<PAGE>
As filed with the Securities and Exchange Commission on March 16, 1999
Registration No. 333-
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
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)
23-0366390
Pennsylvania
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
<TABLE>
<S> <C>
Deborah K. Owen, Esq.
2500 Columbia Avenue Senior Vice President, Secretary and General Counsel
Lancaster, Pennsylvania 17603 2500 Columbia Avenue
(717) 397-0611 Lancaster, Pennsylvania 17603
(address, including zip code, and telephone (717) 397-0611
number, including area code, of (Name, address, including zip code, and telephone
registrant's principal executive offices) number, including area code, of agent for service)
</TABLE>
With copies to:
Bonnie A. Barsamian, Esq.
Robert E. King, Jr., Esq.
Rogers & Wells LLP
200 Park Avenue
New York, New York 10166-0153
(212) 878-8000
---------------
Approximate Date of Commencement of Proposed Sale to the Public: From time
to time after this Registration Statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [_]
If the only 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. [_]
---------------
Calculation of Registration Fee
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Title of each class of Proposed maximum Proposed maximum
securities to be Amount to be offering price aggregate Amount of
registered registered per unit(1) offering price(1) registration fee
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Debt Securities(5)
Common Stock(5)
Class A Preferred
Stock(5)
Warrants
Depositary Shares
Total................... $1,000,000,000(2)(3) $1,000,000,000(2)(3) $1,000,000,000(1)(2)(3)(4) $278,000
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(o) under the Securities Act.
(2) In U.S. dollars or the equivalent thereof in any other currency, currency
unit or units or composite currency or currencies. Such amount represents
the aggregate offering price of the securities registered hereunder and
the exercise price of any securities issuable upon exercise of warrants.
If any securities are issued at an original issue discount, then such
greater amount as shall result in an aggregate initial offering price of
$1,000,000,000.
(3) Not specified as to each class of securities to be registered, pursuant to
General Instruction II.D. of Form S-3.
(4) The number of shares of Common Stock registered hereunder is limited to
that which is permissible under Rule 415(a)(4) of the Securities Act of
1933.
(5) Also includes such indeterminate number of shares of Class A Preferred
Stock and Common Stock as may be issued upon conversion of or exchange for
any Debt Securities, or Class A Preferred Stock that provides for
conversion or exchange into other securities. The Common Stock being
registered includes an indeterminate number of shares of Series One
Preferred Stock and Preferred Stock Purchase Rights which will attach to
any share of Common Stock issued and an indeterminate number of shares of
Series One Preferred Stock issuable upon exercise of such Preferred Stock
Purchase Rights.
---------------
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933 or until the Registration Statement
shall become effective on such date as the Commission, acting pursuant to said
Section 8(a), may determine.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
PROSPECTUS
ARMSTRONG WORLD INDUSTRIES, INC.
----------------
$1,000,000,000
Debt Securities
Common Stock
Class A Preferred Stock
Warrants
Depositary Shares
We may offer from time to time, together or separately, (1) debt
securities, referred to as "Debt Securities," which may be either senior debt
securities or subordinated debt securities or other evidences of indebtedness
in one or more series; (2) shares of common stock, referred to as "Common
Stock," including Preferred Stock Purchase Rights which attach to each share
of Common Stock, referred to as "Rights"; (3) shares of Class A Preferred
Stock, referred to as "Preferred Stock," including shares of Series One
Preferred Stock issuable upon exercise of the Rights and one or more series of
Class A Preferred Stock which may be convertible into or exchangeable for
Common Stock or Debt Securities; (4) warrants or other rights to purchase Debt
Securities, Common Stock or Preferred Stock, or any combination thereof, as we
may designate at the time of the offering, referred to as "Warrants"; and (5)
depositary shares, referred to as "Depositary Shares." Our Common Stock is
listed on the New York Stock Exchange, the Pacific Stock Exchange and the
Philadelphia Stock Exchange under the symbol "ACK." Our 7.45% Senior Quarterly
Interest Bonds due 2038 are listed on the New York Stock Exchange under the
symbol "AKK." The Debt Securities, Common Stock, Preferred Stock, Warrants and
Depositary Shares are collectively referred to as the "Securities."
The aggregate initial offering price of the Securities that we intend to
offer will not exceed $1,000,000,000. The Securities may be issued as units
and in any combination. We will offer the Securities in amounts, at prices and
on terms to be determined by market conditions at the time of the offering.
We will provide the specific terms of the Securities in supplements to this
prospectus. You should read this prospectus and the prospectus supplements
carefully before you invest in the Securities. This prospectus may not be used
to consummate sales of Securities unless accompanied by a prospectus
supplement.
Your investment in the Securities may involve certain risks. See "Risk
Factors" beginning on page 5 of this prospectus and those risk factors
contained in the applicable prospectus supplement, if any, for any additional
risks in connection with your investment.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities, or determined if
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.
----------------
The date of this Prospectus is March 16, 1999.
The information contained in this prospectus is not complete and may be
changed. A registration statement relating to these Securities has been filed
with the Securities and Exchange Commission. We may not sell these Securities
until the registration statement becomes effective. This prospectus is not an
offer to sell or the solicitation of an offer to buy these Securities in any
state in which such offer, solicitation or sale is not permitted.
<PAGE>
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
Securities and Exchange Commission using a "shelf" registration process. Under
this shelf process, we may sell any combination of the Securities described in
this prospectus in one or more offerings up to a total dollar amount of
$1,000,000,000. This prospectus provides you with a general description of the
Securities we may offer. Each time we sell Securities, we will provide a
prospectus supplement that will contain specific information about the terms
of that offering. The prospectus supplement may also add, update or change
information contained in this prospectus. You should read both this prospectus
and any prospectus supplement together with additional information described
under the heading "Where You Can Find More Information" before you invest in
any of the Securities.
WHERE YOU CAN FIND MORE INFORMATION
Armstrong World Industries, Inc., referred to as the "Company," files
annual, quarterly and special reports, proxy statements and other information
with the Securities and Exchange Commission. The Securities and Exchange
Commission is referred to in this prospectus as the "Commission." You may read
and copy any document that the Company files at the Commission's public
reference rooms located at 450 Fifth Street, N.W., Judiciary Plaza, Room 1024,
Washington, D.C. 20549; at regional offices of the Commission at the
Northwestern Atrium Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661-2511; and at 7 World Trade Center, New York, New York 10048.
The Company's filings with the Commission (file number 001-02116) are also
available to the public at the Commission's web site at http://www.sec.gov.
You may also read and copy these documents at the offices of the New York
Stock Exchange, 20 Broad Street, New York, New York 10005.
In addition, the Company has filed with the Commission a Registration
Statement on Form S-3 under the Securities Act of 1933, as amended, with
respect to the Securities. This prospectus does not contain all of the
information in the Registration Statement. For further information with
respect to the Company and the Securities, you should read the Registration
Statement and its exhibits.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Commission allows the Company to "incorporate by reference" the
information it files with them, which means that the Company can disclose
important information to you by referring you to those documents. The
information incorporated by reference is considered to be part of this
prospectus, and later information that the Company files with the Commission
will automatically update and supersede this information. The Company
incorporates by reference its Annual Report on Form 10-K for its fiscal year
ended December 31, 1998 and any future filings made with the Commission under
Sections 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934, as
amended, until such time as all of the Securities have been sold. In this
prospectus, the Securities Exchange Act of 1934, as amended, is referred to as
the "Exchange Act," and the Securities Act of 1933, as amended, is referred to
as the "Securities Act."
2
<PAGE>
You may request a copy of these filings, at no cost, by writing or
telephoning the Company at the following address:
Armstrong World Industries, Inc.
2500 Columbia Avenue
Lancaster, Pennsylvania 17603
Attn: Deborah K. Owen
Senior Vice President, Secretary
and General Counsel
(717) 397-0611
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING INFORMATION
This prospectus and any accompanying prospectus supplement include forward-
looking statements. We have based these forward-looking statements on our
current expectations and projections about future events. Forward looking
statements are generally identifiable by use of the words "may," "will,"
"should," "expect," "anticipate," "estimate," "believe," "intend" or "project"
or the negatives of such words or variations thereon or comparable
terminology. These forward-looking statements are subject to risks,
uncertainties and assumptions about the Company, including, among other
things:
. material adverse changes in economic conditions in the markets
served by the Company;
. the possibility that currently unanticipated difficulties may arise
in integrating the operations of newly acquired businesses and newly
formed joint ventures; and
. competition from others in the markets served by the Company.
We undertake no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise. In light of these risks, uncertainties and assumptions, the
forward-looking events discussed in this prospectus and any accompanying
prospectus supplement might not occur.
3
<PAGE>
THE COMPANY
The Company was incorporated in Pennsylvania in 1891. We design,
manufacture and sell interior furnishings, including floor coverings, building
products (primarily ceiling systems) and wood products. These products are
sold primarily for use in the furnishing, refurbishing, repair, modernization
and construction of residential, commercial and institutional buildings. We
also manufacture various industrial and other products, including pipe
insulation, gasket material and textile machine parts. Through Triangle
Pacific Corp., a company acquired on July 23, 1998 and referred to as
"Triangle Pacific," we manufacture hardwood and other flooring and relevant
products, as well as kitchen and bathroom cabinets. Further, effective
August 31, 1998, we acquired 93% of DLW Aktiengesellschaft, a German company,
that manufactures flooring and some office furniture in Europe.
Our business includes five segments, flooring coverings, building products,
wood products, insulation products and all other products, each of which is
described below.
. Floor Coverings
We are a worldwide manufacturer of floor coverings for the interiors of
homes and commercial and institutional buildings, offering a broad range of
resilient flooring together with adhesives, installation and maintenance
materials and accessories. Resilient flooring, in both sheet and tile form,
together with laminate flooring, linoleum, carpet and sports flooring, is made
in a wide variety of types, designs, and colors. These types of flooring offer
such features as ease of installation, reduced maintenance (no-wax), and
cushioning for greater underfoot comfort. Floor covering products are sold to
the commercial and residential market segments through wholesalers, retailers
(including large home centers), and contractors, and to the hotel/motel and
manufactured homes industries.
. Building Products
We are a major producer of ceiling materials in the United States and
abroad, and market both residential and commercial ceiling systems. Ceiling
materials for the home are offered in a variety of types and designs; most
provide noise reduction and incorporate Company-designed features intended to
permit ease of installation. These residential ceiling products are sold
through wholesalers and retailers (including large home centers). Commercial
ceiling systems, designed for use in shopping centers, offices, schools,
hospitals, and other commercial and institutional structures, are available in
numerous colors, performance characteristics and designs and offer
characteristics such as acoustical control, rated fire protection, and
aesthetic appeal. We sell commercial ceiling materials and accessories, along
with acoustical wall panels, to ceiling systems contractors and to resale
distributors. Suspension ceiling systems products are manufactured and sold
through a joint venture with Worthington Industries.
. Wood Products
The Company, through Triangle Pacific, manufactures and sells hardwood
flooring and other flooring and related products. The wood products segment
also manufactures and distributes kitchen and bathroom cabinets. These
products are used primarily in residential new construction and remodeling,
with some commercial applications such as retail stores and restaurants.
Flooring sales are generally made through independent wholesale flooring
distributors and the cabinets are distributed through Company-operated
distributors and directly to the end-user. The business of this segment is
seasonal, with demand for its products generally the highest between the
months of April and November.
4
<PAGE>
. Insulation Products
We manufacture insulation products for the technical insulation market.
Insulation products are made in a wide variety of types and designs to satisfy
various industrial and commercial applications with the majority of the
products comprising closed cell flexible foams. A broad range of cladding and
other related materials for the insulation contracting market are also
produced. Insulation products are sold primarily throughout Europe and North
America, with increasing markets in Asia and South America.
. All Other Products
Other business units include the making of a variety of specialty products
for the automotive, textile and other industries worldwide. Gasket materials
are sold for new and replacement use in the automotive, farm equipment,
appliance, small engine, compressor and other industries. Textile products
include cots and aprons sold to equipment manufacturers and textile mills.
Gasket and textile products are sold, depending on type and ultimate use, to
original equipment manufacturers, contractors, wholesalers, fabricators and
end users.
5
<PAGE>
RISK FACTORS
The Securities we plan to sell may involve a significant degree of risk.
Investors should carefully consider the risk factors described below, together
with all of the information set forth or incorporated by reference in this
prospectus or any accompanying prospectus supplement, in determining whether
or not to purchase any of the Securities. Additional risk factors may be set
forth in an accompanying prospectus supplement.
. Risks Associated with Integration of Triangle Pacific, DLW and Other
Possible Expansion.
The Company recently experienced a period of significant expansion. This
expansion period included the acquisitions of Triangle and DLW. It also
included expansion into markets that have not been traditionally serviced by
the Company. As a result, our management now manages a substantially larger
enterprise. We can not give any assurance that we can effectively implement
the organizational and operational systems necessary for optimal management
and integration of our newly expanded businesses, or any other businesses that
we may acquire in the future. We also can not give any assurances that we will
be able to manage our growth successfully. In addition, our management is in
the ongoing process of evaluating the nature and scope of our operations and
various short-term and long-term strategic considerations. We must assess to
what extent integration, consolidation or other modification of our businesses
is appropriate. Some uncertainties and risks relating to the integration of
combined operations may exist and, therefore, it is difficult to predict or
quantify the impact of such decisions on our results of operations and
financial condition.
While management expects to realize certain operating synergies and cost
savings as a result of its recent acquisitions as well as any future
acquisitions, there can be no assurance that such synergies and savings will
be achieved. It may also be difficult to integrate these businesses into our
Company successfully or on a timely basis. As a result, any future
acquisitions may have an adverse effect on our results of operations and
financial position.
. Absence of Public Market for the Debt Securities, Warrants and Preferred
Stock.
Any new Securities sold will have no established trading market, other than
the Company's Common Stock, which is listed on the New York, Pacific and
Philadelphia Stock Exchanges. Any Common Stock sold pursuant to a prospectus
supplement will be listed on the New York, Pacific and Philadelphia Stock
Exchanges, subject to official notice of issuance. Any underwriters purchasing
our Securities for any public offering and sale may make a market in such
Securities, but such underwriters will not be obligated to do so and may
discontinue any market making activities at any time without notice. As a
result, we can not give any assurance that the secondary market for any of the
Debt Securities, Warrants, Preferred Stock or Depositary Shares will be
liquid.
. Certain Provisions of the Company's Articles of Incorporation, Bylaws and
the Pennsylvania Business Corporation Law.
The Company's Articles of Incorporation and Bylaws, as well the
Pennsylvania Business Corporation Law, contain provisions that may have the
effect of delaying, deterring or preventing a change in control of the
Company, including without limitation, cumulative voting for directors,
classification of the board of directors into three classes, certain
supermajority voting requirements, the ability to issue shares of a series of
Preferred Stock without stockholder approval and the issuance of preferred
stock purchase rights which attach to each share of Common Stock and may
become exercisable in connection with certain acquisitions. For a further
description of these provisions, see "Description of Capital Stock."
6
<PAGE>
. Risks Associated with Year 2000 Issues.
Like most other companies, the Company strives to ensure that its
information systems are able to recognize and process date-sensitive
information properly as the year 2000 approaches. Systems that do not
recognize and process this information could generate erroneous data or even
fail. The Company is conducting reviews of its key computer systems and has
identified a number of systems that could be affected by the year 2000 issue.
The Company is undertaking to upgrade these systems to allow them to function
properly. If these steps are not completed successfully in a timely manner,
the Company's operations and financial performance could be adversely affected
through disruptions in operations.
7
<PAGE>
USE OF PROCEEDS
Except as otherwise described in any accompanying prospectus supplement,
the Company expects to add substantially all of the net proceeds from the sale
of the Securities to its funds to be used for general corporate purposes.
These general corporate purposes may include repayment of long-term and short-
term debt, capital expenditures, working capital and the financing of
acquisitions. Funds not used immediately may be invested in short-term
marketable securities.
8
<PAGE>
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 from continuing businesses to fixed charges for the indicated
periods.
<TABLE>
<CAPTION>
Year Ended December 31,
-------------------------
1994 1995 1996 1997 1998
<S> <C> <C> <C> <C> <C>
Ratio of earnings
from continuing businesses to fixed charges (1).. 8.71 1.06 8.23 10.29 0.63(2)
</TABLE>
- --------
(1) Excluding restructuring charges for all periods, the pre-tax loss on the
ceramic tile business combination for 1995 and an asbestos liability
charge in 1998, the ratios would have been 8.71, 7.26, 9.76, 10.29 and
5.06 for 1994, 1995, 1996, 1997 and 1998, respectively.
(2) Earnings were inadequate to cover fixed charges by $28.9 million.
The ratio of earnings from continuing businesses to fixed charges has been
computed by dividing earnings from continuing businesses by fixed charges. For
purposes of calculating this ratio, earnings from continuing businesses
consist of consolidated earnings from continuing business operations before
income taxes plus fixed charges. Fixed charges consist of interest expense and
one-third of rent expense which is deemed to be representative of interest and
amortization of finance costs.
The following table sets forth the Company's consolidated ratios of
earnings from continuing businesses to combined fixed charges and preferred
stock dividends for the indicated periods.
<TABLE>
<CAPTION>
Year Ended December 31,
----------------------------
1994 1995 1996 1997 1998
<S> <C> <C> <C> <C> <C>
Ratio of earnings
from continuing businesses to fixed charges
(1).......................................... 4.89 0.83(2) 5.73 10.29 0.63(3)
</TABLE>
- --------
(1) Excluding restructuring charges for all periods, the pre-tax loss on the
ceramic tile business combination for 1995 and an asbestos liability
charge in 1998, the ratios would have been 4.85, 4.32, 6.78, 10.29 and
5.06 for 1994, 1995, 1996, 1997 and 1998, respectively.
(2) Earnings were inadequate to cover fixed charges plus preferred stock
dividends by $16.2 million.
(3) Earnings were inadequate to cover fixed charges by $28.9 million.
9
<PAGE>
DESCRIPTION OF DEBT SECURITIES
This section describes the general terms and provisions of the Debt
Securities. A prospectus supplement will describe the specific terms of the
Debt Securities offered through that prospectus supplement and any general
terms outlined in this section that will not apply to those Debt Securities.
The senior debt securities, referred to as "Senior Debt Securities," will
be issued under an Indenture, dated as of December 23, 1998, between the
Company and The First National Bank of Chicago, as Trustee. In this
prospectus, The First National Bank of Chicago is referred to as the
"Trustee," and this Indenture is referred to as the "Senior Indenture." The
subordinated debt securities, referred to as "Subordinated Debt Securities,"
will be issued under a separate Indenture, dated as of December 23, 1998,
between the Company and the Trustee. In this prospectus, this Indenture is
referred to as the "Subordinated Indenture." The Senior Indenture and
Subordinated Indenture are sometimes referred to collectively as the
"Indentures."
The statements under this caption relating to the Debt Securities and the
Indentures are summaries only and are not complete. Such summaries make use of
terms defined in the Indentures. Wherever such terms are used herein or
particular provisions of the Indentures are referred to, such terms or
provisions, as the case may be, are incorporated by reference as part of the
statements made herein, and such statements are qualified in their entirety by
such reference. Certain defined terms in the Indentures are capitalized
herein. In the summary below, we have included references to section numbers
and articles of the applicable Indentures so that you can easily locate these
provisions. The Indentures have been filed as exhibits to the Registration
Statement of which this prospectus is a part. You should read the Indentures
for additional information before you decide to purchase any Debt Securities.
General
The Indentures do not limit the aggregate principal amount of Debt
Securities that may be issued. They provide that Debt Securities may be issued
from time to time, in one or more series, each in an aggregate principal
amount authorized by the Company prior to issuance. (Section 301) The Debt
Securities will have terms and provisions that are not inconsistent with the
Indentures. These terms will relate 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 our
unsecured and unsubordinated obligations and will rank on a parity with all of
our other unsecured and unsubordinated indebtedness. The Subordinated Debt
Securities when issued will be subordinated in right of payment to the prior
payment in full of all our Senior Debt, 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 being sold will be Senior Debt Securities or Subordinated Debt
Securities, the price or prices of the Debt Securities being issued and will
describe the following terms of the Debt Securities:
. the title of the Debt Securities and the aggregate principal amount
of the Debt Securities being issued by the Company;
. the Person to whom any interest on a Debt Security of the series is
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
payment;
10
<PAGE>
. the date or dates on which the principal of and premium, if any, on
such Debt Securities is payable or the method of determination of
the principal and premium, if any;
. the interest rate or rates of such Debt Securities or the method of
determination thereof, if any, the date or dates from which any such
interest will accrue, the date or dates on which any such interest
will be payable and the record date for any such interest payable on
any interest payment date;
. the place or places where the principal of, and any premium and
interest, if any, on any of such Debt Securities will be payable;
. the terms and conditions relating to redemption of any such Debt
Securities, if applicable;
. the obligation, if any, of the Company to redeem, repay or purchase
such Debt Securities pursuant to any sinking fund or analogous
provisions or at the option of a holder and the terms and conditions
upon which such Debt Securities will be redeemed, repaid or
purchased pursuant to such obligation;
. the denominations of such Debt Securities, if other than
denominations of $1,000 and any integral multiple of $1,000;
. whether such Debt Securities are to be issued at less than their
principal amount and the amount of the discount at which such Debt
Securities will be issued;
. 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;
. if other than United States dollars, 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 of such Debt
Securities in the currency of United States dollars is to be
determined for any purpose, including for the purpose of determining
the principal amount deemed to be outstanding at any time);
. 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 of such Debt Securities, 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);
. if other than the entire principal amount thereof, the portion of
the principal amount of any of such Debt Securities that will be
payable upon declaration of acceleration of the maturity of such
Debt Securities;
. 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 of such Debt Securities which will be
due and payable upon any Maturity other than the Stated Maturity or
which will be deemed to
11
<PAGE>
be outstanding as of any such date (or, in any such case, the manner
in which such deemed principal amount is to be determined);
. provisions, if any, for the defeasance of such Debt Securities as
described under "Defeasance and Covenant Defeasance--Defeasance and
Discharge" or "Defeasance and Covenant Defeasance--Covenant
Defeasance," or under both such captions;
. if applicable, the conversion rights with respect to such Debt
Securities;
. whether any of such Debt Securities will be issuable 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 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;
. 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;
. any addition to or change in the covenants in the Indentures described
under "Certain Restrictive Covenants" applicable to any of such Debt
Securities; and
. 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 the
applicable prospectus supplement. 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 the applicable prospectus
supplement.
Unless otherwise described in an applicable prospectus supplement, the
Indentures and the forms of the Debt Securities will not contain provisions
designed to afford holders of the Debt Securities protection in the event of a
takeover, recapitalization, or similar restructuring involving the Company
that may adversely affect holders of Debt Securities.
The Company shall deliver Debt Securities of any series, duly executed by
the Company to the Trustee for authentication, together with an order for the
authentication and delivery of such Debt Securities. The Trustee, in
accordance with such order, shall authenticate and deliver such Debt
Securities. No Debt Securities of any series shall be entitled to any benefit
under the Indentures or be valid or obligatory for any purpose unless there
appears thereon a certificate of authentication substantially in the form
provided for in the Indentures and manually executed by the Trustee or an
authenticating agent duly appointed by the Trustee. Such certificate shall be
conclusive evidence, and the only evidence, that such Debt Securities have
been duly authenticated and delivered under, and are entitled to the benefits
of, the Indentures.
12
<PAGE>
Conversion Rights
If a series of Debt Securities is convertible, the applicable prospectus
supplement relating to such series will describe the terms on which those Debt
Securities are convertible and the property or securities into which such Debt
Securities are convertible. Such terms may 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 securities or property to be
received by the holders of Debt Securities would be calculated according to
the market price of our Common Stock or other securities or property as of a
certain stated time. (Article Fourteen)
Subordination of Subordinated Debt Securities
Unless otherwise stated in the applicable prospectus supplement, the
following provisions will apply to the Subordinated Debt Securities.
The Subordinated Debt Securities, to the extent set forth in the
Subordinated Indenture, will 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 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)
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 be entitled to receive payment in full of all amounts due
thereon prior to the holders of the Subordinated Debt Securities being
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 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 such Debt or
pursuant to which such Debt 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.
13
<PAGE>
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.
Further provisions, if any, applicable to the subordination of the
Subordinated Debt Securities of a particular series may be described in the
applicable prospectus supplement.
Form, Exchange and Transfer
Unless otherwise specified in the applicable prospectus supplement, the
Debt Securities of each series will be issuable only in fully registered form,
without coupons, and only in denominations of $1,000 and integral multiples of
$1,000. (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 any
taxes or other governmental charges as described in the Indentures. 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. The Company may also 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)
In the event of a redemption in part, the Company will not be required to
(i) issue, register the transfer of or exchange any Debt Security of that
series (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, in whole or in
part, called for redemption, except the unredeemed portion of any such Debt
Security being redeemed in part. (Section 305)
Global Securities
The Debt Securities of a particular series may be issued in the form of one
or more Global Securities, which will be deposited with a depositary, referred
to as the "Depositary," or its nominee or a custodian therefor, each of which
will be identified in the prospectus supplement relating to such series. The
Global Securities will have an aggregate principal amount equal to that of the
Debt Securities that they represent. The Global Securities will have a legend
regarding their restrictions on
14
<PAGE>
exchanges and registration of transfer 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 in this summary, 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 of a Global Security
will be registered in such names as the Depositary may direct. (Sections 204
and 305)
So long as the Depositary for a Global Security, or its nominee, is the
registered owner of such Global Security, such Depositary or such nominee, as
the case may be, will be considered the sole owner or Holder of the Debt
Securities represented by such Global Security for all purposes under the Debt
Securities and the Indentures. Except as provided above, owners of beneficial
interests in a Global Security will not be entitled to have such Global
Security or any Debt Securities that it represents 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 of such Global Security. 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, referred
to as "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.
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
15
<PAGE>
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.
However, at the Company's option, 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 New York, 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 monies paid by the Company to a Paying Agent for the payment of
principal of, premium, if any, or interest on any Debt Security that 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. After such time, the
Holder of such Debt Security will look only to the Company for payment of such
amounts. (Section 1003)
Restrictive Covenants
. Limitation on Liens. The Senior Indenture provides that, except as
otherwise provided in the next succeeding paragraph, neither the Company nor
any Restricted Subsidiary will issue, assume or guarantee any indebtedness for
borrowed money, referred to as "Debt," secured by any mortgage, pledge,
security interest, lien or other encumbrance, referred to as 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) unless the Company secures or causes such Restricted Subsidiary to
secure the Senior Debt Securities equally and ratably with, or prior to, such
secured Debt, for so long as such Debt will be so secured. The restriction
will not apply to 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
16
<PAGE>
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, 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 the heading "Consolidation, Merger and Sale of Assets" below;
(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 December 23, 1998; 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, referred to as 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) referred to above), 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 the
heading "--Limitations on Sale and Leaseback Transactions" below) entered into
after December 23, 1998 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.
17
<PAGE>
. Limitations on Sale and Leaseback Transactions. The Senior Indenture
provides that neither we nor any of our Restricted Subsidiaries will enter
into any Sale and Lease-Back Transaction with respect to any Principal
Property unless either:
(1) the Company or such Restricted Subsidiary would (at the time of
entering into such arrangement) be entitled pursuant to the
foregoing covenant relating to "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 December 23, 1998
(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 the heading "--Limitation on
Liens" above) 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 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)
18
<PAGE>
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 of such plant
or facility.
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 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, referred to as 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 that, after notice or lapse of time or both,
would become an Event of Default, has occurred and is continuing;
19
<PAGE>
(iii) if, as a result of the transaction, property of the Company or a
Restricted Subsidiary becomes subject to a Lien that would not be
permitted under the provisions described under the heading
"Restrictive Covenants--Limitations on Liens" above, 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
Unless otherwise provided with respect to any series of Debt Securities,
the following are Events of Default under the Indentures with respect to Debt
Securities of any series:
. failure to pay principal of or premium, if any, 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);
. 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);
. 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);
. 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;
. certain events in bankruptcy, insolvency or reorganization; and
. any other Event of Default as may be specified with respect to Debt
Securities of such series.
If an Event of Default (other than an Event of Default relating to
bankruptcy, insolvency or reorganization as described above) with respect to
the Debt Securities of any series at the time outstanding occurs and is
continuing, either the Trustee or the Holders of at least 25% in aggregate
principal amount of the outstanding securities of that series 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 relating to bankruptcy, insolvency or
reorganization as described above with respect to the Debt Securities of any
series at the time outstanding occurs, 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 for
the payment of money based on such acceleration has been obtained by the
Trustee, 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
nonpayment of accelerated principal (or other specified amount), have been
cured or waived as provided in the
20
<PAGE>
Indentures. (Section 502) For information as to waiver of defaults, see
"Modification and Waiver" below.
Subject to the provisions of the Indentures relating to the duties of the
Trustee, in case an Event of Default occurs and is 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)
Holders of a Debt Security of any series do not 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
as to the performance by the Company of its covenants and agreements under the
Indentures. The Company must also specify all such known defaults under the
Indentures. (Section 1004)
Modification and Waiver
With respect to the Debt Securities of any series, modifications or
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 the modification or
amendment, except that no such modification or amendment may, without the
consent of the holders of all the outstanding securities of such series to:
(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 of such Debt Security;
21
<PAGE>
(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 the provisions of the Indentures 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)
The Indentures 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 United States 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)
We 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, except in limited circumstances. 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
22
<PAGE>
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 we may specify (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
Unless otherwise specified in the applicable prospectus supplement, we may
elect 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.
. Defeasance and Discharge. The Indentures provide that the Company will be
discharged from all its obligations with respect to such Debt Securities
(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, that, 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 provide that the Company
may omit to comply with 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 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. In
order to do so, the Company 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, that, 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.
23
<PAGE>
In the event the Company exercises this option with respect to any Debt
Securities and such Debt Securities are 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 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 of the debt security (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 First National Bank of Chicago, as Trustee, serves as trustee under the
Indentures. The Trustee also provides cash management and other banking and
advisory services to the Company in the normal course of business.
In certain circumstances, such as an Event of Default, 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, as amended. If the Trustee is
unable 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, we would be required to appoint a successor trustee
for such Indenture.
24
<PAGE>
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 summary of the material
terms of the capital stock of the Company is not complete and is qualified in
its entirety by reference to, the more complete descriptions contained in (i)
the Articles of Incorporation of the Company, as amended, the Bylaws of the
Company, as amended, and the Rights Agreement, effective March 21, 1996,
between the Company and ChaseMellon Shareholder Services, L.L.C., formerly
known as Chemical Mellon Shareholder Services, L.L.C., as Rights Agent, which
are incorporated by reference as exhibits to the registration statement of
which this prospectus is a part, and (ii) the certificate of designation or
amendment to the Articles of Incorporation relating to each series of
Preferred Stock.
Common Stock
. Dividends. Holders of our Common Stock may receive dividends when
declared by our Board of Directors out of funds that we can legally use to pay
dividends. In certain cases, holders of Common Stock may not receive dividends
until we have satisfied our obligations to any holders of outstanding
preferred stock.
. Preferred Stock Purchase Rights. Attached to each share of Common Stock
offered hereby will be a right to purchase Series One Preferred Stock. The
rights are exercisable under the circumstances described below under the
heading "--Series One Preferred Stock and Preferred Stock Purchase Rights" and
the exercise of such rights may have the effect of delaying, deterring or
preventing a change of control of the Company described below under the
heading "--Certain Provisions Affecting Control of the Company."
. Voting Rights. Holders of our 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 held by the shareholder by the number of directors
to be elected. The shareholder can then cast the total number of votes so
determined for one nominee or can distribute them among different nominees.
Our Bylaws require shareholders desiring to nominate persons for election as a
director to give advance notice of such nominations to the Company.
Generally, to receive authorization, corporate actions voted upon by the
shareholders of the Company, or by a class of such shareholders of the
Company, require the affirmative vote of a majority of the votes cast by such
shareholders, or by such class of shareholders, entitled to vote thereon.
However, this does not apply to the election of directors which are subject to
cumulative voting as discussed above. Further, our Articles of Incorporation
and Bylaws require 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 our Articles of Incorporation 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 our Board of Directors. In addition, our Bylaws 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.
25
<PAGE>
Our 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. This helps ensure
continuity and stability of corporate leadership and policy, but it also has
the effect of making it more difficult for a person to acquire control of the
Company. As a result of this classification system, 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.
. Liquidation. 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.
. Listing. Our outstanding shares of Common Stock are listed on the New
York, Pacific and Philadelphia Stock Exchanges under the symbol "ACK." Any
additional Common Stock we issue will also be listed on the New York, Pacific
and Philadelphia Stock Exchanges, subject to official notice of issuance.
. Transfer Agent and Registrar. The Transfer Agent and Registrar for the
Common Stock is ChaseMellon Shareholder Services, L.L.C.
. 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. The shares of Common
Stock currently outstanding are fully paid 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
discussed below under the heading "--Series One Preferred Stock and Preferred
Stock Purchase Rights," is issuable in one or more series and 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. The applicable prospectus supplement
relating to the particular series of the preferred stock offered by such
prospectus supplement will contain specific terms, including:
(i) the title of the series and the number of shares in the series
offered;
(ii) the price at which such series will be issued;
(iii) the dividend rate (or method of calculation), if any, the dates
on which dividends will be payable and the dates from which
dividends shall commence to accumulate for such series;
(iv) any redemption or sinking fund provisions of such series;
(v) any conversion provisions of such series;
(vi) the voting rights, if any, of such series;
(vii) the liquidation preference of such series; and
(viii) any additional dividend, liquidation, redemption, sinking fund and
other special or relative rights, preferences, qualifications,
privileges, limitations, options and restrictions of such series.
26
<PAGE>
The Board of Directors of the Company is empowered, without approval of the
stockholders, to cause shares of Class A Preferred Stock to be issued in one
or more series, with the numbers of shares of each series to be determined by
it. The Board of Directors will be authorized to fix or alter the designation,
number, voting powers, preferences and relative, participating, optional and
other rights, and the qualifications, limitations or restrictions of such
rights pursuant to a certificate of designations or an amendment to the
Company's Articles of Incorporation. Among the specific matters that may be
determined by the Board of Directors are the rate of dividends; the redemption
price, if any; the terms of a sinking fund or redemption or purchase account,
if any; the amount payable in the event of any voluntary liquidation,
dissolution or winding up of the affairs of the Company; conversion or
exchange rights, if any; and voting power, if any.
Although the Company has no present intention to issue additional shares of
Class A Preferred Stock, the issuance of shares of the Class A Preferred
Stock, or the issuance of rights to purchase such shares, could be used to
discourage an unsolicited acquisition proposal. For instance, the issuance of
a series of Class A Preferred Stock might impede a business combination by
including class voting rights that would enable the holders to block such a
transaction; or such issuance might facilitate a business combination by
including voting rights that would provide a required percentage vote of the
stockholders. In addition, under certain circumstances, the issuance of Class
A Preferred Stock could adversely affect the voting power of the holders of
the Common Stock. Although the Board of Directors is required to make any
determination to issue such stock based on its judgment as to the best
interests of the stockholders of the Company, the Board of Directors could act
in a manner that would discourage an acquisition attempt or other transaction
that some or even a majority of the stockholders might believe to be in their
best interests or in which stockholders might receive a premium for their
stock over the then market price of such stock. The Board of Directors does
not at present intend to seek stockholder approval prior to any issuance of
currently authorized stock, unless otherwise required by law or the rules of
any market on which the Company's securities are traded.
. Dividends. The Preferred Stock will be preferred over the Common Stock
(but may be subordinated as to the other series of Preferred Stock) with
respect to the payment of dividends. Holders of shares of each series of
Preferred Stock will be entitled to receive dividends (either in cash, shares
of Common Stock or Preferred Stock, or otherwise) if such dividends are
declared by our Board of Directors, at the rate and on the date or dates set
forth in the applicable prospectus supplement. Such preferred stock dividend
payments are made prior to the declaration of or setting aside for payment of
dividends or distributions on the Common Stock. With respect to each series of
Preferred Stock, the dividends on each share of such series will 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 will not bear interest.
. Conversion. Shares of any series of Preferred Stock will be convertible
into shares of Common Stock, any other series of Preferred Stock or Debt
Securities 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
of such Preferred Stock while there is any arrearage in the payment of
dividends.
. Voting Rights. Unless otherwise provided in the prospectus supplement,
holders of our Preferred Stock will be entitled to one vote for each share of
Preferred Stock held by them on all matters presented to shareholders.
27
<PAGE>
. Liquidation. The Preferred Stock will be preferred over the Common Stock
(but may be subordinated as to other series of Preferred Stock, as described
in this prospectus) as to assets so that the holders of each series of
Preferred Stock will be entitled to be paid the amount set forth in the
prospectus supplement relating to any such series, upon the voluntary or
involuntary liquidation, dissolution or winding up of the Company. Such
payments are made before any distribution is made to the holders of Common
Stock. However, 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 applicable 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
applicable prospectus supplement, and except in certain circumstances as
discussed below under "--Certain Provisions Affecting Control of the Company,"
the Preferred Stock will not be upon issuance, subject to discriminatory
provisions based on ownership thresholds.
The description of the terms of a particular series of Preferred Stock
offered hereby that will be set forth in the applicable prospectus supplement
is not complete and is qualified in its entirety by reference to the
applicable certificate of designations or amendment to the Company's Articles
of Incorporation with respect to each series.
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. In this prospectus, such rights
are referred to as "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, our Board of Directors paid a distribution of one Right for each
outstanding share of our Common Stock 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 entities 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 our 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.
28
<PAGE>
The terms of the Rights are set forth in the Rights Agreement which has
been filed with the Securities and Exchange Commission as an Exhibit to a
Registration Statement on Form 8-A/A filed on March 15, 1996, file number 001-
02116, which 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 our Board of Directors, out of funds legally
available to pay dividends, in preference to the holders of Common Stock. Such
dividends are 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.
. Redemption. The Series One Preferred Stock may be redeemed at the option
of our Board of Directors, 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 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, upon issuance, be freely
alienable and not subject to discriminatory provisions based on ownership
thresholds.
Certain Provisions Affecting Control of the Company
. General. Certain provisions of our Articles of Incorporation and Bylaws,
as well as the Pennsylvania Business Corporation Law, referred to as the
"PBCL," operate only with respect to extraordinary corporate transactions,
such as mergers, reorganizations, tender offers, sales or transfers
29
<PAGE>
of substantially all of the Company's assets or the liquidation of the
Company, and could have the effect of delaying or making more difficult a
change in control of the Company in certain circumstances.
The provisions of the Company's Articles of Incorporation, Bylaws and the
PBCL described below are designed to reduce, or have the effect of reducing,
the vulnerability of the Company to an unsolicited proposal for the
restructuring or sale of all or substantially all of the assets of the Company
or an unsolicited takeover attempt that is unfair to the Company's
stockholders. The summary of such provisions set forth below is not complete
and is subject to and qualified in its entirety by reference to the Company's
Articles of Incorporation, Bylaws and the PBCL.
The Company's Board of Directors has no present intention to introduce
additional measures that might have an anti-takeover effect. The Company's
Board of Directors, however, expressly reserves the right to introduce such
measures in the future.
. Certain Provisions of the Articles of Incorporation and Bylaws. The
provisions of our Articles of Incorporation and Bylaws which may have the
effect of delaying, deterring or preventing a change of control of the Company
include the classification of our Board of Directors into three classes,
cumulative voting for members of the Board of Directors, the requirement of an
80% vote of outstanding shares to remove directors, each as described under
the heading "--Common Stock -- Voting Rights" above, and the ability of the
Board of Directors to issue Class A Preferred Stock in one or more series as
described under the heading "--Class A Preferred Stock" above. In addition,
our Articles of Incorporation 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
the Company or an affiliate of the Company), 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.
30
<PAGE>
Certain other provisions of our Articles of Incorporation 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."
. Preferred Stock Purchase Rights. In addition to the provisions of the
Company's Articles of Incorporation and Bylaws discussed above, the Company
has issued Preferred Stock Purchase Rights which also may have the effect of
delaying, deterring or preventing a change of control of the Company. The
Preferred Stock Purchase Rights and the terms of the Series One Preferred
Stock issuable upon exercise of such rights are described above under the
heading "--Series One Preferred Stock and Preferred Stock Purchase Rights."
. Certain Provisions of the PBCL. The Company is governed by certain "anti-
takeover" provisions in the PBCL which include 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 20% 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 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, including a
provision which permits the Board to consider various corporate
interests including the short and long-term interests of the
corporation and the resources, intent and conduct of any person
seeking to acquire the corporation.
31
<PAGE>
DESCRIPTION OF WARRANTS
We may issue Warrants for the purchase of Debt Securities, Common Stock,
Preferred Stock or any combination thereof. Warrants may be issued alone or
together with any other Securities offered by a prospectus supplement, and may
be attached to or separate from such Securities. Warrants may be issued under
warrant agreements, each referred to as a "Warrant Agreement." The Warrant
Agreement will be entered into between the Company and a warrant agent,
referred to as a "Warrant Agent," as specified in the applicable prospectus
supplement. The Warrant Agent will act solely as our agent in connection with
the Warrants of a particular series and will not act as an agent or trustee
for any holders or beneficial owners of Warrants. The following description
sets forth certain general terms and provisions of the Warrants to be offered
and is not intended to be complete. Further terms of the Warrants and the
applicable Warrant Agreement will be set forth in the applicable prospectus
supplement.
If we offer Warrants, the applicable prospectus will describe their terms,
including, where applicable, the following:
(i) the title of such Warrant;
(ii) the aggregate number of such Warrants;
(iii) the price or prices at which such Warrants will be issued;
(iv) the designation, number and terms of the Debt Securities, Common
Stock, Preferred Stock, or combination of such Securities,
purchasable upon exercise of such Warrants;
(v) the designation and terms of the other Securities, if any, with which
such Warrants are issued and the number of such Warrants issued with
each such Security;
(vi) the date, if any, on and after which such Warrants and the related
underlying Securities will be separately transferable;
(vii) the price at which each underlying Security purchasable upon
exercise of such Warrants may be purchased;
(viii) the date on which the right to exercise such Warrants shall
commence and the date on which such right shall expire;
(ix) the minimum amount of such Warrants that may be exercised at any one
time;
(x) information with respect to book-entry procedures, if any;
(xi) a discussion of any applicable federal income tax considerations;
and
(xii) any other terms of such Warrants, including terms, procedures and
limitations relating to the transferability, exchange and exercise
of such Warrants.
32
<PAGE>
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 applicable 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, referred to as a
"Deposit Agreement," between the Company and a bank or trust company. The bank
or trust company selected by the Company is referred to as the "Preferred
Depositary." The Preferred Depositary must have its principal office in the
United States and must have a combined capital and surplus of at least
$50,000,000. The prospectus supplement relating to a series of Depositary
Shares will set forth the name and address of the Preferred 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 Preferred 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 our expense.
Upon surrender of Depositary Receipts at the office of the Preferred
Depositary and upon payment of the charges provided in the Deposit Agreement
and subject to the terms thereof, a Depositary Share Holder is entitled to
have the Preferred Depositary deliver to such holder the whole shares of
Preferred Stock underlying the Depositary Shares evidenced by the surrendered
Depositary Receipts.
. Dividends. The Preferred 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 Preferred Depositary will 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
will be added to and treated as part of the next sum received by the Preferred
Depositary for distribution to record holders of Depositary Shares.
In the event of a distribution other than in cash, the Preferred Depositary
will distribute property received by it to the record holders of Depositary
Shares entitled thereto, unless the Preferred Depositary determines that it is
not feasible to make such distribution, in which case the Preferred 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.
33
<PAGE>
. 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 Preferred Depositary of the Depositary Receipts
evidencing such Depositary Shares. 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 Preferred 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
Preferred 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 Preferred 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 Preferred Depositary in order to
enable the Preferred Depositary to do so. The Preferred 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 "-- Certain Provisions
Affecting Control of the Company," 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 Preferred 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 or the Preferred 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.
. 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 Preferred 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.
34
<PAGE>
. Miscellaneous. The Preferred Depositary will forward to the holders of
Depositary Shares all reports and communications which are delivered to the
Preferred Depositary and which the Company is required to furnish to the
holders of the Preferred Stock.
Neither the Preferred 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 Preferred 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 Preferred Depositary, any such
resignation or removal to take effect upon the appointment of a successor
Preferred Depositary and the Company's acceptance of such appointment. Such
successor Preferred 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.
35
<PAGE>
PLAN OF DISTRIBUTION
We may sell the Securities in any one or more of the following three ways:
(i) to or through underwriters or dealers; (ii) through agents; or, (iii)
directly to one or more purchasers. The prospectus supplement relating to the
Securities being sold will set forth the terms of the Securities being sold,
including the name or names of any underwriters, dealers or agents, the
purchase price of such Securities and the proceeds to the Company from such
sale, any underwriting discounts, selling commissions and other items
constituting underwriters', dealers' or agents' compensation, any initial
public offering price and any discounts or concessions allowed or reallowed or
paid to dealers or agents, and any securities exchanges on which the
Securities of such series may be listed, will be set forth in, or may be
calculated from the information set forth in the prospectus supplement. Only
underwriters so named in the prospectus supplement will be deemed to be
underwriters in connection with the Securities offered thereby. The
distribution of Securities may be effected from time to time in one or more
transactions including negotiated transactions at a fixed public offering
price or at varying prices determined at the time of the sale.
If underwriters are used in the sale, the Securities will be acquired by
the underwriters for their own account and may be resold from time to time in
one or more transactions, including negotiated transactions, at a fixed public
offering price or at varying prices determined at the time of sale. The
Securities may be offered to the public either through underwriting syndicates
represented by managing underwriters or by underwriters without a syndicate.
Unless otherwise set forth in the prospectus supplement, the obligations of
the underwriters to purchase Securities will be subject to certain conditions
precedent and the underwriters will be obligated to purchase all the
Securities offered by the prospectus supplement if any of such Securities are
purchased. In connection with the sale of Securities, underwriters may be
deemed to have received compensation from the Company in the form of
underwriting discounts or commissions and may also receive commissions from
purchasers of Securities for whom they may act as agent. 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 and/or
commissions (which may be changed from time to time) from the purchasers for
whom they may act as agent. Any initial public offering price and any
discounts or concessions allowed or reallowed or paid to dealers may be
changed from time to time.
We may grant an option to the underwriters named in the prospectus
supplement, exercisable during a fixed period after the date of the prospectus
supplement, to purchase additional Securities to cover overallotments, if any,
at the same price as the initial Securities to be purchased by the
underwriters. The underwriters may purchase such Securities only to cover
overallotments made in connection with an offering of Securities.
We may also directly sell Securities or use agents (which may also act as
principals) designated by us from time to time. Any agent involved in the
offer or sale of the Securities in respect of which this prospectus is
delivered will be named, and any commissions payable by us to such agent will
be set forth in, or may be calculated from the information set forth in, the
prospectus supplement. Unless otherwise indicated in the prospectus
supplement, any such agent will be acting on a best efforts basis for the
period of its appointment. In the case of sales made directly by us, no
commission will be payable.
If so indicated in the prospectus supplement, the Company will authorize
agents, underwriters or dealers to solicit offers by certain specified
institutions to purchase Securities from the Company at the public offering
price set forth in the prospectus supplement pursuant to delayed delivery
contracts
36
<PAGE>
providing for payment and delivery on a date specified in the future. Such
contracts will be subject to the conditions set forth in the prospectus
supplement, and the prospectus supplement will set forth the commissions
payable for solicitation of such contracts.
Agents and underwriters may be entitled under agreements entered into with
the Company to indemnification by the Company against certain civil
liabilities, including liabilities under the Securities Act, or to
contribution with respect to payments that the agents or underwriters may be
required to make in respect thereof. Agents and underwriters may be customers
of, engage in transactions with, or perform services for the Company or its
affiliates in the ordinary course of business.
All of the Securities will be a new issue of securities with no established
trading market, other than the Common Stock, which is currently listed on the
Philadelphia, Pacific and New York Stock Exchanges under the symbol "ACK." The
Securities, other than the Common Stock, may or may not be listed on a
national securities exchange or a foreign securities exchange. In the event
that such Securities are not listed on a national securities exchange, certain
broker-dealers may make a market in such Securities, but will not be obligated
to do so and may discontinue any market making at any time without notice. No
assurance can be given that any broker-dealer will make a market in such
Securities or as to the liquidity of the trading market for such Securities.
The prospectus supplement with respect to such Securities of any series will
state, if known, whether or not any broker-dealer intends to make a market in
such Securities. If no such determination has been made, the prospectus
supplement will so state.
37
<PAGE>
LEGAL MATTERS
Certain legal matters in connection with the Securities offered hereby will
be passed upon for the Company by Rogers & Wells LLP, New York, New York. With
respect to matters of Pennsylvania law, we may rely on Pennsylvania counsel
chosen by the Company at the time of the issuance of the Securities or may
name separate counsel who will pass on certain legal matters under
Pennsylvania law in the prospectus supplement relating to that offering. If
certain legal matters in connection with the Securities offered hereby will be
passed upon by counsel for any underwriters, dealers or agents, that counsel
will be named in the prospectus supplement relating to that offering.
EXPERTS
The consolidated financial statements of the Company as of December 31,
1998 and 1997 and for each of the years in the three-year period ended
December 31, 1998 and related financial statement schedule, have been
incorporated by reference herein in reliance upon the report of KPMG LLP,
independent certified public accountants, incorporated by reference herein,
and upon the authority of said firm as experts in accounting and auditing.
38
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
You should rely only on the information contained in, or incorporated by
reference into, this prospectus. Armstrong World Industries, Inc. has not
authorized any other person to provide you with different information.
Armstrong World Industries, Inc. is not making an offer of these Securities in
any location where the offer is not permitted.
---------------
TABLE OF CONTENTS
Page
Forward-Looking Information .................................................. 3
The Company................................................................... 4
Risk Factors.................................................................. 6
Use of Proceeds............................................................... 8
Ratio of Earnings to Fixed Charges and Earnings to Combined Fixed Charges and
Preferred Stock Dividends..................................................... 9
Description of Debt Securities................................................10
Description of Capital Stock..................................................25
Description of Warrants.......................................................32
Description of Depositary Shares..............................................33
Plan of Distribution..........................................................36
Legal Matters.................................................................38
Experts.......................................................................38
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Armstrong World Industries, Inc.
$1,000,000,000
Debt Securities
Common Stock
Class A Preferred Stock
Warrants
Depositary Shares
---------------
PROSPECTUS
---------------
March 16, 1999
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table indicates the expenses to be incurred in connection
with the offerings described in this Registration Statement. All expenses are
estimated except the Securities and Exchange Commission registration fee.
<TABLE>
<CAPTION>
Securities and Exchange Commission registration fee................... $278,000
<S> <C>
Accounting fees....................................................... 15,000*
Legal fees and expenses............................................... 30,000*
Printing and engraving fees........................................... 5,000*
Miscellaneous......................................................... 1,000*
-------
Total................................................................. 346,000
=======
</TABLE>
- --------
*Does not include expenses of preparing prospectus supplements and other
expenses relating to offerings of particular securities.
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
II-1
<PAGE>
receipt of an undertaking to repay all amounts so advanced if it is ultimately
determined that they are not entitled 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 Company's By-laws also provide, pursuant to Section 1713 of the PBCL,
that a director of the Company 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 the Company 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.
The Company 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, as amended.
Item 16. Exhibits.
The following is a list of all exhibits filed as a part of this
Registration Statement on Form S-3:
1.1 Underwriting Agreement Standard Provisions (for Debt Securities and
Preferred Stock) dated October 21, 1998 (incorporated by reference to
Exhibit 1.3 of the Company's Form 8-K filed on November 10, 1998).
1.2 Form of Underwriting Agreement (for Common Stock).*
4.1 Articles of Incorporation, as amended (incorporated by reference to
Exhibit 3(b) of the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1994, file no. 1-2116, filed with the
Commission on March 28, 1995).
4.2 Bylaws, as amended (incorporated by reference to Exhibit 3(a) of the
Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1994, file no. 1-2116, filed with the Commission on March
28, 1995).
4.3 Indenture for Senior Debt Securities dated December 23, 1998.
4.4 Indenture for Subordinated Debt Securities dated December 23, 1998.
4.5 Form of Senior Debt Securities (included in Exhibit 4.3).
4.6 Form of Subordinated Debt Securities (included in Exhibit 4.4).
4.7 Form of specimen certificate representing shares of Common Stock.
4.8 Form of specimen certificate representing shares of Preferred Stock.*
4.9 Form of Warrant.*
4.10 Form of Deposit Agreement (incorporated by reference to Exhibit 4.3 of
the Company's Registration Statement on Form S-3 (File No. 333-6333)).
4.11 Rights Agreement between the Company and Chase Mellon Shareholder
Services, L.L.C., formerly known as, Chemical Mellon Shareholder
Services, L.L.C., effective as of March 21, 1996 (incorporated by
reference to Exhibit 4 of the Company's Registration Statement on
Form 8A/A filed on March 15, 1996).
5.1 Opinion of Rogers & Wells LLP.
II-2
<PAGE>
5.2 Opinion of Douglas S. Brossman.
12.1 Calculation of Ratio of Earnings to Fixed Charges (set forth in the
computation included in the prospectus forming a part of this
registration statement).
12.2 Calculation of Ratio of Earnings to Fixed Charges and Preferred Stock
Dividend (set forth in the computation included in the prospectus
forming a part of this registration statement).
23.1 Consent of Independent Auditors.
23.2 Consent of Rogers & Wells LLP (set forth in its opinion filed as
Exhibit 5.1).
24.1 Powers of attorney (set forth in the signature pages to this
registration statement).
25.1 Statement of Eligibility and Qualification on Form T-1 of Trustee
under the Senior Indenture.
25.2 Statement of Eligibility and Qualification on Form T-1 of Trustee
under the Subordinated Indenture.
- --------
* To be filed by amendment, by incorporation by reference or by filing of a
Current Report on Form 8-K in connection with the offering of the
Securities.
Item 17. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the Securities
Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range may
be reflected in the form of prospectus filed with the Commission pursuant to
Rule 424(b) if, in the aggregate, the changes in volume and price represent no
more than a 20 percent change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee" table in the effective
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 (a)(1)(i) and (a)(1)(ii) above do not apply if the
registration statement is on Form S-3, Form S-8 or Form F-3, and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or 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.
II-3
<PAGE>
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to 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.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
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.
(d) The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a form
of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities Act of
1933, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(e) The undersigned registrant hereby undertakes to file an application for
the purpose of determining the eligibility of the trustee to act under
subsection (a) of section 310 of the Trust Indenture Act ("Act") in accordance
with the rules and regulations prescribed by the Commission under section
305(b)(2) of the Act.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Company 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 City of Lancaster, State of Pennsylvania, on
the 16th day of March, 1999.
Armstrong World Industries, Inc.
/s/ George A. Lorch
By: _________________________________
Name: George A. Lorch
Title: Chairman of the Board of
Directors and Chief Executive
Officer
POWER OF ATTORNEY
KNOW ALL MEN AND WOMEN BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Frank A. Riddick, III and
Deborah K. Owen, and each of them, such individual's true and lawful
attorneys-in-fact and agents, with full power of substitution and
resubstitution, for such individual and in his or her name, place and stead,
in any and all capacities, to sign any and all amendments (including post-
effective amendments) to this Registration Statement on Form S-3 and any
registration statement for the same offering that is to be effective upon
filing pursuant to Rule 462(b) under the Securities Act of 1933, as amended,
and any and all applications and other documents in connection therewith, with
the Securities and Exchange Commission and any state or other securities
authority, 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
requisite and necessary to be done in and about the premises as fully and to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their substitute or substitutes, may lawfully do or cause to be done
by virtue hereof.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATES INDICTED.
Signatures Title Date
/s/ George A. Lorch Chairman of the March 16, 1999
- ------------------------------------- Board of Directors
George A. Lorch and Chief Executive
Officer
/s/ Frank A. Riddick, III
- ------------------------------------- Senior Vice March 16, 1999
Frank A. Riddick, III President, Finance
and Chief Financial
Officer (Principal
Financial Officer)
II-5
<PAGE>
Signatures Title Date
/s/ Edward R. Case Vice President and March 16, 1999
- ------------------------------------- Controller
Edward R. Case (Principal
Accounting Officer)
Director March , 1999
- -------------------------------------
John A. Krol
/s/ David W. Raisbeck Director March 16, 1999
- -------------------------------------
David W. Raisbeck
Director March , 1999
- -------------------------------------
David M. Levan
/s/ James E. Marley
- ------------------------------------- Director March 16, 1999
James E. Marley
/s/ Jerre L. Stead Director March 16, 1999
- -------------------------------------
Jerre L. Stead
/s/ H. Jesse Arnelle Director March 16, 1999
- -------------------------------------
H. Jesse Arnelle
/s/ Donald C. Clark Director March 16, 1999
- -------------------------------------
Donald C. Clark
/s/ Judith R. Haberkorn
- ------------------------------------- Director March 16, 1999
Judith R. Haberkorn
/s/ Van C. Campbell Director March 16, 1999
- -------------------------------------
Van C. Campbell
II-6
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit
Number Exhibit
- ------- ---------------------------------------------------------------------------------------------
<S> <C>
1.1 Underwriting Agreement Standard Provisions (for Debt Securities and Preferred Stock)
dated October 21, 1998 (incorporated by reference to Exhibit 1.3 of the Company's Form
8-K filed on November 10, 1998).
1.2 Form of Underwriting Agreement (for Common Stock).*
4.1 Articles of Incorporation, as amended (incorporated by reference to Exhibit 3(b) of the
Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1994,
file no. 1-2116, filed with the Commission on March 28, 1995).
4.2 Bylaws, as amended (incorporated by reference to Exhibit 3(a) of the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1994, file no. 1-2116, filed
with the Commission on March 28, 1995).
4.3 Indenture for Senior Debt Securities dated December 23, 1998.
4.4 Indenture for Subordinated Debt Securities dated December 23, 1998.
4.5 Form of Senior Debt Securities (included in Exhibit 4.3).
4.6 Form of Subordinated Debt Securities (included in Exhibit 4.4).
4.7 Form of specimen certificate representing shares of Common Stock.
4.8 Form of specimen certificate representing shares of Preferred Stock.*
4.9 Form of Warrant.*
4.10 Form of Deposit Agreement (incorporated by reference to Exhibit 4.3 of the Company's
Registration Statement on Form S-3 (File No. 333-6333)).
4.11 Rights Agreement between the Company and Chase Mellon Shareholder Services, L.L.C.,
formerly known as, Chemical Mellon Shareholder Services, L.L.C., effective as of March
21, 1996 (incorporated by reference to Exhibit 4 of the Company's Registration Statement
on Form 8A/A filed on March 15, 1996).
5.1 Opinion of Rogers & Wells LLP.
5.2 Opinion of Douglas S. Brossman.
12.1 Calculation of Ratio of Earnings to Fixed Charges (set forth in the computation included
in the prospectus forming a part of this registration statement).
12.2 Calculation of Ratio of Earnings to Fixed Charges and Preferred Stock Dividend (set forth
in the computation included in the prospectus forming a part of this registration statement).
23.1 Consent of Independent Auditors.
23.2 Consent of Rogers & Wells LLP (set forth in its opinion filed as Exhibit 5.1).
24.1 Powers of attorney (set forth in the signature pages to this registration statement).
25.1 Statement of Eligibility and Qualification on Form T-1 of Trustee under the
Senior Indenture.
25.2 Statement of Eligibility and Qualification on Form T-1 of Trustee under the
Subordinated Indenture.
</TABLE>
- --------
* To be filed by amendment, by incorporation by reference or by filing of a
Current Report on Form 8-K in connection with the offering of the
Securities.
II-7
<PAGE>
EXHIBIT 4.3
Armstrong World Industries, Inc.
TO
The First National Bank of Chicago
Trustee
INDENTURE
Dated as of December 23, 1998
Senior Debt Securities
<PAGE>
TABLE OF CONTENTS
----------
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
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............................................................................ 2
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.............................................................................. 3
Event of Default........................................................................ 3
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
Opinion of Counsel...................................................................... 4
Original Issue Discount Security........................................................ 4
</TABLE>
- -------------
NOTE: This table of contents shall not, for any purpose, be deemed to be a part
of the Indenture.
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Outstanding............................................................................. 5
Paying Agent............................................................................ 5
Person.................................................................................. 6
Place of Payment........................................................................ 6
Predecessor Security.................................................................... 6
Principal Property...................................................................... 6
Redemption Date......................................................................... 6
Redemption Price........................................................................ 6
Regular Record Date..................................................................... 6
Restricted Subsidiary................................................................... 6
Sale and Leaseback Transaction.......................................................... 6
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.............................................................. 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..................................................................... 11
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............................................................. 14
Section 204. Form of Legend for Global Securities.................................................... 18
Section 205. Form of Trustee's Certificate of Authentication......................................... 19
</TABLE>
-ii-
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Section 206. Form of Conversion Notice............................................................... 19
ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series.................................................... 20
Section 302. Denominations........................................................................... 23
Section 303. Execution, Authentication, Delivery and Dating.......................................... 23
Section 304. Temporary Securities.................................................................... 24
Section 305. Registration, Registration of Transfer and Exchange..................................... 25
Section 306. Mutilated, Destroyed, Lost and Stolen Securities........................................ 26
Section 307. Payment of Interest; Interest Rights Preserved.......................................... 27
Section 308. Persons Deemed Owners................................................................... 28
Section 309. Cancellation............................................................................ 29
Section 310. Computation of Interest................................................................. 29
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture................................................. 29
Section 402. Application of Trust Money.............................................................. 30
ARTICLE FIVE
Remedies
Section 501. Events of Default....................................................................... 30
Section 502. Acceleration of Maturity; Rescission and Annulment...................................... 31
Section 503. Collection of Indebtedness and Suits for Enforcement by Trustee......................... 32
Section 504. Trustee May File Proofs of Claim........................................................ 33
Section 505. Trustee May Enforce Claims Without Possession of Securities............................. 33
Section 506. Application of Money Collected.......................................................... 34
Section 507. Limitation on Suits..................................................................... 34
Section 508. Unconditional Right of Holders to Receive Principal, Premium and Interest............... 35
Section 509. Restoration of Rights and Remedies...................................................... 35
</TABLE>
-iii-
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Section 510. Rights and Remedies Cumulative.......................................................... 35
Section 511. Delay or Omission Not Waiver............................................................ 35
Section 512. Control by Holders...................................................................... 35
Section 513. Waiver of Past Defaults................................................................. 36
Section 514. Undertaking for Costs................................................................... 36
Section 515. Waiver of Usury, Stay or Extension Laws................................................. 36
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities..................................................... 37
Section 602. Notice of Defaults...................................................................... 37
Section 603. Certain Rights of Trustee............................................................... 37
Section 604. Not Responsible for Recitals or Issuance of Securities.................................. 38
Section 605. May Hold Securities..................................................................... 38
Section 606. Money Held in Trust..................................................................... 38
Section 607. Compensation and Reimbursement.......................................................... 38
Section 608. Conflicting Interests................................................................... 39
Section 609. Corporate Trustee Required; Eligibility................................................. 39
Section 610. Resignation and Removal; Appointment of Successor....................................... 39
Section 611. Acceptance of Appointment by Successor.................................................. 41
Section 612. Merger, Conversion, Consolidation or Succession to Business............................. 42
Section 613. Preferential Collection of Claims Against Company....................................... 42
Section 614. Appointment of Authenticating Agent..................................................... 42
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee Names and Addresses of Holders............................... 44
Section 702. Preservation of Information; Communications to Holders.................................. 44
Section 703. Reports by Trustee...................................................................... 44
Section 704. Reports by Company...................................................................... 45
</TABLE>
-iv-
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. Company May Consolidate, Etc., Only on Certain Terms.................................... 45
Section 802. Successor Substituted................................................................... 46
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of Holders...................................... 46
Section 902. Supplemental Indentures With Consent of Holders......................................... 47
Section 903. Execution of Supplemental Indentures.................................................... 48
Section 904. Effect of Supplemental Indentures....................................................... 49
Section 905. Conformity with Trust Indenture Act..................................................... 49
Section 906. Reference in Securities to Supplemental Indentures...................................... 49
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest.............................................. 49
Section 1002. Maintenance of Office or Agency......................................................... 49
Section 1003. Money for Securities Payments to Be Held in Trust....................................... 50
Section 1004. Statement by Officers as to Default..................................................... 51
Section 1005. Existence............................................................................... 51
Section 1006. Maintenance of Properties............................................................... 51
Section 1007. Payment of Taxes and Other Claims....................................................... 51
Section 1008. Limitations on Liens.................................................................... 51
Section 1009. Limitations on Sale and Leaseback Transactions.......................................... 53
Section 1010. Waiver of Certain Covenants............................................................. 54
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article................................................................ 55
Section 1102. Election to Redeem; Notice to Trustee................................................... 55
Section 1103. Selection by Trustee of Securities to Be Redeemed....................................... 55
Section 1104. Notice of Redemption.................................................................... 56
</TABLE>
-v-
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Section 1105. Deposit of Redemption Price............................................................. 57
Section 1106. Securities Payable on Redemption Date................................................... 57
Section 1107. Securities Redeemed in Part............................................................. 57
ARTICLE TWELVE
Sinking Funds
Section 1201. Applicability of Article................................................................ 58
Section 1202. Satisfaction of Sinking Fund Payments with Securities................................... 58
Section 1203. Redemption of Securities for Sinking Fund............................................... 58
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Company's Option to Effect Defeasance or Covenant Defeasance............................ 59
Section 1302. Defeasance and Discharge................................................................ 59
Section 1303. Covenant Defeasance..................................................................... 59
Section 1304. Conditions to Defeasance or Covenant Defeasance......................................... 60
Section 1305. Deposited Money and U.S. Government Obligations
to Be Held in Trust; Miscellaneous Provisions........................................ 61
Section 1306. Reinstatement........................................................................... 62
ARTICLE FOURTEEN
Conversion of Securities
Section 1401. Applicability of Article................................................................ 62
Section 1402. Exercise of Conversion Privilege........................................................ 62
Section 1403. No Fractional Shares.................................................................... 63
Section 1404. Adjustment of Conversion Price.......................................................... 64
Section 1405. Notice of Certain Corporate Actions..................................................... 64
Section 1406. Reservation of Shares of Common Stock................................................... 65
Section 1407. Payment of Certain Taxes Upon Conversion................................................ 65
Section 1408. Nonassessability........................................................................ 65
Section 1409. Effect of Consolidation or Merger on Conversion Privilege............................... 66
Section 1410. Duties of Trustee Regarding Conversion.................................................. 66
Section 1411. Repayment of Certain Funds Upon Conversion.............................................. 67
Testimonium............................................................................................... 68
Signatures and Seals...................................................................................... 68
Acknowledgements.......................................................................................... 69
</TABLE>
-vi-
<PAGE>
Certain Sections of this Indenture relating to Sections 310 through 318,
inclusive, of the Trust Indenture Act of 1939:
<TABLE>
<CAPTION>
Trust Indenture
Act Section Indenture Section
<S> <C>
(S) 310 (a) (1) ................................................................... 609
(a) (2) ................................................................... 609
(a) (3) ................................................................... Not Applicable
(a) (4) ................................................................... Not Applicable
(b) ................................................................... 608, 610
(S) 311 (a) ................................................................... 613
(b) ................................................................... 613
(S) 312 (a) ................................................................... 701, 702
(b) ................................................................... 702
(c) ................................................................... 702
(S) 313 (a) ................................................................... 703
(b) ................................................................... 703
(c) ................................................................... 703
(d) ................................................................... 703
(S) 314 (a) ................................................................... 704
(a) (4) ................................................................... 101, 1004
(b) ................................................................... Not Applicable
(c) (1) ................................................................... 102
(c) (2) ................................................................... 102
(c) (3) ................................................................... Not Applicable
(d) ................................................................... Not Applicable
(e) ................................................................... 102
(S) 315 (a) ................................................................... 601
(b) ................................................................... 602
(c) ................................................................... 601
(d) ................................................................... 601
(e) ................................................................... 514
(S) 316 (a) ................................................................... 101
(a) (1) (A) ................................................................... 502, 512
(a) (1) (B) ................................................................... 513
(a) (2) ................................................................... Not Applicable
(b) ................................................................... 508
(c) ................................................................... 104
(S) 317 (a) (1) ................................................................... 503
(a) (2) ................................................................... 504
(b) ................................................................... 1003
(S) 318 (a) ................................................................... 107
</TABLE>
- --------------
Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Indenture
-vii-
<PAGE>
INDENTURE, dated as of December 23, 1998, 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 2500 Columbia Avenue, Lancaster, Pennsylvania
17603, and The First National Bank of Chicago, a national banking association
duly organized and existing under the laws of the United States of America, as
Trustee (herein called the "Trustee").
Recitals of the Company
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured
debentures, notes or other evidences of indebtedness (herein called the
"Securities"), to be issued in one or more series as in this Indenture provided.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
Now, Therefore, This Indenture Witnesseth:
For and in consideration of the premises and the purchase of the Securities
by the Holders thereof, it is mutually agreed, for the equal and proportionate
benefit of all Holders of the Securities or of series thereof, as follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly provided
or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles, and, except as otherwise herein expressly provided, the term
"generally accepted accounting principles" with respect to any computation
required or permitted hereunder shall mean such accounting principles as
are generally accepted at the date of such computation;
(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
<PAGE>
(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.
"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
-2-
<PAGE>
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
The First National Bank of Chicago, One First National Plaza, Suite 0126,
Chicago, Illinois, 60670-0126 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.
-3-
<PAGE>
"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 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.
-4-
<PAGE>
"Outstanding", when used with respect to Securities, means, as of the date
of determination, all Securities theretofore authenticated and delivered under
this Indenture, except:
(1) Securities theretofore cancelled by the Trustee or delivered to
the Trustee for cancellation;
(2) Securities for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Trustee or any Paying Agent
(other than the Company) in trust or set aside and segregated in trust by
the Company (if the Company shall act as its own Paying Agent) for the
Holders of such Securities; provided that, if such Securities are to be
redeemed, notice of such redemption has been duly given pursuant to this
Indenture or provision therefor satisfactory to the Trustee has been made;
(3) Securities as to which Defeasance has been effected pursuant to
Section 1302; and
(4) Securities which have been paid pursuant to Section 306 or in
exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide purchaser
in whose hands such Securities are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given, made or taken any
request, demand, authorization, direction, notice, consent, waiver or other
action hereunder as of any date, (A) the principal amount of an Original Issue
Discount Security which shall be deemed to be Outstanding shall be the amount of
the principal thereof which would be due and payable as of such date upon
acceleration of the Maturity thereof to such date pursuant to Section 502, (B)
if, as of such date, the principal amount payable at the Stated Maturity of a
Security is not determinable, the principal amount of such Security which shall
be deemed to be Outstanding shall be the amount as specified or determined as
contemplated by Section 301, (C) the principal amount of a Security denominated
in one or more foreign currencies or currency units which shall be deemed to be
Outstanding shall be the U.S. dollar equivalent, determined as of such date in
the manner provided as contemplated by Section 301, of the principal amount of
such Security (or, in the case of a Security described in Clause (A) or (B)
above, of the amount determined as provided in such Clause), and (D) Securities
owned by the Company or any other obligor upon the Securities or any Affiliate
of the Company or of such other obligor shall be disregarded and deemed not to
be Outstanding, except that, in determining whether the Trustee shall be
protected in relying upon any such request, demand, authorization, direction,
notice, consent, waiver or other action, only Securities which the Trustee knows
to be so owned shall be so disregarded. Securities so owned which have been
pledged in good faith may be regarded as Outstanding if the pledgee establishes
to the satisfaction of the Trustee the pledgee's right so to act with respect to
such Securities and that the pledgee is not the 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.
-5-
<PAGE>
"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.
"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.
-6-
<PAGE>
"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
installment of principal thereof or interest thereon, means the date specified
in such Security as the fixed date on which the principal of such Security or
such instalment of principal or interest is due and payable.
"Subsidiary" means a corporation more than 50% of the outstanding voting
stock of which is owned, directly or indirectly, by the Company or by one or
more other Subsidiaries, or by the Company and one or more other Subsidiaries.
For the purposes of this definition, "voting stock" means stock which ordinarily
has voting power for the election of directors, whether at all times or only so
long as no senior class of stock has such voting power by reason of any
contingency.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trustee" means the Person named as the "Trustee" in the first paragraph of
this instrument until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Trustee" shall mean or
include each Person who is then a Trustee hereunder, and if at any time there is
more than one such Person, "Trustee" as used with respect to the Securities of
any series shall mean the Trustee with respect to Securities of that series.
"U.S. Government Obligation" has the meaning specified in Section 1304.
"Vice President", when used with respect to the Company or the Trustee,
means any vice president, whether or not designated by a number or a word or
words added before or after the title "vice president".
Section 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to take any
action under any provision of this Indenture, the Company shall furnish to the
Trustee such certificates and opinions as may be required under the Trust
Indenture Act. Each such certificate or opinion shall be given in the form of an
Officers' Certificate, if to be given by an officer of the Company, or an
Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirements set forth in
this Indenture.
-7-
<PAGE>
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.
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
-8-
<PAGE>
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 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
-9-
<PAGE>
referred to in Section 507(2) or (iv) any direction referred to in Section 512,
in each case with respect to Securities of such series. If any record date is
set pursuant to this paragraph, the Holders of Outstanding Securities of such
series on such record date, and no other Holders, shall be entitled to join in
such notice, declaration, request or direction, whether or not such Holders
remain Holders after such record date; provided that no such action shall be
effective hereunder unless taken on or prior to the applicable Expiration Date
by Holders of the requisite principal amount of Outstanding Securities of such
series on such record date. Nothing in this paragraph shall be construed to
prevent the Trustee from setting a new record date for any action for which a
record date has previously been set pursuant to this paragraph (whereupon the
record date previously set shall automatically and with no action by any Person
be cancelled and of no effect), and nothing in this paragraph shall be construed
to render ineffective any action taken by Holders of the requisite principal
amount of Outstanding Securities of the relevant series on the date such action
is taken. Promptly after any record date is set pursuant to this paragraph, the
Trustee, at the Company's expense, shall cause notice of such record date, the
proposed action by Holders and the applicable Expiration Date to be given to the
Company in writing and to each Holder of Securities of the relevant series in
the manner set forth in Section 106.
With respect to any record date set pursuant to this Section, the party
hereto which sets such record dates may designate any day as the "Expiration
Date" and from time to time may change the Expiration Date to any earlier or
later day; provided that no such change shall be effective unless notice of the
proposed new Expiration Date is given to the other party hereto in writing, and
to each Holder of Securities of the relevant series in the manner set forth in
Section 106, on or prior to the existing Expiration Date. If an Expiration Date
is not designated with respect to any record date set pursuant to this Section,
the party hereto which set such record date shall be deemed to have initially
designated the 180th day after such record date as the Expiration Date with
respect thereto, subject to its right to change the Expiration Date as provided
in this paragraph. Notwithstanding the foregoing, no Expiration Date shall be
later than the 180th day after the applicable record date.
Without limiting the foregoing, a Holder entitled hereunder to take any
action hereunder with regard to any particular Security may do so with regard to
all or any part of the principal amount of such Security or by one or more duly
appointed agents each of which may do so pursuant to such appointment with
regard to all or any part of such principal amount.
Section 105. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice, consent, waiver or
Act of Holders or other document provided or permitted by this Indenture to be
made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder if made, given, furnished or filed in writing
to or with the Trustee at its Corporate Trust Office, Attention: Corporate
Trust Administration, or
-10-
<PAGE>
(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 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.
-11-
<PAGE>
Section 111. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied, shall
give to any Person, other than the parties hereto and their successors hereunder
and the Holders, any benefit or any legal or equitable right, remedy or claim
under this Indenture.
Section 112. Governing Law.
This Indenture and the Securities shall be governed by and construed in
accordance with the law of the State of New York.
Section 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security 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.
-12-
<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 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
-13-
<PAGE>
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 December 23, 1998 (herein called the
"Indenture", which term shall have the meaning assigned to it in such
instrument), between the Company and The First National Bank of Chicago, 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,
-14-
<PAGE>
Redemption Redemption
Year Price Year Price
---- ---------- ---- ----------
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,
Redemption Price
For Redemption Redemption Price For
Through Operation Redemption Otherwise
of the Than Through Operation
Year Sinking Fund of the Sinking Fund
- ------- ----------------- ----------------------
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,
-15-
<PAGE>
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.]
[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
-16-
<PAGE>
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.]
[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
-17-
<PAGE>
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.
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
-18-
<PAGE>
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 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.
-19-
<PAGE>
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.
Security or Other Taxpayer
Identification
_______________________________________
(Name) 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.
-20-
<PAGE>
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;
-21-
<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;
(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
-22-
<PAGE>
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.
Section 302. Denominations.
The Securities of each series shall be issuable only in registered form
without coupons and only in such denominations as shall be specified as
contemplated by Section 301. In the absence of any such specified denomination
with respect to the Securities of any series, the Securities of such series
shall be issuable in denominations of $1,000 and any integral multiple thereof.
Section 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its Chairman
of the Board, its Vice Chairman of the Board, its President or one of its Vice
Presidents, under its corporate seal reproduced thereon attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals who
were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities of any series executed by the
Company to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities, and the Trustee in accordance
with the Company Order shall authenticate and deliver such Securities. If the
form or terms of the Securities of the series have been established by or
pursuant to one or more Board Resolutions as permitted by Sections 201 and 301,
in authenticating such Securities, and accepting the additional responsibilities
under this Indenture in relation to such Securities, the Trustee shall be
entitled to receive, and (subject to Section 601) shall be fully protected in
relying upon, an Opinion of Counsel stating,
-23-
<PAGE>
(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.
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
-24-
<PAGE>
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.
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
-25-
<PAGE>
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.
(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
-26-
<PAGE>
them to save each of them and any agent of either of them harmless, then, in the
absence of notice to the Company or the Trustee that such Security has been
acquired by a bona fide purchaser, the Company shall execute and the Trustee
shall authenticate and deliver, in lieu of any such destroyed, lost or stolen
Security, a new Security of the same series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has become
or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this Section in lieu of
any destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of that series duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.
Section 307. Payment of Interest; Interest Rights Preserved.
Except as otherwise provided as contemplated by Section 301 with respect to
any series of Securities, interest on any Security which is payable, and is
punctually paid or duly provided for, on any Interest Payment Date shall be paid
to the Person in whose name that Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest.
Any interest on any Security of any series which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular 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
-27-
<PAGE>
satisfactory to the Trustee for such deposit prior to the date of the
proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this
Clause provided. Thereupon the Trustee shall fix a Special Record Date for
the payment of such Defaulted Interest which shall be not more than 15 days
and not less than 10 days prior to the date of the proposed payment and not
less than 10 days after the receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly notify the Company of such
Special Record Date and, in the name and at the expense of the Company,
shall cause notice of the proposed payment of such Defaulted Interest and
the Special Record Date therefor to be given to each Holder of Securities
of such series in the manner set forth in Section 106, not less than 10
days prior to such Special Record Date. Notice of the proposed payment of
such Defaulted Interest and the Special Record Date therefor having been so
mailed, such Defaulted Interest shall be paid to the Persons in whose names
the Securities of such series (or their respective Predecessor Securities)
are registered at the close of business on such Special Record Date and
shall no longer be payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest on the
Securities of any series in any other lawful manner not inconsistent with
the requirements of any securities exchange on which such Securities may be
listed, and upon such notice as may be required by such exchange, if, after
notice given by the Company to the Trustee of the proposed payment pursuant
to this Clause, such manner of payment shall be deemed practicable by the
Trustee.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Security.
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.
-28-
<PAGE>
Section 309. Cancellation.
All Securities surrendered for payment, redemption, registration of
transfer or exchange or for credit against any sinking fund payment shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee
and shall be promptly cancelled by it. The Company may at any time deliver to
the Trustee for cancellation any Securities previously authenticated and
delivered hereunder which the Company may have acquired in any manner
whatsoever, and may deliver to the Trustee (or to any other Person for delivery
to the Trustee) for cancellation any Securities previously authenticated
hereunder which the Company has not issued and sold, and all Securities so
delivered shall be promptly cancelled by the Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities cancelled as provided
in this Section, except as expressly permitted by this Indenture. All cancelled
Securities held by the Trustee shall be disposed of as directed by a Company
Order.
Section 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301 for Securities
of any series, interest on the Securities of each series shall be computed on
the basis of a 360-day year of twelve 30-day months.
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of further effect
(except as to any surviving rights of registration of transfer or exchange of
Securities herein expressly provided for), and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered
(other than (i) Securities which have been destroyed, lost or stolen
and which have been replaced or paid as provided in Section 306 and
(ii) Securities for whose payment money has theretofore been deposited
in trust or segregated and held in trust by the Company 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
-29-
<PAGE>
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice
of redemption by the Trustee in the name, and at the expense, of
the Company,
and the Company, in the case of (i), (ii) or (iii) above, has
deposited or caused to be deposited with the Trustee as trust funds in
trust for the purpose money in an amount sufficient to pay and
discharge the entire indebtedness on such Securities not theretofore
delivered to the Trustee for cancellation, for principal and any
premium and interest to the date of such deposit (in the case of
Securities which have become due and payable) or to the Stated
Maturity or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of this
Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 607, the obligations of
the Trustee to any Authenticating Agent under Section 614 and, if money shall
have been deposited with the Trustee pursuant to subclause (B) of Clause (1) of
this Section, the obligations of the Trustee under Section 402 and the last
paragraph of Section 1003 shall survive.
Section 402. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all money
deposited with the Trustee pursuant to Section 401 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal and any premium and
interest for whose payment such money has been deposited with the Trustee.
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
-30-
<PAGE>
(2) default in the payment of the principal of or any premium on any
Security of that series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when and as
due by the terms of a Security of that series; or
(4) default in the performance, or breach, of any covenant or warranty
of the Company in this Indenture (other than a covenant or warranty a
default in whose performance or whose breach is elsewhere in this Section
specifically dealt with or which has expressly been included in this
Indenture solely for the benefit of series of Securities other than that
series), and continuance of such default or breach for a period of 60 days
after there has been given, by registered or certified mail, to the Company
by the Trustee or to the Company and the Trustee by the Holders of at least
25% in principal amount of the Outstanding Securities of that series a
written notice specifying such default or breach and requiring it to be
remedied and stating that such notice is a "Notice of Default" hereunder;
or
(5) 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 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
-31-
<PAGE>
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
(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
-32-
<PAGE>
(2) default is made in the payment of the principal of (or premium, if
any, on) any Security at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal and any premium and interest and, to the extent that
payment of such interest shall be legally enforceable, interest on any overdue
principal and premium and on any overdue interest, at the rate or rates
prescribed therefor in such Securities, and, in addition thereto, such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel.
If an Event of Default with respect to Securities of any series occurs and
is continuing, the Trustee may in its discretion proceed to protect and enforce
its rights and the rights of the Holders of Securities of such series by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the exercise of any power
granted herein, or to enforce any other proper remedy.
Section 504. Trustee May File Proofs of Claim.
In case of any judicial proceeding relative to the Company (or any other
obligor upon the Securities), its property or its creditors, the Trustee shall
be entitled and empowered, by intervention in such proceeding or otherwise, to
take any and all actions authorized under the Trust Indenture Act in order to
have claims of the Holders and the Trustee allowed in any such proceeding. In
particular, the Trustee shall be authorized to collect and receive any moneys or
other property payable or deliverable on any such claims and to distribute the
same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator
or other similar official in any such judicial proceeding is hereby authorized
by each Holder to make such payments to the Trustee and, in the event that 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
-33-
<PAGE>
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.
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.
-34-
<PAGE>
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, 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
-35-
<PAGE>
(2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
Section 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series may on behalf of the Holders of all the
Securities of such series 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, by the Trustee 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.
-36-
<PAGE>
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;
(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;
-37-
<PAGE>
(5) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction
of any of the Holders pursuant to this Indenture, unless such Holders shall
have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by it in compliance
with such request or direction;
(6) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of the
Company, personally or by agent or attorney; and
(7) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder.
Section 604. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the Trustee's
certificates of authentication, shall be taken as the statements of the Company,
and neither the Trustee nor any Authenticating Agent assumes any responsibility
for their correctness. The Trustee makes no representations as to the validity
or sufficiency of this Indenture or of the Securities. Neither the Trustee nor
any Authenticating Agent shall be accountable for the use or application by the
Company of Securities or the proceeds thereof.
Section 605. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to Sections
608 and 613, may otherwise deal with the Company with the same rights it would
have if it were not Trustee, Authenticating Agent, Paying Agent, Security
Registrar or such other agent.
Section 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated from
other funds except to the extent required by law. The Trustee shall be under no
liability for interest on any money received by it hereunder except as otherwise
agreed with the Company.
Section 607. Compensation and Reimbursement.
The Company agrees
-38-
<PAGE>
(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.
The provisions of this Section 607 shall survive the termination of this
Indenture and the resignation or removal of the Trustee.
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 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.
-39-
<PAGE>
The Trustee may resign at any time with respect to the Securities of one or
more series by giving written notice thereof to the Company. If the instrument
of acceptance by a successor Trustee required by Section 611 shall not have been
delivered to the Trustee within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities of such series.
The Trustee may be removed at any time with respect to the Securities of
any series by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series, delivered to the Trustee and to the
Company.
If at any time:
(1) the Trustee shall fail to comply with Section 608 after written
request therefor by the Company or by any Holder who has been a bona fide
Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609 and shall
fail to resign after written request therefor by the Company or by any such
Holder, or
(3) the Trustee shall become incapable of acting or shall be adjudged
a bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of
the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (A) the Company by a Board Resolution may remove the
Trustee with respect to all Securities, or (B) subject to Section 514, any
Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Securities and the appointment of a successor Trustee or Trustees.
If the Trustee shall resign, be removed or become incapable of acting, or
if a vacancy shall occur in the office of Trustee for any cause, with respect to
the Securities of one or more series, the Company, by a Board Resolution, shall
promptly appoint a successor Trustee or Trustees with respect to the Securities
of that or those series (it being understood that any such successor Trustee may
be appointed with respect to the Securities of one or more or all of such series
and that at any time there shall be only one Trustee with respect to the
Securities of any particular series) and shall comply with the applicable
requirements of Section 611. If, within one year after such resignation, 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
-40-
<PAGE>
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Securities of such
series.
The Company shall give notice of each resignation and each removal of the
Trustee with respect to the Securities of any series and each appointment of a
successor Trustee with respect to the Securities of any series to all Holders of
Securities of such series in the manner provided in Section 106. Each notice
shall include the name of the successor Trustee with respect to the Securities
of such series and the address of its Corporate Trust Office.
Section 611. Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Trustee with respect to
all Securities, every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; but, on the request of the
Company or the successor Trustee, such retiring Trustee shall, upon payment of
its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to such successor Trustee all property and money
held by such retiring Trustee hereunder.
In case of the appointment hereunder of a successor Trustee with respect to
the Securities of one or more (but not all) series, the Company, the retiring
Trustee and each successor Trustee with respect to the Securities of one or more
series shall execute and deliver an indenture supplemental hereto wherein each
successor Trustee shall accept such appointment and which (1) shall contain such
provisions as shall be necessary or desirable to transfer and confirm to, and to
vest in, each successor Trustee all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of that or those series to which
the appointment of such successor Trustee relates, (2) if the retiring Trustee
is not retiring with respect to all Securities, shall contain such provisions as
shall be deemed necessary or desirable to confirm that all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of that
or those series as to which 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.
-41-
<PAGE>
Upon request of any such successor Trustee, the Company shall execute any
and all instruments for more fully and certainly vesting in and confirming to
such successor Trustee all such rights, powers and trusts referred to in the
first or second preceding paragraph, as the case may be.
No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be qualified and eligible under
this Article.
Section 612. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the same effect
as if such successor Trustee had itself authenticated such Securities.
Section 613. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company (or
any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
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.
-42-
<PAGE>
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time terminate
the agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall give notice of such
appointment in the manner provided in Section 106 to all Holders of Securities
of the series with respect to which such Authenticating Agent will serve. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section.
The Company agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section.
If an appointment with respect to one or more series is made pursuant to
this Section, the Securities of such series may have endorsed thereon, in
addition to the Trustee's certificate of authentication, an 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
-43-
<PAGE>
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
(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 1999.
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
-44-
<PAGE>
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 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
-45-
<PAGE>
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
(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
-46-
<PAGE>
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 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
-47-
<PAGE>
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.
-48-
<PAGE>
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 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
-49-
<PAGE>
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.
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
-50-
<PAGE>
a date specified therein, which shall not be less than 30 days from the date of
such publication, any unclaimed balance of such money then remaining will be
repaid to the Company.
Section 1004. Statement by Officers as to Default.
The Company will deliver to the Trustee, within 120 days after the end of
each fiscal year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not to the best knowledge of the signers thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions of this Indenture (without regard to any period of
grace or requirement of notice provided hereunder) and, if the Company shall be
in default, specifying all such defaults and the nature and status thereof of
which they may have knowledge.
Section 1005. Existence.
Subject to Article Eight, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its existence,
rights (charter and statutory) and franchises; provided, however, that the
Company shall not be required to preserve any such right or franchise if the
Board of Directors shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and that the loss
thereof is not disadvantageous in any material respect to the Holders.
Section 1006. Maintenance of Properties.
The Company will cause all properties used or useful in the conduct of its
business or the business of any Subsidiary to be maintained and kept in good
condition, repair and working order and supplied with all necessary equipment
and will cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of the Company may
be necessary so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided, however, that
nothing in this Section shall prevent the Company from discontinuing the
operation or maintenance of any of such properties if such discontinuance is, in
the judgment of the Company, desirable in the conduct of its 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
-51-
<PAGE>
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 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
-52-
<PAGE>
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 December 23, 1998; 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 Transactions (other than Sale and Leaseback Transactions
permitted by Section 1009(1)) entered into after December 23, 1998 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 December 23, 1998 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
-53-
<PAGE>
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 December 23, 1998
(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 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.
-54-
<PAGE>
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 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.
-55-
<PAGE>
The Trustee shall promptly notify the Company in writing of the Securities
selected for redemption as aforesaid and, in case of any Securities selected for
partial redemption as aforesaid, the principal amount thereof to be redeemed.
The provisions of the two preceding paragraphs shall not apply with respect
to any redemption affecting only a single Security, whether such Security is to
be redeemed in whole or in part. In the case of any such redemption in part, the
unredeemed portion of the principal amount of the Security shall be in an
authorized denomination (which shall not be less than the minimum authorized
denomination) for such Security.
For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Securities shall relate, in the
case of any Securities redeemed or to be redeemed only in part, to the portion
of the principal amount of such Securities which has been or is to be redeemed.
Section 1104. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage prepaid,
mailed not less than 30 nor more than 60 days prior to the Redemption Date, to
each Holder of Securities to be redeemed, at 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.
-56-
<PAGE>
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 equal to and in exchange for the unredeemed portion of the principal of
the Security so surrendered.
-57-
<PAGE>
ARTICLE TWELVE
Sinking Funds
Section 1201. Applicability of Article.
The provisions of this Article shall be applicable to any sinking fund for
the retirement of Securities of any series except as otherwise specified as
contemplated by Section 301 for such Securities.
The minimum amount of any sinking fund payment provided for by the terms of
any Securities is herein referred to as a "mandatory sinking fund payment", and
any payment in excess of such minimum amount provided for by the terms of such
Securities is herein referred to as an "optional sinking fund payment". If
provided for by the terms of any Securities, the cash amount of any sinking fund
payment may be subject to reduction as provided in Section 1202. Each sinking
fund payment shall be applied to the redemption of Securities as provided for by
the terms of such Securities.
Section 1202. Satisfaction of Sinking Fund Payments with Securities.
The Company (1) may deliver Outstanding Securities of a series (other than
any previously called for redemption) and (2) may apply as a credit Securities
of a series which have been redeemed either at the election of the Company
pursuant to the terms of such Securities or through the application of permitted
optional sinking fund payments pursuant to the terms of such Securities, in each
case in satisfaction of all or any part of any sinking fund payment with respect
to any Securities of such series required to be made pursuant to the terms of
such Securities as and to the extent provided for by the terms of such
Securities; provided that the Securities to be so credited have not been
previously so credited. The Securities to be so credited shall be received and
credited for such purpose by the Trustee at the Redemption Price, as specified
in the Securities so to be redeemed, for redemption through operation of the
sinking fund and the amount of such sinking fund payment shall be reduced
accordingly.
Section 1203. Redemption of Securities for Sinking Fund.
Not less than 60 days prior to each sinking fund payment date for any
Securities, the Company will deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing sinking fund payment for such
Securities pursuant to the terms of such Securities, the portion thereof, if
any, which is to be satisfied by payment of cash and the portion thereof, if
any, which is to be satisfied by delivering and crediting Securities pursuant to
Section 1202 and will also deliver to the Trustee any Securities to be so
delivered. Not less than 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.
-58-
<PAGE>
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Company's Option to Effect Defeasance or Covenant Defeasance.
The Company may elect, at its option at any time, to have Section 1302 or
Section 1303 applied to any Securities or any series of Securities, as the case
may be, designated pursuant to Section 301 as being defeasible pursuant to such
Section 1302 or 1303, in accordance with any applicable requirements provided
pursuant to Section 301 and upon compliance with the conditions set forth below
in this Article. Any such election shall be evidenced by a Board Resolution or
in another manner specified as contemplated by Section 301 for such Securities.
Section 1302. Defeasance and Discharge.
Upon the Company's exercise of its option (if any) to have this Section
applied to any Securities or any series of Securities, as the case may be, the
Company shall be deemed to have been discharged from its obligations with
respect to such Securities as provided in this Section on and after the date the
conditions set forth in Section 1304 are satisfied (hereinafter called
"Defeasance"). For this purpose, such Defeasance means that the Company shall be
deemed to have paid and discharged the entire indebtedness represented by such
Securities and to have satisfied all its other obligations under such Securities
and this Indenture insofar as such Securities are concerned (and the Trustee, at
the expense of the Company, shall execute proper instruments acknowledging the
same), subject to the following which shall survive until otherwise terminated
or discharged hereunder: (1) the rights of Holders of such Securities to
receive, solely from the trust fund described in Section 1304 and as more fully
set forth in such Section, payments in respect of the principal of and any
premium and interest on such Securities when payments are due, (2) the Company's
obligations with respect to such Securities under Sections 304, 305, 306, 1002
and 1003, (3) the rights, powers, trusts, duties and immunities of the Trustee
hereunder and (4) this Article. Subject to compliance with this Article, the
Company may exercise its option (if any) to have this Section applied to any
Securities notwithstanding the prior exercise of its option (if any) to have
Section 1303 applied to such Securities.
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
-59-
<PAGE>
by reason of any reference elsewhere herein to any such Section or by reason of
any reference in any such Section to any other provision herein or in any other
document, but the remainder of this Indenture and such Securities shall be
unaffected thereby.
Section 1304. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to the application of Section 1302 or
Section 1303 to any Securities or any series of Securities, as the case may be:
(1) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee which satisfies the
requirements contemplated by Section 609 and agrees to comply with the
provisions of this Article applicable to it) as trust funds in trust for
the purpose of making the following payments, specifically pledged as
security for, and dedicated solely to, the benefits of the Holders of such
Securities, (A) money in an amount, or (B) U.S. Government Obligations
which through the scheduled payment of principal and interest in respect
thereof in accordance with their terms will provide, not later than one day
before the due date of any payment, money in an amount, or (C) a
combination thereof, in each case sufficient, in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay and
discharge, and which shall be applied by the Trustee (or any such other
qualifying trustee) to pay and discharge, the principal of and any premium
and interest on such Securities on the respective Stated Maturities, in
accordance with the terms of this Indenture and such Securities. As used
herein, "U.S. Government Obligation" means (x) any security which is (i) a
direct obligation of the United States of America for the payment of which
the full faith and credit of the United States of America is pledged or
(ii) an obligation of a Person controlled or supervised by and acting as an
agency or instrumentality of the United States of America the payment of
which is unconditionally guaranteed as a full faith and credit obligation
by the United States of America, which, in either case (i) or (ii), is not
callable or redeemable at the option 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
-60-
<PAGE>
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.
(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
-61-
<PAGE>
own Paying Agent) as the Trustee may determine, to the Holders of such
Securities, of all sums due and to become due thereon in respect of principal
and any premium and interest, but money so held in trust need not be segregated
from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 1304 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the Holders of Outstanding Securities.
Anything in this Article to the contrary notwithstanding, the Trustee shall
deliver or pay to the Company from time to time upon Company Request any money
or U.S. Government Obligations held by it as provided in Section 1304 with
respect to any Securities which, in the opinion of a nationally recognized firm
of independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect the Defeasance or Covenant Defeasance, as
the case may be, with respect to such Securities.
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
-62-
<PAGE>
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
business on any Regular Record Date to the opening of business on the next
succeeding Interest Payment Date (excluding Securities or portions thereof
called for redemption during such period) shall 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 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
-63-
<PAGE>
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
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
-64-
<PAGE>
(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.
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.
-65-
<PAGE>
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 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
-66-
<PAGE>
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.
______________________
-67-
<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.
Armstrong World Industries, Inc.
/s/ E. Follin Smith
By ______________________________
E. Follin Smith
Vice President and Treasurer
Attest:
/s/ Robert J. Sandkuhler
_____________________________
The First National Bank of Chicago
/s/ Michael D. Pinzon
By _______________________________
Attest:
/s/ Mary R. Fonti
_____________________________
Authorized Officer
-68-
<PAGE>
State of New York )
) ss.:
County of New York )
On the 23rd day of December, 1998, before me personally came
Michael Pinzon, to me known, who, being by me duly sworn, did depose and say
that he/she is a Officer of The First National Bank of Chicago, 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.
/s/ Mark E. Davis
-------------------------
Commonwealth of Pennsylvania )
) ss.:
County of Lancaster )
On the 23rd day of December, 1998 before me personally came E. Follin
Smith, to me known, who, being by me duly sworn, did depose and say that she is
Treasurer of Armstrong World Industries, Inc., 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 his or her name thereto by like authority.
/s/ Donna L. Royer-Good
-------------------------
-69-
<PAGE>
EXHIBIT 4.4
Armstrong World Industries, Inc.
TO
The First National Bank of Chicago
Trustee
INDENTURE
Dated as of December 23, 1998
Subordinated Debt Securities
<PAGE>
TABLE OF CONTENTS
----------
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Recitals of the Company................................................................................... 1
ARTICLE ONE
Definitions and Other Provisions of General Application
Section 101. Definitions:
Act..................................................................................... 2
Affiliate; control...................................................................... 2
Authenticating Agent.................................................................... 2
Board of Directors...................................................................... 2
Board Resolution........................................................................ 2
Business Day............................................................................ 2
Commission.............................................................................. 2
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
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Outstanding............................................................................. 4
Paying Agent............................................................................ 5
Person.................................................................................. 5
Place of Payment........................................................................ 5
Predecessor Security.................................................................... 5
Redemption Date......................................................................... 5
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..................................................................... 6
Trustee................................................................................. 6
U.S. Government Obligation.............................................................. 7
Vice President.......................................................................... 7
Section 102. Compliance Certificates and Opinions.................................................... 7
Section 103. Form of Documents Delivered to Trustee.................................................. 7
Section 104. Acts of Holders; Record Dates........................................................... 8
Section 105. Notices, Etc., to Trustee and Company................................................... 10
Section 106. Notice to Holders; Waiver............................................................... 10
Section 107. Conflict with Trust Indenture Act....................................................... 10
Section 108. Effect of Headings and Table of Contents................................................ 10
Section 109. Successors and Assigns.................................................................. 11
Section 110. Separability Clause..................................................................... 11
Section 111. Benefits of Indenture................................................................... 11
Section 112. Governing Law........................................................................... 11
Section 113. Legal Holidays.......................................................................... 11
ARTICLE TWO
Security Forms
Section 201. Forms Generally......................................................................... 11
Section 202. Form of Face of Security................................................................ 12
Section 203. Form of Reverse of Security............................................................. 13
Section 204. Form of Legend for Global Securities.................................................... 18
Section 205. Form of Trustee's Certificate of Authentication......................................... 18
</TABLE>
-ii-
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Section 206. Form of Conversion Notice............................................................... 18
ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series.................................................... 19
Section 302. Denominations........................................................................... 22
Section 303. Execution, Authentication, Delivery and Dating.......................................... 22
Section 304. Temporary Securities.................................................................... 23
Section 305. Registration, Registration of Transfer and Exchange..................................... 24
Section 306. Mutilated, Destroyed, Lost and Stolen Securities........................................ 25
Section 307. Payment of Interest; Interest Rights Preserved.......................................... 26
Section 308. Persons Deemed Owners................................................................... 27
Section 309. Cancellation............................................................................ 28
Section 310. Computation of Interest................................................................. 28
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture................................................. 28
Section 402. Application of Trust Money.............................................................. 29
ARTICLE FIVE
Remedies
Section 501. Events of Default....................................................................... 29
Section 502. Acceleration of Maturity; Rescission and Annulment...................................... 31
Section 503. Collection of Indebtedness and Suits for
Enforcement by Trustee............................................................... 32
Section 504. Trustee May File Proofs of Claim........................................................ 32
Section 505. Trustee May Enforce Claims Without Possession
of Securities........................................................................ 33
Section 506. Application of Money Collected.......................................................... 33
Section 507. Limitation on Suits..................................................................... 33
Section 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest and to Convert.................................................. 34
Section 509. Restoration of Rights and Remedies...................................................... 34
</TABLE>
-iii-
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Section 510. Rights and Remedies Cumulative.......................................................... 34
Section 511. Delay or Omission Not Waiver............................................................ 34
Section 512. Control by Holders...................................................................... 35
Section 513. Waiver of Past Defaults................................................................. 35
Section 514. Undertaking for Costs................................................................... 35
Section 515. Waiver of Usury, Stay or Extension Laws................................................. 35
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities..................................................... 36
Section 602. Notice of Defaults...................................................................... 36
Section 603. Certain Rights of Trustee............................................................... 36
Section 604. Not Responsible for Recitals or Issuance of Securities.................................. 37
Section 605. May Hold Securities..................................................................... 37
Section 606. Money Held in Trust..................................................................... 37
Section 607. Compensation and Reimbursement.......................................................... 38
Section 608. Conflicting Interests................................................................... 38
Section 609. Corporate Trustee Required; Eligibility................................................. 38
Section 610. Resignation and Removal; Appointment of Successor....................................... 39
Section 611. Acceptance of Appointment by Successor.................................................. 40
Section 612. Merger, Conversion, Consolidation or Succession
to Business.......................................................................... 41
Section 613. Preferential Collection of Claims Against Company....................................... 41
Section 614. Appointment of Authenticating Agent..................................................... 41
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee Names and Addresses
of Holders........................................................................... 43
Section 702. Preservation of Information; Communications
to Holders........................................................................... 43
Section 703. Reports by Trustee...................................................................... 43
Section 704. Reports by Company...................................................................... 44
</TABLE>
-iv-
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. Company May Consolidate, Etc., Only on
Certain Terms........................................................................ 44
Section 802. Successor Substituted................................................................... 45
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of Holders...................................... 45
Section 902. Supplemental Indentures With Consent of Holders......................................... 46
Section 903. Execution of Supplemental Indentures.................................................... 47
Section 904. Effect of Supplemental Indentures....................................................... 48
Section 905. Conformity with Trust Indenture Act..................................................... 48
Section 906. Reference in Securities to Supplemental Indentures...................................... 48
Section 907. Subordination Unimparied................................................................ 48
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest.............................................. 48
Section 1002. Maintenance of Office or Agency......................................................... 48
Section 1003. Money for Securities Payments to Be Held in Trust....................................... 49
Section 1004. Statement by Officers as to Default..................................................... 50
Section 1005. Existence............................................................................... 50
Section 1006. Maintenance of Properties............................................................... 50
Section 1007. Payment of Taxes and Other Claims....................................................... 50
Section 1008. Waiver of Certain Covenants............................................................. 51
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article................................................................ 51
Section 1102. Election to Redeem; Notice to Trustee................................................... 51
Section 1103. Selection by Trustee of Securities to Be Redeemed....................................... 51
Section 1104. Notice of Redemption.................................................................... 52
</TABLE>
-v-
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Section 1105. Deposit of Redemption Price............................................................. 53
Section 1106. Securities Payable on Redemption Date................................................... 53
Section 1107. Securities Redeemed in Part............................................................. 53
ARTICLE TWELVE
Sinking Funds
Section 1201. Applicability of Article................................................................ 54
Section 1202. Satisfaction of Sinking Fund Payments with Securities................................... 54
Section 1203. Redemption of Securities for Sinking Fund............................................... 54
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Company's Option to Effect Defeasance or
Covenant Defeasance.................................................................. 55
Section 1302. Defeasance and Discharge................................................................ 55
Section 1303. Covenant Defeasance..................................................................... 55
Section 1304. Conditions to Defeasance or Covenant Defeasance......................................... 56
Section 1305. Deposited Money and U.S. Government Obligations
to Be Held in Trust; Miscellaneous Provisions........................................ 58
Section 1306. Reinstatement........................................................................... 58
ARTICLE FOURTEEN
Conversion of Securities
Section 1401. Applicability of Article................................................................ 59
Section 1402. Exercise of Conversion Privilege........................................................ 59
Section 1403. No Fractional Shares.................................................................... 60
Section 1404. Adjustment of Conversion Price.......................................................... 60
Section 1405. Notice of Certain Corporate Actions..................................................... 61
Section 1406. Reservation of Shares of Common Stock................................................... 61
Section 1407. Payment of Certain Taxes Upon Conversion................................................ 62
Section 1408. Nonassessability........................................................................ 62
Section 1409. Effect of Consolidation or Merger on Conversion Privilege............................... 62
Section 1410. Duties of Trustee Regarding Conversion.................................................. 63
Section 1411. Repayment of Certain Funds Upon Conversion.............................................. 63
</TABLE>
-vi-
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
ARTICLE FIFTEEN
Subordination of Securities
Section 1501. Securities Subordinate to Senior Debt................................................... 64
Section 1502. Payment Over of Proceeds Upon Dissolution, Etc.......................................... 64
Section 1503. Prior Payment to Senior Debt Upon Acceleration
of Securities........................................................................ 65
Section 1504. No Payment When Senior Debt in Default.................................................. 65
Section 1505. Payment Permitted If No Default......................................................... 66
Section 1506. Subrogation to Rights of Holders of Senior Debt......................................... 66
Section 1507. Provisions Solely to Define Relative Rights............................................. 66
Section 1508. Trustee to Effectuate Subordination..................................................... 67
Section 1509. No Waiver of Subordination Provisions................................................... 67
Section 1510. Notice to Trustee....................................................................... 67
Section 1511. Reliance on Judicial Order or Certificate of
Liquidating Agent.................................................................... 68
Section 1512. Trustee Not Fiduciary for Holders of Senior Debt........................................ 68
Section 1513. Rights of Trustee as Holder of Senior Debt;
Preservation of Trustee's Rights..................................................... 68
Section 1514. Article Applicable to Paying Agents..................................................... 69
Section 1515. Certain Conversions Deemed Payment...................................................... 69
Section 1516. Obligations of Company and Right to Convert
Unconditional........................................................................ 69
Testimonium............................................................................................... 70
Signatures and Seals...................................................................................... 70
Acknowledgements.......................................................................................... 71
</TABLE>
-vii-
<PAGE>
--------------------------------------
Certain Sections of this Indenture relating to Sections 310
through 318, inclusive, of the Trust Indenture Act of 1939:
<TABLE>
<CAPTION>
Trust Indenture
Act Section Indenture Section
<S> <C>
(s) 310 (a) (1) ................................................................... 609
(a) (2) ................................................................... 609
(a) (3) ................................................................... Not Applicable
(a) (4) ................................................................... Not Applicable
(b) ................................................................... 608, 610
(s) 311 (a) ................................................................... 613
(b) ................................................................... 613
(s) 312 (a) ................................................................... 701, 702
(b) ................................................................... 702
(c) ................................................................... 702
(s) 313 (a) ................................................................... 703
(b) ................................................................... 703
(c) ................................................................... 703
(d) ................................................................... 703
(s) 314 (a) ................................................................... 704
(a) (4) ................................................................... 101, 1004
(b) ................................................................... Not Applicable
(c) (1) ................................................................... 102
(c) (2) ................................................................... 102
(c) (3) ................................................................... Not Applicable
(d) ................................................................... Not Applicable
(e) ................................................................... 102
(s) 315 (a) ................................................................... 601
(b) ................................................................... 602
(c) ................................................................... 601
(d) ................................................................... 601
(e) ................................................................... 514
(s) 316 (a) ................................................................... 101
(a) (1) (A) ................................................................... 502, 512
(a) (1) (B) ................................................................... 513
(a) (2) ................................................................... Not Applicable
(b) ................................................................... 508
(c) ................................................................... 104
(s) 317 (a) (1) ................................................................... 503
(a) (2) ................................................................... 504
(b) ................................................................... 1003
(s) 318 (a) ................................................................... 107
</TABLE>
- --------------
Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Indenture.
-viii-
<PAGE>
INDENTURE, dated as of December 23, 1998, 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 2500 Columbia Avenue, Lancaster, Pennsylvania
17603, and The First National Bank of Chicago, a national banking association
duly organized and existing under the laws of the United States of America, as
Trustee (herein called the "Trustee").
Recitals of the Company
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured
debentures, notes or other evidences of indebtedness (herein called the
"Securities"), to be issued in one or more series as in this Indenture provided.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
Now, Therefore, This Indenture Witnesseth:
For and in consideration of the premises and the purchase of the Securities
by the Holders thereof, it is mutually agreed, for the equal and proportionate
benefit of all Holders of the Securities or of series thereof, as follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly provided
or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles, and, except as otherwise herein expressly provided, the term
"generally accepted accounting principles" with respect to any computation
required or permitted hereunder shall mean such accounting principles as
are generally accepted at the date of such computation;
(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
<PAGE>
(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 reclassifications bears to the
total number of shares of all such classes resulting from all such
reclassifications.
-2-
<PAGE>
"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
The First National Bank of Chicago, One First National Plaza, Suite 0126,
Chicago, Illinois, 60670-0126 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 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.
-3-
<PAGE>
"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) 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-
<PAGE>
(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.
"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.
-5-
<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.
"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
installment of principal thereof or interest thereon, means the date specified
in such Security as the fixed date on which the principal of such Security or
such instalment of principal or interest is due and payable.
"Subsidiary" means a corporation more than 50% of the outstanding voting
stock of which is owned, directly or indirectly, by the Company or by one or
more other Subsidiaries, or by the Company and one or more other Subsidiaries.
For the purposes of this definition, "voting stock" means stock which ordinarily
has voting power for the election of directors, whether at all times or only so
long as no senior class of stock has such voting power by reason of any
contingency.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trustee" means the Person named as the "Trustee" in the first paragraph of
this instrument until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Trustee" shall mean or
include each Person who is then a Trustee hereunder, and if at any time there is
more than one such Person, "Trustee" as used with respect to the Securities of
any series shall mean the Trustee with respect to Securities of that series.
-6-
<PAGE>
"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.
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
-7-
<PAGE>
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 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
-8-
<PAGE>
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.
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.
-9-
<PAGE>
Section 105. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice, consent, waiver or
Act of Holders or other document provided or permitted by this Indenture to be
made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder if made, given, furnished or filed in writing
to or with the Trustee at its Corporate Trust Office, Attention: Corporate
Trust Administration, or
(2) the Company by the Trustee or by any Holder shall be sufficient
for every purpose hereunder (unless otherwise herein expressly provided) if
in writing and mailed, first-class postage prepaid, to the Company
addressed to it at the address of its principal office specified in the
first paragraph of this instrument or at any other address previously
furnished in writing to the Trustee by the Company, 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 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.
-10-
<PAGE>
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, 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
-11-
<PAGE>
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.
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
-12-
<PAGE>
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:
_______________________________________
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 December 23, 1998 (herein called the
"Indenture", which term shall have the meaning assigned to it in such
instrument), between the Company and The First National Bank of Chicago, 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
-13-
<PAGE>
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,
Redemption Redemption
Year Price Year Price
---- ----------- ---- ------------
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,
Redemption Price
For Redemption Redemption Price For
Through Operation Redemption Otherwise
of the Than Through Operation
Year Sinking Fund of the Sinking Fund
---- ------------------- -----------------------
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
-14-
<PAGE>
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.]
[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
-15-
<PAGE>
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.]
[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
-16-
<PAGE>
and upon all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture, the Holder
of this Security shall not have the right to institute any proceeding with
respect to the Indenture or for the appointment of a receiver or trustee or for
any other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 25% in principal amount
of the Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable indemnity, and the Trustee
shall not have received from the Holders of a majority in principal amount of
Securities of this series at the time Outstanding a direction inconsistent with
such request, and shall have failed to institute any such proceeding, for 60
days after receipt of such notice, request and offer of indemnity. The foregoing
shall not apply to any suit instituted by the Holder of this Security for the
enforcement of any payment of principal hereof or any premium or interest hereon
on or after the respective due dates expressed herein.
No reference herein to the Indenture and no provision of this Security or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and 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.
-17-
<PAGE>
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.
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.
-18-
<PAGE>
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.
-19-
<PAGE>
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;
-20-
<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;
(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
-21-
<PAGE>
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 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
-22-
<PAGE>
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 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,
-23-
<PAGE>
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.
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.
-24-
<PAGE>
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.
(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.
-25-
<PAGE>
If there shall be delivered to the Company and the Trustee (i) evidence to
their satisfaction of the destruction, loss or theft of any Security and (ii)
such security or indemnity as may be required by them to save each of them and
any agent of either of them harmless, then, in the absence of notice to the
Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and the Trustee shall authenticate and
deliver, in lieu of any such destroyed, lost or stolen Security, a new Security
of the same series and of like tenor and principal amount and bearing a number
not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has become
or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this Section in lieu of
any destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of that series duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.
Section 307. Payment of Interest; Interest Rights Preserved.
Except as otherwise provided as contemplated by Section 301 with respect to
any series of Securities, interest on any Security which is payable, and is
punctually paid or duly provided for, on any Interest Payment Date shall be paid
to the Person in whose name that Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest.
Any interest on any Security of any series which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular 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
-26-
<PAGE>
Company shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such Defaulted Interest
or shall make arrangements satisfactory to the Trustee for such deposit
prior to the date of the proposed payment, such money when deposited to be
held in trust for the benefit of the Persons entitled to such Defaulted
Interest as in this Clause provided. Thereupon the Trustee shall fix a
Special Record Date for the payment of such Defaulted Interest which shall
be not more than 15 days and not less than 10 days prior to the date of the
proposed payment and not less than 10 days after the receipt by the Trustee
of the notice of the proposed payment. The Trustee shall promptly notify
the Company of such Special Record Date and, in the name and at the expense
of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be given to each
Holder of Securities of such series in the manner set forth in Section 106,
not less than 10 days prior to such Special Record Date. Notice of the
proposed payment of such Defaulted Interest and the Special Record Date
therefor having been so mailed, such Defaulted Interest shall be paid to
the Persons in whose names the Securities of such series (or their
respective Predecessor Securities) are registered at the close of business
on such Special Record Date and shall no longer be payable pursuant to the
following Clause (2).
(2) The Company may make payment of any Defaulted Interest on the
Securities of any series in any other lawful manner not inconsistent with
the requirements of any securities exchange on which such Securities may be
listed, and upon such notice as may be required by such exchange, if, after
notice given by the Company to the Trustee of the proposed payment pursuant
to this Clause, such manner of payment shall be deemed practicable by the
Trustee.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Security.
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
-27-
<PAGE>
whatsoever, whether or not such Security be overdue, and neither the Company,
the Trustee nor any agent of the Company or the Trustee shall be affected by
notice to the contrary.
Section 309. Cancellation.
All Securities surrendered for payment, redemption, registration of
transfer or exchange or for credit against any sinking fund payment shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee
and shall be promptly cancelled by it. The Company may at any time deliver to
the Trustee for cancellation any Securities previously authenticated and
delivered hereunder which the Company may have acquired in any manner
whatsoever, and may deliver to the Trustee (or to any other Person for delivery
to the Trustee) for cancellation any Securities previously authenticated
hereunder which the Company has not issued and sold, and all Securities so
delivered shall be promptly cancelled by the Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities cancelled as provided
in this Section, except as expressly permitted by this Indenture. All cancelled
Securities held by the Trustee shall be disposed of as directed by a Company
Order.
Section 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301 for Securities
of any series, interest on the Securities of each series shall be computed on
the basis of a 360-day year of twelve 30-day months.
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of further effect
(except as to any surviving rights of registration of transfer or exchange of
Securities herein expressly provided for), and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered (other
than (i) Securities which have been destroyed, lost or stolen and
which have been replaced or paid as provided in Section 306 and (ii)
Securities for whose payment money has theretofore been deposited in
trust or segregated and held in trust by the Company 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
-28-
<PAGE>
(ii) will become due and payable at their Stated Maturity
within one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice
of redemption by the Trustee in the name, and at the expense, of
the Company,
and the Company, in the case of (i), (ii) or (iii) above, has
deposited or caused to be deposited with the Trustee as trust funds in
trust for the purpose money in an amount sufficient to pay and
discharge the entire indebtedness on such Securities not theretofore
delivered to the Trustee for cancellation, for principal and any
premium and interest to the date of such deposit (in the case of
Securities which have become due and payable) or to the Stated
Maturity or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of this
Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 607, the obligations of
the Trustee to any Authenticating Agent under Section 614 and, if money shall
have been deposited with the Trustee pursuant to subclause (B) of Clause (1) of
this Section, the obligations of the Trustee under Section 402 and the last
paragraph of Section 1003 shall survive.
Section 402. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all money
deposited with the Trustee pursuant to Section 401 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal and any premium and
interest for whose payment such money has been deposited with the Trustee.
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):
-29-
<PAGE>
(1) default in the payment of any interest upon any Security of that
series when it becomes due and payable, and continuance of such default for
a period of 30 days; or
(2) default in the payment of the principal of or any premium on any
Security of that series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when and as
due by the terms of a Security of that series; or
(4) default in the performance, or breach, of any covenant or warranty
of the Company in this Indenture (other than a covenant or warranty a
default in whose performance or whose breach is elsewhere in this Section
specifically dealt with or which has expressly been included in this
Indenture solely for the benefit of series of Securities other than that
series), and continuance of such default or breach for a period of 60 days
after there has been given, by registered or certified mail, to the Company
by the Trustee or to the Company and the Trustee by the Holders of at least
25% in principal amount of the Outstanding Securities of that series a
written notice specifying such default or breach and requiring it to be
remedied and stating that such notice is a "Notice of Default" hereunder;
or
(5) 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 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.
-30-
<PAGE>
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
(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.
-31-
<PAGE>
Section 503. Collection of Indebtedness and Suits for Enforcement by Trustee.
The Company covenants that if
(1) default is made in the payment of any interest on any Security
when such interest becomes due and payable and such default continues for a
period of 30 days, or
(2) default is made in the payment of the principal of (or premium, if
any, on) any Security at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal and any premium and interest and, to the extent that
payment of such interest shall be legally enforceable, interest on any overdue
principal and premium and on any overdue interest, at the rate or rates
prescribed therefor in such Securities, and, in addition thereto, such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel.
If an Event of Default with respect to Securities of any series occurs and
is continuing, the Trustee may in its discretion proceed to protect and enforce
its rights and the rights of the Holders of Securities of such series by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the exercise of any power
granted herein, or to enforce any other proper remedy.
Section 504. Trustee May File Proofs of Claim.
In case of any judicial proceeding relative to the Company (or any other
obligor upon the Securities), its property or its creditors, the Trustee shall
be entitled and empowered, by intervention in such proceeding or otherwise, to
take any and all actions authorized under the Trust Indenture Act in order to
have claims of the Holders and the Trustee allowed in any such proceeding. In
particular, the Trustee shall be authorized to collect and receive any moneys or
other property payable or deliverable on any such claims and to distribute the
same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator
or other similar official in any such judicial proceeding is hereby authorized
by each Holder to make such payments to the Trustee and, in the event that 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.
-32-
<PAGE>
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.
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;
-33-
<PAGE>
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, 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.
-34-
<PAGE>
Section 512. Control by Holders.
The Holders of a majority in principal amount of the Outstanding Securities
of any series shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred on the Trustee, with respect to the Securities of
such series, provided that
(1) such direction shall not be in conflict with any rule of law or
with this Indenture, and
(2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
Section 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series may on behalf of the Holders of all the
Securities of such series 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, by the Trustee 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
-35-
<PAGE>
hinder, delay or impede the execution of any power herein granted to the
Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.
ARTICLE 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;
-36-
<PAGE>
(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.
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.
-37-
<PAGE>
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.
The provisions of this Section 607 shall survive the termination of this
Indenture and the resignation or removal of the Trustee.
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 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.
-38-
<PAGE>
Section 610. Resignation and Removal; Appointment of Successor.
No resignation or removal of the Trustee and no appointment of a successor
Trustee pursuant to this Article shall become effective until the acceptance of
appointment by the successor Trustee in accordance with the applicable
requirements of Section 611.
The Trustee may resign at any time with respect to the Securities of one or
more series by giving written notice thereof to the Company. If the instrument
of acceptance by a successor Trustee required by Section 611 shall not have been
delivered to the Trustee within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities of such series.
The Trustee may be removed at any time with respect to the Securities of
any series by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series, delivered to the Trustee and to the
Company.
If at any time:
(1) the Trustee shall fail to comply with Section 608 after written
request therefor by the Company or by any Holder who has been a bona fide
Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609 and shall
fail to resign after written request therefor by the Company or by any such
Holder, or
(3) the Trustee shall become incapable of acting or shall be adjudged
a bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of
the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (A) the Company by a Board Resolution may remove the
Trustee with respect to all Securities, or (B) subject to Section 514, any
Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Securities and the appointment of a successor Trustee or Trustees.
If the Trustee shall resign, be removed or become incapable of acting, or
if a vacancy shall occur in the office of Trustee for any cause, with respect to
the Securities of one or more series, the Company, by a Board Resolution, shall
promptly appoint a successor Trustee or Trustees with respect to the Securities
of that or those series (it being understood that any such successor Trustee may
be appointed with respect to the Securities of one or more or all of such series
and that at any time there shall be only one Trustee with respect to the
Securities of any particular series) and shall comply with the applicable
requirements of Section 611. If, within one year after such resignation, 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
-39-
<PAGE>
requirements of Section 611, become the successor Trustee with respect to the
Securities of such series and to that extent supersede the successor Trustee
appointed by the Company. If no successor Trustee with respect to the Securities
of any series shall have been so appointed by the Company or the Holders and
accepted appointment in the manner required by Section 611, any Holder who has
been a bona fide Holder of a Security of such series for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the appointment of a successor Trustee with
respect to the Securities of such series.
The Company shall give notice of each resignation and each removal of the
Trustee with respect to the Securities of any series and each appointment of a
successor Trustee with respect to the Securities of any series to all Holders of
Securities of such series in the manner provided in Section 106. Each notice
shall include the name of the successor Trustee with respect to the Securities
of such series and the address of its Corporate Trust Office.
Section 611. Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Trustee with respect to
all Securities, every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; but, on the request of the
Company or the successor Trustee, such retiring Trustee shall, upon payment of
its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to such successor Trustee all property and money
held by such retiring Trustee hereunder.
In case of the appointment hereunder of a successor Trustee with respect to
the Securities of one or more (but not all) series, the Company, the retiring
Trustee and each successor Trustee with respect to the Securities of one or more
series shall execute and deliver an indenture supplemental hereto wherein each
successor Trustee shall accept such appointment and which (1) shall contain such
provisions as shall be necessary or desirable to transfer and confirm to, and to
vest in, each successor Trustee all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of that or those series to which
the appointment of such successor Trustee relates, (2) if the retiring Trustee
is not retiring with respect to all Securities, shall contain such provisions as
shall be deemed necessary or desirable to confirm that all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of that
or those series as to which 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
-40-
<PAGE>
and money held by such retiring Trustee hereunder with respect to the Securities
of that or those series to which the appointment of such successor Trustee
relates.
Upon request of any such successor Trustee, the Company shall execute any
and all instruments for more fully and certainly vesting in and confirming to
such successor Trustee all such rights, powers and trusts referred to in the
first or second preceding paragraph, as the case may be.
No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be qualified and eligible under
this Article.
Section 612. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the same effect
as if such successor Trustee had itself authenticated such Securities.
Section 613. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company (or
any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
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,
-41-
<PAGE>
such Authenticating Agent shall resign immediately in the manner and with the
effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time terminate
the agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall give notice of such
appointment in the manner provided in Section 106 to all Holders of Securities
of the series with respect to which such Authenticating Agent will serve. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section.
The Company agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section.
If an appointment with respect to one or more series is made pursuant to
this Section, the Securities of such series may have endorsed thereon, in
addition to the Trustee's certificate of authentication, an 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
-42-
<PAGE>
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
(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 1999.
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
-43-
<PAGE>
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 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
-44-
<PAGE>
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
(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
-45-
<PAGE>
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 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
-46-
<PAGE>
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
obligated to, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
-47-
<PAGE>
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.
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
-48-
<PAGE>
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.
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
-49-
<PAGE>
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 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
-50-
<PAGE>
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.
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,
-51-
<PAGE>
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.
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,
-52-
<PAGE>
(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.
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
-53-
<PAGE>
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 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
-54-
<PAGE>
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.
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)
-55-
<PAGE>
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 (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
-56-
<PAGE>
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.
(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
-57-
<PAGE>
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 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.
-58-
<PAGE>
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
business on any Regular Record Date to the opening of business on the next
succeeding Interest Payment Date (excluding Securities or portions thereof
called for redemption during such period) shall 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 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
-59-
<PAGE>
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 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
-60-
<PAGE>
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 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.
-61-
<PAGE>
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 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
-62-
<PAGE>
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.
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.
-63-
<PAGE>
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.
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
-64-
<PAGE>
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 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
-65-
<PAGE>
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
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,
-66-
<PAGE>
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 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
-67-
<PAGE>
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
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.
-68-
<PAGE>
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) 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.
_____________________________
-69-
<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.
Armstrong World Industries, Inc.
/s/ E. Follin Smith
By __________________________
E. Follin Smith
Vice President and Treasurer
Attest:
/s/ Robert J. Sandkuhler
________________________________
The First National Bank of Chicago
/s/ Michael D. Pinzon
By __________________________
Attest:
Mary R. Fonti
________________________________
Authorized Officer
-70-
<PAGE>
State of New York )
) (S).:
County of New York )
On the 23rd day of December, 1998, before me personally came Michael
Pinzon, to me known, who, being by me duly sworn, did depose and say that he/she
is a Officer of The First National Bank of Chicago, 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.
/s/ Mark E. Davis
-------------------------
Commonwealth of Pennsylvania )
) (S).:
County of Lancaster )
On the 23rd day of December, 1998, before me personally came E. Follin
Smith, to me known, who, being by me duly sworn, did depose and say that she is
Treasurer of Armstrong World Industries, Inc., 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 his or her name thereto by like authority.
/s/ Donna L. Royer-Good
-------------------------
-71-
<PAGE>
EXHIBIT 4.7
COMMON STOCK [GRAPHIC] THIS CERTIFICATE IS TRANSFERABLE IN
RIDGEFIELD PARK, NJ AND NEW YORK, NY
PAR VALUE $1.00
<TABLE>
<S> <C>
- ------- ----------
NUMBER SHARES
- ------- ----------
NL
- ------- ----------
</TABLE>
INCORPORATED UNDER THE LAWS OF CUSIP 042476 10 1
THE COMMONWEALTH OF PENNSYLVANIA SEE REVERSE FOR CERTAIN DEFINITIONS
[LOGO] ARMSTRONG
WORLD INDUSTRIES, INC.
------------------------------------------------------------------
This
Certifies
that
is the
owner of
------------------------------------------------------------------
FULLY PAID AND NON-ASSESSABLE SHARES OF THE COMMON STOCK OF
Armstrong World Industries, Inc. transferable on the books of the
Company by the holder hereof in person or by duly authorized attorney
upon surrender of this Certificate properly endorsed. This Certificate
is not valid until countersigned by a Transfer Agent registered by a
Registrar of the Company. Witness the seal of the Company and the
signatures of its duly authorized officers.
[BACKGROUND] CERTIFICATE OF STOCK
<TABLE>
<S> <C> <C>
Dated /s/ Frank A. Riddick, III /s/ George A. Lorch [SEAL]
------------------------ ---------------------- ARMSTRONG WORLD
SENIOR VICE PRESIDENT, PRESIDENT INDUSTRIES, INC.
FINANCE INCORPORATED
DEC. 30, 1891
</TABLE>
COUNTERSIGNED AND REGISTERED:
ChaseMellon Shareholder Services, L.L.C.
TRANSFER AGENT
AND REGISTRAR
BY
AUTHORIZED SIGNATURE
<PAGE>
[LOGO] ARMSTRONG
WORLD INDUSTRIES, INC.
The corporation will furnish without charge to each stockholder who so
requests a statement of (1) the designations, preferences, limitations and
relative rights of the shares of each class of stock of this corporation and (2)
the variations in the relative rights and preferences of the respective series
of each class of stock issuable in series insofar as they have been fixed and
determined, and the authority of the Board of Directors to fix and determine the
relative rights and preferences of subsequent series. Requests may be directed
to the Secretary, Armstrong World Industries, Inc., Lancaster, Pennsylvania, or
to the Transfer Agent named on the face of this certificate.
The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
<TABLE>
<S> <C>
TEN COM - as tenants in common UNIF GIFT MIN ACT-..............Custodian...................
TEN ENT - as tenants by the entireties (Cust) (Minor)
JT TEN - as joint tenants with right of under Uniform Gifts to Minors
survivorship and not as tenants Act........................
in common (State)
UNIF TRAN MIN ACT-..............Custodian...................
(Cust) (Minor)
Under Uniform Transfers to Minors
Act........................
(State)
</TABLE>
Additional abbreviations may also be used though not in the above list.
For value received,______________ hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
- --------------------------------------
|
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- ------------------------------------------------------------------------ Shares
of the capital stock represented by the within Certificate, and do hereby
irrevocably constitute and appoint
- ---------------------------------------------------------------------- Attorney
to transfer the said stock on the books of the within-named Company with full
power of substitution in the premises.
Dated, _________________________
--------------------------------------------------------
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH
THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN
EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR
ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED:--------------------------------------------------------
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE
GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND
LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM),
PURSUANT TO S.E.C. RULE 17Ad-15.
KEEP THIS CERTIFICATE IN A SAFE PLACE. IF IT IS LOST, STOLEN, MUTILATED OR
DESTROYED, THE CORPORATION WILL REQUIRE A BOND OF INDEMNITY AS A CONDITION TO
THE ISSUANCE OF A REPLACEMENT CERTIFICATE.
This certificate also evidences and entitles the holder hereof to
certain Rights as set forth in the Rights Agreement between Armstrong World
Industries, Inc. (the "Company") and ChaseMellon Shareholder Services, L.L.C.
(the "Rights Agent") effective as of March 21, 1996 (the "Rights Agreement"),
the terms of which are hereby incorporated herein by reference and a copy of
which is on file at the principal offices of the Company. Under certain
circumstances, as set forth in the Rights Agreement, such Rights will be
evidenced by separate certificates and will no longer be evidenced by this
certificate. The Company will mail or cause to be mailed to the holder of this
certificate a copy of the Rights Agreement, as in effect on the date of the
mailing, without charge promptly after receipt of a written request therefor.
Under certain circumstances set forth in the Rights Agreement, Rights issued to,
or held by, any Person who is, was or becomes an Acquiring Person or any
Affiliate or Associates thereof (as such terms are defined in the Rights
Agreement), whether currently held by or on behalf of such Person or by any
subsequent holder, may become null and void. Rights will expire March 21, 2006
unless earlier redeemed or otherwise extended as described in the Rights
Agreement.
<PAGE>
Exhibit 5.1
[LETTERHEAD OF ROGERS & WELLS LLP]
March 16, 1999
Armstrong World Industries, Inc.
2500 Columbia Avenue
Lancaster, PA 17603
Re: Registration on Form S-3 of $1,000,000,000 of Debt Securities,
Common Stock, Preferred Stock, Warrants and Depositary Shares
Dear Ladies and Gentlemen:
We are acting as counsel to Armstrong World Industries, Inc., a
Pennsylvania corporation (the "Company"), in connection with the preparation
and filing of the Company's Registration Statement on Form S-3 (as the same
may be amended and supplemented from time to time, the "Registration
Statement") with the Securities and Exchange Commission (the "Commission")
under the Securities Act of 1933, as amended (the "Securities Act"), covering
the offer and sale by the Company from time to time of up to $1,000,000,000
aggregate amount of the following securities: (i) unsecured debt securities
which may be either senior or subordinated debt securities in one or more
series (the "Debt Securities"), which, in each case are to be issued under
Indentures (each an "Indenture" and together, the "Indentures") entered into
between the Company and The First National Bank of Chicago, as trustee
thereunder (the "Trustee"); (ii) shares of common stock, par value $1.00 per
share (the "Common Stock"), with Preferred Stock Purchase Rights attached to
each share of Common Stock (the "Rights"); (iii) shares of the Company's Class
A Preferred Stock , no par value per share (the "Preferred Stock"), in one or
more series, which may also be issued in the form of depositary shares (the
"Depositary Shares") evidenced by depositary receipts (the "Receipts"); and
(iv) warrants or other rights to purchase Debt Securities, Common Stock or
Preferred Stock (the "Warrants"). The Debt Securities, Common Stock, Preferred
Stock, Depositary Shares and Warrants are collectively referred to herein as
the "Securities." Except as otherwise defined herein, capitalized terms have
the meanings provided in the Registration Statement. The Registration
Statement provides that the Securities may be offered separately or together,
in separate series, in amounts, at prices and on terms to be set forth in one
or more supplements to the prospectus (each, a "Prospectus Supplement").
We have examined such documents, records, and matters of law as we have
deemed necessary for purposes of this opinion. Based on such examination of
law as we have deemed necessary, and on the assumptions set forth below, we
are of the opinion that:
1. The Debt Securities, when (a) duly executed by the Company and
authenticated by the Trustee in accordance with the provisions of the
applicable Indenture and issued and sold (x) in accordance with the
Registration Statement and applicable Prospectus Supplement or (y)
upon exercise of Warrants as contemplated by the Registration
Statement and the applicable Prospectus Supplement, and (b) delivered
to the purchaser or purchasers thereof against receipt by the Company
of such lawful consideration therefor as the Company's Board of
Directors (or a duly authorized committee thereof or a duly authorized
officer of the Company) may determine, will be valid and binding
obligations of the Company enforceable against the Company in
accordance with their respective terms and entitled to the benefits of
the applicable Indenture, subject to (i) the effect of any applicable
<PAGE>
bankruptcy, insolvency, fraudulent transfers, reorganization,
moratorium or similar laws affecting creditors' rights generally and
(ii) the effect of general principles of equity (regardless of whether
considered in a proceeding at law or in equity).
2. The Common Stock with the attached Rights, when (a) duly issued and
sold in accordance with the Registration Statement and the applicable
Prospectus Supplement or upon conversion of Debt Securities or
Preferred Stock, or upon exercise of Warrants as contemplated by the
Registration Statement and the applicable Prospectus Supplement and
(b) delivered to the purchaser or purchasers thereof against receipt
by the Company of such lawful consideration therefor as the Company's
Board of Directors (or a duly authorized committee thereof or a duly
authorized officer of the Company) may determine of at least the par
value thereof, will be validly issued, fully paid and nonassessable.
3. The Preferred Stock, when (a) (i) duly issued and sold in accordance
with the Registration Statement and applicable Prospectus Supplement
or upon conversion of Debt Securities, or upon exercise of Warrants as
contemplated by the Registration Statement and the applicable
Prospectus Supplement, and (ii) delivered to the purchaser or
purchasers thereof against receipt by the Company of such lawful
consideration therefor as the Company's Board of Directors (or a duly
authorized committee thereof or a duly authorized officer of the
Company) may determine or (b) duly issued pursuant to the exchange of
validly issued and fully paid Depositary Shares in accordance with the
terms of the applicable and valid and binding deposit agreement, will
be validly issued, fully paid and non-assessable.
4. The Warrants, when (a) duly issued and sold in accordance with the
Registration Statement and the applicable Prospectus Supplement and
the provisions of the applicable and valid and binding warrant
agreement, and (b) delivered to the purchaser or purchasers thereof
against receipt by the Company of such lawful consideration therefor
as the Company's Board of Directors (or a duly authorized committee
thereof or a duly authorized officer of the Company) may determine,
will be validly issued, fully paid and non-assessable.
5. The Depositary Shares, when (a) duly issued and sold in accordance
with the Registration Statement and the applicable Prospectus
Supplement, and (b) the Receipts in the form contemplated and
authorized by a valid and binding deposit agreement have been duly
executed and delivered by the depositary and delivered to the
purchaser or purchasers thereof against receipt by the Company of such
lawful consideration therefor as the Company's Board of Directors (or
duly authorized committee thereof or a duly authorized officer of the
Company) may determine, will be validly issued and will entitle the
holders thereof to the rights specified in the Receipts and such
deposit agreement.
In rendering the foregoing opinions, we have assumed that (i) the
definitive terms of each class and series of the Securities not presently
provided for in the Registration Statement, the Company's certificate of
incorporation or certificate of designations will have been established in
accordance with all applicable provisions of law, the Indenture, the Company's
certificate of incorporation or certificate of designations and by-laws, and
the authorizing resolutions of the Company's Board of Directors, and reflected
in appropriate documentation approved by us and, if applicable, duly executed
and delivered by the Company and any other appropriate party, (ii) the
interest rate on the Debt Securities will not be higher than the maximum
lawful rate permitted from time to time under applicable law, (iii) any
2
<PAGE>
Securities consisting of Common Stock, Preferred Stock or Depositary Shares,
and any Common Stock, Preferred Stock or Depositary Shares for or into which
any other Securities are exercisable, exchangeable or convertible will have
been duly authorized and reserved for issuance, (iv) each warrant agreement
and deposit agreement will have been duly authorized, executed and delivered
by, and will constitute a valid and binding obligation of, each party thereto,
(v) the Indentures will be duly qualified under the Trust Indenture Act of
1939, (vi) the Registration Statement, and any amendments thereto, will have
become and at the time of issuance of the Securities will continue to be
effective, (vii) a Prospectus Supplement describing each class or series of
Securities offered pursuant to the Registration Statement will have been filed
with the Commission, (viii) the resolutions authorizing the Company to
register, offer, sell, and issue the Securities will remain in effect and
unchanged at all times during which the Securities are offered, sold, or
issued by the Company and (ix) all Securities will be issued in compliance
with applicable federal and state securities laws.
In rendering the foregoing opinions, we have relied as to certain factual
matters upon certificates of officers of the Company, and we have not
independently verified the accuracy of the statements contained therein. In
rendering the foregoing opinions, our examination of matters of law has been
limited to the laws of the State of New York, the Commonwealth of Pennsylvania
and the federal laws of the United States of America, as in effect on the date
hereof. To the extent that any opinions set forth herein are dependent on the
laws of the Commonwealth of Pennsylvania we have relied on the opinion of
Douglas S. Brossman, the Senior Attorney of the Company, dated the date
hereof. Our opinion, to the extent based upon such reliance, is limited by the
qualifications, assumptions and conditions set forth in such opinion in
addition to those set forth herein.
We understand that prior to offering for sale any Securities you will
advise us in writing of the terms of such offering and of such Securities,
will afford us an opportunity to review the operative documents (including the
applicable Prospectus Supplement and any applicable Underwriting Agreement,
Warrant Agreement, Deposit Agreement, Indenture or Supplemental Indenture)
pursuant to which the Securities are to be offered, sold, and issued, and will
file as an exhibit to the Registration Statement such supplement or amendment
to this opinion (if any) as we may reasonably consider necessary or
appropriate by reason of the terms of such Securities or any changes in the
Company's capital structure or other pertinent circumstances.
We hereby consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement and to the reference to us in the Prospectus under the
caption "Legal Matters." In giving this consent, we do not admit that we are
within the category of persons whose consent is required under Section 7 of
the Securities Act, or the Rules and Regulations of the Commission thereunder.
Very truly yours,
/s/ Rogers & Wells LLP
3
<PAGE>
Exhibit 5.2
[LETTERHEAD OF ARMSTRONG WORLD INDUSTRIES]
March 16, 1999
Armstrong World Industries, Inc.
2500 Columbia Avenue
Lancaster, Pennsylvania 17603
Re: Registration on Form S-3 of $1,000,000,000 of Debt Securities,
Common Stock, Preferred Stock, Warrants and Depositary Shares
Ladies and Gentlemen:
I am the Senior Attorney of Armstrong World Industries, Inc., a
Pennsylvania corporation (the "Company"). This opinion is being rendered in
connection with the preparation and filing of the Company's Registration
Statement on Form S-3 (as the same may be amended and supplemented from time
to time, the "Registration Statement") with the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933, as amended
(the "Securities Act"), covering the offer and sale by the Company from time
to time of up to $1,000,000,000 aggregate amount of the following securities:
(i) unsecured debt securities which may be either senior or subordinated debt
securities in one or more series (the "Debt Securities"), which, in each case
are to be issued under Indentures (each an "Indenture" and together, the
"Indentures") entered into between the Company and The First National Bank of
Chicago, as trustee thereunder (the "Trustee"); (ii) shares of common stock,
par value $1.00 per share (the "Common Stock"), with Preferred Stock Purchase
Rights attached to each share of Common Stock (the "Rights"); (iii) shares of
the Company's Class A Preferred Stock , no par value per share (the "Preferred
Stock"), in one or more series, which may also be issued in the form of
depositary shares (the "Depositary Shares") evidenced by depositary receipts
(the "Receipts"); and (iv) warrants or other rights to purchase Debt
Securities, Common Stock or Preferred Stock (the "Warrants"). The Debt
Securities, Common Stock, Preferred Stock, Depositary Shares and Warrants are
collectively referred to herein as the "Securities." Except as otherwise
defined herein, capitalized terms have the meanings provided in the
Registration Statement. The Registration Statement provides that the
Securities may be offered separately or together, in separate series, in
amounts, at prices and on terms to be set forth in one or more supplements to
the prospectus (each, a "Prospectus Supplement").
In rendering the opinions expressed herein, I have examined: the
Registration Statements; the Articles of Incorporation and Bylaws of the
Company, each as amended to date; and such corporate proceedings of the
Company and such other documents as I have deemed necessary. As to questions
of fact material to the opinions expressed herein, I have relied on
certificates of officers of the Company and have not independently verified
the accuracy of the information contained therein.
In such examination, I have assumed the genuineness of all signatures, the
authenticity of all documents, certificates and instruments submitted to me as
originals, the conformity with originals of all documents submitted to me as
copies and the absence of any amendments or modifications to those items
reviewed by me.
<PAGE>
I have assumed that (i) prior to the issuance of any shares of Common
Stock, Preferred Stock, Warrants or Depositary Shares (or securities
convertible into shares of Common Stock), there will exist, under the Articles
of Incorporation, the requisite number of authorized but unissued shares of
Common Stock or Preferred Stock, as the case may be; and (ii) appropriate
certificates representing shares of Common Stock or Preferred Stock, as the
case may be, or Receipts evidencing Depositary Shares, will be executed and
delivered upon the issuance and sale of any such securities, and that such
certificates or Receipts will comply with all applicable requirements of
Pennsylvania law.
I have also assumed that (i) the issuance, sale, amount and terms of the
Securities to be offered from time to time will be authorized and determined
by proper action of the Board of Directors of the Company (each, a "Board
Action") and will be in accordance with the Company's Articles of
Incorporation and applicable Pennsylvania law, (ii) the resolutions
authorizing the Company to register, offer, sell, and issue the Securities
will remain in effect and unchanged at all times during which the Securities
are offered, sold, or issued by the Company, (iii) the interest rate on the
Debt Securities will not be higher than the lawful rate permitted from time to
time under applicable law, (iv) the Registration Statement, and any amendments
thereto, will have become, and at the time of issuance of the Securities will
continue to be effective, (v) a Prospectus Supplement relating to the
Securities offered pursuant to the Registration Statement will have been filed
with the Commission, and (vi) all Securities will be issued in compliance with
applicable federal and state securities laws.
To the extent that the obligations of the Company under a deposit agreement
may be dependent upon such matters, I have assumed for purposes of this
opinion that the depositary is duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization; that the
depositary is duly qualified to engage in the activities contemplated by the
deposit agreement; that the deposit agreement has been duly authorized,
executed and delivered by the depositary and constitutes the legally valid and
binding obligation of the depositary enforceable against the depositary in
accordance with its terms; that the depositary is in compliance, generally,
with respect to acting as depositary under the deposit agreement, with all
applicable laws and regulations; and that the depositary has the requisite
organizational and legal power and authority to perform its obligations under
the deposit agreement.
Based upon the foregoing and such examination of law as I have deemed
necessary, and subject to the qualifications and exceptions herein, I am of
the opinion that:
1. The Debt Securities, when (a) duly executed by the Company and
authenticated by the Trustee in accordance with the provisions of the
applicable Indenture and issued and sold (x) in accordance with the
Registration Statement and applicable Prospectus Supplement or (y)
upon exercise of Warrants as contemplated by the Registration
Statement and the applicable Prospectus Supplement, and (b) delivered
to the purchaser or purchasers thereof against receipt by the Company
of such lawful consideration therefor as the Company's Board of
Directors (or a duly authorized committee thereof or a duly authorized
officer of the Company) may determine, will be valid and binding
obligations of the Company enforceable against the Company in
accordance with their respective terms and entitled to the benefits of
the applicable Indenture.
2. The Common Stock with the attached Rights, when (a) duly issued and
sold in accordance with the Registration Statement and the applicable
Prospectus Supplement or upon conversion of Debt Securities or
Preferred Stock, or upon exercise of Warrants as contemplated by the
Registration Statement and the applicable Prospectus Supplement and
2
<PAGE>
(b) delivered to the purchaser or purchasers thereof against receipt
by the Company of such lawful consideration therefor as the Company's
Board of Directors (or a duly authorized committee thereof or a duly
authorized officer of the Company) may determine will be validly
issued, fully paid and nonassessable.
3. The Preferred Stock, when (a) (i) duly issued and sold in accordance
with the Registration Statement and applicable Prospectus Supplement
or upon conversion of Debt Securities, or upon exercise of Warrants as
contemplated by the Registration Statement and the applicable
Prospectus Supplement, and (ii) delivered to the purchaser or
purchasers thereof against receipt by the Company of such lawful
consideration therefor as the Company's Board of Directors (or a duly
authorized committee thereof or a duly authorized officer of the
Company) may determine or (b) duly issued pursuant to the exchange of
validly issued and fully paid Depositary Shares in accordance with the
terms of the applicable and valid and binding deposit agreement, will
be validly issued, fully paid and non-assessable.
4. The Warrants, when (a) duly issued and sold in accordance with the
Registration Statement and the applicable Prospectus Supplement and
the provisions of the applicable and valid and binding warrant
agreement, and (b) delivered to the purchaser or purchasers thereof
against receipt by the Company of such lawful consideration therefor
as the Company's Board of Directors (or a duly authorized committee
thereof or a duly authorized officer of the Company) may determine,
will be validly issued, fully paid and non-assessable.
5. The Depositary Shares, when (a) duly issued and sold in accordance
with the Registration Statement and the applicable Prospectus
Supplement, and (b) the Receipts in the form contemplated and
authorized by a valid and binding deposit agreement have been duly
executed and delivered by the depositary and delivered to the
purchaser or purchasers thereof against receipt by the Company of such
lawful consideration therefor as the Company's Board of Directors (or
duly authorized committee thereof or a duly authorized officer of the
Company ) may determine will be validly issued and will entitle the
holders thereof to the rights specified in the Receipts and such
deposit agreement.
The opinions stated herein relating to the validity and binding nature of
obligations of the Company are subject to (i) the effect of any applicable
bankruptcy, insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or similar laws affecting
creditors' rights generally and (ii) the effect of general principles of
equity (regardless of whether considered in a proceeding in equity or at law).
I am a member of the bar of the Commonwealth of Pennsylvania and express no
opinion as to the laws of any jurisdiction other than the Federal law of the
United States and the laws of the Commonwealth of Pennsylvania and all
references to governmental authorities are to Federal and Pennsylvania
authorities.
I consent to the reliance on this opinion by Rogers & Wells LLP, in
rendering their opinion to you in connection with the filing of the
Registration Statement. I hereby consent to the filing of a copy of this
opinion as an exhibit to the Registration Statement. In giving this consent I
do not admit that I am within the category of persons whose consent in
required under Section 7 of the Act, or the Rules and Regulation of the
Commission promulgated thereunder.
Very truly yours,
/s/ Douglas S. Brossman
3
<PAGE>
EXHIBIT 23.1
Consent of Independent Auditors
The Board of Directors
Armstrong World Industries, Inc.:
We consent to the use of our report dated February 2, 1999, relating to the
consolidated financial statements of Armstrong World Industries, Inc., and
subsidiaries as of December 31, 1998 and 1997, and for each of the years in
the three-year period ended December 31, 1998, and the related financial
statement schedule, which report appears in the December 31, 1998 annual
report on Form 10-K of Armstrong World Industries, Inc., incorporated herein
by reference, and to the reference to our firm under the heading "Experts" in
the prospectus.
/s/ KPMG LLP
Philadelphia, Pennsylvania
March 12, 1999
<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)_
----------------
THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
----------------
ARMSTRONG WORLD INDUSTRIES, INC.
(Exact name of obligor as specified in its charter)
Pennsylvania 23-0366390
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
2500 Columbia Avenue
Lancaster, Pennsylvania 17603
(Address of principal executive offices) (Zip Code)
Senior Debt Securities
(Title of Indenture Securities)
<PAGE>
Item 1. General Information. Furnish the following information as to the
-------------------
trustee:
(a) Name and address of each examining or supervising authority
to which it is subject.
Comptroller of Currency, Washington, D.C., Federal Deposit
Insurance Corporation, Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(b) Whether it is authorized to exercise corporate trust powers.
The trustee is authorized to exercise corporate trust powers.
Item 2. Affiliations With the Obligor. If the obligor is an affiliate of
-----------------------------
the trustee, describe each such affiliation.
No such affiliation exists with the trustee.
Item 16. List of exhibits. List below all exhibits filed as a part of this
----------------
Statement of Eligibility.
1. A copy of the articles of association of the trustee now in
effect.*
2. A copy of the certificates of authority of the trustee to
commence business.*
3. A copy of the authorization of the trustee to exercise
corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by Section 321(b) of the
Act.
<PAGE>
7. A copy of the latest report of condition of the trustee
published pursuant to law or the requirements of its
supervising or examining authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, 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 Chicago and State of Illinois, on the 15th day of
March, 1999.
The First National Bank of Chicago,
Trustee
By /s/ Steven M. Wagner
Steven M. Wagner
First Vice President
*Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits bearing
identical numbers in Item 16 of the Form T-1 of The First National Bank of
Chicago, filed as Exhibit 25 to the Registration Statement on Form S-3 of U S
WEST Capital Funding, Inc. filed with the Securities and Exchange Commission on
May 6, 1998 (Registration No. 333-51907-01).
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
March 15, 1999
Securities and Exchange Commission
Washington, D.C. 20549
Ladies and Gentlemen:
In connection with the qualification of an indenture between Armstrong World
Industries, Inc. and The First National Bank of Chicago, the undersigned, in
accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended,
hereby consents that the reports of examinations of the undersigned, made by
Federal or State authorities authorized to make such examinations, may be
furnished by such authorities to the Securities and Exchange Commission upon its
request therefor.
Very truly yours,
The First National Bank of Chicago
By: /s/ Steven M. Wagner
Steven M. Wagner
First Vice President
<PAGE>
EXHIBIT 7
<TABLE>
<CAPTION>
<S> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 12/31/98 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for December 31, 1998
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
Schedule RC--Balance Sheet
<TABLE>
<CAPTION>
Dollar Amounts in thousands C400
----
RCFD BIL MIL THOU
---- ------------
<S> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A): RCFD
----
a. Noninterest-bearing balances and currency and coin(1) ............... 0081 5,585,982 1.a
b. Interest-bearing balances(2) ........................................ 0071 4,623,842 1.b
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A) ........... 1754 0 2.a
b. Available-for-sale securities (from Schedule RC-B, column D) ........ 1773 11,181,405 2.b
3. Federal funds sold and securities purchased under agreements to
resell ................................................................. 1350 9,853,544 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule RCFD
----
RC-C) .................................................................. 2122 31,155,998 4.a
b. LESS: Allowance for loan and lease losses ........................... 3123 411,963 4.b
c. LESS: Allocated transfer risk reserve ............................... 3128 3,884 4.c
d. Loans and leases, net of unearned income, allowance, and RCFD
----
reserve (item 4.a minus 4.b and 4.c) ................................ 2125 30,740,151 4.d
5. Trading assets (from Schedule RD-D) .................................... 3545 7,635,778 5.
6. Premises and fixed assets (including capitalized leases) ............... 2145 739,925 6.
7. Other real estate owned (from Schedule RC-M) ........................... 2150 4,827 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M) ......................................... 2130 202,359 8.
9. Customers' liability to this bank on acceptances outstanding ........... 2155 269,516 9.
10. Intangible assets (from Schedule RC-M) ................................. 2143 291,665 10.
11. Other assets (from Schedule RC-F) ...................................... 2160 3,071,912 11.
12. Total assets (sum of items 1 through 11) ............................... 2170 74,200,906 12.
</TABLE>
- ----------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 12/31/98 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>
Schedule RC-Continued
<TABLE>
<CAPTION>
Dollar Amounts in
Thousands
---------
LIABILITIES
<S> <C> <C> <C>
13. Deposits:
a. In domestic offices (sum of totals of columns A and C RCON
----
from Schedule RC-E, part 1) ..................................... 2200 22,524,140 13.a
(1) Noninterest-bearing(1) ...................................... 6631 10,141,937 13.a1
(2) Interest-bearing ............................................ 6636 12,382,203 13.a2
b. In foreign offices, Edge and Agreement subsidiaries, and RCFN
----
IBFs (from Schedule RC-E, part II) .............................. 2200 19,691,237 13.b
(1) Noninterest bearing ......................................... 6631 408,126 13.b1
(2) Interest-bearing ............................................ 6636 19,283,111 13.b2
14. Federal funds purchased and securities sold under agreements
to repurchase: ..................................................... RCFD 2800 9,113,686 14
15. a. Demand notes issued to the U.S. Treasury ........................ RCON 2840 120,599 15.a
b. Trading Liabilities(from Schedule RC-D) ......................... RCFD 3548 6,797,927 15.b
16. Other borrowed money: .............................................. RCFD
----
a. With original maturity of one year or less ...................... 2332 5,385,355 16.a
b. With original maturity of more than one year ................... A547 327,126 16.b
c. With original maturity of more than three years ................. A548 316,411 16.c
17. Not applicable
18. Bank's liability on acceptance executed and outstanding ............ 2920 269,516 18.
19. Subordinated notes and debentures .................................. 3200 2,400,000 19.
20. Other liabilities (from Schedule RC-G) ............................. 2930 2,137,443 20.
21. Total liabilities (sum of items 13 through 20) ..................... 2948 69,083,440 21.
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus ...................... 3838 0 23.
24. Common stock ....................................................... 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock) ........... 3839 3,201,435 25.
26. a. Undivided profits and capital reserves .......................... 3632 1,695,446 26.a
b. Net unrealized holding gains (losses) on available-for-sale
securities ...................................................... 8434 6,349 26.b
27. Cumulative foreign currency translation adjustments ................ 3284 13,378 27.
28. Total equity capital (sum of items 23 through 27) .................. 3210 5,117,466 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28) .............................. 3300 74,200,906 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
<TABLE>
<C><S> <C> <C>
1. Indicate in the box at the right the number of the statement
below that best describes the most comprehensive level of
auditing work performed for the bank by independent external ---------------- Number
auditors as of any date during 1996.......................RCFD 6724............N/A M.1.
----------------
</TABLE>
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified public
accounting firm which submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4.= Directors' examination of the bank performed by other external auditors (may
be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external
auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
- ------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
<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)_
---------------
THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
---------------
ARMSTRONG WORLD INDUSTRIES, INC.
(Exact name of obligor as specified in its charter)
Pennsylvania 23-0366390
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
2500 Columbia Avenue
Lancaster, Pennsylvania 17603
(Address of principal executive offices) (Zip Code)
Subordinated Debt Securities
(Title of Indenture Securities)
<PAGE>
Item 1. General Information. Furnish the following information as to the
-------------------
trustee:
(a) Name and address of each examining or supervising authority
to which it is subject.
Comptroller of Currency, Washington, D.C., Federal Deposit
Insurance Corporation, Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(b) Whether it is authorized to exercise corporate trust powers.
The trustee is authorized to exercise corporate trust powers.
Item 2. Affiliations With the Obligor. If the obligor is an affiliate of
-----------------------------
the trustee, describe each such affiliation.
No such affiliation exists with the trustee.
Item 16. List of exhibits. List below all exhibits filed as a part of this
----------------
Statement of Eligibility.
1. A copy of the articles of association of the trustee now in
effect.*
2. A copy of the certificates of authority of the trustee to
commence business.*
3. A copy of the authorization of the trustee to exercise
corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by Section 321(b) of the
Act.
<PAGE>
7. A copy of the latest report of condition of the trustee
published pursuant to law or the requirements of its
supervising or examining authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, 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 Chicago and State of Illinois, on the 15th day of
March, 1999.
The First National Bank of Chicago,
Trustee
By /s/ Steven M. Wagner
Steven M. Wagner
Vice President
*Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits bearing
identical numbers in Item 16 of the Form T-1 of The First National Bank of
Chicago, filed as Exhibit 25 to the Registration Statement on Form S-3 of U S
WEST Capital Funding, Inc. filed with the Securities and Exchange Commission on
May 6, 1998 (Registration No. 333-51907-01).
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
March 15, 1999
Securities and Exchange Commission
Washington, D.C. 20549
Ladies and Gentlemen:
In connection with the qualification of an indenture between Armstrong World
Industries, Inc. and The First National Bank of Chicago, the undersigned, in
accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended,
hereby consents that the reports of examinations of the undersigned, made by
Federal or State authorities authorized to make such examinations, may be
furnished by such authorities to the Securities and Exchange Commission upon its
request therefor.
Very truly yours,
The First National Bank of Chicago
By: /s/ Steven M. Wagner
Steven M. Wagner
First Vice President
<PAGE>
EXHIBIT 7
<TABLE>
<CAPTION>
<S> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 12/31/98 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for December 31, 1998
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
Schedule RC--Balance Sheet
<TABLE>
<CAPTION>
Dollar Amounts in thousands C400
----
RCFD BIL MIL THOU
---- ------------
<S> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A): RCFD
----
a. Noninterest-bearing balances and currency and coin(1) ............... 0081 5,585,982 1.a
b. Interest-bearing balances(2) ........................................ 0071 4,623,842 1.b
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A) ........... 1754 0 2.a
b. Available-for-sale securities (from Schedule RC-B, column D) ........ 1773 11,181,405 2.b
3. Federal funds sold and securities purchased under agreements to
resell ................................................................. 1350 9,853,544 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule RCFD
----
RC-C) .................................................................. 2122 31,155,998 4.a
b. LESS: Allowance for loan and lease losses ........................... 3123 411,963 4.b
c. LESS: Allocated transfer risk reserve ............................... 3128 3,884 4.c
d. Loans and leases, net of unearned income, allowance, and RCFD
----
reserve (item 4.a minus 4.b and 4.c) ................................ 2125 30,740,151 4.d
5. Trading assets (from Schedule RD-D) .................................... 3545 7,635,778 5.
6. Premises and fixed assets (including capitalized leases) ............... 2145 739,925 6.
7. Other real estate owned (from Schedule RC-M) ........................... 2150 4,827 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M) ......................................... 2130 202,359 8.
9. Customers' liability to this bank on acceptances outstanding ........... 2155 269,516 9.
10. Intangible assets (from Schedule RC-M) ................................. 2143 291,665 10.
11. Other assets (from Schedule RC-F) ...................................... 2160 3,071,912 11.
12. Total assets (sum of items 1 through 11) ............................... 2170 74,200,906 12.
</TABLE>
- ----------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 12/31/98 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>
Schedule RC-Continued
<TABLE>
<CAPTION>
Dollar Amounts in
Thousands
---------
LIABILITIES
<S> <C> <C> <C>
13. Deposits:
a. In domestic offices (sum of totals of columns A and C RCON
----
from Schedule RC-E, part 1) ..................................... 2200 22,524,140 13.a
(1) Noninterest-bearing(1) ...................................... 6631 10,141,937 13.a1
(2) Interest-bearing ............................................ 6636 12,382,203 13.a2
b. In foreign offices, Edge and Agreement subsidiaries, and RCFN
----
IBFs (from Schedule RC-E, part II) .............................. 2200 19,691,237 13.b
(1) Noninterest bearing ......................................... 6631 408,126 13.b1
(2) Interest-bearing ............................................ 6636 19,283,111 13.b2
14. Federal funds purchased and securities sold under agreements
to repurchase: ..................................................... RCFD 2800 9,113,686 14
15. a. Demand notes issued to the U.S. Treasury ........................ RCON 2840 120,599 15.a
b. Trading Liabilities(from Schedule RC-D) ......................... RCFD 3548 6,797,927 15.b
16. Other borrowed money: .............................................. RCFD
----
a. With original maturity of one year or less ...................... 2332 5,385,355 16.a
b. With original maturity of more than one year ................... A547 327,126 16.b
c. With original maturity of more than three years ................. A548 316,411 16.c
17. Not applicable
18. Bank's liability on acceptance executed and outstanding ............ 2920 296,516 18.
19. Subordinated notes and debentures .................................. 3200 2,400,000 19.
20. Other liabilities (from Schedule RC-G) ............................. 2930 2,137,443 20.
21. Total liabilities (sum of items 13 through 20) ..................... 2948 69,083,440 21.
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus ...................... 3838 0 23.
24. Common stock ....................................................... 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock) ........... 3839 3,201,435 25.
26. a. Undivided profits and capital reserves .......................... 3632 1,695,446 26.a
b. Net unrealized holding gains (losses) on available-for-sale
securities ...................................................... 8434 6,349 26.b
27. Cumulative foreign currency translation adjustments ................ 3284 13,378 27.
28. Total equity capital (sum of items 23 through 27) .................. 3210 5,117,466 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28) .............................. 3300 74,200,906 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
<TABLE>
<C><S> <C> <C>
1. Indicate in the box at the right the number of the statement
below that best describes the most comprehensive level of
auditing work performed for the bank by independent external ---------------- Number
auditors as of any date during 1996.......................RCFD 6724............N/A M.1.
----------------
</TABLE>
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified public
accounting firm which submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4.= Directors' examination of the bank performed by other external auditors (may
be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external
auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
- ------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
