No. 33-13020,
and incorporated herein by reference.
Exhibit 7 - Copy of the latest report of condition of the trustee
transmitted electronically pursuant to law or the
requirements of its supervising or examining authority.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
trustee, Mellon Bank, N.A., a national banking association organized and
existing under the laws of the United States of America, has duly caused this
statement of eligibility to be signed on its behalf by the undersigned,
thereunto duly authorized, all in the city of Pittsburgh, and Commonwealth of
Pennsylvania, on the 7th day of June, 1996.
MELLON BANK, N.A.
TRUSTEE
By: /s/ Elaine D. Renn
--------------------------
Elaine D. Renn
Vice President
<PAGE>
EXHIBIT 7
REPORT OF CONDITION
CONSOLIDATING DOMESTIC AND FOREIGN SUBSIDIARIES OF
MELLON BANK, N.A.
FOR MARCH 31, 1996
In the Commonwealth of Pennsylvania, at the close of business on
March 31, 1996; Transmitted electronically in response to call made by
Comptroller of the Currency, under Title 12, United States Code, Section 161.
Charter No. 6301 Northeastern District
STATEMENT OF RESOURCES AND LIABILITIES
(in thousands)
<TABLE>
<S> <C> <C>
Assets
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin........................................ $ 2,551,023
Interest-bearing balances................................................................. 1,238,899
Securities:
Held-to-maturity securities............................................................... 2,439,004
Available-for-sale securities............................................................. 3,099,006
Federal funds sold and securities purchased under agreements
to resell in domestic offices of the bank and of its
Edge and Agreement subsidiaries, and in IBFs:
Federal funds sold........................................................................ 702,797
Securities purchased under agreements to resell........................................... 30,000
Loans and lease financing receivables:
Loans and leases, net of unearned income.................................... $22,883,119
LESS: Allowance for loan and lease losses.................................. 307,557
Loans and leases, net of unearned income, allowance, and reserve.......................... 22,575,562
Assets held in trading accounts............................................................. 267,077
Premises and fixed assets (including capitalized leases).................................... 471,772
Other real estate owned..................................................................... 61,625
Customers' liability to this bank on acceptances outstanding................................ 245,337
Intangible assets........................................................................... 1,092,534
Other assets................................................................................ 1,476,962
Total Assets............................................................. 36,251,598
Liabilities
Deposits:
In domestic offices....................................................................... 22,173,508
Noninterest-bearing...................................................... 6,940,994
Interest-bearing......................................................... 15,232,514
In foreign offices, Edge and Agreement subsidiaries, and IBFs............................. 3,670,489
Noninterest-bearing...................................................... 21,548
Interest-bearing......................................................... 3,648,941
Federal funds purchased and securities sold under agreements
to repurchase in domestic offices of the bank and of its
Edge and Agreement subsidiaries, and in IBFs:
Federal funds purchased................................................................... 2,113,635
Securities sold under agreements to repurchase............................................ 1,256,071
Demand notes issued to the U.S. Treasury.................................................... 319,803
Trading liabilities......................................................................... 247,310
Other borrowed money:
With remaining maturity of one year or less............................................... 1,560,260
With remaining maturity of more than one year............................................. 164,882
Mortgage indebtedness and obligations under capitalized leases.............................. 2,898
Bank's liability on acceptances executed and outstanding.................................... 245,337
Subordinated notes and debentures........................................................... 698,251
Other liabilities........................................................................... 802,115
Total Liabilities.................................................... 33,245,559
Equity Capital
Common stock................................................................................ 167,285
Surplus (exclude all surplus related to preferred stock).................................... 831,676
Undivided profits and capital reserves...................................................... 2,028,643
Net unrealized holding gains (losses) on available-for-sale securities...................... (23,949)
Cumulative foreign currency translation adjustments......................................... (6,616)
Total Equity Capital................................................. 2,997,039
Total Liabilities, Limited-Life Preferred Stock, and Equity Capital.. 36,251,598
</TABLE>
<PAGE>
I, Michael K. Hughey, Senior Vice President and Corporate Controller of the
above-named bank, do hereby declare that this Report of Condition is true and
correct to the best of my knowledge and belief.
Michael K. Hughey
May 6, 1996
We, the undersigned directors, attest to the correctness of this
Statement of Resources and Liabilities. We declare that it has been examined by
us, and to the best of our knowledge and belief has been prepared in conformance
with the instructions and is true and correct.
Frank V. Cahouet
W. Keith Smith
Charles A. Corry
