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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 13, 1998
REGISTRATION STATEMENT NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
PARKER-HANNIFIN CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
OHIO 34-0451060
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
</TABLE>
6035 PARKLAND BOULEVARD
CLEVELAND, OHIO 44124-4141
(216) 896-3000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------------
JOSEPH D. WHITEMAN, ESQ.
Vice President, General Counsel and Secretary
Parker-Hannifin Corporation
6035 Parkland Boulevard
Cleveland, Ohio 44124-4141
(216) 896-3000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
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Copies to:
<TABLE>
<S> <C>
THOMAS C. DANIELS, ESQ. EARL D. WEINER, ESQ.
Jones, Day, Reavis & Pogue Sullivan & Cromwell
901 Lakeside Avenue 125 Broad Street
Cleveland, Ohio 44114 New York, NY 10004
(216) 586-3939 (212) 558-4000
</TABLE>
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of the Registration Statement as determined in
light of market conditions.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
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<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------------
PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO BE PROPOSED MAXIMUM AGGREGATE OFFERING AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED(1)(2) OFFERING PRICE(3) PRICE (2)(3) REGISTRATION FEE
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Senior Debt Securities......... $600,000,000 100% $600,000,000 $177,000.00
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</TABLE>
(1) Such amount in U.S. dollars or the equivalent thereof in foreign currencies
or foreign currency units as shall result in an aggregate initial public
offering price for all securities of $600,000,000.
(2) Pursuant to Rule 429 under the Securities Act of 1933, the Prospectus
contained herein relates to an aggregate of $755,000,000 principal amount of
Senior Debt Securities, consisting of $600,000,000 principal amount of
Senior Debt Securities being registered hereby and the $155,000,000
principal amount of Senior Debt Securities that are as yet unsold that were
previously registered under the Company's Registration Statement on Form S-3
(No. 333-02761) that was filed with the Securities and Exchange Commission
on April 23, 1996 and for which a filing fee of $53,448.28 has previously
been paid.
(3) Estimated solely for the purpose of calculating the registration fee.
------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
PURSUANT TO RULE 429 OF THE SECURITIES ACT OF 1933, THE PROSPECTUS INCLUDED
IN THIS REGISTRATION STATEMENT IS A COMBINED PROSPECTUS RELATING ALSO TO
REGISTRATION STATEMENT NO. 333-02761.
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INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED MARCH 13, 1998
PROSPECTUS
$755,000,000
PARKER-HANNIFIN CORPORATION
SENIOR DEBT SECURITIES*
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Parker-Hannifin Corporation (the "Company") intends to issue from time to
time in one or more series its senior unsecured debt securities (the "Senior
Debt Securities"), consisting of debentures, notes, bonds and/or other unsecured
evidences of indebtedness, at an aggregate initial offering price not to exceed
U.S. $755,000,000 or the equivalent thereof if Senior Debt Securities are
denominated in one or more foreign currencies or foreign currency units, at
prices and on terms to be determined at or prior to the time of sale.
Specific terms of the Senior Debt Securities in respect of which this
Prospectus is being delivered (the "Offered Securities") will be set forth in an
accompanying supplement to this Prospectus (each, a "Prospectus Supplement"),
together with the terms of the offering of the Offered Securities, the initial
offering price and the net proceeds to the Company from the sale thereof. The
accompanying Prospectus Supplement will set forth, among other items, the
following with respect to the Offered Securities: the specific designation,
aggregate principal amount, authorized denominations, maturity, rate or method
of calculation of interest, if any, and dates for payment thereof, any
redemption, prepayment or sinking fund provisions, any exchange rights, and the
currency, currencies or currency units in which principal, premium, if any, or
interest, if any, is payable.
The Offered Securities may be sold through underwriters, dealers or agents
or may be sold directly to purchasers. If any underwriters, dealers or agents
are involved in the sale of any Offered Securities, their names and any
applicable fee, commission or discount arrangements will be set forth in the
accompanying Prospectus Supplement. The net proceeds to the Company of the sale
of Offered Securities will be the purchase price of such Offered Securities less
attributable issuance expenses, including underwriters', dealers' or agents'
compensation. See "Plan of Distribution" for indemnification arrangements for
underwriters, dealers and agents.
* Pursuant to Rule 429 under the Securities Act of 1933 (the "Securities Act"),
this Prospectus also relates to an additional $155,000,000 of Senior Debt
Securities which were registered under Registration Statement No. 333-02761.
This Prospectus may not be used to consummate sales of Senior Debt
Securities unless accompanied by a Prospectus Supplement.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS OR ANY SUPPLEMENT HERETO. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
------------------
THE DATE OF THIS PROSPECTUS IS , 1998.
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NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION NOT CONTAINED OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS OR
THE ACCOMPANYING PROSPECTUS SUPPLEMENT AND, IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY OR ANY AGENT, DEALER OR UNDERWRITER. NEITHER THE DELIVERY OF THIS
PROSPECTUS OR THE ACCOMPANYING PROSPECTUS SUPPLEMENT NOR ANY SALE MADE HEREUNDER
OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE
INFORMATION CONTAINED HEREIN OR IN THE ACCOMPANYING PROSPECTUS SUPPLEMENT IS
CORRECT AS OF ANY DATE SUBSEQUENT TO THE DATE HEREOF OR THEREOF OR THAT THERE
HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR
THEREOF. NEITHER THIS PROSPECTUS NOR THE ACCOMPANYING PROSPECTUS SUPPLEMENT
CONSTITUTES AN OFFER TO SELL OR SOLICITATION OF AN OFFER TO BUY SENIOR DEBT
SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT
AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT
QUALIFIED TO DO SO OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION.
------------------------
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 (the "Exchange Act") and in accordance therewith files
reports and other information with the Securities and Exchange Commission (the
"Commission"). Such reports, proxy statements and other information can be
inspected and copied at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549 and at
the following regional offices of the Commission: New York Regional Office,
Seven World Trade Center, Suite 1300, New York, New York 10048, and Chicago
Regional Office, Citicorp Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661-2511. Copies of such material can be obtained by mail at
prescribed rates from the Public Reference Section of the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549. The Commission also maintains a Web
site (http : / / www.sec.gov) that contains reports, proxy and information
statements regarding registrants that file electronically with the Commission.
The Company's Common Stock is listed on the New York Stock Exchange, and such
reports, proxy and information statements and other information concerning the
Company may also be inspected at the offices of the New York Stock Exchange, 20
Broad Street, New York, New York 10005.
This Prospectus constitutes a part of a Registration Statement on Form S-3
(the "Registration Statement") filed by the Company with the Commission under
the Securities Act. This Prospectus and the accompanying Prospectus Supplement
omit certain of the information contained in the Registration Statement in
accordance with the rules and regulations of the Commission. Reference is hereby
made to the Registration Statement and related exhibits for further information
with respect to the Company and the Senior Debt Securities. Statements contained
herein concerning the provisions of any document are not necessarily complete
and, in each instance, reference is made to the copy of such document filed as
an exhibit to the Registration Statement or otherwise filed with the Commission.
Each such statement is qualified in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents previously filed by the Company with the Commission
are incorporated by reference in this Prospectus:
(i) The Company's Annual Report on Form 10-K for the fiscal year ended June
30, 1997; and
(ii) The Company's Quarterly Reports on Form 10-Q for the quarters ended
September 30, 1997 and December 31, 1997; and
(iii) The Company's Current Report on Form 8-K, dated December 15, 1997.
All documents filed by the Company with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this
Prospectus and prior to the termination of the offering hereunder shall be
deemed to be incorporated by reference into this Prospectus and to be a part
hereof from the date of the filing of such documents. Any statement contained
herein or in a document incorporated or deemed to be incorporated by reference
herein shall be deemed to be modified or superseded for purposes of the
Registration Statement and this Prospectus to the extent that a statement
contained herein or in any subsequently filed document which also is or is
deemed to be incorporated by reference herein or in the accompanying Prospectus
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Supplement modifies or supersedes such statement. Any such statement so modified
or superseded shall not be deemed, except as so modified or superseded, to
constitute a part of the Registration Statement or this Prospectus.
The Company will provide, without charge, to each person to whom this
Prospectus is delivered, on the written or oral request of any such person, a
copy of any or all of the documents which have been incorporated herein by
reference, other than exhibits to such documents (unless such exhibits are
specifically incorporated by reference into such documents). Requests should be
directed to Parker-Hannifin Corporation, 6035 Parkland Blvd., Cleveland, Ohio
44124-4141, Attention: Joseph D. Whiteman, Esq., Vice President, General Counsel
and Secretary, telephone (216) 896-3000.
THE COMPANY
Parker-Hannifin Corporation (the "Company") is a leading worldwide
full-line manufacturer of motion control products, including fluid power
systems, electromechanical controls and related components. Fluid power involves
the transfer and control of power through the medium of liquid, gas or air, in
hydraulic, pneumatic and vacuum applications. Fluid power systems move and
position materials, control machines, vehicles and equipment and improve
industrial efficiency and productivity. Components of a simple fluid power
system include a pump which generates pressure, valves which control the fluid's
flow, an actuator which translates the pressure in the fluid into mechanical
energy, a filter to remove contaminants and numerous hoses, couplings, fittings
and seals. Electromechanical control involves the use of electronic components
and systems to control motion and precisely locate or vary speed in automation
applications. In addition to motion control products, the Company also is a
leading worldwide producer of fluid purification, fluid flow, process
instrumentation, air conditioning, refrigeration, and electromagnetic shielding
and thermal management products.
The Company's manufacturing, service, distribution and administrative
facilities are located in 35 states, Puerto Rico and worldwide in 37 foreign
countries. Its motion control technology is used in products of its two business
segments: Industrial and Aerospace. The products are sold as original and
replacement equipment through product and distribution centers worldwide. The
Company markets its products through its direct-sales employees and more than
7,500 independent distributors. The Company's products are supplied to over
350,000 customer outlets in virtually every significant manufacturing,
transportation and processing industry.
The Company was incorporated in Ohio in 1938. Its principal executive
offices are located at 6035 Parkland Boulevard, Mayfield Heights, Ohio
44124-4141, telephone (216) 896-3000.
RATIOS OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratio of earnings to fixed charges for
the Company for each of the last five fiscal years ended June 30, 1997 and for
the six months ended December 31, 1997 and December 31, 1996. For the purpose of
calculating the ratio of earnings to fixed charges, "earnings" consist of income
from continuing operations before income taxes and fixed charges (excluding
capitalized interest). "Fixed charges" consist of (i) interest on indebtedness,
whether expensed or capitalized, and (ii) that portion of rental expense the
Company believes to be representative of interest.
<TABLE>
<CAPTION>
SIX MONTHS ENDED FISCAL YEAR ENDED
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DECEMBER 31, DECEMBER 31, JUNE 30,
1997 1996 1997 1996 1995 1994 1993
------------ ------------ ---- ---- ----- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of earnings to fixed
charges................... 8.98 6.52 8.34 9.09 10.16 3.68 3.05
</TABLE>
USE OF PROCEEDS
The Company intends to use the net proceeds from the sale of the Senior
Debt Securities for general corporate purposes, which may include refinancing or
repayment of indebtedness, financing acquisitions as they may arise,
repurchasing the Company's equity securities, and financing of capital
expenditures and working capital. Further details relating to the uses of the
net proceeds of any such offering will be set forth in the applicable Prospectus
Supplement.
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DESCRIPTION OF SENIOR DEBT SECURITIES
The following description of the Senior Debt Securities sets forth certain
general terms and provisions of the Senior Debt Securities to which any
Prospectus Supplement may relate. The particular terms of the Senior Debt
Securities offered by any Prospectus Supplement (the "Offered Securities") and
the extent, if any, to which such general provisions may apply to the Senior
Debt Securities so offered will be described in the Prospectus Supplement or
Prospectus Supplements relating to such Offered Securities.
The Offered Securities are to be issued under an Indenture (the
"Indenture"), dated as of May 3, 1996, between the Company and National City
Bank, as Trustee (the "Trustee"). The Indenture is filed as an exhibit to the
Registration Statement of which this Prospectus is a part and is available for
inspection at the corporate trust office of the Trustee at 1900 East Ninth
Street, Cleveland, Ohio 44114, or as described above under "Available
Information." The following summaries of certain provisions of the Senior Debt
Securities and the Indenture do not purport to be complete and are subject to,
and are qualified in their entirety by reference to, all the provisions of the
Indenture, including the definitions therein of certain terms, and, with respect
to any particular Offered Securities, to the description of the terms thereof
included in the Prospectus Supplement relating thereto. Section numbers below
refer to provisions of the Indenture.
GENERAL
The Senior Debt Securities will be unsecured obligations of the Company and
will rank on a parity with all other unsecured unsubordinated indebtedness of
the Company. The Indenture does not limit the amount of Senior Debt Securities
that may be issued thereunder and provides that Senior Debt Securities may be
issued from time to time in one or more series. (Section 301)
The Prospectus Supplement or Prospectus Supplements relating to the
particular series of Senior Debt Securities offered thereby will describe the
following terms of the Offered Securities or the series of which they are a
part: (i) the title of the Offered Securities; (ii) any limit on the aggregate
principal amount of the Offered Securities; (iii) the Person to whom any
interest on the Offered Securities shall be payable, if other than the Person in
whose name that Offered Security is registered on the Regular Record Date for
such interest; (iv) the date or dates on which the principal of any Offered
Security is payable; (v) the rate or rates at which the Offered Securities will
bear interest, if any, and the date or dates from which such interest will
accrue and the dates on which such interest will be payable and the Regular
Record Dates for such Interest Payment Dates; (vi) the place or places where the
principal of and any premium and interest on any Offered Securities is payable;
(vii) the period or periods within which, the price or prices at which and the
terms and conditions upon which the Offered Securities may be redeemed in whole
or in part at the option of the Company; (viii) any mandatory or optional
sinking fund or analogous provisions; (ix) if other than denominations of $1,000
and any integral multiple thereof, the denominations in which any securities
will be issuable; (x) if the amount of payments of principal of and any premium
or the interest on the Offered Securities may be determined with reference to an
index or pursuant to a formula, the manner in which such amounts shall be
determined; (xi) 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 Offered Securities is payable and the manner of determining
the equivalent thereof in the currency of the United States of America under the
Indenture; (xii) if the principal of or any premium or interest on any Offered
Securities is to be payable, at the election of the Company or the Holder
thereof, in one or more currencies or currency units other than that or those in
which such Offered 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; (xiii) if other than the entire principal amount thereof, the
portion of the principal amount of any Offered Securities which will be payable
upon declaration of acceleration of the Maturity thereof; (xiv) if the principal
amount payable at the Stated Maturity of any Offered Securities 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 Offered
Securities as of any such date for any purpose under the Indenture; (xv) if
applicable, that the Offered Securities, in whole or any specified part, shall
be defeasible pursuant to the Indenture; (xvi) if applicable, that any Offered
Securities will be issuable in whole or in part in the form of one or more
Global Securities and, if so,
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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 "Book-Entry System" 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 Senior 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; (xvii) any addition to or change in the Events of
Default applicable to any Offered Securities and any change in the right of the
Trustee or the requisite Holders of such Offered Securities to declare the
principal amount thereof due and payable pursuant to the Indenture; (xviii) any
addition to or change in the covenants set forth in Article Ten of the
Indenture, including, without limitation, those described in "Certain Covenants
of Senior Debt Securities," which apply to such Offered Securities; and (xix)
any other terms of the Offered Securities not inconsistent with the provisions
of the Indenture. (Section 301)
DENOMINATIONS, REGISTRATION OF TRANSFER AND EXCHANGE
Unless otherwise indicated in the Prospectus Supplement or Prospectus
Supplements relating thereto, the Senior Debt Securities will be issued only in
registered form, without coupons and only in denominations of $1,000 or any
integral multiple thereof. (Section 302)
Senior Debt Securities may be issued under the Indenture as Original Issue
Discount Securities to be offered and sold at a substantial discount below their
stated principal amount. Certain United States federal income tax consequences,
if any, and other special considerations applicable to any such Original Issue
Discount Securities will be described in the Prospectus Supplement or Prospectus
Supplements relating thereto. "Original Issue Discount Security" means any
Senior Debt 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 upon the occurrence of an Event of Default and the continuation thereof.
(Section 101) In addition, certain United States federal income tax or other
considerations, if any, applicable to any Senior Debt Securities which are
denominated in a currency or currency unit other than United States dollars may
be described in the applicable Prospectus Supplement.
Subject to the terms of the Indenture and the limitations applicable to
Global Securities, upon surrender for registration of transfer of any Senior
Debt Security of a series at the office or agency of the Company in the Place of
Payment for that series, the Company will execute, and the Trustee will
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Senior Debt Securities of the same series, of any
authorized denominations and of like tenor and aggregate principal amount. At
the option of the Holder, subject to the terms of the Indenture and the
limitations applicable to Global Securities, Senior Debt Securities of any
series may be exchanged for other Senior Debt Securities of the same series, of
any authorized denominations and of like tenor and aggregate principal amount,
upon surrender of the Senior Debt Securities to be exchanged at such office or
agency. No service charge will be made for any registration of transfer or
exchange of the Offered Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. (Section 305)
CERTAIN DEFINITIONS
Set forth below is a summary of certain defined terms used in the
Indenture. Reference is made to the Indenture for the full definition of all
such terms.
"Subsidiary" is defined as a corporation more than 50% of the outstanding
voting stock of which is owned, directly or indirectly, by the Company and/or
one or more Subsidiaries of the Company.
"Restricted Subsidiary" is defined as a Subsidiary of the Company
substantially all the property of which is located, or substantially all of the
business of which is carried on, within the United States and which owns a
Principal Property.
"Principal Property" is defined to mean any manufacturing or processing
plant or warehouse owned by the Company or any Restricted Subsidiary which is
located within the United States and the gross book value of which (including
related land, improvements, machinery and equipment without deduction of any
depreciation reserves) on the date as of which the determination is being made,
exceeds 1% of Consolidated Net Tangible
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Assets, other than properties or any portion of a particular property which in
the opinion of the Company's Board of Directors are not of material importance
to the Company's business or to the use or operation of such property.
"Attributable Debt" is defined to mean the total net amount of rent
required to be paid during the remaining primary term of certain leases,
discounted at a rate per annum equal to the weighted average yield to maturity
of the Senior Debt Securities calculated in accordance with generally accepted
financial practices.
"Consolidated Net Tangible Assets" is defined to mean the aggregate amount
of assets, less applicable reserves and other properly deductible items, after
deducting (i) all liabilities other than deferred income taxes, Funded Debt and
shareholders' equity, and (ii) all goodwill and other intangibles of the Company
and its consolidated Subsidiaries.
"Funded Debt" is defined to mean (i) all indebtedness for money borrowed
having a maturity of more than 12 months from the date as of which the
determination is made or having a maturity of 12 months or less but by its terms
being renewable or extendible beyond 12 months from such date at the option of
the borrower and (ii) rental obligations payable more than 12 months from such
date under leases which are capitalized in accordance with generally accepted
accounting principles (such rental obligations to be included as Funded Debt at
the amount so capitalized at the date of such computation and to be included for
the purposes of the definition
of Consolidated Net Tangible Assets both as an asset and as Funded Debt at the
respective amounts so capitalized).
CERTAIN COVENANTS OF SENIOR DEBT SECURITIES
The Indenture contains, among other things, the following covenants:
Restrictions of Secured Debt. The Company will not itself, and will not
permit any Restricted Subsidiary to, incur, issue, assume or guarantee any
evidence of indebtedness for money borrowed ("Debt") secured by a mortgage,
pledge or lien ("Mortgage") on any Principal Property of the Company or any
Restricted Subsidiary, or on any shares of stock of or Debt of any Restricted
Subsidiary, without effectively providing that the Senior Debt Securities are
secured equally and ratably with, or, at the Company's option, prior to, such
secured Debt, unless the aggregate amount of all such secured Debt, together
with all Attributable Debt of the Company and its Restricted Subsidiaries with
respect to sale and leaseback transactions involving Principal Properties, with
the exception of such transactions which are excluded as described in
"Restrictions on Sales and Leasebacks" below, would not exceed 10% of
Consolidated Net Tangible Assets.
The above restriction does not apply to, and there will be excluded from
Debt in any computation under such restriction, (i) Debt secured by Mortgages on
property of, or on any shares of stock of or Debt of, any corporation existing
at the time such corporation becomes a Restricted Subsidiary, (ii) Debt secured
by Mortgages in favor of the Company or a Restricted Subsidiary, (iii) Debt
secured by Mortgages in favor of governmental bodies to secure progress or
advance payments or payments pursuant to contracts or statute, (iv) Debt secured
by Mortgages on property, shares of stock or Debt existing at the time of
acquisition thereof, including acquisition through merger or consolidation, and
Debt secured by Mortgages to finance the acquisition of property, shares of
stock or Debt or to finance construction on property which is incurred within
180 days of such acquisition or completion of construction, (v) Debt secured by
Mortgages securing industrial revenue or pollution control bonds, or (vi) any
extension, renewal or replacement of any Debt referred to in the foregoing
clauses (i) through (v) inclusive, provided, however, that such extension,
renewal or replacement Mortgage shall be limited to all or part of the same
property, shares of stock or Debt that secured the Mortgage extended, renewed or
replaced, plus improvements on such property. (Section 1007)
Restrictions on Sales and Leasebacks. Neither the Company nor any
Restricted Subsidiary may enter into any sale and leaseback transaction
involving any Principal Property, unless the aggregate amount of all
Attributable Debt of the Company and its Restricted Subsidiaries with respect to
such transaction plus all secured Debt to which the restrictions described under
"Restrictions on Secured Debt" above apply would not exceed 10% of Consolidated
Net Tangible Assets.
This restriction does not apply to, and there shall be excluded from
Attributable Debt in any computation under such restriction, any sale and
leaseback transaction if (i) the lease is for a period of not in excess of three
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years, including renewal rights, (ii) the sale or transfer of the Principal
Property is made within 180 days after the later of its acquisition or
completion of construction, (iii) the lease secures or relates to industrial
revenue or pollution control bonds, (iv) the transaction is between the Company
and a Restricted Subsidiary or between Restricted Subsidiaries, or (v) the
Company or such Restricted Subsidiary, within 180 days after the sale is
completed, applies (A) to the retirement of the Senior Debt Securities, other
Funded Debt of the Company ranking on a parity with or senior to the Senior Debt
Securities, or Funded Debt of a Restricted Subsidiary, or (B) to the purchase of
other property which will constitute a Principal Property having a value at
least equal to the value of the Principal Property leased, an amount equal to
the greater of (i) the net proceeds of the sale of the Principal Property
leased, or (ii) the fair market value of the Principal Property leased. In lieu
of applying proceeds to the retirement of Funded Debt, the Company may surrender
debentures or notes, including the Senior Debt Securities, to the Trustee for
retirement and cancellation, or the Company or a Restricted Subsidiary may
receive credit for the principal amount of Funded Debt voluntarily retired
within 180 days after such sale. (Section 1008)
EVENTS OF DEFAULT
The Indenture defines an Event of Default with respect to Senior Debt
Securities of any series as being any one of the following events and such other
events as may be established for the Senior Debt Securities of a particular
series: (i) default for 30 days in any payment of interest on any Senior Debt
Security of such series; (ii) default in any payment of principal of or any
premium on any Senior Debt Security of such series when due; (iii) default in
the payment of any sinking fund installment with respect to such series when
due; (iv) default for 60 days after appropriate notice in performance of any
other covenant or warranty included in the Indenture, other than those covenants
or warranties included solely for the benefit of series of Senior Debt
Securities other than that series; (v) default under any evidence of
indebtedness of the Company or any Restricted Subsidiary exceeding $10,000,000
in aggregate principal amount, including a default with respect to Senior Debt
Securities of series other than that series or under any mortgage, indenture or
instrument under which any such indebtedness is issued or secured, including the
Indenture, which default results in acceleration of the maturity of such
indebtedness, if such acceleration is not rescinded or annulled or if such
indebtedness is not discharged within 10 days after written notice as provided
in the Indenture; (vi) certain events in bankruptcy, insolvency or
reorganization; or (vii) any other Event of Default provided with respect to
Senior Debt Securities of that series. (Section 501) If an Event of Default with
respect to Senior Debt Securities of any series at the time Outstanding occurs
and is continuing, either the Trustee or the Holders of at least 25% in
principal amount of the Outstanding Senior Debt Securities of that series may
declare the principal of such series, or, if the Senior Debt Securities of that
series are Original Issue Discount Securities, such portion of the principal as
may be specified by the terms of that series, to be due and payable immediately.
At any time after a declaration of acceleration with respect to Senior Debt
Securities of any series has been made, but before a judgment or decree based on
acceleration has been obtained, the Holders of a majority in principal amount of
the Outstanding Senior Debt Securities of that series may, under certain
circumstances, rescind and annul such acceleration. (Section 502)
Reference is made to the Prospectus Supplement or Prospectus Supplements
relating to each series of Offered Securities which are Original Issue Discount
Securities for the particular provisions relating to acceleration of the
Maturity of a portion of the principal amount of such Original Issue Discount
Securities upon the occurrence of an Event of Default and the continuation
thereof.
The Indenture requires the Company to file annually with the Trustee an
Officers' Certificate as to the absence of certain defaults under the terms of
the Indenture. (Section 1009) The Indenture provides that if a default occurs
with respect to Senior Debt Securities of any series, the Trustee will give the
Holders of such series notice of such default when, as and to the extent
provided by the Trust Indenture Act, provided, however, that in the case of any
default under any covenant referenced in clause (iv) above with respect to such
series, no such notice to Holders will be given until at least thirty days after
the occurrence thereof. (Section 602)
The Indenture provides that the Trustee will be under no obligation,
subject to the duty of the Trustee during default to act with the required
standard of care, to exercise any of its rights or powers under the Indenture 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 indemnification of the Trustee, the Holders of a majority
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<PAGE> 9
in principal amount of the Outstanding Senior Debt 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 Senior Debt Securities of that
series. (Section 512)
MODIFICATION AND WAIVER
Without the consent of any Holders, the Company and the Trustee, at any
time from time to time, may modify or amend the Indenture to (i) evidence the
succession of another Person to the Company and such Person's assumption of any
covenants of the Company under the Indenture and any Senior Debt Securities;
(ii) add covenants of the Company for the benefit of Holders of all or any
series of Senior Debt Securities or to surrender any right or power conferred
upon the Company; (iii) add any additional Events of Default for the benefit of
the Holders of all or any series of Senior Debt Securities; (iv) add to or
change any provisions of the Indenture to the extent necessary to permit or
facilitate the issuance of Senior Debt Securities in bearer form, registrable or
not registrable as to principal, and with or without interest coupons, or to
permit or facilitate the issuance of Senior Debt Securities in uncertificated
form; (v) add to, change or eliminate any of the provisions of the Indenture in
respect of one or more series of Senior Debt Securities, subject to certain
limitations; (vi) secure the Senior Debt Securities; (vii) establish the form or
terms of Senior Debt Securities of any series; (viii) evidence and provide for
the acceptance of appointment by a successor Trustee with respect to one or more
series of Senior Debt Securities; or (ix) to cure any ambiguity, to correct or
supplement any provision in the Indenture which may be defective or inconsistent
with any other provision of the Indenture, provided that such action will not
adversely affect the interests of Holders of Senior Debt Securities of any
series in any material respect. (Section 901)
Modifications and amendments of the Indenture may be made by the Company
and the Trustee with the consent of the Holders of 66 2/3% in principal amount
of the Outstanding Senior Debt Securities of each series affected by such
modification or amendment; provided, however, that no such modification or
amendment may, without the consent of the Holder of each outstanding Senior Debt
Security affected thereby, (i) change the stated maturity date of the principal
of, or any installment of principal of or interest on, any Senior Debt Security,
(ii) reduce the principal amount of, or any premium or interest on, any Senior
Debt Security, (iii) reduce the amount of principal of an Original Issue
Discount Security or any other Senior Debt Security payable upon acceleration of
the Maturity thereof, (iv) change the place or currency of payment of principal
of, or any premium or interest on, any Senior Debt Security, (v) impair the
right to institute suit for the enforcement of any payment on or with respect to
any Senior Debt Security or (vi) reduce the percentage in principal amount of
Outstanding Senior Debt Securities of any series, the consent of whose Holders
is required for modification or amendment of the Indenture or for waiver of
compliance with certain provisions of the Indenture or for waiver of certain
defaults. (Section 902)
The Holders of 66 2/3% in principal amount of the Outstanding Senior Debt
Securities of any series may on behalf of the Holders of all Senior Debt
Securities of that series waive, insofar as that series is concerned, compliance
by the Company with certain restrictive provisions of the Indenture. (Section
1010) The Holders of a majority in principal amount of the Outstanding Senior
Debt Securities of any series may on behalf of the Holders of all Senior Debt
Securities of that series waive any past default under the Indenture with
respect to that series, except a default in the payment of the principal of, or
any premium or interest on, any Senior Debt Security of that series or in
respect of a provision which under the Indenture cannot be modified or amended
without the consent of the Holder of each Outstanding Senior Debt Security of
that series affected. (Section 513)
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Company may not consolidate with or merge into or convey, transfer or
lease its property and assets substantially as an entirety to any person (a
"successor Person") unless (i) that person is a corporation, partnership or
trust organized and validly existing under the laws of the United States of
America or any State or the District of Columbia, (ii) the successor Person
assumes by supplemental indenture all of the Company's obligations on the Senior
Debt Securities outstanding at that time, (iii) after giving effect thereto, no
Event of Default, and no event which, after notice or lapse of time, would
become an Event of Default, shall have occurred and be continuing and (iv)
certain other conditions are met. The Indenture further provides that no
consolidation
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<PAGE> 10
or merger of the Company with or into any other corporation and no conveyance,
transfer or lease of its property substantially as an entirety to another
corporation may be made if, as a result thereof, any Principal Property of the
Company or any Restricted Subsidiary or any shares of Capital Stock or Debt of a
Restricted Subsidiary would become subject to a Mortgage which is not expressly
excluded from the restrictions or permitted by the provisions of Section 1008
(see "Restrictions on Secured Debt"), unless the Senior Debt Securities are
secured equally and ratably with, or prior to, all indebtedness secured thereby.
(Section 801)
DEFEASANCE AND DISCHARGE, COVENANT DEFEASANCE
The Company may elect, at its option at any time, to effect a defeasance
and discharge (a "Defeasance") or a covenant defeasance (a "Covenant
Defeasance") in respect of the Senior Debt Securities or any series thereof
designated as being defeasible pursuant to its terms.
Upon the Company's exercise of its option to effect a Defeasance, the
Company will be deemed to have been discharged from its obligations with respect
to such Senior Debt Securities on and after the date the conditions to
Defeasance described below are satisfied. For purposes of the Indenture,
Defeasance means the Company will be deemed to have paid and discharged the
entire indebtedness represented by such Senior Debt Securities and to have
satisfied all of its other obligations under or with respect to such Senior Debt
Securities and under the Indenture, except for the following (i) the rights of
Holders of such Senior Debt Securities to receive, solely from the trust fund
described in the Indenture, payments in respect of principal of, and any premium
and interest on, such Senior Debt Securities when due, (ii) certain of the
Company's obligations under the Indenture with respect to temporary securities;
registration, registration of transfer and exchange; mutilated, destroyed, lost
or stolen securities; maintenance of an office or agency; and money held in
trust for the benefit of Holders of Senior Debt Securities, (iii) the rights,
powers, trusts, duties and immunities of the Trustee and (iv) the foregoing
provisions. (Section 1302)
Upon the Company's exercise of its option to effect a Covenant Defeasance
with respect to any Senior Debt Securities or any series thereof, (i) the
Company will be released from its obligations with respect to liens resulting
from consolidations or mergers and its covenants relating to existence,
maintenance of properties, payment of taxes and other claims as well as any
additional covenants specified in the terms of such series of Senior Debt
Securities or any supplemental indenture related thereto, and (ii) the
occurrence of certain events of default related to the foregoing covenants will
be deemed not to be or result in an Event of Default, in each case after the
date that the conditions to Covenant Defeasance described below are satisfied.
(Section 1303)
The conditions that the Company must satisfy in order to effect a
Defeasance or a Covenant Defeasance in respect of the Senior Debt Securities or
any series thereof are as follows: (i) the Company will irrevocably deposit or
cause to be deposited with the Trustee as trust funds for the purpose of making
payments when due under the Indenture money or U.S. Government Obligations or a
combination thereof in an amount sufficient to pay and discharge the principal
of and any premium and interest on such Senior Debt Securities on the respective
Stated Maturities in accordance with the terms of such Senior Debt Securities
and the Indenture; (ii) delivery by the Company of an Opinion of Counsel
regarding the tax effects of such action on the Holders of Senior Debt
Securities; (iii) delivery of an Officer's Certificate to the effect that no
listed Senior Debt Securities will be delisted; (iv) no Event of Default shall
have occurred and be continuing at the time of the deposit or, regarding
bankruptcy-related events, at any time on or prior to the 90th day after such
deposit; (v) such deposit will not cause the Trustee to have a conflicting
interest under the Trust Indenture Act; (vi) such Defeasance or Covenant
Defeasance will not result in a breach of or default under any other agreement
to which the Company is a party or by which it is bound; (vii) such Defeasance
or Covenant Defeasance will not result in the trust arising from such deposit
constituting an investment company within the meaning of the Investment Company
Act unless the trust is registered or exempted thereunder; and (viii) delivery
by the Company to the Trustee of any Officer's Certificate and Opinion of
Counsel, each stating that all conditions precedent with respect to such
Defeasance or Covenant Defeasance have been complied with. (Section 1304)
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<PAGE> 11
PAYMENT AND PAYING AGENTS
Unless otherwise indicated in the applicable Prospectus Supplement, payment
of interest on a Senior Debt Security on any Interest Payment Date will be made
to the person in whose name such Senior Debt Security or one or more Predecessor
Senior Debt Securities is registered at the close of business on the Regular
Record Date for such interest. (Section 307)
The Company will maintain in each Place of Payment for any series of Senior
Debt Securities an office or agency where Senior Debt Securities of that series
may be presented or surrendered for payment, where Senior Debt Securities of
that series may be surrendered for registration of transfer or exchange and
where notices and demands to or upon the Company in respect of the Senior Debt
Securities of that series and the Indenture may be served. (Section 1002)
If the Company acts as its own Paying Agent with respect to any series of
Senior Debt Securities, it will, on or before each due date of the principal of,
or any premium or interest on, any securities of such series, segregate and hold
in trust for the benefit of the Persons entitled thereto a sum sufficient to pay
the principal and any premium and interest so becoming due until such sums are
paid to such Persons or otherwise disposed of and will promptly notify the
Trustee of its action or failure to so act. Whenever the Company will have one
or more Paying Agents for any series of Senior Debt Securities, it will, prior
to each due date of the principal of, or any premium or interest on, any Senior
Debt Securities of that series, deposit with the 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 to so act.
The Company will cause each Paying Agent for any series of Senior Debt
Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent agrees with the Trustee, subject to the
Indenture, that such Paying Agent will (i) comply with the provisions of the
Trust Indenture Act applicable to it as a Paying Agent and (ii) during the
continuance of any default by the Company , or any other obligor upon the Senior
Debt Securities of that series, in the making of any payment in respect of the
Senior Debt Securities of that series, upon the written request of the Trustee,
pay to the Trustee all sums held in trust by such Paying Agent for payment in
respect of the Senior Debt Securities of that series. (Section 1003)
REGARDING THE TRUSTEE
National City Bank is the Trustee under the Indenture. National City Bank
is currently committed to provide loans to the Company under (i) a $100,000,000
unsecured revolving credit facility, which expires October 31, 2002, and (ii) a
$3,000,000 line of credit for the leasing of manufacturing equipment, which
expires October 31, 2002. Both Duane E. Collins, President, Chief Executive
Officer and Director of the Company, and John G. Breen, a Director of the
Company, are directors of National City Bank.
BOOK-ENTRY SYSTEM
If so specified in the Prospectus Supplement or Prospectus Supplements,
Senior Debt Securities of any series may be issued under a book-entry system in
the form of one or more global securities (each a "Global Security"). Each
Global Security will be deposited with, or on behalf of, a depositary, which,
unless otherwise specified in the Prospectus Supplement or Prospectus
Supplements, will be The Depository Trust Company, New York, New York (the
"Depositary"). The Global Securities will be registered in the name of the
Depositary or its nominee and will bear a legend regarding the restrictions on
exchanges and registration of transfers thereof referred to below and any other
matters as may be provided for pursuant to the Indenture.
The Depositary has advised the Company that the Depositary is a
limited-purpose trust company organized under the New York Banking Law, a
"banking organization" within the meaning of the New York Banking Law, a member
of the Federal Reserve System, a "clearing corporation" within the meaning of
the New York Uniform Commercial Code, and a "clearing agency" registered
pursuant to the provisions of Section 17A of the Exchange Act. The Depositary
was created to hold securities of its participants and to facilitate the
clearance and settlement of securities transactions among its participants
through electronic book-entry changes in accounts of the participants, thereby
eliminating the need for physical movement of securities certificates. The
Depositary's
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participants include securities brokers and dealers, banks, trust companies,
clearing corporations, and certain other organizations, some of whom, and/or
their representatives, own the Depositary. Access to the Depositary's book-entry
system is also available to others, such as banks, brokers, dealers and trust
companies that clear through or maintain a custodial relationship with a
participant, either directly or indirectly.
Upon the issuance of a Global Security in registered form, the Depositary
will credit, on its book-entry registration and transfer system, the respective
principal amounts of the Senior Debt Securities represented by such Global
Security to the accounts of participants. The accounts to be credited will be
designated by the underwriters, dealers or agents, if any, or by the Company, if
such Senior Debt Securities are offered and sold directly by the Company.
Ownership of beneficial interests in the Global Security will be limited to
participants or persons that may hold interests through participants. Ownership
of beneficial interests by participants in the Global Security will be shown on,
and the transfer of that ownership interest will be effected only through,
records maintained by such participants. The laws of some jurisdictions may
require that certain purchasers of securities take physical delivery of such
securities in definitive form. Such laws may impair the ability to transfer
beneficial interest in a Global Security.
So long as the Depositary or its nominee is the registered owner of a
Global Security, it will be considered the sole owner or holder of the Senior
Debt Securities represented by such Global Security for all purposes under the
Indenture. Except as set forth below, owners of beneficial interests in such
Global Security will not be entitled to have the Senior Debt Securities
represented thereby registered in their names, will not receive or be entitled
to receive physical delivery of certificates representing the Senior Debt
Securities and will not be considered the owners or holders thereof under the
Indenture. Accordingly, each person owning a beneficial interest in such Global
Security must rely on the procedures of the Depositary and, if such person is
not a participant, on the procedures of the participant through which such
person owns its interest, to exercise any rights of a holder under the
Indenture. The Company understands that under existing practice, in the event
that the Company requests any action of the holders or a beneficial owner
desires to take any action a holder is entitled to take, the Depositary would
act upon the instructions of, or authorize, the participant to take such action.
Payment of principal of, and any premium and interest on, Senior Debt
Securities represented by a Global Security will be made to the Depositary or
its nominee, as the case may be, as the registered owner and holder of the
Global Security representing such Senior Debt Securities. None of the Company,
the Trustee, any paying agent or registrar for such Senior Debt Securities will
have any responsibility or liability for any aspect of the records relating to
or payments made on account of beneficial ownership interests in the Global
Security or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
The Company has been advised by the Depositary that the Depositary will
credit participants' accounts with payments of principal and any premium or
interest on the payment date thereof in amounts proportionate to their
respective beneficial interests in the principal amount of the Global Security
as shown on the records of the Depositary. The Company expects that payments by
participants to owners of beneficial interests in the Global Security held
through such participants will be governed by standing instructions and
customary practices, as is now the case with securities held for the accounts of
customers registered in "street name," and will be the responsibility of such
participants.
A Global Security may not be exchanged or transferred except as a whole by
the Depositary to a nominee or successor of the Depositary or by a nominee of
the Depositary to another nominee of the Depositary. A Global Security
representing all but not part of the Senior Debt Securities being offered hereby
is exchangeable or transferable for Senior Debt Securities in definitive form of
like tenor and terms if (i) the Depositary notifies the Company that it is
unwilling or unable to continue as depositary for such Global Security or if at
any time the Depositary is no longer eligible to be or in good standing as a
clearing agency registered under the Exchange Act, and in either case, a
successor depositary is not appointed by the Company within 90 days of receipt
by the Company of such notice or of the Company becoming aware of such
ineligibility, or (ii) the Company in its sole discretion at any time determines
not to have all of the Senior Debt Securities represented by a Global Security
and notifies the Trustee thereof. A Global Security exchangeable pursuant to the
preceding sentence shall be exchangeable for Senior Debt Securities registered
in such names and in such authorized denominations as the Depositary for such
Global Security shall direct. (Section 305)
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PLAN OF DISTRIBUTION
The Company may sell the Offered Securities in four ways: (i) directly to
purchasers, (ii) through agents, (iii) to or through underwriters and (iv) to
dealers.
The distribution of Senior Debt Securities may be effected from time to
time in one or more transactions at a fixed price or prices, which may be
changed, or at market prices prevailing at the time of sale, at prices related
to such prevailing market prices or at negotiated prices.
In connection with the sale of Senior Debt Securities, underwriters or
agents may receive compensation from the Company or from purchasers of Senior
Debt Securities for whom they may act as agents in the form of discounts,
concessions or commissions. Underwriters may sell Senior Debt Securities to or
through dealers, and such dealers may receive compensation in the form of
discounts, concessions or commissions from the underwriters and/or commission
from the purchasers from whom they may act as agents. Any underwriters or agents
participating in the distribution of Senior Debt Securities may be deemed to be
underwriters, and any discounts or commissions received by them from the Company
and any profit on the resale of Senior Debt Securities may be deemed to be
underwriting discounts and commission under the Securities Act.
Offers to purchase Offered Securities may be solicited directly by the
Company and sales thereof may be made by the Company directly to institutional
investors or others. The terms of any such sales will be set forth in the
accompanying Prospectus Supplement.
Offers to purchase Offered Securities may be solicited by agents designated
by the Company from time to time. Any such agent, who may be deemed to be an
underwriter as that term is defined in the Securities Act, involved in the offer
or sale of the Offered Securities in respect of which this Prospectus is
delivered will be named, and any commissions payable by the Company to such
agent set forth, in the accompanying Prospectus Supplement. Unless otherwise
indicated in the accompanying Prospectus Supplement, any such agent will be
acting on a reasonable efforts basis for the period of its appointment. Agents
may be entitled under agreements which may be entered into with the Company to
indemnification by the Company against certain civil liabilities, including
liabilities under the Securities Act, and may be customers of, engage in
transactions with or perform services for the Company in the ordinary course of
business.
If any underwriters are utilized in the sale of the Offered Securities in
respect of which this Prospectus is delivered, the Company will enter into an
underwriting agreement with such underwriters at the time of sale to them and
the names of the specific managing underwriter or underwriters, as well as any
other underwriters and the terms of the transaction will be set forth in the
accompanying Prospectus Supplement, which will be used by the underwriters to
make resales of the Offered Securities in respect of which this Prospectus is
delivered to the public. The underwriters may be entitled, under the relevant
underwriting agreement, to indemnification by the Company against certain
liabilities, including liabilities under the Securities Act, and may be
customers of, engage in transactions with, or perform services for, the Company
in the ordinary course of business.
If a dealer is utilized in the sale of the Offered Securities in respect of
which this Prospectus is delivered, the Company will sell such Offered
Securities to the dealer, as principal. The dealer may then resell such Offered
Securities to the public at varying prices to be determined by such dealer at
the time of resale. Dealers may be entitled to indemnification by the Company
against certain liabilities, including liabilities under the Securities Act, and
may be customers of, engaged in transactions with, or perform services of, the
Company in the ordinary course of business.
Offered Securities may also be offered or sold, if so indicated in the
accompanying Prospectus Supplement, in connection with a remarketing upon their
purchase, in accordance with their terms, by one or more firms ("remarketing
firms"), acting as principals for their own accounts or as agents for the
Company. Any remarketing firm will be identified and the terms of its agreement,
if any, with the Company and its compensation will be described in the
accompanying Prospectus Supplement. Remarketing firms may be entitled under
agreements which may be entered into with the Company to indemnification by the
Company against certain civil liabilities, including liabilities under the
Securities Act, and may be customers of, engage in transactions with, or perform
services for, the Company in the ordinary course of business.
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<PAGE> 14
If so indicated in the accompanying Prospectus Supplement, the Company will
authorize agents and underwriters or dealers to solicit offers by certain
purchasers to purchase Offered Securities from the Company at the public
offering price set forth in the accompanying Prospectus Supplement pursuant to
delayed delivery contracts providing for payments and delivery on a specified
date in the future. Such contracts will be subject to only those conditions set
forth in the accompanying Prospectus Supplement, and the accompanying Prospectus
Supplement will set forth the commission payable for solicitation of such
offers. The obligations of any purchaser under any such contract will be subject
to the condition that the purchase of such Senior Debt Securities shall not at
the time of delivery be prohibited under the laws of the jurisdiction to which
such purchaser is subject. The underwriters and such other agents will not have
any responsibility in respect of the validity or performance of such contracts.
Any underwriters, agents or dealers utilized in the sale of Offered
Securities will not confirm sales to accounts over which they exercise
discretionary authority.
LEGAL MATTERS
The validity of the Senior Debt Securities offered hereby will be passed
upon for the Company by Jones, Day, Reavis & Pogue, Cleveland, Ohio, and for any
underwriters or agents by Sullivan & Cromwell, New York, New York. Sullivan &
Cromwell has on occasion been retained to perform legal services for the
Company.
EXPERTS
The consolidated financial statements of the Company contained in its
Annual Report on Form 10-K for the fiscal year ended June 30, 1997, filed with
the Commission and incorporated in this Prospectus have been examined by Coopers
& Lybrand L.L.P., independent accountants, to the extent and for the periods set
forth in their report dated July 31, 1997, incorporated in this Prospectus by
reference, and are incorporated by reference in reliance upon the report and the
authority of said firm as experts in accounting and auditing.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following is a list of the expenses to be incurred by the Company in
connection with the issuance and distribution of the Senior Debt Securities
being registered hereby, other than underwriting discounts and commissions. All
of the amounts shown are estimates except for the Commission registration fee.
<TABLE>
<S> <C>
Commission registration fee................................. $177,000
Printing and engraving costs................................ $ 15,000
Accounting fees and expenses................................ $ 16,500
Trustee fees and expenses................................... $ 15,000
Legal fees and expenses..................................... $ 35,000
Miscellaneous expenses...................................... $ 1,500
--------
Total....................................................... $260,000
========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article VII of the Registrant's Code of Regulations provides as follows:
ARTICLE VII
INDEMNIFICATION OF DIRECTORS, OFFICERS AND EMPLOYEES
The Corporation shall indemnify, to the full extent permitted or authorized
by the Ohio General Corporation Law as it may from time to time be amended, any
person made or threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that he is or was a director, officer or
employee of the Corporation, or is or was serving at the request of the
Corporation as a director, trustee, officer or employee of another corporation,
partnership, joint venture, trust or other enterprise. The indemnification
provided by this Article VII shall not be deemed exclusive of any other rights
to which any person seeking indemnification may be entitled under the articles
of incorporation or the regulations, or any agreement, vote of shareholders or
disinterested directors, or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office, and
shall continue as to a person who has ceased to be a director, trustee, officer
or employee and shall inure to the benefit of the heirs, executors and
administrators of such a person.
Section 1701.13(E) of the Ohio Revised Code provides as follows:
(E)(1) A corporation may indemnify or agree to indemnify any person
who was or is a party or is threatened to be made a party, to any
threatened, pending, or completed action, suit, or proceeding, whether
civil, criminal, administrative, or investigative, other than an action by
or in the right of the corporation, by reason of the fact that he is or was
a director, officer, employee, or agent of the corporation, or is or was
serving at the request of the corporation as a director, trustee, officer,
employee, member, manager, or agent of another corporation, domestic or
foreign, nonprofit or for profit, limited liability company, or a
partnership, joint venture, trust, or other enterprise, against expenses,
including attorneys' fees, judgments, fines, and amounts paid in settlement
actually and reasonably incurred by him in connection with such action,
suit, or proceeding, if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation, and with respect to any criminal action or proceeding, if he
had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit, or proceeding by judgement, order,
settlement, conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of it self, create a presumption that the person did
not act in good faith and in a manner which he
II-1
<PAGE> 16
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, he had
reasonable cause to believe that his conduct was unlawful.
(2) A corporation may indemnify or agree to indemnify any person who
was or is a party, or is threatened to be made a party, to any threatened,
pending, or completed action or suit by or in the right of the corporation
to procure a judgment in its favor, by reason of the fact that he is or was
a director, officer, employee, or agent of the corporation, or is or was
serving at the request of the corporation as a director, trustee, officer,
employee, member, manager, or agent of another corporation, domestic or
foreign, nonprofit or for profit, limited liability company, or a
partnership, joint venture, trust, or other enterprise, against expenses,
including attorney's fees, actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit, if he
acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation, except that no
indemnification shall be made in respect of any of the following:
(a) Any claim, issue, or matter as to which such person is adjudged
to be liable for negligence or misconduct in the performance of his duty
to the corporation unless, and only to the extent that, the court of
common pleas or the court in which such action or suit was brought
determines, upon application, that, despite the adjudication of
liability, but in view of all the circumstances of the case, such person
is fairly and reasonably entitled to indemnity for such expenses as the
court of common pleas or such other court shall deem proper;
(b) Any action or suit in which the only liability asserted against
a director is pursuant to section 1701.95 of the Revised Code.
(3) To the extent that a director, trustee, officer, employee, member,
manager, or agent has been successful on the merits or otherwise in defense
of any action, suit, or proceeding referred to in division (E)(1) or (2) of
this section, or in defense of any claim, issue, or matter therein, he
shall be indemnified against expenses, including attorney's fees, actually
and reasonably incurred by him in connection with the action, suit, or
proceeding.
(4) Any indemnification under division (E)(1) or (2) of this section,
unless ordered by a court, shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification
of the director, trustee, officer, employee, member, manager, or agent is
proper in the circumstances because he has met the applicable standard of
conduct set forth in division (E)(1) or (2) of this section. Such
determination shall be made as follows:
(a) By a majority vote of a quorum consisting of directors of the
indemnifying corporation who were not and are not parties to or
threatened with any such action, suit, or proceeding referred to in
division (E)(1) or (2) of this section;
(b) If the quorum described in division (E)(4) (a) of this section
is not obtainable or if a majority vote of a quorum of disinterested
directors so directs, in a written opinion by independent legal counsel
other than an attorney, or a firm having associated with it an attorney,
who has been retained by or who has performed services for the
corporation or any person to be indemnified within the past five years;
(c) By the shareholders;
(d) By the court of common pleas or the court in which the action,
suit, or proceeding referred to in division (E)(1) or (2) of this
section was brought.
Any determination made by the disinterested directors under division (E)(4)
(a) or by independent legal counsel under division (E)(4)(b) of this section
shall be promptly communicated to the person who threatened or brought the
action or suit by or in the right of the corporation under division (E)(2) of
this section, and within ten days after receipt of such notification, such
person shall have the right to petition the court of common pleas or the court
in which such action or suit was brought to review the reasonableness of such
determination.
(5)(a) Unless at the time of a director's act or omission that is the
subject of an action, suit, or proceeding refereed to in division (E)(1) or
(2) of this section, the articles or the regulations of a corporation
II-2
<PAGE> 17
state, by specific reference to this division, that the provisions of this
division do not apply to the corporation and unless the only liability
asserted against a director in an action, suit, or proceeding referred to
in divisions (E)(1) and (2) of this section is pursuant to section 1701.95
of the Revised Code, expenses, including attorney's fees, incurred by a
director in defending the action, suit, or proceeding shall be paid by the
corporation as they are incurred, in advance of the final disposition of
the action, suit, or proceeding upon receipt of an undertaking by or on
behalf of the director in which be agrees to do both of the following:
(i) Repay such amount if it is proved by clear and convincing
evidence in a court of competent jurisdiction that his action or failure
to act involved an act or omission undertaken with deliberate intent to
cause injury to the corporation or undertaken with reckless disregard
for the best interests of the corporation;
(ii) Reasonably cooperate with the corporation concerning the
action, suit, or proceeding.
(b) Expenses, including attorney's fees, incurred by a director,
trustee, officer, employee, member, manager, or agent in defending any
action, suit, or proceeding referred to in division (E)(1) or (2) of this
section, may be paid by the corporation as they are incurred, in advance of
the final disposition of the action, suit, or proceeding, as authorized by
the directors in the specific case, upon receipt of an undertaking by or on
behalf of the director, trustee, officer, employee, member, manager, or
agent to repay such amount, if it ultimately is determined that he is not
entitled to be indemnified by the corporation.
(6) The indemnification authorized by this section shall not be
exclusive of, and shall be in addition to any other rights granted to those
seeking indemnification under the articles or the regulations, any
agreement, a vote of shareholders or disinterested directors, or otherwise,
both as to action in their official capacities and as to action in another
capacity while holding their offices or positions, and shall continue as to
a person who has ceased to be a director, trustee, officer, employee, or
agent and shall inure to the benefit of the heirs, executors, and
administrators of such a person.
(7) A corporation may purchase and maintain insurance or furnish
similar protection, including, but not limited to, trust funds, letters of
credit, or self-insurance, on behalf of or for any person who is or was a
director, officer, employee, member, manager, or agent of the corporation,
or is or was serving at the request of the corporation as a director,
trustee, officer, employee, or agent of another corporation, domestic or
foreign, nonprofit or for profit, limited liability company, or a
partnership, joint venture, trust, or other enterprise, against any
liability asserted against him and incurred by him in any such capacity, or
arising out of his status as such, whether or not the corporation would
have the power to indemnify him against such liability under this section.
Insurance may be purchased from or maintained with a person in which the
corporation has a financial interest.
(8) The authority of a corporation to indemnify persons pursuant to
division (E)(1) or (2) of this section does not limit the payment of
expenses as they are incurred, indemnification, insurance, or other
protection that may be provided pursuant to divisions (E)(5), (6), and (7)
of this section. Divisions (E) (1) and (2) of this section do not create
any obligation to repay or return payments made by the corporation pursuant
to division (E)(5), (6), or (7).
(9) As used in division (E) of this section, "corporation" includes
all constituent entities in a consolidation or merger and the new or
surviving corporation, so that any person who is or was a director,
officer, employee, trustee, member, manager, or agent of such a constituent
entities, or is or was serving at the request of such constituent entity as
a director, trustee, officer, employee, trustee, member, manager, or agent
of another corporation, domestic or foreign, nonprofit or for profit,
limited liability company, or partnership, joint venture, trust, or other
enterprise, shall stand in the same position under this section with
respect to the new or surviving corporation as would if he had served the
new or surviving corporation in the same capacity.
The Company carries directors' and officers' liability insurance that
covers certain liabilities and expenses of the Company's directors and officers.
II-3
<PAGE> 18
Reference is also made to the indemnification provisions in the form of
United States Distribution Agreement filed as exhibit 1.1 to this Registration
Statement and to the undertaking "(c)" in Item 17 of this Registration
Statement.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) Exhibits. The following exhibits are filed herewith and made a part
hereof:
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
- ------- ----------------------
<C> <S>
1.1 Form of United States Distribution Agreement.
4.1 Indenture, dated May 3, 1996, between the Company and
National City Bank, as Trustee, relating to the Senior Debt
Securities.
5.1 Opinion of Jones, Day, Reavis & Pogue as to the validity of
the securities being offered.
12.1 Computation of Ratio of Earnings to Fixed Charges.
23.1 Consent of Jones, Day, Reavis & Pogue (included in Exhibit
5.1).
23.2 Consent of Coopers & Lybrand L.L.P.
24.1 Powers of Attorney.
25.1 Statement of Eligibility of National City Bank under the
Trust Indenture Act of 1939 on Form T-1 relating to the
Indenture.
</TABLE>
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 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 20% 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 the undertakings set forth in paragraphs (a)(1)(i) and
(a)(1)(ii) of this section 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 section 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in this registration statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of 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
II-4
<PAGE> 19
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.
II-5
<PAGE> 20
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE
REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF CLEVELAND, STATE OF OHIO, ON MARCH 13, 1998.
PARKER-HANNIFIN CORPORATION
By: /s/ THOMAS A. PIRAINO
------------------------------------
Thomas A. Piraino
Vice President -- Law and Assistant
Secretary
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATES INDICATED.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
* /s/ P.S. PARKER Chairman of the Board and Director March 13, 1998
- ------------------------------------------------
P.S. Parker
* /s/ D. E. COLLINS President, Chief Executive Officer March 13, 1998
- ------------------------------------------------ and Director
D. E. Collins (Principal Executive Officer)
* /s/ M. J. HIEMSTRA Vice President -- Finance and March 13, 1998
- ------------------------------------------------ Administration and
M. J. Hiemstra Chief Financial Officer
(Principal Financial Officer)
* /s/ H. C. GUERITEY, JR. Controller March 13, 1998
- ------------------------------------------------ (Principal Accounting Officer)
H. C. Gueritey, Jr.
Director March 13, 1998
- ------------------------------------------------
Allan L. Rayfield
* /s/ J. G. BREEN Director March 13, 1998
- ------------------------------------------------
J. G. Breen
* /s/ P. G. SCHLOEMER Director March 13, 1998
- ------------------------------------------------
P. G. Schloemer
* /s/ P. C. ELY, JR. Director March 13, 1998
- ------------------------------------------------
Paul C. Ely, Jr.
Director March 13, 1998
- ------------------------------------------------
Allen H. Ford
* /s/ W. R. SCHMITT Director March 13, 1998
- ------------------------------------------------
W. R. Schmitt
</TABLE>
II-6
<PAGE> 21
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
* /s/ H.R. ORTINO Director March 13, 1998
- ------------------------------------------------
Hector R. Ortino
* /s/ D. W. SULLIVAN Director March 13, 1998
- ------------------------------------------------
D. W. Sullivan
* /s/ S. A. STREETER Director March 13, 1998
- ------------------------------------------------
S.A. Streeter
* /s/ P.W. LIKINS Director March 13, 1998
- ------------------------------------------------
Peter W. Likins
* /s/ M.A. TRESCHOW Director March 13, 1998
- ------------------------------------------------
Michael A. Treschow
Director March 13, 1998
- ------------------------------------------------
Debra L. Starnes
* The undersigned, by signing his name hereto, does hereby sign and execute this Registration Statement pursuant
to the Powers of Attorney executed by the above-named officers and directors of the Registrant and which have
been filed with the Securities and Exchange Commission on behalf of such officers and directors.
/s/ THOMAS A. PIRAINO March 13, 1998
- ------------------------------------------------
Thomas A. Piraino, Attorney-in-Fact
</TABLE>
II-7
<PAGE> 22
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT DESCRIPTION
- ------- -------------------
<C> <S>
1.1 Form of United States Distribution Agreement.
4.1 Indenture, dated May 3, 1996, between the Company and
National City Bank, as Trustee, relating to the Senior Debt
Securities.
5.1 Opinion of Jones, Day, Reavis & Pogue as to the validity of
the securities being offered.
12.1 Computation of Ratio of Earnings to Fixed Charges.
23.1 Consent of Jones, Day, Reavis & Pogue (included in Exhibit
5.1).
23.2 Consent of Coopers & Lybrand L.L.P.
24.1 Powers of Attorney.
25.1 Statement of Eligibility of National City Bank under the
Trust Indenture Act of 1939 on Form T-1 relating to the
Indenture.
</TABLE>
II-8
<PAGE> 1
Exhibit 1.1
PARKER-HANNIFIN CORPORATION
$755,000,000
Medium-Term Notes
Due 9 Months or more from Date of Issue
U.S. DISTRIBUTION AGREEMENT
_____, 1998
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Citicorp Securities, Inc.
399 Park Avenue
New York, New York 10043
Salomon Brothers Inc
7 World Trade Center
New York, New York 10048
Dear Sirs:
PARKER-HANNIFIN CORPORATION, an Ohio corporation (the
"Company"), confirms its agreement with each of you with respect to the issue
and sale from time to time by the Company of up to $755,000,000 (or the
equivalent thereof in one or more foreign currencies or composite currencies)
aggregate initial public offering price of its medium-term notes due 9 months or
more from date of issue (the "Notes"). The Notes will be issued under an
Indenture dated as of May 3, 1996 (the "Indenture") between the Company and
National City Bank, as Trustee (the "Trustee"), and will have the maturities,
interest rates, redemption provisions, if any, and other terms as set forth in
supplements to the Basic Prospectus referred to below.
<PAGE> 2
The Company hereby appoints Morgan Stanley & Co. Incorporated
("Morgan Stanley"), Citicorp Securities, Inc. and Salomon Brothers Inc
(individually, an "Agent" and collectively, the "Agents") as its exclusive
agents, subject to Section 11, for the purpose of soliciting and receiving
offers to purchase Notes from the Company by others and, on the basis of the
representations and warranties herein contained, but subject to the terms and
conditions herein set forth, each Agent agrees to use reasonable efforts to
solicit and receive offers to purchase Notes upon terms acceptable to the
Company at such times and in such amounts as the Company shall from time to time
specify. In addition, any Agent may also purchase Notes as principal pursuant to
the terms of a terms agreement relating to such sale (a "Terms Agreement") in
accordance with the provisions of Section 2(b) hereof.
The Company has filed with the Securities and Exchange
Commission (the "Commission") registration statements (Nos. 333-02761 and
333-_____), the most recent of which contains a prospectus, for the registration
under the Securities Act of 1933, as amended (the "Act") of the Notes. Such
registration statements, including the exhibits thereto, as amended at the
Commencement Date (as hereinafter defined), are hereinafter collectively
referred to as the "Registration Statement." The Company proposes to file with
the Commission from time to time, pursuant to Rule 424 under the Act,
supplements to the prospectus included in the most recent Registration Statement
that will describe certain terms of the Notes. The prospectus in the form in
which it appears in the most recent Registration Statement, which, pursuant to
Rule 429 of the Act, is a combined prospectus relating also to Registration
Statement No. 333-02761, is hereinafter referred to as the "Basic Prospectus."
The term "Prospectus" means the Basic Prospectus together with the prospectus
supplement or supplements (each a "Prospectus Supplement") specifically relating
to Notes, as filed with, or transmitted for filing to, the Commission pursuant
to Rule 424. As used herein, the terms "Basic Prospectus" and "Prospectus" shall
include in each case the documents, if any, incorporated by reference therein.
The terms "supplement," "amendment" and "amend" as used herein shall include all
documents deemed to be incorporated by reference in the Prospectus that are
filed subsequent to the date of the Basic Prospectus by the Company with the
Commission pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act").
1. REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to and agrees with each Agent as of the Commencement Date, as of each
date on which the Company accepts an offer to purchase Notes (including any
purchase by an Agent pursuant to a Terms Agreement), as of each date
2
<PAGE> 3
the Company issues and delivers Notes and as of each date the Registration
Statement or the Basic Prospectus is amended or supplemented, as follows (it
being understood that such representations, warranties and agreements shall be
deemed to relate to the Registration Statement, the Basic Prospectus and the
Prospectus, each as amended or supplemented to each such date):
(a) The Registration Statement has become effective; no stop
order suspending the effectiveness of the Registration Statement is in effect,
and no proceedings for such purpose are pending before or threatened by the
Commission.
(b) Each part of the Registration Statement and the Prospectus
conform and, as amended or supplemented, if applicable, will conform in all
material respects with the requirements of the Act, the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act") and the rules and regulations of
the Commission thereunder; each part of the Registration Statement, when such
part became effective, did not contain and each such part, as amended or
supplemented, if applicable, will not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading; and the Prospectus does not
contain and, as amended or supplemented, if applicable, will not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading, except that (i) the foregoing shall not apply to
statements in or omissions from any such document in reliance upon, and in
conformity with written information relating to an Agent furnished to the
Company by such Agent expressly for use in the preparation thereof, and (ii) the
representations and warranties set forth above, when made as of the Commencement
Date or as of any date on which the Company accepts an offer to purchase Notes,
shall be deemed not to cover information concerning an offering of particular
Notes to the extent such information will be set forth in a supplement to the
Basic Prospectus.
(c) The documents from which information is incorporated by
reference in the Prospectus, when they became effective or were filed with the
Commission, as the case may be, conformed in all material respects to the
requirements of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder, and any documents so filed and
incorporated by reference subsequent to the effective date of the Registration
Statement will, when they are filed with the Commission, conform in all material
respects to the requirements of the
3
<PAGE> 4
Act and the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder.
(d) The financial statements of the Company and its
subsidiaries set forth in the Registration Statement and Prospectus, as amended
or supplemented, if applicable, fairly present, the financial condition of the
Company and its subsidiaries as of the dates indicated and the results of
operations and changes in financial position for the periods therein specified
in conformity with generally accepted accounting principles consistently applied
throughout the periods involved (except as otherwise stated therein).
(e) The Company and each of its subsidiaries has been duly
incorporated and is an existing corporation in good standing under the laws of
its jurisdiction of incorporation, has full power and authority (corporate and
other) to conduct its business as described in the Registration Statement and
Prospectus and is duly qualified to do business in each jurisdiction in which it
owns or leases real property or in which the conduct of its business requires
such qualification except where the failure to be so qualified, considering all
such cases in the aggregate, does not involve a material risk to the business,
properties, financial position or results of operations of the Company and its
subsidiaries (taken as a whole); and all of the outstanding shares of capital
stock of each such subsidiary have been duly authorized and validly issued, are
fully paid and non-assessable and (except as otherwise stated in the Prospectus)
are owned beneficially by the Company subject to no security interest, other
encumbrance or adverse claim.
(f) Each of this Agreement and any applicable Written Terms
Agreement (as hereinafter defined) has been duly authorized, executed and
delivered by the Company.
(g) The Indenture and the Notes have been duly authorized, the
Indenture has been duly qualified under the Trust Indenture Act, executed and
delivered and constitutes, and the Notes, when duly executed, authenticated,
issued and delivered as contemplated hereby and by the Indenture, will
constitute valid and legally binding obligations of the Company enforceable in
accordance with their terms subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability relating to
or affecting creditors' rights and to general equity principles.
4
<PAGE> 5
(h) Except as contemplated in the Prospectus, as amended or
supplemented, if applicable, subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus, neither
the Company nor any of its subsidiaries has incurred any liabilities or
obligations, direct or contingent, or entered into any transactions, not in the
ordinary course of business, that are material to the Company and its
subsidiaries (taken as a whole), and there has not been any material change, on
a consolidated basis, in the capital stock, short-term debt or long-term debt of
the Company and its subsidiaries, or any material adverse change, or any
development involving a prospective material adverse change, in the condition
(financial or other), business, prospects, net worth or results of operations of
the Company and its subsidiaries (taken as a whole).
(i) Except as set forth in the Prospectus, as amended or
supplemented, if applicable, there is not pending or, to the knowledge of the
Company, threatened, any action, suit or proceeding to which the Company or any
of its subsidiaries is a party before or by any court or governmental agency or
body, which might result in any material adverse change in the condition
(financial or other), business, prospects, net worth or results of operations of
the Company and its subsidiaries, or might materially and adversely affect the
properties or assets thereof.
(j) There are no contracts or documents of the Company or any
of its subsidiaries that are required to be filed as exhibits to the
Registration Statement by the Act or by the Rules and Regulations that have not
been so filed.
(k) The performance of this Agreement and the consummation of
the transactions herein contemplated will not result in a breach or violation of
any of the terms and provisions of, or constitute a default under, any statute,
any agreement or instrument to which the Company is a party or by which it is
bound or to which any of the property of the Company is subject, the Company's
Amended Articles of Incorporation or Regulations, or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Company or any of its properties; no consent, approval, authorization or
order of, or filing with, any court or governmental agency or body is required
for the consummation of the transactions contemplated by this Agreement in
connection with the issuance or sale of the Notes by the Company, except such as
may be required under the Act, the Trust Indenture Act or state securities laws;
and the Company has full power and
5
<PAGE> 6
authority to authorize, issue and sell the Notes as contemplated by this
Agreement.
(l) The Company has complied with all provisions of Section
517.075, Florida Statutes relating to doing business with the Government of Cuba
or with any person or affiliate located in Cuba.
2. SOLICITATIONS AS AGENT; PURCHASES AS
PRINCIPAL.
(a) SOLICITATIONS AS AGENT. In connection with an Agent's
actions as agent hereunder, such Agent agrees to use reasonable efforts to
solicit offers to purchase Notes upon the terms and conditions set forth in the
Prospectus as then amended or supplemented.
The Company reserves the right, in its sole discretion, to
instruct the Agents to suspend at any time, for any period of time or
permanently, the solicitation of offers to purchase Notes. Upon receipt of at
least one business day's prior notice from the Company, the Agents will
forthwith suspend solicitations of offers to purchase Notes from the Company
until such time as the Company has advised the Agents that such solicitation may
be resumed. While such solicitation is suspended, the Company shall not be
required to deliver any certificates, opinions or letters in accordance with
Sections 5(a), 5(b) and 5(c); PROVIDED, HOWEVER, that if the Registration
Statement or Prospectus is amended or supplemented during the period of
suspension (other than by an amendment or supplement providing solely for a
change in the interest rates, redemption provisions, amortization schedules or
maturities offered on the Notes or for a change the Agents deem to be
immaterial), no Agent shall be required to resume soliciting offers to purchase
Notes until the Company has delivered such certificates, opinions and letters as
such Agent may request.
The Company agrees to pay to each Agent, as consideration for
the sale of each Note resulting from a solicitation made or an offer to purchase
received by such Agent, a commission in the form of a discount from the purchase
price of such Note equal to the percentage set forth below of the purchase price
of such Note:
6
<PAGE> 7
<TABLE>
<CAPTION>
Term Commission Rate
---- ---------------
<S> <C> <C>
From 9 months to less than 12 months .125%
From 12 months to less than 18 months .150%
From 18 months to less than 2 years .200%
From 2 years to less than 3 years .250%
From 3 years to less than 4 years .350%
From 4 years to less than 5 years .450%
From 5 years to less than 6 years .500%
From 6 years to less than 7 years .550%
From 7 years to less than 8 years .600%
From 8 years to less than 9 years .600%
From 9 years to less than 10 years .600%
From 10 years to less than 15 years .625%
From 15 years to less than 20 years .700%
From 20 years to less than 30 years .750%
From 30 years and beyond to be negotiated
</TABLE>
Each Agent shall communicate to the Company, orally or in
writing, each offer to purchase Notes received by such Agent as agent that in
its judgment should be considered by the Company. The Company shall have the
sole right to accept offers to purchase Notes and may reject any offer in whole
or in part. Each Agent shall have the right to reject any offer to purchase
Notes that it considers to be unacceptable, and any such rejection shall not be
deemed a breach of its agreements contained herein. The procedural details
relating to the issue and delivery of Notes sold by the Agents as agents and the
payment therefor shall be as set forth in the Administrative Procedures (as
hereinafter defined).
(b) PURCHASES AS PRINCIPAL. Each sale of Notes to an Agent as
principal shall be made in accordance with the terms of this Agreement. In
connection with each such sale, the Company will enter into a Terms Agreement
that will provide for the sale of such Notes to and the purchase thereof by such
Agent. Each Terms Agreement will take the form of either (i) a written agreement
between such Agent and the Company, which may be substantially in the form of
Exhibit A hereto (a "Written Terms Agreement"), or (ii) an oral agreement
between such Agent and the Company confirmed in writing by such Agent to the
Company.
An Agent's commitment to purchase Notes pursuant to a Terms
Agreement shall be deemed to have been made on the basis of the representations
and warranties of the Company herein contained and shall be subject to the terms
and conditions herein set forth. Each Terms Agreement shall specify the
principal amount of Notes to be purchased by such Agent pursuant thereto, the
maturity date of such
7
<PAGE> 8
Notes, the price to be paid to the Company for such Notes, the interest rate and
interest rate formula, if any, applicable to such Notes and any other terms of
such Notes. Each such Terms Agreement may also specify any requirements for
officers' certificates, opinions of counsel and letters from the independent
public accountants of the Company pursuant to Section 4 hereof. A Terms
Agreement may also specify certain provisions relating to the reoffering of such
Notes by such Agent.
Each Terms Agreement shall specify the time and place of
delivery of and payment for such Notes. Unless otherwise specified in a Terms
Agreement, the procedural details relating to the issue and delivery of Notes
purchased by an Agent as principal and the payment therefor shall be as set
forth in the Administrative Procedures. Each date of delivery of and payment for
Notes to be purchased by an Agent pursuant to a Terms Agreement is referred to
herein as a "Settlement Date."
Unless otherwise specified in a Terms Agreement, if you are
purchasing Notes as principal you may resell such Notes to other dealers. Any
such sales may be at a discount, which shall not exceed the amount set forth in
the Prospectus Supplement relating to such Notes.
(c) ADMINISTRATIVE PROCEDURES. The Agents and the Company
agree to perform the respective duties and obligations specifically provided to
be performed in the Medium-Term Notes Administrative Procedures (attached hereto
as Exhibit B) (the "Administrative Procedures"), as amended from time to time.
The Administrative Procedures may be amended only by written agreement of the
Company and the Agents.
(d) DELIVERY. The documents required to be delivered by
Section 4 of this Agreement as a condition precedent to each Agent's obligation
to begin soliciting offers to purchase Notes as an agent of the Company shall be
delivered at the office of Sullivan & Cromwell, counsel for the Agents, not
later than 4:00 p.m., New York time, on the date hereof, or at such other time
and/or place as the Agents and the Company may agree upon in writing, but in no
event later than the day prior to the earlier of (i) the date on which the
Agents begin soliciting offers to purchase Notes and (ii) the first date on
which the Company accepts any offer by an Agent to purchase Notes pursuant to a
Terms Agreement. The date of delivery of such documents is referred to herein as
the "Commencement Date."
8
<PAGE> 9
(e) OBLIGATIONS SEVERAL. The Company acknowledges that the
obligations of the Agents under this Agreement are several and not joint.
3. AGREEMENTS. The Company agrees with each Agent that:
(a) Prior to the termination of the offering of the Notes
pursuant to this Agreement or any Terms Agreement, the Company will not file any
Prospectus Supplement relating to the Notes or any amendment to the Registration
Statement unless the Company has previously furnished to the Agents copies
thereof for their review and given each of you a reasonable opportunity to
comment on any such proposed amendment or supplement; PROVIDED, HOWEVER, that,
in the event that an Agent may own any Notes as principal, until the
distribution of such Notes has been completed, the Company will not file any
such proposed supplement or amendment to which such Agent reasonably objects;
PROVIDED, FURTHER, that (i) the foregoing requirements shall not apply to any of
the Company's periodic filings with the Commission required to be filed pursuant
to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act, copies of which
filings the Company will cause to be delivered to the Agents promptly after
being transmitted for filing with the Commission and (ii) any Prospectus
Supplement that merely sets forth the terms or a description of particular Notes
shall only be reviewed by the Agent or Agents offering such Notes. Subject to
the foregoing sentence, the Company will promptly cause each Prospectus
Supplement to be filed with or transmitted for filing to the Commission in
accordance with Rule 424(b) under the Act. The Company will promptly advise the
Agents (i) of the filing of any amendment or supplement to the Basic Prospectus
(other than filings referred to in clause (i) above) (except that notice of the
filing of an amendment or supplement to the Basic Prospectus that merely sets
forth the terms or a description of particular Notes shall only be given to the
Agent or Agents offering such Notes), (ii) of the filing and effectiveness of
any amendment to the Registration Statement, (iii) of any request by the
Commission for any amendment to the Registration Statement or any amendment or
supplement to the Basic Prospectus or for any additional information, (iv) of
the issuance by the Commission of any stop order suspending the effectiveness of
the Registration Statement or the institution or threatening of any proceeding
for that purpose and (v) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Notes for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose. The Company will use its best efforts to prevent the issuance of any
such stop order or notice of suspension
9
<PAGE> 10
of qualification and, if issued, to obtain as soon as possible the withdrawal
thereof. If the Basic Prospectus is amended or supplemented as a result of the
filing under the Exchange Act of any document incorporated by reference in the
Prospectus, no Agent shall be obligated to solicit offers to purchase Notes so
long as it is not reasonably satisfied with such document.
(b) If, at any time when a prospectus relating to the Notes is
required to be delivered under the Act, any event occurs or condition exists as
a result of which the Prospectus, as then amended or supplemented, would include
an untrue statement of a material fact, or omit to state any material fact
necessary to make the statements therein, in the light of the circumstances when
the Prospectus, as then amended or supplemented, is delivered to a purchaser,
not misleading, or if, in the opinion of the Agents or in the opinion of the
Company, it is necessary at any time to amend or supplement the Prospectus, as
then amended or supplemented, to comply with applicable law, the Company will
immediately notify the Agents by telephone (with confirmation in writing) to
suspend solicitation of offers to purchase Notes and, if so notified by the
Company, the Agents shall forthwith suspend such solicitation and cease using
the Prospectus, as then amended or supplemented. If the Company shall decide to
amend or supplement the Registration Statement or Prospectus, as then amended or
supplemented, it shall so advise the Agents promptly by telephone (with
confirmation in writing) and, at its expense, shall prepare and cause to be
filed promptly with the Commission an amendment or supplement to the
Registration Statement or Prospectus, as then amended or supplemented, which
will be provided to the Agents for review, that will correct such statement or
omission or effect such compliance and will supply such amended or supplemented
Prospectus to the Agents in such quantities as they may reasonably request. If
any documents, certificates, opinions and letters furnished to the Agents
pursuant to paragraph (f) below and Sections 5(a), 5(b) and 5(c) in connection
with the preparation and filing of such amendment or supplement are satisfactory
in all respects to the Agents, upon the filing with the Commission of such
amendment or supplement to the Prospectus or upon the effectiveness of an
amendment to the Registration Statement, the Agents will resume the solicitation
of offers to purchase Notes hereunder. Notwithstanding any other provision of
this Section 3(b), until the distribution of any Notes an Agent may own as
principal has been completed, if any event described above in this paragraph (b)
occurs, the Company will, at its own expense, forthwith prepare and cause to be
filed promptly with the Commission an amendment or supplement to the
Registration Statement or Prospectus,
10
<PAGE> 11
as then amended or supplemented, satisfactory in all respects to such Agent,
will supply such amended or supplemented Prospectus to such Agent in such
quantities as it may reasonably request and shall furnish to such Agent pursuant
to paragraph (f) below and Sections 5(a), 5(b) and 5(c) such documents,
certificates, opinions and letters as it may request in connection with the
preparation and filing of such amendment or supplement.
(c) The Company will make generally available to its security
holders and to the Agents as soon as practicable earning statements that satisfy
the provisions of Section 11(a) of the Act and the rules and regulations of the
Commission thereunder covering twelve month periods beginning, in each case, not
later than the first day of the Company's fiscal quarter next following the
"effective date" (as defined in Rule 158 under the Act) of the Registration
Statement with respect to each sale of Notes. If such fiscal quarter is the last
fiscal quarter of the Company's fiscal year, such earning statement shall be
made available not later than 90 days after the close of the period covered
thereby and in all other cases shall be made available not later than 45 days
after the close of the period covered thereby.
(d) The Company will furnish to each Agent, without charge, a
signed copy of the Registration Statement, including exhibits and all amendments
thereto, and as many copies of the Prospectus, any documents incorporated by
reference therein and any supplements and amendments thereto as such Agent may
reasonably request.
(e) The Company will use its best efforts to qualify the Notes
for offer and sale under the securities or Blue Sky laws of such jurisdictions
as the Agents shall reasonably request and to maintain such qualifications for
as long as the Agents shall reasonably request, provided that the Company shall
not be required in connection therewith to qualify as a foreign corporation or
to execute a general consent to service of process in any state.
(f) The Company shall furnish to the Agents such relevant
documents and certificates of officers of the Company relating to the business,
operations and affairs of the Company, the Registration Statement, the Basic
Prospectus, any amendments or supplements thereto, the Indenture, the Notes,
this Agreement, the Administrative Procedures, any Terms Agreement and the
performance by the Company of its obligations hereunder or thereunder as the
Agents may from time to time reasonably request.
11
<PAGE> 12
(g) The Company shall notify the Agents promptly in writing of
any downgrading, or of its receipt of any notice of any intended or potential
downgrading or of any review for possible change that does not indicate the
direction of the possible change, in the rating accorded any of the Company's
securities by any "nationally recognized statistical rating organization," as
such term is defined for purposes of Rule 436(g)(2) under the Act.
(h) The Company will, whether or not any sale of Notes is
consummated, pay all expenses incident to the performance of its obligations
under this Agreement and any Terms Agreement, including: (i) the preparation and
filing of the Registration Statement and the Prospectus and all amendments and
supplements thereto, (ii) the preparation, issuance and delivery of the Notes,
(iii) the fees and disbursements of the Company's counsel and accountants and of
the Trustee and its counsel, (iv) the qualification of the Notes under
securities or Blue Sky laws in accordance with the provisions of Section 3(e),
including filing fees and the fees and disbursements of counsel for the Agents
in connection therewith and in connection with the preparation of any Blue Sky
or Legal Investment Memoranda, (v) the printing and delivery to the Agents in
quantities as hereinabove stated of copies of the Registration Statement and all
amendments thereto and of the Prospectus and any amendments or supplements
thereto, (vi) the printing and delivery to the Agents of copies of any Blue Sky
or Legal Investment Memoranda, (vii) any fees charged by rating agencies for the
rating of the Notes, (viii) any expenses incurred by the Company in connection
with a "road show" presentation to potential investors and (ix) the fees and
disbursements of counsel for the Agents incurred in connection with the offering
and sale of the Notes, including any opinions to be rendered by such counsel
hereunder, and (x) any out-of-pocket expenses incurred by the Agents; PROVIDED
that any advertising expenses incurred by the Agents shall have been approved by
the Company.
(i) During the period beginning the date of any Terms
Agreement and continuing to and including the Settlement Date with respect to
such Terms Agreement, the Company will not, without such Agent's prior written
consent, offer, sell, contract to sell or otherwise dispose of any debt
securities of the Company or warrants to purchase debt securities of the Company
substantially similar to such Notes (other than (i) the Notes that are to be
sold pursuant to such Terms Agreement, (ii) Notes previously agreed to be sold
by the Company, (iii) commercial paper issued in the ordinary course of business
and (iv) debt securities issued by the Company pursuant to transactions exempt
from registration under
12
<PAGE> 13
Section 4(2) of the Act or Rule 506 promulgated thereunder, except as may
otherwise be provided in such Terms Agreement.
4. CONDITIONS OF THE OBLIGATIONS OF THE AGENTS. Each Agent's
obligation to solicit offers to purchase Notes as agent of the Company, each
Agent's obligation to purchase Notes pursuant to any Terms Agreement and the
obligation of any other purchaser to purchase Notes will be subject to the
accuracy of the representations and warranties on the part of the Company
herein, to the accuracy of the statements of the Company's officers made in each
certificate furnished pursuant to the provisions hereof and to the performance
and observance by the Company of all covenants and agreements herein contained
on its part to be performed and observed at the time the Company accepts the
offer to purchase such Notes and at the time of issuance and delivery thereof
and to the following additional conditions precedent when and as specified:
(a) Prior to such solicitation or purchase, as
the case may be:
(i) no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceeding for
that purpose shall have been instituted or, to the knowledge of the
Company or any Agent, threatened by the Commission, and any request of
the Commission for additional information (to be included in the
Registration Statement or the Prospectus or otherwise) shall have been
complied with to the satisfaction of the Agents;
(ii) no Agent shall have advised the Company that the
Registration Statement or Prospectus, or any amendment or supplement
thereto, contains an untrue statement of fact which in the opinion of
the Agents is material, or omits to state a fact which in the opinion
of the Agents is material and is required to be stated therein or is
necessary to make the statements therein (in the case of the
Prospectus, in the light of the circumstances under which they were
made) not misleading;
(iii) except as contemplated in the Prospectus, as amended or
supplemented at the time of such solicitation or at the time such offer
to purchase was made, subsequent to the respective dates as of which
information is given on the Registration Statement and the Prospectus,
as amended or supplemented, if applicable, there shall not have been
any change, on a consolidated basis, in the capital stock, short-term
debt or
13
<PAGE> 14
long-term debt of the Company and its subsidiaries, or any adverse
change in the condition (financial or other), business, prospects, net
worth or results of operations of the Company and its subsidiaries
that, in the judgment of the relevant Agent, makes it impracticable to
market the Notes on the terms and in the manner contemplated by the
Prospectus, as so amended or supplemented; and
(iv) none of the following shall have occurred: (a) trading on
the New York Stock Exchange or the American Stock Exchange shall have
been wholly suspended, (b) minimum or maximum prices for trading shall
have been fixed, or maximum ranges for prices for securities shall have
been required, on the New York Stock Exchange or the American Stock
Exchange, by such Exchange or by order of the Commission or any other
governmental authority having jurisdiction, (c) a banking moratorium
shall have been declared by Federal or New York authorities, (d) any
downgrading shall have occurred in the rating accorded the Company's
debt securities by any "nationally recognized statistical rating
organization," as that term is defined by the Commission for purposes
of Rule 436(g)(2) under the Act or any such organization shall have
publicly announced that it has under surveillance or review, with
possible negative implications, its rating of any of the Company's debt
securities, or (e) an outbreak or material escalation of major
hostilities in which the United States is involved, a declaration of
war by Congress, any other substantial national or inter national
calamity or any other event or occurrence of a similar character shall
have occurred that, in the judgment of the relevant Agent, makes it
impracticable or inadvisable to market the Notes on the terms and in
the manner contemplated by the Prospectus, as amended or supplemented
at the time of such solicitation or at the time such offer to purchase
was made;
(A) except, in each case described in paragraph (iii) or (iv)
above, as disclosed to the relevant Agent in writing by the Company prior to
such solicitation or, in the case of a purchase of Notes, as disclosed to the
relevant Agent before the offer to purchase such Notes was made or (B) unless in
each case described in (iv) above, the relevant event shall have occurred and
been known to the relevant Agent before such solicitation or, in the case of a
purchase of Notes, before the offer to purchase such Notes was made.
14
<PAGE> 15
(b) On the Commencement Date and, if called for by any Terms
Agreement, on the corresponding Settlement Date, the relevant Agents shall have
received:
(i) The opinion, dated as of such date, of Jones, Day, Reavis
& Pogue, outside counsel for the Company, in substantially the form
attached as Annex I hereto.
(ii) The opinion of Joseph D. Whiteman, Esq., Vice President,
General Counsel and Secretary of the Company, dated as of such date, to
the effect that:
(a) The Company is duly incorporated, validly existing and in
good standing under the laws of its jurisdiction of incorporation, with
corporate power and authority to own its properties and to conduct its
business as described in the Prospectus and is qualified to do business
in each state in which it owns or leases real property, except where
the failure to be so qualified, considering all such cases in the
aggregate, does not involve a material risk to the business,
properties, financial position or results of operations of the Company
and its subsidiaries (taken as a whole).
(b) each of Parker Services Inc., Travel 17325 Inc., Parker
Properties Inc., Parker-Hannifin International Corp., Parker
Intangibles Inc., Parker de Puerto Rico, Inc., Parker Finance Corp.,
Parker-Hannifin Asia Pacific Co., Ltd., and iPower Distribution Group
Inc. (collectively referred to as the "Domestic Subsidiaries") is duly
incorporated, validly existing and in good standing under the laws of
its respective jurisdiction of incorporation; each of the Domestic
Subsidiaries has corporate power and authority to own its properties
and to conduct its business as described in the Prospectus and is
qualified to do business in each state in which it owns or leases real
property, except where the failure to be so qualified, considering all
such cases in the aggregate, does not involve a material risk to the
business, properties, financial position or results of the operations
of the Company and its Domestic Subsidiaries (taken as a whole); all of
the outstanding shares of capital stock of each of the Domestic
Subsidiaries have been duly authorized and validly issued, are fully
paid and nonassessable and (except as otherwise stated in the
Prospectus) are owned beneficially by the Company;
15
<PAGE> 16
(c) each of Parker Hannifin GmbH, Parker Hannifin Plc, Parker
Hannifin S.p.A., Parker Hannifin (Canada) Inc. and Parker Hannifin,
S.A.(collectively referred to as the "Significant Foreign
Subsidiaries") has been duly organized and is in good standing under
the laws of its respective jurisdiction of incorporation; each of the
Significant Foreign Subsidiaries has full power and authority
(corporate and other) to conduct its business as described in the
Registration Statement; each of the Significant Foreign Subsidiaries is
not, and is not required to be, registered or qualified to do business
as a foreign corporation under the laws of any jurisdiction other than
its jurisdiction of incorporation, and all of the outstanding shares of
capital stock of each of the Significant Foreign Subsidiaries have been
duly authorized and validly issued, are fully paid and non-assessable
and (except for shareholders' or directors' qualifying shares) are
owned, directly or indirectly, by the Company subject to no security
interest, other encumbrance, or adverse claim (such counsel being
entitled to rely upon opinions of local counsel, provided that such
counsel shall furnish to you signed copies thereof and state that he
believes that both you and he are justified in relying upon such
opinion).
(iii) The opinion, dated as of such date, of Sullivan &
Cromwell, counsel for the Agents, covering the matters in Annex I in
the paragraphs numbered (2), (3) and (4), and certain matters covered
in the first and last unnumbered paragraphs of Annex I.
The opinion of Jones, Day, Reavis & Pogue described in
paragraph (b)(i) above shall be rendered to the Agents at the request
of the Company and shall so state therein.
(c) On the Commencement Date and, if called for by any Terms
Agreement, on the corresponding Settlement Date, the relevant Agents shall have
received a certificate, dated the Commencement Date or such Settlement Date, as
the case may be, and signed by the Chairman of the Board, the President or a
Vice President and by the principal financial or accounting officer to the
effect that, to the best of their knowledge based upon reasonable investigation:
(i) the representations and warranties of the Company
contained in this Agreement are true and correct as of such date and
that the Company has complied with all of the agreements and satisfied
all
16
<PAGE> 17
of the conditions on its part to be performed or
satisfied on or before such date;
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued, and no proceeding for that
purpose has been instituted or is threatened by the Commission; and
(iii) since the effective date of the Registration Statement,
there has occurred no event required to be set forth in an amendment or
supplement to the Registration Statement or Prospectus that has not
been so set forth, and there has been no document required to be filed
under the Exchange Act and the rules and regulations thereunder that
upon such filing would be deemed to be incorporated by reference in the
Prospectus that has not been so filed.
The officers signing and delivering such certificate may rely
upon the best of their knowledge as to proceedings threatened.
(d) On the Commencement Date and, if called for by any Terms
Agreement, on the corresponding Settlement Date, Coopers & Lybrand, independent
public accountants, shall have furnished to the relevant Agents a letter or
letters, dated the Commencement Date or such Settlement Date to the effect set
forth in Annex II hereto.
(e) On the Commencement Date and on each Settlement Date, the
Company shall have furnished to the relevant Agents such appropriate further
information, certificates and documents as they may reasonably request.
5. ADDITIONAL AGREEMENTS OF THE COMPANY. (a) Each time the
Registration Statement or Prospectus is amended or supplemented (other than by
an amendment or supplement (i) solely setting forth the terms of any securities
registered thereunder other than the Notes or (ii) providing solely for a change
in the interest rates, redemption provisions, amortization schedules or
maturities offered on the Notes or for a change the Agents deem to be
immaterial), the Company will deliver or cause to be delivered forthwith to each
Agent a certificate, dated the date of such amendment or supplement, as the case
may be, in form reasonably satisfactory to the Agents, of the same tenor as the
certificate referred to in Section 4(c), and signed by officers as required in
such Section, relating to the Registration Statement or the Prospectus as
amended or supplemented to the time of delivery of such certificate.
17
<PAGE> 18
(b) Each time the Company furnishes a certificate pursuant to
Section 5(a), the Company will furnish or cause to be furnished forthwith to
each Agent a written opinion of independent counsel for the Company. Any such
opinion shall be dated the date of such amendment or supplement, as the case may
be, shall be in a form satisfactory to the Agents and shall be of the same tenor
as the opinion referred to in Section 4(b)(i), but modified to relate to the
Registration Statement and the Prospectus as amended and supplemented to the
time of delivery of such opinion. In lieu of such opinion, counsel last
furnishing such an opinion to an Agent may furnish to each Agent a letter to the
effect that such Agent may rely on such last opinion to the same extent as
though it were dated the date of such letter (except that statements in such
last opinion will be deemed to relate to the Registration Statement and the
Prospectus as amended or supplemented to the time of delivery of such letter).
(c) Each time the Registration Statement or the Prospectus is
amended or supplemented to set forth amended or supplemental financial
information or such amended or supplemental information is incorporated by
reference in the Prospectus, the Company shall cause its independent public
accountants forthwith to furnish each Agent with a letter, dated the date of
such amendment or supplement, as the case may be, in form satisfactory to the
Agents, of the same tenor as the letter referred to in Section 4(d), with regard
to the amended or supplemental financial information included or incorporated by
reference in the Registration Statement or the Prospectus as amended or
supplemented to the date of such letter.
6. INDEMNITY AND CONTRIBUTION. (a) The Company agrees to
indemnify and hold harmless each Agent and each person, if any, who controls any
Agent within the meaning of either Section 15 of the Act or Section 20 of the
Exchange Act from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred by any Agent or any such controlling person in connection
with defending or investigating any such action or claim) caused by any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or any amendment thereof or the Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto), or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission or alleged
untrue statement or omission based upon
18
<PAGE> 19
information relating to such Agent furnished to the Company in writing by such
Agent expressly for use therein.
(b) Each Agent agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement and each person, if any, who controls the Company within
the meaning of either Section 15 of the Act or Section 20 of the Exchange Act to
the same extent as the foregoing indemnity from the Company to such Agent, but
only with reference to information relating to such Agent furnished to the
Company in writing by such Agent expressly for use in the Registration Statement
or the Prospectus or any amendments or supplements thereto.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought pursuant to either paragraph (a) or (b) above, such
person (the "indemnified party") shall promptly notify the person against whom
such indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding and
shall pay the fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any indemnified party shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for the fees and expenses of more than one separate firm (in addition
to any local counsel) for all such indemnified parties and that all such fees
and expenses shall be reimbursed as they are incurred. Such firm shall be
designated in writing by Morgan Stanley or, if Morgan Stanley is not an
indemnified party and is not reasonably likely to become an indemnified party,
by the Agents that are indemnified parties, in the case of parties indemnified
pursuant to paragraph (a) above, and by the Company, in the case of parties
indemnified pursuant to paragraph (b) above. The indemnifying party shall not be
liable for any
19
<PAGE> 20
settlement of any proceeding effected without its written consent, but if
settled with such consent or if there be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and against
any loss or liability by reason of such settlement or judgment. Notwithstanding
the foregoing sentence, if at any time an indemnified party shall have requested
an indemnifying party to reimburse the indemnified party for fees and expenses
of counsel as contemplated by the second and third sentences of this paragraph,
the indemnifying party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 30 days after receipt by such indemnifying party of the
aforesaid request and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of such
settlement. No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such
proceeding.
(d) To the extent the indemnification provided for in
paragraph (a) or (b) of this Section 6 is unavailable to an indemnified party or
insufficient in respect of any losses, claims, damages or liabilities referred
to therein in connection with any offering of Notes, then each indemnifying
party under such paragraph, in lieu of indemnifying such indemnified party
thereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages or liabilities (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and each Agent on the other hand from the offering of
such Notes or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and each Agent on the other hand in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and each Agent on the other hand in connection with the offering of such Notes
shall be deemed to be in the same respective proportions as the total net
proceeds from the offering of such Notes (before deducting expenses) received by
the Company bear to the total
20
<PAGE> 21
discounts and commissions received by each Agent in respect thereof. The
relative fault of the Company on the one hand and each Agent on the other hand
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company or by
such Agent and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. Each Agent's
obligation to contribute pursuant to this Section 6 shall be several in the
proportion that the principal amount of the Notes the sale of which by or
through such Agent gave rise to such losses, claims, damages or liabilities
bears to the aggregate principal amount of the Notes the sale of which by or
through any Agent gave rise to such losses, claims, damages or liabilities, and
not joint.
(e) The Company and the Agents agree that it would not be just
or equitable if contribution pursuant to this Section 6 were determined by PRO
RATA allocation (even if the Agents were treated as one entity for such purpose)
or by any other method of allocation that does not take account of the equitable
considerations referred to in paragraph (d) of this Section 6. The amount paid
or payable by an indemnified party as a result of the losses, claims, damages
and liabilities referred to in paragraph (d) of this Section 6 shall be deemed
to include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 6, no Agent shall be required to contribute any
amount in excess of the amount by which the total price at which the Notes
referred to in paragraph (d) of this Section 6 that were offered and sold to the
public through such Agent exceeds the amount of any damages that such Agent has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The remedies provided for in this Section 6 are not exclusive
and shall not limit any rights or remedies which may otherwise be available to
any indemnified party at law or in equity.
(f) The indemnity and contribution provisions contained in
this Section 6, representations, warranties and other statements of the Company,
its officers and the Agents set forth in or made pursuant to this Agreement or
any Terms Agreement will remain in full force and effect regardless of
21
<PAGE> 22
(i) any termination of this Agreement or any such Terms Agreement, (ii) any
investigation made by or on behalf of any Agent or any person controlling any
Agent or by or on behalf of the Company, its officers or directors or any person
controlling the Company and (iii) acceptance of and payment for any of the
Notes.
7. POSITION OF THE AGENTS. In acting under this Agreement and
in connection with the sale of any Notes by the Company (other than Notes sold
to an Agent pursuant to a Terms Agreement), each Agent is acting solely as agent
of the Company and does not assume any obligation towards or relationship of
agency or trust with any purchaser of Notes. An Agent shall make reasonable
efforts to assist the Company in obtaining performance by each purchaser whose
offer to purchase Notes has been solicited by such Agent and accepted by the
Company, but such Agent shall not have any liability to the Company in the event
any such purchase is not consummated for any reason. If the Company shall
default in its obligations to deliver Notes to a purchaser whose offer it has
accepted, the Company shall hold the relevant Agent harmless against any loss,
claim, damage or liability arising from or as a result of such default and
shall, in particular, pay to such Agent the commission it would have received
had such sale been consummated.
8. TERMINATION. This Agreement may be terminated at any time
by the Company or, as to any Agent, by the Company or such Agent upon the giving
of written notice of such termination to the other parties hereto, but without
prejudice to any rights, obligations or liabilities of any party hereto accrued
or incurred prior to such termination. The termination of this Agreement shall
not require termination of any Terms Agreement, and the termination of any such
Terms Agreement shall not require termination of this Agreement. If this
Agreement is terminated, the provisions of the third paragraph of Section 2(a),
Section 2(e), the last sentence of Section 3(b) and Sections 3(c), 3(h), 6, 7,
9, 11 and 13 shall survive; PROVIDED that if at the time of termination an offer
to purchase Notes has been accepted by the Company but the time of delivery to
the purchaser or its agent of such Notes has not occurred, the provisions of
Sections 2(b), 2(c), 3(a), 3(e), 3(f), 3(g), 3(i), 4 and 5 shall also survive
until such delivery has been made.
9. NOTICES. All communications hereunder will be in writing
and effective only on receipt, and, if sent to Morgan Stanley, will be mailed,
delivered or telefaxed and confirmed to Morgan Stanley at 1585 Broadway, 2nd
Floor, New York, New York 10036, Attention: Manager -- Continuously Offered
Products (telefax number: 212-761-0780), with a
22
<PAGE> 23
copy to 1585 Broadway, New York, New York 10036, 36th floor, Attention:
Investment Banking Information Center(telefax number: 212-761-0260), Citicorp
Securities, Inc., 399 Park Avenue, New York, NY 10043, Attention: Managing
Director, Syndicate (telefax number: 212-291-3190) and Salomon Brothers Inc, 7
World Trade Center, New York, New York 10048 (telefax number: 212-783-4120) or,
if sent to the Company, will be mailed, delivered or telefaxed and confirmed to
the Company at 6035 Parkland Boulevard, Cleveland, Ohio 44124, Attention:
Treasurer (telefax number (216) 481-4057).
10. SUCCESSORS. This Agreement and any Terms Agreement will
inure to the benefit of and be binding upon the parties hereto and their
respective successors and the officers, directors and controlling persons
referred to in Section 6 and the purchasers of Notes (to the extent expressly
provided in Section 4), and no other person will have any right or obligation
hereunder.
11. AMENDMENTS. This Agreement may be amended or supplemented
if, but only if, such amendment or supplement is in writing and is signed by the
Company and each Agent; PROVIDED that the Company may from time to time, on
seven days prior written notice to the Agents but without the consent of any
Agent, amend this Agreement to add as a party hereto one or more additional
firms registered under the Exchange Act, whereupon each such firm shall become
an Agent hereunder on the same terms and conditions as the other Agents that are
parties hereto. The Agents shall sign any amendment or supplement giving effect
to the addition of any such firm as an Agent under this Agreement.
12. COUNTERPARTS. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
13. APPLICABLE LAW. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York.
14. HEADINGS. The headings of the sections of this Agreement
have been inserted for convenience of reference only and shall not be deemed a
part of this Agreement.
23
<PAGE> 24
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
between the Company and you.
Very truly yours,
PARKER-HANNIFIN CORPORATION
By
------------------------------
Name: Joseph D. Whiteman
Title: Vice President, General
Counsel and Secretary
The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
MORGAN STANLEY & CO. INCORPORATED
By
------------------------------
Name:
Title:
CITICORP SECURITIES, INC.
By
------------------------------
Name:
Title:
SALOMON BROTHERS INC
By
------------------------------
Name:
Title:
24
<PAGE> 25
ANNEX I
(1) The Indenture has been duly authorized, executed and
delivered by the Company and duly qualified under the Trust Indenture
Act of 1939 and is a valid and binding instrument of the Company,
enforceable against the Company in accordance with its terms, subject
to the effect of (i) general principles of equity, regardless of
whether such enforceability is considered in a proceeding in equity or
at law, and (ii) any applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors' rights generally.
(2) The Notes have been duly authorized and, if executed and
authenticated in accordance with the provisions of the Indenture and
delivered to and paid for by the purchasers thereof on the date of such
opinion, would be valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms, subject
to the effect of (i) general principles of equity, regardless of
whether such enforceability is considered in a proceeding in equity or
at law, and (ii) any applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors' rights generally.
(3) Each of the Distribution Agreement and, if applicable, any
Written Terms Agreement has been duly authorized, executed and
delivered by the Company.
(4) Neither the execution and delivery of the Distribution
Agreement nor the performance of the transactions therein contemplated
will result in the violation of any statute or regulation or any order
or decree of any court or governmental authority known to us which is
binding upon the Company or its property, or conflict with or result in
a default under any of the terms and provisions of the Company's
Amended Articles of Incorporation or Code of Regulations or any
indenture, loan agreement or any agreement listed on EXHIBIT A attached
hereto.
(5) No consent, approval, authorization or order or any
governmental agency or body is required for the issuance or sale by the
Company of the Notes, except such as have been obtained
-1-
<PAGE> 26
under the Act and the Trust Indenture Act and such as may be required
under state securities or Blue Sky laws in connection with the purchase
and distribution of the Notes by the Agents.
We have participated in the preparation of the Registration
Statement and Prospectus (certain of the documents incorporated into the
Prospectus by reference having previously been prepared and filed by the Company
without our participation). From time to time we have had discussions with
officers and employees of the Company, accountants and auditors, the independent
accountants who examined certain of the financial statements of the Company and
its consolidated subsidiaries included in the Registration Statement and
Prospectus, and your representatives concerning the information contained in the
Registration Statement and Prospectus and the proposed responses to various
items in Form S-3. Based thereupon we are of the opinion that the Registration
Statement and the Prospectus (except for financial statements, financial
schedules, and other financial data included therein, as to which we express no
opinion) at the time the Registration Statement became effective under the Act
complied as to form in all material respects with the Act and the Trust
Indenture Act and the respective rules and regulations thereunder, and that the
documents incorporated or deemed to be incorporated by reference into the
Prospectus that were filed prior to the date of this opinion (except for
financial statements, financial schedules, and other financial data included
therein, as to which we express no opinion) at the time they were filed complied
as to form in all material respects with the requirements of the Exchange Act
and the rules and regulations thereunder.
-2-
<PAGE> 27
We do not know of any litigation or governmental proceedings
required to be described in the Prospectus that are not described as required,
or of any contracts or other documents of a character required to be described
in the Registration Statement or Prospectus or to be filed as exhibits to the
Registration Statement which are not described and filed as required. The
descriptions in the Registration Statement and Prospectus of statutes, legal and
governmental proceedings, contracts and other documents present fair summaries
of such statutes, legal and governmental proceedings, contracts or other
documents. We further are of the opinion that the statements contained in the
Prospectus under the caption "Description of Senior Debt Securities" and "United
States Taxation," insofar as they purport to summarize the provisions of
documents or the Unites States Federal tax laws described therein, present fair
summaries of such provisions or such United States Federal tax laws.
The Registration Statement has become effective under the Act,
and to the best of our knowledge, no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceeding for that purpose or
challenging the accuracy of any document incorporated by reference into the
Prospectus are pending or, to the best of our knowledge, threatened by the
Commission.
We have not independently verified and are not passing upon,
and do not assume any responsibility for, the accuracy, completeness or fairness
(except as set forth in the second preceding paragraph above) of the information
contained in the Registration Statement and Prospectus, including any document
incorporated or deemed to be incorporated therein by reference. Based upon the
participation and discussions described above, however, no facts have come to
our attention that cause us to believe that the Registration Statement (except
for financial statements, financial schedules, and other financial date included
therein), at the time it became effective contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein not misleading, or that the
Prospectus (with the foregoing exceptions), on the date of the Prospectus and
the Commencement Date, contained or contains any untrue statement of a material
fact or omitted or omits to state a material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
-3-
<PAGE> 28
ANNEX II
(1) They are independent certified public accountants with
respect to the Company and its subsidiaries within the meaning of the
Act and the published rules and regulations thereunder.
(2) In their opinion, the consolidated financial statements
and schedules audited by them and included or incorporated by reference
in the Registration Statement and Prospectus comply as to form in all
material respects with the applicable accounting requirements of the
Act or the Exchange Act, as applicable, and the published rules and
regulations thereunder.
(3) On the basis of procedures referred to in such letter,
including a reading of the latest available interim financial
statements of the Company and inquiries of officials of the Company
responsible for financial and accounting matters, nothing caused them
to believe that:
(A) any unaudited financial statements included or
incorporated in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements
of the Exchange Act and the published rules and regulations
thereunder or are not stated on a basis substantially
consistent with that of the audited financial statements
included in the Company's most recent Annual Report on Form
10-K; or
(B) at a specified date not more than five days prior
to the date of such letter, there was any change in the
capital stock, short-term debt or long-term debt of the
Company and its subsidiaries or any decrease in consolidated
net current assets or net assets as compared with amounts
shown in the most recent unaudited balance sheet included or
incorporated by reference in the Prospectus, except in all
cases for changes or decreases which the Prospectus discloses
have occurred or may occur or as may be set forth in such
letter; or
(C) for the period from the date of the most recent
unaudited balance sheet included or incorporated by reference
in the Prospectus to a subsequent specified date not more than
five days prior to the date of such letter, there was any
decrease, as compared with the corresponding period of the
previous year and with the period of corresponding length
ended the date of such
<PAGE> 29
unaudited balance sheet, in consolidated net sales,
consolidated net income before taxes, or net income, except in
all cases for changes or decreases which the Prospectus
discloses have occurred or may occur or as may be set forth in
such letter.
(4) In addition to their examination referred to in their
report included or incorporated by reference in the Registration
Statement and Prospectus and the procedures referred to in (3) above,
they have carried out certain other specified procedures, not
constituting an audit, with respect to certain of the dollar amounts,
percentages and other financial information to bc agreed upon by the
Company and the Underwriters (in each case to the extent that such
dollar amounts, percentages and other financial information, are
derived directly or by analysis or computation, from the general
accounting records of the Company and its subsidiaries) that are
included or incorporated by reference in the Prospectus and appear or
are incorporated by reference in the Company's Annual Report on Form
10-K under the captions "Item 1. -- Business", "Item 6. -- Selected
Financial Data", and "Item 7. -- Management's Discussion and Analysis
of Financial Condition and Results of Operations", and have found such
dollar amounts, percentages and financial information to be in
agreement with the general accounting records of the Company and its
subsidiaries.
-2-
<PAGE> 30
EXHIBIT A
PARKER-HANNIFIN CORPORATION
MEDIUM-TERM NOTES
TERMS AGREEMENT
_______ __, 199_
PARKER-HANNIFIN CORPORATION
6035 Parkland Boulevard
Cleveland, OH 44124
Attention:
Re: Distribution Agreement dated
[ ]
---------
(the "Distribution Agreement")
------------------------------
We agree to purchase your Medium-Term Notes having the
following terms:
[We agree to purchase, severally and not jointly, the
principal amount of Notes set forth below opposite our names:
Principal Amount
Name of Notes
---- ----------------
[Name of relevant Agent(s)]
[Insert syndicate list]1
Total . . . . . . $
===========
- --------
Delete if the transaction will not be syndicated.
A-1
<PAGE> 31
The Notes shall have the following terms:
All Notes: Fixed Rate Notes: Floating Rate
- ---------- ----------------- -------------
Notes:
- ------
Principal amount: Interest Rate: Base rate:
Purchase price: Applicability Index maturity:
of modified
Price to public: payment upon Spread:
acceleration:
Settlement date Spread
multiplier:
and time: If yes, state
issue price: Alternate rate
Place of event spread:
delivery: Amortization
schedule: Initial interest
Specified rate:
currency:
Initial interest
Maturity date: reset date:
Initial accrual Interest reset
period OID: dates:
Total amount Interest reset
of OID: period:
Original yield Maximum interest
to maturity: rate:
Optional repayment Minimum interest
date(s): rate:
Optional redemption Interest payment
date(s): period:
Initial redemption Interest payment
date: dates:
Initial redemption Calculation agent:
percentage:
Annual redemption
percentage
decrease:
Other terms:
A-2
<PAGE> 32
The provisions of Sections 1, 2(b) and 2(c) and 3 through 6,
9, 10, 11 and 13 of the Distribution Agreement and the related definitions are
incorporated by reference herein and shall be deemed to have the same force and
effect as if set forth in full herein.
[If on the Settlement Date any one or more of the Agents shall
fail or refuse to purchase Notes that it has or they have agreed to purchase on
such date, and the aggregate amount of Notes which such defaulting Agent or
Agents agreed but failed or refused to purchase is not more than one-tenth of
the aggregate amount of the Notes to be purchased on such date, the other Agents
shall be obligated severally in the proportions that the amount of Notes set
forth opposite their respective names above bears to the aggregate amount of
Notes set forth opposite the names of all such non-defaulting Agents, or in such
other proportions as _____________ may specify, to purchase the Notes which such
defaulting Agent or Agents agreed but failed or refused to purchase on such
date; PROVIDED that in no event shall the amount of Notes that any Agent has
agreed to purchase pursuant to this Agreement be increased pursuant to this
paragraph by an amount in excess of one-ninth of such amount of Notes without
the written consent of such Agent. If on the Settlement Date any Agent or Agents
shall fail or refuse to purchase Notes and the aggregate amount of Notes with
respect to which such default occurs is more than one-tenth of the aggregate
amount of Notes to be purchased on such date, and arrangements satisfactory to
___________ and the Company for the purchase of such Notes are not made within
36 hours after such default, this Agreement shall terminate without liability on
the part of any non-defaulting Agent or the Company. In any such case either
___________ or the Company shall have the right to postpone the Settlement Date
but in no event for longer than seven days, in order that the required changes,
if any, in the Registration Statement and in the Prospectus or in any other
documents or arrangements may be effected. Any action taken under this paragraph
shall not relieve any defaulting Agent from
A-3
<PAGE> 33
liability in respect of any default of such Agent under this Agreement.]2
This Agreement is subject to termination on the terms
incorporated by reference herein. If this Agreement is so terminated, the
provisions of Sections 3(h), 6, 9, 11 and 13 of the Distribution Agreement shall
survive for the purposes of this Agreement.
The following information, opinions, certificates, letters and
documents referred to in Section 4 of the Distribution Agreement will be
required: ________________
[NAME OF RELEVANT AGENT(S)]
By
---------------------------------
Name
Title:
Accepted:
PARKER-HANNIFIN CORPORATION
By
---------------------------
Name:
Title:
- --------
Delete if the transaction will not be syndicated.
A-4
<PAGE> 34
EXHIBIT B
PARKER-HANNIFIN CORPORATION
MEDIUM-TERM NOTES
ADMINISTRATIVE PROCEDURES
---------------------------------
Explained below are the administrative procedures and specific terms
of the offering of Medium-Term Notes (the "Notes"), on a continuous basis by
PARKER-HANNIFIN CORPORATION (the "Company") pursuant to the Distribution
Agreement, dated as of [____________](the "Distribution Agreement") among the
Company and Morgan Stanley & Co. Incorporated, Citicorp Securities, Inc. and
Salomon Brothers Inc (the "Agents"). The Notes will be issued under an Indenture
dated as of May 3, 1996 (the "Indenture") between the Company and National City
Bank, as trustee (the "Trustee"). In the Distribution Agreement, the Agents have
agreed to use reasonable efforts to solicit purchases of the Notes, and the
administrative procedures explained below will govern the issuance and
settlement of any Notes sold through an Agent, as agent of the Company. An
Agent, as principal, may also purchase Notes for its own account, and if
requested by such Agent, the Company and such Agent will enter into a terms
agreement (a "Terms Agreement"), as contemplated by the Distribution Agreement.
The administrative procedures explained below will govern the issuance and
settlement of any Notes purchased by an Agent, as principal, unless otherwise
specified in the applicable Terms Agreement.
The Trustee will be the Registrar, Calculation Agent, Authenticating
Agent and Paying Agent for the Notes and will perform the duties specified
herein. Each Note will be represented by either a Global Security (as defined
below) delivered to the Trustee, as agent for The Depository Trust Company
("DTC"), and recorded in the book-entry system maintained by DTC (a "Book-Entry
Note") or a certificate delivered to the holder thereof or a person designated
by
B-1
<PAGE> 35
such holder (a "Certificated Note"). Except as set forth in the Indenture, an
owner of a Book-Entry Note will not be entitled to receive a Certificated Note.
Book-Entry Notes, which may be payable only in U.S. dollars, will be
issued in accordance with the administrative procedures set forth in Part I
hereof as they may subsequently be amended as the result of changes in DTC'S
operating procedures. Certificated Notes will be issued in accordance with the
administrative procedures set forth in Part II hereof. Unless otherwise defined
herein, terms defined in the Indenture, the Notes or any prospectus supplement
relating to the Notes shall be used herein as therein defined.
The Company will advise the Agents in writing of the employees of the
Company with whom the Agents are to communicate regarding offers to purchase
Notes and the related settlement details.
PART I: ADMINISTRATIVE PROCEDURES FOR BOOK-ENTRY NOTES
In connection with the qualification of the Book-Entry Notes for
eligibility in the book-entry system maintained by DTC, the Trustee will perform
the custodial, document control and administrative functions described below, in
accordance with its respective obligations under a Letter of Representation from
the Company and the Trustee to DTC, dated as of June 3, 1996, and a Medium-Term
Note Certificate Agreement between the Trustee and DTC, dated as of March 22,
1989 (the "MTN Certificate Agreement"), and its obligations as a participant in
DTC, including DTC's Same-Day Funds Settlement System ("SDFS").
Issuance: On any date of settlement (as defined
under "Settlement" below) for one or
more Book-Entry Notes, the Company will
issue a single global security in fully
registered form without coupons (a
"Global Security") representing up to
U.S. $200,000,000 principal amount of
all such Notes that have the same
Original Issue Date, Maturity Date and
other terms. Each Global Security will
be dated and issued as of the date of
its authentication by the Trustee. Each
Global Security will bear an "Interest
Accrual Date," which will be (i) with
respect to an original Global Security
B-2
<PAGE> 36
(or any portion thereof), its original
issuance date and (ii) with respect to any
Global Security (or any portion thereof)
issued subsequently upon exchange of a
Global Security, or in lieu of a destroyed,
lost or stolen Global Security, the most
recent Interest Payment Date to which
interest has been paid or duly provided for
on the predecessor Global Security (or if no
such payment or provision has been made, the
original issuance date of the predecessor
Global Security), regardless of the date of
authentication of such subsequently issued
Global Security. Book-Entry Notes may be
payable only in U.S. dollars. No Global
Security will represent any Certificated
Note.
Denominations: Book-Entry Notes will be issued in principal
amounts of U.S. $1,000 or any amount in
excess thereof that is an integral multiple
of U.S. $1,000. Global Securities will be
denominated in principal amounts not in
excess of U.S. $200,000,000. If one or more
Book-Entry Notes having an aggregate
principal amount in excess of $200,000,000
would, but for the preceding sentence, be
represented by a single Global Security,
then one Global Security will be issued to
represent each U.S. $200,000,000 principal
amount of such Book-Entry Note or Notes and
an additional Global Security will be issued
to represent any remaining principal amount
of such Book-Entry Note or Notes. In such a
case, each of the Global Securities
representing such Book-Entry Note or Notes
shall be assigned the same CUSIP number.
Preparation If any offer to purchase a Book-
of Pricing Entry Note is accepted by or on
Supplement: behalf of the Company, the Company
will prepare a pricing supplement (a
"Pricing Supplement") reflecting the terms
of such Note. The Company (i) will arrange
to file such Pricing Supplement with the
Commission in accordance with the applicable
paragraph
B-3
<PAGE> 37
of Rule 424(b) under the Act and (ii) will,
as soon as possible and in any event not
later than the date on which such Pricing
Supplement is filed with the Commission,
deliver the number of copies of such Pricing
Supplement to the relevant Agent as such
Agent shall request.
In each instance that a Pricing Supplement
is prepared, the relevant Agent will affix
the Pricing Supplement to Prospectuses prior
to their use. Outdated Pricing Supplements,
and the Prospectuses to which they are
attached (other than those retained for
files), will be destroyed.
Settlement: The receipt by the Company of immediately
available funds in payment for a Book-Entry
Note and the authentication and issuance of
the Global Security representing such Note
shall constitute "settlement" with respect
to such Note. All offers accepted by the
Company will be settled on the third
Business Day next succeeding the date of
acceptance, unless the Company accepts an
offer to purchase Notes after 4:30 p.m. on
such date in which case settlement will
occur on the fourth Business Day next
succeeding such date of acceptance, pursuant
to the timetable for settlement set forth
below, unless the Company and the purchaser
agree to settlement on another day, which
shall be no earlier than the next Business
Day.
Settlement Settlement Procedures with regard
Procedures: to each Book-Entry Note sold by the
Company to or through an Agent (unless
otherwise specified pursuant to a Terms
Agreement) shall be as follows:
A. The relevant Agent will advise the
Company by telephone that such Note is
a Book-Entry Note and of the following
settlement information:
B-4
<PAGE> 38
1. Principal amount.
2. Maturity Date.
3. In the case of a Fixed
Book-Entry Note, the Interest
Rate, whether such Note will pay
interest annually or semiannually
and whether such Note is an
Amortizing Note, and, if so, the
amortization schedule, or, in the
case of a Floating Rate Book-Entry
Note, the Initial Interest Rate
(if known at such time), Interest
Payment Date(s), Interest Payment
Period, Calculation Agent, Base
Rate, Index Maturity, Interest
Reset Period, Initial Interest
Reset Date, Interest Reset Dates,
Spread or Spread Multiplier (if
any), Minimum Interest Rate (if
any), Maximum Interest Rate (if
any) and the Alternate Rate Event
Spread (if any).
4. Redemption or repayment
provisions (if any).
5. Settlement date and time
(Original Issue Date).
6. Interest Accrual Date.
7. Price.
8. Agent's commission (if any)
determined as provided in the
Distribution Agreement.
9. Whether the Note is an Original
Issue Discount Note (an "OID
Note"), and if it is an OID Note,
the total amount of OID, the yield
to maturity, the initial accrual
period OID and the applicability
of Modified Payment upon
B-5
<PAGE> 39
Acceleration (and, if so, the
Issue Price).
10. Whether the Note is an Indexed
Note, and if it is an Indexed
Note, the Denominated Currency,
the Indexed Currency or
Currencies, the Payment Currency,
the Exchange Rate Agent, the
Reference Dealers, the Face
Amount, the Fixed Amount of each
Indexed Currency, the Aggregate
Fixed Amount of each Indexed
Currency and the Authorized
Denominations (if other than U.S.
dollars).
11. Whether the Note is a
Renewable Note, and if it is a
Renewable Note, the Initial
Maturity Date and the Final
Maturity Date.
12. Whether the Company has the to
extend the Original Maturity Date
of the Note, and, if so, the Final
Maturity Date of such Note.
13. Whether the Company has the
option to reset the Interest Rate,
the Spread or the Spread
Multiplier of the Note.
14. Any other applicable terms.
B. The Company will advise the Trustee
by telephone or electronic transmission
(confirmed in writing at any time on
the same date) of the information set
forth in Settlement Procedure "A"
above. The Trustee will then assign a
CUSIP number to the Global Security
representing such Note and will notify
the Company and the relevant
B-6
<PAGE> 40
Agent of such CUSIP number by telephone
as soon as practicable.
C. The Trustee will enter a pending
deposit message through DTC's
Participant Terminal System, providing
the following settlement information to
DTC, the relevant Agent and Standard &
Poor's Corporation:
1. The information set forth in
Settlement Procedure "A".
2. The Initial Interest Payment
Date for such Note, the number of
days by which such date succeeds
the related DTC Record Date (which
in the case of Floating Rate Notes
which reset daily or weekly, shall
be the date five calendar days
immediately preceding the
applicable Interest Payment Date
and, in the case of all other
Notes, shall be the Record Date as
defined in the Note) and, if
known, the amount of interest
payable on such Initial Interest
Payment Date.
3. The CUSIP number of the Global
Security representing such Note.
4. Whether such Global Security
will represent any other
Book-Entry Note (to the extent
known at such time).
5. Whether such Note is an
Amortizing Note (by an appropriate
notation in the comments field of
DTC's Participant Terminal
System).
6. The number of participant
accounts to be maintained by DTC
on behalf of the relevant Agent
and the Trustee.
B-7
<PAGE> 41
D. The Trustee will complete and
authenticate the Global Security
representing such Note.
E. DTC will credit such Note to the
Trustee's participant account at DTC.
F. The Trustee will enter an SDFS
deliver order through DTC's Participant
Terminal System instructing DTC to (i)
debit such Note to the Trustee's
participant account and credit such
Note to the relevant Agent's
participant account and (ii) debit such
Agent's settlement account and credit
the Trustee's settlement account for an
amount equal to the price of such Note
less such Agent's commission (if any).
The entry of such a deliver order shall
constitute a representation and
warranty by the Trustee to DTC that (a)
the Global Security representing such
Book-Entry Note has been issued and
authenticated and (b) the Trustee is
holding such Global Security pursuant
to the MTN Certificate Agreement.
G. Unless the relevant Agent is the end
purchaser of such Note, such Agent will
enter an SDFS deliver order through
DTC's Participant Terminal System
instructing DTC (i) to debit such Note
to such Agent's participant account and
credit such Note to the participant
accounts of the Participants with
respect to such Note and (ii) to debit
the settlement accounts of such
Participants and credit the settlement
account of such Agent for an amount
equal to the price of such Note.
H. Transfers of funds in accordance
with SDFS deliver orders described in
Settlement Procedures
B-8
<PAGE> 42
"F" and "G" will be settled in
accordance with SDFS operating
procedures in effect on the settlement
date.
I. The Trustee will credit to the
account of the Company maintained at
KeyBank National Association,
Cleveland, Ohio, in immediately
available funds the amount transferred
to the Trustee in accordance with
Settlement Procedure "F".
J. Unless the relevant Agent is the end
purchaser of such Note, such Agent will
confirm the purchase of such Note to
the purchaser either by transmitting to
the Participants with respect to such
Note a confirmation order or orders
through DTC's institutional delivery
system or by mailing a written
confirmation to such purchaser.
K. Monthly, the Trustee will send to
the Company a statement setting forth
the principal amount of Notes
outstanding as of that date under the
Indenture and setting forth a brief
description of any sales of which the
Company has advised the Trustee that
have not yet been settled.
Settlement For sales by the Company of Book-
Procedures Entry Notes to or through an Agent
Timetable: (unless otherwise specified pursuant to
a Terms Agreement) for settlement on the
first Business Day after the sale date,
Settlement Procedures "A" through "J" set
forth above shall be completed as soon as
possible but not later than the respective
times in New York City set forth below:
Settlement
Procedure Time
--------- ----
A 11:00 A.M. on sale date
B-9
<PAGE> 43
B 12:00 Noon on sale date
C 2:00 P.M. on sale date
D 9:00 A.M. on settlement date
E 10:00 A.M. on settlement date
F-G 2:00 P.M. on settlement date
H 4:45 P.M. on settlement date
I-J 5:00 P.M. on settlement date
If a sale is to be settled more than a
Business Day after the sale date,
Settlement Procedures "A", "B" and "C"
shall be completed as soon as
practicable but no later than 11:00
A.M., 12:00 Noon and 2:00 P.M.,
respectively, on the first Business Day
after the sale date. If the Initial
Interest Rate for a Floating Rate
Book-Entry Note has not been determined
at the time that Settlement Procedure
"A" is completed, Settlement Procedures
"B" and "C" shall be completed as soon
as such rate has been determined but no
later than 12:00 Noon and 2:00 P.M.,
respectively, on the first Business Day
before the settlement date. Settlement
Procedure "H" is subject to extension
in accordance with any extension of
Fedwire closing deadlines and in the
other events specified in the SDFS
operating procedures in effect on the
settlement date.
If settlement of a Book-Entry Note is
rescheduled or cancelled, the Trustee,
after receiving notice from the Company
or the relevant Agent, will deliver to
DTC, through DTC's Participant Terminal
System, a cancellation message to such
effect by no later than 2:00 P.M. on
the Business Day immediately preceding
the scheduled settlement date.
Failure If the Trustee fails to enter an
to Settle: SDFS deliver order with respect to a
Book-Entry Note pursuant to Settlement
Procedure "F", the Trustee may deliver
to DTC, through DTC's Participant
Terminal System, as soon as practicable
a withdrawal message instructing DTC to
debit such Note to the Trustee's
participant account, provided that the
B-10
<PAGE> 44
Trustee's participant account contains
a principal amount of the Global
Security representing such Note that is
at least equal to the principal amount
to be debited. If a withdrawal message
is processed with respect to all the
Book-Entry Notes represented by a
Global Security, the Trustee will mark
such Global Security "cancelled," make
appropriate entries in the Trustee's
records and send such cancelled Global
Security to the Company. The CUSIP
number assigned to such Global Security
shall, in accordance with the
procedures of the CUSIP Service Bureau
of Standard & Poor's Corporation, be
cancelled and not immediately
reassigned. If a withdrawal message is
processed with respect to one or more,
but not all, of the Book-Entry Notes
represented by a Global Security, the
Trustee will exchange such Global
Security for two Global Securities, one
of which shall represent such
Book-Entry Note or Notes and shall be
cancelled immediately after issuance
and the other of which shall represent
the remaining Book-Entry Notes
previously represented by the
surrendered Global Security and shall
bear the CUSIP number of the
surrendered Global Security.
If the purchase price for any
Book-Entry Note is not timely paid to
the Participants with respect to such
Note by the beneficial purchaser
thereof (or a person, including an
indirect participant in DTC, acting on
behalf of such purchaser), such
Participants and, in turn, the relevant
Agent may enter SDFS deliver orders
through DTC's Participant Terminal
System reversing the orders entered
pursuant to Settlement Procedures "F"
and "G", respectively. Thereafter, the
Trustee will deliver the withdrawal
message and take the related actions
described in the preceding paragraph.
Notwithstanding the foregoing, upon any
failure to settle with respect to a
B-11
<PAGE> 45
Book-Entry Note, DTC may take any
actions in accordance with its SDFS
operating procedures then in effect.
In the event of a failure to settle
with respect to one or more, but not
all, of the Book-Entry Notes to have
been represented by a Global Security,
the Trustee will provide, in accordance
with Settlement Procedures "D" and "F",
for the authentication and issuance of
a Global Security representing the
Book-Entry Notes to be represented by
such Global Security and will make
appropriate entries in its records.
B-12
<PAGE> 46
PART II: ADMINISTRATIVE PROCEDURES FOR CERTIFICATED NOTES
The Trustee will serve as Registrar in connection with the
Certificated Notes.
Issuance: Each Certificated Note will be dated and issued as of the date
of its authentication by the Trustee. Each Certificated Note
will bear an Original Issue Date, which will be (i) with
respect to an original Certificated Note (or any portion
thereof), its original issuance date (which will be the
settlement date) and (ii) with respect to any Certificated
Note (or portion thereof) issued subsequently upon transfer or
exchange of a Certificated Note or in lieu of a destroyed,
lost or stolen Certificated Note, the original issuance date
of the predecessor Certificated Note, regardless of the date
of authentication of such subsequently issued Certificated
Note.
Preparation If any offer to purchase a Certificated Note is accepted by or
of Pricing on behalf of the Company, the Company will prepare a Pricing
Supplement: Supplement reflecting the terms of such Note. The Company (i)
will arrange to file such Pricing Supplement with the
Commission in accordance with the applicable paragraph of Rule
424(b) under the Act and (ii) will, as soon as possible and in
any event not later than the date on which such Pricing
Supplement is filed with the Commission, deliver the number of
copies of such Pricing Supplement to the relevant Agent as
such Agent shall request.
In each instance that a Pricing Supplement is prepared, the
relevant Agent will affix the Pricing Supplement to
Prospectuses prior to their use. Outdated Pricing Supplements,
and the Prospectuses to which they are attached (other than
those retained for files), will be destroyed.
B-13
<PAGE> 47
Settlement: The receipt by the Company of immediately available funds in
exchange for an authenticated Certificated Note delivered to
the relevant Agent and such Agent's delivery of such Note
against receipt of immediately available funds shall
constitute "settlement" with respect to such Note. All offers
accepted by the Company will be settled on the third Business
Day next succeeding the date of acceptance, unless the Company
accepts an offer to purchase Notes after 4:30 p.m. on
such date in which case settlement will occur on the fourth
Business Day next succeeding such date of acceptance, pursuant
to the timetable for settlement set forth below, unless the
Company and the purchaser agree to settlement on another date,
which date shall be no earlier than the next Business Day.
Settlement Settlement Procedures with regard to each Certificated Note
Procedures: sold by the Company to or through an Agent (unless otherwise
specified pursuant to a Terms Agreement) shall be as follows:
A. The relevant Agent will advise the Company by
telephone that such Note is a Certificated Note and
of the following settlement information:
1. Name in which such Note is to be registered
("Registered Owner").
2. Address of the Registered Owner and address
for payment of principal and interest.
3. Taxpayer identification number of the
Registered Owner (if available).
4. Principal amount.
5. Maturity Date.
B-14
<PAGE> 48
6. In the case of a Fixed Rate Certificated
Note, the Interest Rate, whether such Note will
pay interest annually or semiannually and
whether such Note is an Amortizing Note and, if
so, the amortization schedule, or, in the case
of a Floating Rate Certificated Note, the
Initial Interest Rate (if known at such time),
Interest Payment Date(s), Interest Payment
Period, Calculation Agent, Base Rate, Index
Maturity, Interest Reset Period, Initial
Interest Reset Date, Interest Reset Dates,
Spread or Spread Multiplier (if any), Minimum
Interest Rate (if any), Maximum Interest Rate
(if any) and the Alternate Rate Event Spread
(if any).
7. Redemption or repayment provisions (if any).
8. Settlement date and time (Original Issue
Date).
9. Interest Accrual Date.
10. Price.
11. Agent's commission (if any) determined as
provided in the Distribution Agreement.
12. Denominations.
13. Specified Currency.
14. Whether the Note is an OID Note, and if it
is an OID Note, the total amount of OID, the
yield to maturity, the initial accrual period
OID and the applicability of Modified Payment
upon Acceleration (and if so, the Issue Price).
B-15
<PAGE> 49
15. Whether the Note is an Indexed Note, and if
it is an Indexed Note, the Denominated
Currency, the Indexed Currency or Currencies,
the Payment Currency, the Exchange Rate Agent,
the Reference Dealers, the Face Amount, the
Fixed Amount of each Indexed Currency, the
Aggregate Fixed Amount of each Indexed Currency
and the Authorized Denominations (if other than
U.S. dollars).
16. Whether the Note is a Renewable Note, and
if it is a Renewable Note, the Initial Maturity
Date and the Final Maturity Date.
17. Whether the Company has the option to
extend the Original Maturity Date of the Note,
and, if so, the Final Maturity Date of such
Note.
18. Whether the Company has the option to reset
the Interest Rate, the Spread or the Spread
Multiplier of the Note.
19. Any other applicable terms.
B. The Company will advise the Trustee by telephone
or electronic transmission (confirmed in writing at
any time on the same date) of the information set
forth in Settlement Procedure "A" above.
C. The Company will have delivered to the Trustee a
pre-printed four-ply packet for such Note, which
packet will contain the following documents in forms
that have been approved by the Company, the relevant
Agent and the Trustee:
B-16
<PAGE> 50
1. Note with customer confirmation.
2. Stub One - For the Trustee.
3. Stub Two - For the relevant Agent.
4. Stub Three - For the Company.
D. The Trustee will complete such Note and
authenticate such Note and deliver it (with the
confirmation) and Stubs One and Two to the relevant
Agent, and such Agent will acknowledge receipt of
the Note by stamping or otherwise marking Stub One
and returning it to the Trustee. Such delivery will
be made only against such acknowledgment of receipt
and evidence that instructions have been given by
such Agent for payment to the account of the Company
at KeyBank National Association, Cleveland, Ohio, or
to such other account as the Company shall have
specified to such Agent and the Trustee, in
immediately available funds, of an amount equal to
the price of such Note less such Agent's commission
(if any). In the event that the instructions given
by such Agent for payment to the account of the
Company are revoked, the Company will as promptly as
possible wire transfer to the account of such Agent
an amount of immediately available funds equal to
the amount of such payment made.
E. Unless the relevant Agent is the end purchaser of
such Note, such Agent will deliver such Note (with
confirmation) to the customer against payment in
immediately available funds. Such Agent will obtain
the acknowledgment of
B-17
<PAGE> 51
receipt of such Note by retaining
Stub Two.
F. The Trustee will send Stub Three to the Company by
first-class mail. Monthly, the Trustee will also send
to the Company a statement setting forth the
principal amount of the Notes outstanding as of that
date under the Indenture and setting forth a brief
description of any sales of which the Company has
advised the Trustee that have not yet been settled.
Settlement For sales by the Company of Certificated Notes to or through
Procedures an Agent (unless otherwise specified pursuant to
Timetable: a Terms Agreement), Settlement Procedures "A" through "F" set
forth above shall be completed on or before the respective
times in New York City set forth below:
Settlement
Procedure Time
---------- ----
A 2:00 P.M. on day before
settlement date
B 3:00 P.M. on day before
settlement date
C-D 2:15 P.M. on settlement
date
E 3:00 P.M. on settlement
date
F 5:00 P.M. on settlement
date
Failure
to Settle: If a purchaser fails to accept delivery of and make
payment for any Certificated Note, the relevant
Agent will notify the Company and the Trustee by
telephone and return such Note to the Trustee. Upon
receipt of such notice, the Company will immediately
wire transfer to the account of such Agent an amount
equal to the price of such Note less such Agent's
commission in respect of such Note (if any). Such
wire transfer will be made
B-18
<PAGE> 52
on the settlement date, if possible, and in any event not
later than the Business Day following the settlement date. If
the failure shall have occurred for any reason other than a
default by such Agent in the performance of its obligations
hereunder and under the Distribution Agreement, then the
Company will reimburse such Agent or the Trustee, as
appropriate, on an equitable basis for its loss of the use of
the funds during the period when they were credited to the
account of the Company. Immediately upon receipt of the
Certificated Note in respect of which such failure occurred,
the Trustee will mark such Note "cancelled," make appropriate
entries in the Trustee's records and send such Note to the
Company.
B-19
<PAGE> 1
Exhibit 4.1
PARKER-HANNIFIN CORPORATION
TO
NATIONAL CITY BANK
-----
INDENTURE
Dated as of May 3, 1996
-----
<PAGE> 2
PARKER-HANNIFIN CORPORATION
Reconciliation and tie between Trust Indenture Act of 1939 and
Indenture, dated as of May 3, 1996
<TABLE>
<CAPTION>
Trust Indenture
Act Section Indenture Section
<S> <C>
Section 310(a)(1)...............................................................................................609
(a)(2).................................................................................................609
(a)(3)......................................................................................Not Applicable
(a)(4)......................................................................................Not Applicable
(b)....................................................................................................608
610
Section 311(a)..................................................................................................613
(b)....................................................................................................613
Section 312(a)..................................................................................................701
702
(b)....................................................................................................702
(c)....................................................................................................702
Section 313(a)..................................................................................................703
(b)....................................................................................................703
(c)...............................................................................................703, 703
(d)....................................................................................................703
Section 314(a)..................................................................................................704
(b).........................................................................................Not Applicable
(c)(1).................................................................................................102
(c)(2).................................................................................................102
(c)(3)......................................................................................Not Applicable
(d).........................................................................................Not Applicable
(e)....................................................................................................102
Section 315(a)..................................................................................................601
(b)....................................................................................................602
703
(c)....................................................................................................601
(d)....................................................................................................601
(d)(1).................................................................................................601
(d)(2).................................................................................................601
(d)(3).................................................................................................601
(e)....................................................................................................514
Section 316(a)(1)(A)............................................................................................502
512
</TABLE>
<PAGE> 3
<TABLE>
<S> <C>
(a)(1)(B)..............................................................................................513
(a)(2)......................................................................................Not Applicable
(b)....................................................................................................508
Section 317(a)(1)...............................................................................................503
(a)(2).................................................................................................504
(b)...................................................................................................1003
Section 318(a)..................................................................................................107
</TABLE>
<PAGE> 4
TABLE OF CONTENTS
<TABLE>
<S> <C>
Parties...........................................................................................................1
Recitals of the Company...........................................................................................1
ARTICLE ONE
Definitions and Other Provisions of General Application
Section 101. Definitions.....................................................................................2
Act.............................................................................................2
Affiliate.......................................................................................2
Attributable Debt...............................................................................2
Authenticating Agent............................................................................2
Board of Directors..............................................................................2
Board Resolution................................................................................2
Business Day....................................................................................3
Capital Stock...................................................................................3
Commission......................................................................................3
Company.........................................................................................3
Company Request; Company Order..................................................................3
Consolidated Net Tangible Assets................................................................3
Corporate Trust Office..........................................................................3
corporation.....................................................................................4
Covenant Defeasance.............................................................................4
Defaulted Interest..............................................................................4
Defeasance......................................................................................4
Depositary......................................................................................4
Event of Default................................................................................4
Exchange Act....................................................................................4
Expiration Date.................................................................................4
Funded Debt.....................................................................................4
Global Security.................................................................................4
Holder..........................................................................................4
Indenture.......................................................................................4
interest........................................................................................5
Interest Payment Date...........................................................................5
Investment Company Act..........................................................................5
Maturity........................................................................................5
Notice of Default...............................................................................5
Officers' Certificate...........................................................................5
Opinion of Counsel..............................................................................5
Original Issue Discount Security................................................................5
</TABLE>
<PAGE> 5
<TABLE>
<S> <C>
Outstanding.....................................................................................5
Paying Agent....................................................................................7
Person..........................................................................................7
Place of Payment................................................................................7
Predecessor Security............................................................................7
Principal Property..............................................................................7
- ------------------------
NOTE: THIS TABLE OF CONTENTS SHALL NOT, FOR ANY PURPOSE, BE DEEMED TO BE A PART OF THE INDENTURE
Redemption Date.................................................................................7
Redemption Price................................................................................7
Regular Record Date.............................................................................7
Responsible Officer.............................................................................8
Restricted Subsidiary...........................................................................8
Securities......................................................................................8
Securities Act..................................................................................8
Security Register and Security Registrar........................................................8
Special Record Date.............................................................................8
Stated Maturity.................................................................................8
Subsidiary......................................................................................8
Trust Indenture Act.............................................................................8
Trustee.........................................................................................9
U.S. Government Obligation......................................................................9
Vice President..................................................................................9
Section 102. Compliance Certificates and Opinions...................................................9
Section 103. Form of Documents Delivered to Trustee................................................10
Section 104. Acts of Holders; Record Dates.........................................................10
Section 105. Notices, Etc., to Trustee and Company.................................................13
Section 106. Notice to Holders; Waiver.............................................................13
Section 107. Conflict with Trust Indenture Act.....................................................14
Section 108. Effect of Headings and Table of Contents..............................................14
Section 109. Successors and Assigns................................................................14
Section 110. Separability Clause...................................................................14
Section 111. Benefits of Indenture.................................................................14
Section 112. Governing Law.........................................................................15
Section 113. Legal Holidays........................................................................15
</TABLE>
<PAGE> 6
<TABLE>
<CAPTION>
ARTICLE TWO
Security Forms
<S> <C> <C>
Section 201. Forms Generally.......................................................................15
Section 202. Form of Face of Security..............................................................16
Section 203. Form of Reverse of Security...........................................................17
Section 204. Form of Legend for Global Securities..................................................22
Section 205. Form of Trustee's Certificate of Authentication.......................................22
ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series..................................................23
Section 302. Denominations.........................................................................26
Section 303. Execution, Authentication, Delivery and Dating . 26
Section 304. Temporary Securities..................................................................27
Section 305. Registration, Registration of Transfer
and Exchange.........................................................................28
Section 306. Mutilated, Destroyed, Lost and Stolen
Securities...........................................................................30
Section 307. Payment of Interest; Interest Rights
Preserved............................................................................31
Section 308. Persons Deemed Owners.................................................................32
Section 309. Cancellation..........................................................................32
Section 310. Computation of Interest...............................................................33
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture...............................................33
Section 402. Applicable of Trust Money.............................................................34
</TABLE>
<PAGE> 7
<TABLE>
<CAPTION>
ARTICLE FIVE
Remedies
<S> <C> <C>
Section 501. Events of Default.....................................................................35
Section 502. Acceleration of Maturity; Rescission and
Annulment.............................................................................37
Section 503. Collection of Indebtedness and Suits for
Enforcement by Trustee..............................................................38
Section 504. Trustee May File Proofs of Claim......................................................39
Section 505. Trustee May Enforce Claims Without
Possession of Securities.............................................................39
Section 506. Application of Money Collected........................................................39
Section 507. Limitation on Suits...................................................................40
Section 508. Unconditional Right of Holders to Receive
Principal, Premium and Interest.....................................................41
Section 509. Restoration of Rights and Remedies....................................................41
Section 510. Rights and Remedies Cumulative........................................................41
Section 511. Delay or Omission Not Waiver..........................................................41
Section 512. Control by Holders....................................................................42
Section 513. Waiver of Past Defaults...............................................................42
Section 514. Undertaking for Costs.................................................................42
Section 515. Waiver of Usury, Stay or Extension Laws...............................................43
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities...................................................43
Section 602. Notice of Defaults....................................................................43
Section 603. Certain Rights of Trustee.............................................................44
</TABLE>
<PAGE> 8
<TABLE>
<S> <C> <C>
Section 604. Not Responsible for Recitals or Issuance
of Securities........................................................................45
Section 605. May Hold Securities...................................................................45
Section 606. Money Held in Trust...................................................................45
Section 607. Compensation and Reimbursement........................................................45
Section 608. Conflicting Interests.................................................................46
Section 609. Corporate Trustee Required; Eligibility...............................................46
Section 610. Resignation and Removal; Appointment
of Successor..........................................................................46
Section 611. Acceptance of Appointment by Successor................................................48
Section 612. Merger, Conversation, Consolidation or
Succession to Business................................................................49
</TABLE>
<PAGE> 9
<TABLE>
<S> <C> <C>
Section 613. Preferential Collection of Claims Against
Company...............................................................................50
Section 614. Appointment of Authenticating Agent...................................................50
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee Names and
Addresses of Holders..................................................................52
Section 702. Preservation of Information; Communications
to Holders............................................................................52
Section 703. Reports by Trustee....................................................................53
Section 704. Reports by Company....................................................................53
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. Company May Consolidate, Etc., Only on
Certain Terms.........................................................................53
Section 802. Successor Substituted.................................................................54
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of
Holders...............................................................................55
Section 902. Supplemental Indentures With Consent of
Holders...............................................................................56
Section 903. Execution of Supplemental Indentures..................................................57
Section 904. Effect of Supplemental Indentures.....................................................58
Section 905. Conformity with Trust Indenture Act...................................................58
Section 906. Reference in Securities to Supplemental
Indentures............................................................................58
</TABLE>
<PAGE> 10
<TABLE>
<CAPTION>
ARTICLE TEN
Covenants
<S> <C> <C>
Section 1001. Payment of Principal, Premium and Interest............................................58
Section 1002. Maintenance of Office or Agency.......................................................59
Section 1003. Money for Securities Payments to Be Held
in Trust..............................................................................59
Section 1004. Existence.............................................................................60
Section 1005. Maintenance of Properties.............................................................61
Section 1006. Payment of Taxes and Other Claims.....................................................61
Section 1007. Restrictions on Secured Debt..........................................................61
Section 1008. Restrictions on Sales and Leasebacks..................................................63
Section 1009. Statement by Officers as to Default...................................................64
Section 1010. Waiver of Certain Covenants...........................................................64
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article..............................................................65
Section 1102. Election to Redeem; Notice to Trustee.................................................65
Section 1103. Selection by Trustee of Securities to be
Redeemed..............................................................................65
Section 1104. Notice of Redemption..................................................................66
Section 1105. Deposit of Redemption Price...........................................................67
Section 1106. Securities Payable on Redemption Date.................................................67
Section 1107. Securities Redeemed in Part...........................................................68
ARTICLE TWELVE
Sinking Funds
</TABLE>
<PAGE> 11
<TABLE>
<S> <C> <C>
Section 1201. Applicability of Article..............................................................68
Section 1202. Satisfaction of Sinking Fund Payments
with Securities.......................................................................68
Section 1203. Redemption of Securities for Sinking Fund.............................................69
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Company's Option to Effect Defeasance or
Covenant Defeasance...................................................................69
Section 1302. Defeasance and Discharge..............................................................70
Section 1303. Covenant Defeasance...................................................................70
Section 1304. Conditions to Defeasance or Covenant
Defeasance............................................................................71
Section 1305. Deposited Money and U.S. Government Obligations
to be Held in Trust; Miscellaneous Provisions.........................................73
Section 1306. Reinstatement.........................................................................74
Testimonium......................................................................................................75
Signatures and Seals.............................................................................................75
Acknowledgements.................................................................................................76
</TABLE>
<PAGE> 12
INDENTURE, dated as of May 3, 1996, between Parker-Hannifin
Corporation, a corporation duly organized and existing under the laws of the
State of Ohio (herein called the "Company"), having its principal office at
17325 Euclid Avenue, Cleveland, Ohio 44112, and National City Bank, a national
bank organized and existing under the laws of United States, with its principal
office at 1900 East Ninth Street, Cleveland, Ohio 44114, 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 prin-
<PAGE> 13
2
ciples" 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
(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, as to any particular lease under
which any Person is at the time liable and at any date as of which the amount
thereof is to be determined, the total net amount of rent required to be paid by
such Person under such lease during the remaining primary term thereof,
discounted from the respective due dates thereof to such date at a rate per
annum equal to the weighted average yield to maturity of the Securities
calculated in accordance with generally accepted financial practices. The net
amount of rent required to be paid under any such lease for any such period
shall be the aggregate amount of the rent payable by the lessee with respect to
such period after excluding amounts required to be paid on account of
maintenance and repairs, insurance, taxes, assessments, water rates and similar
charges. In the case of any lease which is terminable by the lessee upon the
payment of a penalty, such net amount shall also include the amount of such
penalty, but no rent shall be considered as required to be paid under such lease
subsequent to the first date upon which it may be so terminated.
"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
<PAGE> 14
3
institutions in that Place of Payment are authorized or obligated by law or
executive order to close.
"Capital Stock", as applied to the stock of any corporation,
means the capital stock of every class whether now or hereafter authorized,
regardless of whether such capital stock shall be limited to a fixed sum or
percentage with respect to the rights of the holders thereof to participate in
dividends and in the distribution of assets upon the voluntary or involuntary
liquidation, dissolution or winding up of such corporation.
"Commission" means the Securities and Exchange Commission,
from time to time constituted, created under the Exchange Act, or, if at any
time after the execution of this instrument such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request
or order signed in the name of the Company by its Chairman of the Board, its
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 (i) all liabilities other than deferred income taxes, Funded
Debt and shareholders' equity (including all preferred stock whether or not
redeemable) and (ii) all goodwill, trade names, trademarks, patents,
organization expenses and other like intangibles, all as set forth on the most
recent balance sheet of the Company and its consolidated Subsidiaries and
computed in accordance with generally accepted accounting principles.
"Corporate Trust Office" means the principal office of the
Trustee in Cleveland, Ohio at which at any particular time its corporate trust
business shall be administered.
<PAGE> 15
4
"corporation" means a corporation, association, company,
joint-stock company or business trust.
"Covenant Defeasance" has the meaning specified in Section
1303.
"Defaulted Interest" has the meaning specified in Section 307.
"Defeasance" has the meaning specified in Section 1302.
"Depositary" means, with respect to Securities of any series
issuable in whole or in part in the form of one or more Global Securities, a
clearing agency registered under the Exchange Act that is designated to act as
Depositary for such Securities as contemplated by Section 301.
"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.
"Funded Debt" means (i) all indebtedness for money borrowed
having a maturity of more than 12 months from the date as of which the
determination is made or having a maturity of 12 months or less but by its terms
being renewable or extendible beyond 12 months from such date at the option of
the borrower and (ii) rental obligations payable more than 12 months from such
date under leases which are capitalized in accordance with generally accepted
accounting principles (such rental obligations to be included as Funded Debt at
the amount so capitalized at the date of such computation and to be included for
the purposes of the definition of Consolidated Net Tangible Assets both as an
asset and as Funded Debt at the respective amounts so capitalized).
"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.
<PAGE> 16
5
"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 installment 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.
"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.
"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, 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 Officer's
Certificate given pursuant to Section 1009 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;
<PAGE> 17
6
(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.
"Person" means any individual, corporation, partnership, joint
venture, trust, unincorporated organization or government or any agency or
political subdivision thereof.
<PAGE> 18
7
"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 manufacturing or processing
plant or warehouse owned at the date hereof or hereafter acquired by the Company
or any Restricted Subsidiary of the Company which is located within the United
States of America and the gross book value (including related land and
improvements thereon and all machinery and equipment included therein without
deduction of any depreciation reserves) of which on the date as of which the
determination is being made exceeds 1% of Consolidated Net Tangible Assets,
other than (i) any property which in the opinion of the Board of Directors is
not of material importance to the total business conducted by the Company as an
entirety or (ii) any portion of a particular property which is similarly found
not to be of material importance to the use or operation of such property.
"Redemption Date", when used with respect to any Security to
be redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security to
be redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Regular Record Date" for the interest payable on any Interest
Payment Date on the Securities of any series means the date specified for that
purpose as contemplated by Section 301.
"Responsible Officer", when used with respect to the Trustee,
means the chairman or any vice-chairman of the board of directors, the chairman
or any vice-chairman of the executive committee of the board of directors, the
chairman of the trust committee, the president, any vice president, the
secretary, any assistant secretary, the treasurer, any assistant treasurer, the
cashier, any assistant cashier, any trust officer or assistant trust officer,
the controller or any assistant controller or any other officer of the Trustee
customarily performing functions similar to those performed by any of the above
designated officers and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of his
knowledge of and familiarity with the particular subject.
"Restricted Subsidiary" means a Subsidiary of the Company (i)
substantially all the property of which is located, or substantially all the
business of which is carried on, within the United States of America and (ii)
which owns a Principal Property.
<PAGE> 19
8
"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 installment 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 amended, 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.
<PAGE> 20
9
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 and this Indenture. 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 (except for certificates
provided for in Section 1009) shall include,
(1) a statement that each individual signing such
certificate or opinion has read such covenant or condition and the
definitions herein relating thereto;
(2) a brief statement as to the nature and scope of
the examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such
individual, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to whether or
not such covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each
such individual, such condition or covenant has been complied with.
SECTION 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
<PAGE> 21
10
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 the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.
The ownership of Securities shall be proved by the Security
Register.
Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Trustee or
the Company in reliance thereon, whether or not notation of such action is made
upon such Security.
The Company may set any day as a record date for the purpose
of determining the Holders of Outstanding Securities of any series entitled to
give, make or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given, made or taken by Holders of Securities of such series, provided that the
Company may not set a record date for, and the provisions of this paragraph
shall not apply with respect to, the giving or making of any notice,
declaration, request or direction referred to in the next paragraph. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of the relevant series on such record date, and no other Holders,
shall be entitled to take the relevant action, whether or not such Holders
remain Holders after such record
<PAGE> 22
11
date; provided that no such action shall be effective hereunder unless taken on
or prior to the applicable Expiration Date by Holders of the requisite principal
amount of Outstanding Securities of such series on such record date. Nothing in
this paragraph shall be construed to prevent the Company from setting a new
record date for any action for which a record date has previously been set
pursuant to this paragraph (whereupon the record date previously set shall
automatically and with no action by any Person be cancelled and of no effect),
and nothing in this paragraph shall be construed to render ineffective any
action taken by Holders of the requisite principal amount of Outstanding
Securities of the relevant series on the date such action is taken. Promptly
after any record date is set pursuant to this paragraph, the Company, at its own
expense, shall cause notice of such record date, the proposed action by Holders
and the applicable Expiration Date to be given to the Trustee in writing and to
each Holder of Securities of the relevant series in the manner set forth in
Section 106.
The Trustee may set any day as a record date for the purpose
of determining the Holders of Outstanding Securities of any series entitled to
join in the giving or making of (i) any Notice of Default, (ii) any declaration
of acceleration referred to in Section 502, (iii) any request to institute
proceedings referred to in Section 507(2) or (iv) any direction referred to in
Section 512, in each case with respect to Securities of such series. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of such series on such record date, and no other Holders, shall be
entitled to join in such notice, declaration, request or direction, whether or
not such Holders remain Holders after such record date; provided that no such
action shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date. Nothing in this paragraph shall
be construed to prevent the Trustee from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities of the relevant
series on the date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Trustee, at the Company's expense, shall cause
notice of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Company in writing and to each Holder of
Securities of the relevant series in the manner set forth in Section 106.
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.
<PAGE> 23
12
Without limiting the foregoing, a Holder entitled hereunder to
take any action hereunder with regard to any particular Security may do so with
regard to all or any part of the principal amount of such Security or by one or
more duly appointed agents each of which may do so pursuant to such appointment
with regard to all or any part of such principal amount.
SECTION 105. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice,
consent, waiver or Act of Holders or other document provided or permitted by
this Indenture to be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall
be sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Trustee at its Corporate Trust Office,
Attention: Corporate Trust Administration, or
(2) the Company by the Trustee or by any Holder shall
be sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage
prepaid, to the Company addressed to it at the address of its principal
office specified in the first paragraph of this instrument or at any
other address previously furnished in writing to the Trustee by the
Company.
SECTION 106. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any
event, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage prepaid, to
each Holder affected by such event, at his address as it appears in the Security
Register, not later than the latest date (if any), and not earlier than the
earliest date (if any), prescribed for the giving of such notice. In any case
where notice to Holders is given by mail, neither the failure to mail such
notice, nor any defect in any notice so mailed, to any particular Holder shall
affect the sufficiency of such notice with respect to other Holders. Where this
Indenture provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice. Waivers of
notice by Holders shall be filed with the Trustee, but such filing shall not be
a condition precedent to the validity of any action taken in reliance upon such
waiver.
In case by reason of the suspension of regular mail service or
by reason of any other cause it shall be impracticable to give such notice by
mail, then such notification as shall be made with the approval of the Trustee
shall constitute a sufficient notification for every purpose hereunder.
<PAGE> 24
13
SECTION 107. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act which is required under such Act to be a
part of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act which may be so modified or excluded, the latter provision shall
be deemed to apply to this Indenture as so modified or to be excluded, as the
case may be.
SECTION 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.
SECTION 109. Successors and Assigns.
All covenants and agreements in this Indenture by the Company
shall bind its successors and assigns, whether so expressed or not.
SECTION 110. Separability Clause.
In case any provision in this Indenture or in the Securities
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
SECTION 111. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder and the Holders, any benefit or any legal or equitable
right, remedy or claim under this Indenture.
SECTION 112. Governing Law.
This Indenture and the Securities shall be governed by and
construed in accordance with the law of the State of New York.
SECTION 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date
or Stated Maturity of any Security shall not be a Business Day at any Place of
Payment, then (notwithstanding any
<PAGE> 25
14
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)
need not be made at such Place of Payment on such date, but may be made on the
next succeeding Business Day at such Place of Payment with the same force and
effect as if made on the Interest Payment Date or Redemption Date, or at the
Stated Maturity.
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally.
The Securities of each series shall be in substantially the
form set forth in this Article, or in such other form as shall be established by
or pursuant to a Board Resolution or in one or more indentures supplemental
hereto, in each case with such appropriate insertions, omissions, substitutions
and other variations as are required or permitted by this Indenture, and may
have such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or Depositary therefor or as may, consistently herewith, be
determined by the officers executing such Securities, as evidenced by their
execution thereof. If the form of Securities of any series is established by
action taken pursuant to a Board Resolution, a copy of an appropriate record of
such action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the Company
Order contemplated by Section 303 for the authentication and delivery of such
Securities.
The definitive Securities shall be printed, lithographed or
engraved on steel engraved borders or may be produced in any other manner, all
as determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
SECTION 202. Form of Face of Security.
[Insert any legend required by the Internal Revenue Code and
the regulations thereunder]
PARKER-HANNIFIN CORPORATION
[Title of Securities]
No. $
---------- -----------
<PAGE> 26
15
Parker-Hannifin Corporation, a corporation duly organized and
existing under the laws of Ohio (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 installment 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.]
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].
<PAGE> 27
16
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:
PARKER-HANNIFIN CORPORATION
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 _______ __, 1996 (herein called
the "Indenture," which term shall have the meaning assigned to it in such
instrument), between the Company and National City Bank, as Trustee (herein
called the "Trustee", which term includes any successor trustee under the
Indenture), and reference is hereby made to the Indenture for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of
the Company, the Trustee and the Holders of the Securities and of the terms upon
which the Securities are, and are to be, authenticated and delivered. This
Security is one of the series designated on the face hereof [if applicable,
insert--, limited in aggregate principal amount to $_______________].
[If applicable, insert-- The Securities of this series are
subject to redemption upon not less than 30 days' notice by mail, [if
applicable, insert-- (1) on _______________ in any year commencing with the year
____ and ending with the year ____ through operation of the sinking fund for
this series at a Redemption Price equal to 100% of the principal amount, and
(2)] at any time [if applicable, insert-- on or after __________________, 19__,
as a whole or in part, at the election of the Company, at the following
Redemption Prices (expressed as percentages of the principal amount): If
redeemed [on or before _______________, ____%, and if redeemed] during the
12-month period beginning ______________ of the years indicated.
<PAGE> 28
17
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 installments 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 Redemption Price For
For Redemption Redemption Otherwise
Through Operation Than Through Operation
Year of the Sinking Fund of the Sinking Fund
---- ------------------- -------------------
<PAGE> 29
18
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 installments whose Stated Maturity is on or prior to such Redemption
Date will be payable to the Holders of such Securities, or one or more
Predecessor Securities, of record at the close of business on the relevant
Record Dates referred to on the face hereof, all as provided in the Indenture.]
[If applicable, insert-- Notwithstanding the foregoing, the
Company may not, prior to _____________________, redeem any Securities of this
series as contemplated by [if applicable, insert-- Clause (2) of] the preceding
paragraph as a part of, or in anticipation of, any refunding operation by the
application, directly or indirectly, of moneys borrowed having an interest cost
to the Company (calculated in accordance with generally accepted financial
practice) of less than ____% per annum.]
[If applicable, insert-- The sinking fund for this series
provides for the redemption on ________________ in each year beginning with the
year ____ and ending with the year ____ of [if applicable, insert-- not less
than] $____________ [("mandatory sinking fund") and not more than
$______________] aggregate principal amount of Securities of this series.
Securities of this series acquired or redeemed by the Company otherwise than
through [if applicable, insert- - mandatory] sinking fund payments may be
credited against subsequent [if applicable, insert-- mandatory] sinking fund
payments otherwise required to be made--[if applicable, insert-- in the inverse
order in which they become due.]
[If the Security is subject to redemption of any kind,
insert-- In the event of redemption of this Security in part only, a new
Security or Securities of this series and of like tenor for the unredeemed
portion hereof will be issued in the name of the Holder hereof upon the
cancellation hereof.]
[If applicable, insert-- The Indenture contains provisions for
defeasance at any time of [the entire indebtedness of this Security[ [or]
[certain restrictive covenants and Events of Default with respect to this
Security[ [,in each case] upon compliance with certain conditions set forth in
the Indenture.]
[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
<PAGE> 30
19
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 66 2/3% in principal amount of
the Securities at the time Outstanding of each series to be affected. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange herefor or in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.
As provided in and subject to the provisions of the Indenture,
the Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the appointment of a receiver or trustee or
for any other remedy thereunder, unless such Holder shall have previously given
the Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 25% in principal amount
of the Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable indemnity, and the Trustee
shall not have received from the Holders of a majority in principal amount of
Securities of this series at the time Outstanding a direction inconsistent with
such request, and shall have failed to institute any such proceeding, for 60
days after receipt of such notice, request and offer of indemnity. The foregoing
shall not apply to any suit instituted by the Holder of this Security for the
enforcement of any payment of principal hereof or any premium or interest hereon
on or after the respective due dates expressed herein.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and any
premium and interest on this Security at the times, place and rate, and in the
coin or currency, herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registrable in
the Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in any place where the principal
of and any premium and interest on this Security are payable, duly endorsed by,
or accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities of
this series, and of like tenor, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees.
<PAGE> 31
20
The Securities of this series are issuable only in registered
form without coupons in denominations of $____________ and any integral multiple
thereof. As provided in the Indenture and subject to certain limitations therein
set forth, Securities of this series are exchangeable for a like aggregate
principal amount of Securities of this series and of like tenor, of a different
authorized denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
SECTION 204. Form of Legend for Global Securities.
Unless otherwise specified as contemplated by Section 301 for
the Securities evidenced thereby, every Global Security authenticated and
delivered hereunder shall bear a legend in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A
SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE
REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE
THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
<PAGE> 32
21
SECTION 205. Form of Trustees Certificate of Authentication.
The Trustee's certificate of authentication shall be in
substantially the following form:
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
NATIONAL CITY BANK, as Trustee
By
----------------------------------
Authorized Officer
ARTICLE THREE
THE SECURITIES
SECTION 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There
shall be established in or pursuant to a Board Resolution and, subject to
Section 303, set forth, or determined in the manner provided, in an Officers'
Certificate, or established in one or more indentures supplemental hereto, prior
to the issuance of Securities of any series,
(1) the title of the Securities of the series (which shall
distinguish the Securities of the series from Securities of any other
series);
(2) any limit upon the aggregate principal amount of the
Securities of the series which may be authenticated and delivered under
this Indenture (except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other
Securities of the series pursuant to Section 304, 305, 306, 906 or 1107
and except for any Securities which, pursuant to Section 303, are
deemed never to have been authenticated and delivered hereunder);
(3) the 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
<PAGE> 33
22
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 the Securities
of the series is payable;
(5) the rate or rates at which any Securities of the series
shall bear interest, if any, the date or dates from which any such
interest shall accrue, the Interest Payment Dates on which any such
interest shall be payable and the Regular Record Date for any such
interest payable on any Interest Payment Date;
(6) the place or places where the principal of and any premium
and interest on any Securities of the series shall be payable;
(7) the period or periods within which, the price or prices at
which and the terms and conditions upon which any Securities of the
series may be redeemed, in whole or in part, at the option of the
Company and, if other than by a Board Resolution, the manner in which
any election by the Company to redeem the Securities shall be
evidenced;
(8) the obligation, if any, of the Company to redeem or
purchase any Securities of the series pursuant to any sinking fund or
analogous provisions or at the option of the Holder thereof and the
period or periods within which, the price or prices at which and the
terms and conditions upon which any Securities of the series shall be
redeemed or purchased, in whole or in part, pursuant to such
obligation;
(9) if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which any Securities of the
series shall be issuable;
(10) if the amount of principal of or any premium or interest
on any Securities of the series may be determined with reference to an
index or pursuant to a formula, the manner in which such amounts shall
be determined;
(11) if other than the currency of the United States of
America, the currency, currencies or currency units in which the
principal of or any premium or interest on any Securities of 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
<PAGE> 34
23
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) 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;
(17) any addition to or change in the Events of Default which
applies to any Securities of the series and any change in the right of
the Trustee or the requisite Holders of such Securities to declare the
principal amount thereof due and payable pursuant to Section 502;
(18) any addition to or change in the covenants set forth in
Article Ten which applies to Securities of the series; and
(19) 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
<PAGE> 35
24
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 in only
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 President or one of its Vice Presidents, under
its corporate seal reproduced thereon attested by its Secretary or one of its
Assistant Secretaries. The signature of any of these officers on the Securities
may be manual or facsimile.
Securities bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities.
At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities of any series
executed by the Company to the Trustee for authentication, together with a
Company Order for the authentication and delivery of such Securities, and the
Trustee in accordance with the Company Order shall authenticate and deliver such
Securities. If the form or terms of the Securities of the series have been
established by or pursuant to one or more Board Resolutions as permitted by
Sections 201 and 301, in authenticating such Securities, and accepting the
additional responsibilities under this Indenture in relation to such Securities,
the Trustee shall be entitled to receive, and (subject to Section 601) shall be
fully protected in relying upon, an Opinion of Counsel stating,
(1) if the form of such Securities has been established by or
pursuant to Board Resolution as permitted by Section 201, that such
form has been established in conformity with the provisions of this
Indenture;
<PAGE> 36
25
(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 appropriate insertions, omissions, substitutions and
other
<PAGE> 37
26
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.
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Every Security presented or surrendered for registration of
transfer or for exchange shall (if so required by the Company or the Trustee) be
duly endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed, by the
Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of
transfer or exchange of Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Securities, other
than exchanges pursuant to Section 304, 906 or 1107 not involving any transfer.
If the Securities of any series (or any series and specified
tenor) are to be redeemed in part, the Company shall not be required (A) to
issue, register the transfer of or exchange any Securities of that series (or of
that series and specified tenor, as the case may be,) during a period beginning
at the opening of business 15 days before the day of the mailing of a notice of
redemption of any such Securities selected for redemption under Section 1103 and
ending at the close of business on the day of such mailing, or (B) to register
the transfer of or exchange any Security so selected for redemption in whole or
in part, except the unredeemed portion of any Security being redeemed in part.
The provisions of clauses (1), (2), (3) and (4) below shall
apply only to Global Securities:
(1) Each Global Security authenticated under this Indenture
shall be registered in the name of the Depositary designated for such
Global Security or a nominee thereof and delivered to such Depositary
or a nominee thereof or custodian therefor, and each such Global
Security shall constitute a single Security for all purposes of this
Indenture.
(2) Notwithstanding any other provision in this Indenture, no
Global Security may be exchanged in whole or in part for Securities
registered, and no transfer of a Global Security in whole or in part
may be registered, in the name of any Person other than the Depositary
for such Global Security or a nominee thereof unless (A) such
Depositary (i) has notified the Company that it is unwilling or unable
to continue as Depositary for such Global Security or (ii) has ceased
to be a clearing agency registered under the Exchange Act, (B) there
shall have occurred and be continuing an Event of Default with respect
to such Global Security or (C) there shall exist such circumstances, if
any, in addition to or in lieu of the foregoing as have been specified
for this purpose as contemplated by Section 301.
(3) Subject to clause (2) above, any exchange of a Global
Security for other Securities may be made in whole or in part, and all
Securities issued in exchange for a Global Security or any portion
thereof shall be registered in such names as the Depositary for such
Global Security shall direct.
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(4) Every Security authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a Global
Security or any portion thereof, whether pursuant to this Section,
Section 304, 306, 906 or 1107 or otherwise, shall be authenticated and
delivered in the form of, and shall be, a Global Security, unless such
Security is registered in the name of a Person other than the
Depositary for such Global Security or a nominee thereof.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee, the
Company shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of the same series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Security
and (ii) such security or indemnity as may be required by them to save each of
them and any agent of either of them harmless, then, in the absence of notice to
the Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and the Trustee shall authenticate and
deliver, in lieu of any such destroyed, lost or stolen Security, a new Security
of the same series and of like tenor and principal amount and bearing a number
not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this
Section in lieu of any destroyed, lost or stolen Security shall constitute an
original additional contractual obligation of the Company, whether or not the
destroyed, lost or stolen Security shall be at any time enforceable by anyone,
and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Securities of that series duly issued
hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 307. Payment of Interest; Interest Rights Preserved.
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Except as otherwise provided as contemplated by Section 301
with respect to any series of Securities, interest on any Security which is
payable, and is punctually paid or duly provided for, on any Interest Payment
Date shall be paid to the Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest.
Any interest on any Security of any series which is payable,
but is not punctually paid or duly provided for, on any Interest Payment Date
(herein called "Defaulted Interest") shall forthwith cease to be payable to the
Holder on the relevant Regular Record Date by virtue of having been such Holder,
and such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities of such series
(or their respective Predecessor Securities) are registered at the
close of business on a Special Record Date for the payment of such
Defaulted Interest, which shall be fixed in the following manner. The
Company shall notify the Trustee in writing of the amount of Defaulted
Interest proposed to be paid on each Security of such series and the
date of the proposed payment, and at the same time the Company shall
deposit with the Trustee an amount of money equal to the aggregate
amount proposed to be paid in respect of such Defaulted Interest or
shall make arrangements satisfactory to the Trustee for such deposit
prior to the date of the proposed payment, such money when deposited to
be held in trust for the benefit of the Persons entitled to such
Defaulted Interest as in this clause provided. Thereupon the Trustee
shall fix a Special Record Date for the payment of such Defaulted
Interest which shall be not more than 15 days and not less than 10 days
prior to the date of the proposed payment and not less than 10 days
after the receipt by the Trustee of the notice of the proposed payment.
The Trustee shall promptly notify the Company of such Special Record
Date and, in the name and at the expense of the Company, shall cause
notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor to be given to each Holder of Securities
of such series in the manner set forth in Section 106, not less than 10
days prior to such Special Record Date. Notice of the proposed payment
of such Defaulted Interest and the Special Record Date therefor having
been so mailed, such Defaulted Interest shall be paid to the Persons in
whose names the Securities of such series (or their respective
Predecessor Securities) are registered at the close of business on such
Special Record Date and shall no longer be payable pursuant to the
following clause (2).
(2) The Company may make payment of any Defaulted Interest on
the Securities of any series in any other lawful manner not
inconsistent with the requirements of any securities exchange on which
such Securities may be listed, and upon such notice as may be required
by such exchange, if, after notice given by the Company to the Trustee
of the proposed payment pursuant to this clause, such manner of payment
shall be deemed practicable by the Trustee.
<PAGE> 41
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Subject to the foregoing provisions of this Section, each
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.
SECTION 308. Persons Deemed Owners.
Prior to due presentment of a Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name such Security is registered as the owner of
such Security for the purpose of receiving payment of principal of and any
premium and (subject to Section 307) any interest on such Security and for all
other purposes whatsoever, whether or not such Security be overdue, and neither
the Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.
SECTION 309. Cancellation.
All Securities surrendered for payment, redemption,
registration of transfer or exchange or for credit against any sinking fund
payment shall, if surrendered to any Person other than the Trustee, be delivered
to the Trustee and shall be promptly cancelled by it. The Company may at any
time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company may have acquired in any
manner whatsoever, and may deliver to the Trustee (or to any other Person for
delivery to the Trustee) for cancellation any Securities previously
authenticated hereunder which the Company has not issued and sold, and all
Securities so delivered shall be promptly cancelled by the Trustee. No
Securities shall be authenticated in lieu of or in exchange for any Securities
cancelled as provided in this Section, except as expressly permitted by this
Indenture. All cancelled Securities held by the Trustee shall be disposed of as
directed by a Company Order.
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.
<PAGE> 42
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This Indenture shall upon Company Request cease to be of
further effect (except as to any surviving rights of registration of transfer or
exchange of Securities herein expressly provided for), and the Trustee, at the
expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and
delivered (other than (i) Securities which have been
destroyed, lost or stolen and which have been replaced or paid
as provided in Section 306 and (ii) Securities for whose
payment money has theretofore been deposited in trust or
segregated and held in trust by the Company and thereafter
repaid to the Company or discharged from such trust, as
provided in Section 1003) have been delivered to the Trustee
for cancellation; or
(B) all such Securities not theretofore delivered to
the Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at
their Stated Maturity within one year, or
(iii) are to be called for redemption
within one year under arrangements satisfactory to
the Trustee for the giving of notice of redemption by
the Trustee in the name, and at the expense, of the
Company,
and the Company, in the case of (i), (ii) or (iii) above, has
deposited or caused to be deposited with the Trustee as trust
funds in trust 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
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Trustee pursuant to subclause (B) of clause (1) of this Section, the obligations
of the Trustee under Section 402 and the last paragraph of Section 1003 shall
survive.
SECTION 402. Application of Trust Money.
Subject to the provisions of the last paragraph of Section
1003, all money deposited with the Trustee pursuant to Section 401 shall be held
in trust and applied by it, in accordance with the provisions of the Securities
and this Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal and any premium and
interest for whose payment such money has been deposited with the Trustee.
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default.
"Event of Default", wherever used herein with respect to
Securities of any series, means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(1) default in the payment of any interest upon any Security
of that series when it becomes due and payable, and continuance of such
default for a period of 30 days; or
(2) default in the payment of the principal of or any premium
on any Security of that series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when
and as due by the terms of a Security of that series; or
(4) default in the performance, or breach, of any covenant or
warranty of the Company in this Indenture (other than a covenant or
warranty a default in whose performance or whose breach is elsewhere in
this Section specifically dealt with or which has expressly been
included in this Indenture solely for the benefit of series of
Securities other than that 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 10% in principal
amount of the Outstanding Securities of that series a written notice
specifying such default or breach
<PAGE> 44
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and requiring it to be remedied and stating that such notice is a
"Notice of Default" hereunder; or
(5) a default under any bond, debenture, note or other
evidence of indebtedness for money borrowed in an aggregate principal
amount exceeding $10,000,000 by the Company or any Restricted
Subsidiary (including a default with respect to Securities of any
series other than that series) or under any mortgage, indenture or
instrument (including this Indenture) under which there may be issued
or by which there may be secured or evidenced any indebtedness for
money borrowed in an aggregate principal amount exceeding $10,000,000
by the Company or any Restricted Subsidiary whether such indebtedness
now exists or shall hereafter be created, which default shall have
resulted in such indebtedness becoming or being declared due and
payable prior to the date on which it would otherwise have become due
and payable, without such indebtedness having been discharged, or such
acceleration having been rescinded or annulled, within a period of 10
days after there shall have been given, by registered or certified
mail, to the Company by the Trustee or to the Company and the Trustee
by the Holders of at least 10% in principal amount of the Outstanding
Securities of that series a written notice specifying such default and
requiring the Company to cause such indebtedness to be discharged or
cause such acceleration to be rescinded or annulled, as the case may
be, and stating that such notice is a "Notice of Default" hereunder;
provided, however, that, subject to the provisions of Sections 601 and
602, the Trustee shall not be deemed to have knowledge of such default
unless either (A) a Responsible Officer of the Trustee shall have
actual knowledge of such default or (B) the Trustee shall have received
written notice thereof from the Company, from any Holder, from the
holder of any such indebtedness or from the trustee under any such
mortgage, indenture or other instrument; or
(6) the entry by a court having jurisdiction in the premises
of (A) a decree or order for relief in respect of the Company 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 60 consecutive
days; or
(7) 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
<PAGE> 45
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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
(8) any other Event of Default provided with respect to
Securities of that series.
SECTION 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default with respect to Securities of any
series at the time Outstanding occurs and is continuing, then and 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 (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) of all the Securities of that series 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.
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 any premium 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;
<PAGE> 46
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and
(2) all Events of Default with respect to Securities of that
series, other than the non-payment of the principal of Securities of
that series which have become due solely by such declaration of
acceleration, have been cured or waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee.
The Company covenants that if
(1) default is made in the payment of any interest on any
Security when such interest becomes due and payable and such default
continues for a period of 30 days, or
(2) default is made in the payment of the principal of or any
premium 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 any 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
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Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 607.
No provision of this Indenture shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Securities or the rights of any Holder thereof or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding;
provided, however, that the Trustee may, on behalf of the Holders, vote for the
election of a trustee in bankruptcy or similar official and be a member of a
creditors' or other similar committee.
SECTION 505. Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the
Securities may be prosecuted and enforced by the Trustee without the possession
of any of the Securities or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of an express trust, and any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.
SECTION 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article
shall be applied in the following order, at the date or dates fixed by the
Trustee and, in case of the distribution of such money on account of principal
or any premium or interest, upon presentation of the Securities and the notation
thereon of the payment if only partially paid and upon surrender thereof if
fully paid:
FIRST: To the payment of all amounts due the Trustee under
Section 607; and
SECOND: To the payment of the amounts then due and unpaid for
principal of and any premium and interest on the Securities in respect
of which or for the benefit of which such money has been collected,
ratably, without preference or priority of any kind, according to the
amounts due and payable on such Securities for principal and any
premium and interest, respectively.
<PAGE> 48
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SECTION 507. Limitation on Suits.
No Holder of any Security of any series shall have any right
to institute any proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless
(1) such Holder has previously given written notice to the
Trustee of a continuing Event of Default with respect to the Securities
of that series;
(2) the Holders of not less than 25% in principal amount of
the Outstanding Securities of that series shall have made written
request to the Trustee to institute proceedings in respect of such
Event of Default in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(5) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders of a
majority in principal amount of the Outstanding Securities of that
series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all of such
Holders.
SECTION 508. Unconditional Right of Holders to Receive Principal, Premium
and Interest.
Notwithstanding any other provision in this Indenture, the
Holder of any Security shall have the right, which is absolute and
unconditional, to receive payment of the principal of and any premium and
(subject to Section 307) interest on such Security on the respective Stated
Maturities expressed in such Security (or, in the case of redemption, on the
Redemption Date) and to institute suit for the enforcement of any such payment,
and such rights shall not be impaired without the consent of such Holder.
SECTION 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any
<PAGE> 49
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reason, or has been determined adversely to the Trustee or to such Holder, then
and in every such case, subject to any determination in such proceeding, the
Company, the Trustee and the Holders shall be restored severally and
respectively to their former positions hereunder and thereafter all rights and
remedies of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.
SECTION 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities in the last
paragraph of Section 306, no right or remedy herein conferred upon or reserved
to the Trustee or to the Holders is intended to be exclusive of any other right
or remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.
SECTION 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any
Securities to exercise any right or remedy accruing upon any Event of Default
shall impair any such right or remedy or constitute a waiver of any such Event
of Default or an acquiescence therein. Every right and remedy given by this
Article or by law to the Trustee or to the Holders may be exercised from time to
time, and as often as may be deemed expedient, by the Trustee or by the Holders,
as the case may be.
SECTION 512. Control by Holders.
The Holders of a majority in principal amount of the
Outstanding Securities of any series shall have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred on the Trustee, with respect
to the Securities of such series, provided that
(1) such direction shall not be in conflict with any rule of
law or with this Indenture, and
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
SECTION 513. Waiver of Past Defaults.
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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.
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.
ARTICLE SIX
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities.
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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.
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 to Holders of Securities of such series
notice of such default as to the extent provided by the Trust Indenture Act;
provided, however, that, in the case of any default of the character specified
in Section 501(4) with respect to Securities of such series, no such notice to
Holders shall be given until at least 30 days after the occurrence thereof. For
the purpose of this Section, the term "default" means any event which is, or
after notice or lapse of time or both would become, an Event of Default with
respect to Securities of such series.
SECTION 603. Certain Rights of Trustee.
Subject to the provisions of Section 601:
(1) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other
paper or document believed by it to be genuine and to have been signed
or presented by the proper party or parties;
(2) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or Company Order,
and any resolution of the Board of Directors shall be sufficiently
evidenced by a Board Resolution;
(3) whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, the
Trustee (unless other evidence be herein specifically prescribed) may,
in the absence of bad faith on its part, rely upon an Officers'
Certificate;
(4) the Trustee may consult with counsel and the written
advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in reliance
thereon;
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(5) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request
or direction of any of the Holders pursuant to this Indenture, unless
such Holders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;
(6) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness
or other paper or document, but the Trustee, in its discretion, may
make such further inquiry or investigation into such facts or matters
as it may see fit, and, if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or
attorney; and
(7) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder.
SECTION 604. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except
the Trustee's certificates of authentication, shall be taken as the statements
of the Company, and neither the Trustee nor any Authenticating Agent assumes any
responsibility for their correctness. The Trustee makes no representations as to
the validity or sufficiency of this Indenture or of the Securities. Neither the
Trustee nor any Authenticating Agent shall be accountable for the use or
application by the Company of Securities or the proceeds thereof.
SECTION 605. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any
Security Registrar or any other agent of the Company, in its individual or any
other capacity, may become the owner or pledgee of Securities and, subject to
Sections 608 and 613, may otherwise deal with the Company with the same rights
it would have if it were not Trustee, Authenticating Agent, Paying Agent,
Security Registrar or such other agent.
SECTION 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law. The Trustee
shall be under no liability for interest on any money received by it hereunder
except as otherwise agreed with the Company.
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SECTION 607. Compensation and Reimbursement.
The Company agrees
(1) to pay to the Trustee from time to time reasonable
compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture (including the
reasonable compensation and the expenses and disbursements of its
agents and counsel), except any such expense, disbursement or advance
as may be attributable to its negligence or bad faith; and
(3) to indemnify the Trustee for, and to hold it harmless
against, any loss, liability or expense incurred without negligence or
bad faith on its part, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder,
including the costs and expenses of defending itself against any claim
or liability in connection with the exercise or performance of any of
its powers or duties hereunder.
SECTION 608. Conflicting Interests.
If the Trustee has or shall acquire a conflicting interest
within the meaning of the Trust Indenture Act, the Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by,
and subject to the provisions of, the Trust Indenture Act and this Indenture. To
the extent permitted by the Trust Indenture Act, the Trustee shall not be deemed
to have a conflicting interest by virtue of being a trustee under this Indenture
with respect to Securities of more than one series.
SECTION 609. Corporate Trustee Required; Eligibility.
There shall at all times be one (and only one) Trustee
hereunder with respect to the Securities of each series, which may be Trustee
hereunder for Securities of one or more other series. Each Trustee shall be a
Person that is eligible pursuant to the Trust Indenture Act to act as such and
has a combined capital and surplus of at least $50,000,000. If any such Person
publishes reports of condition at least annually, pursuant to law or to the
requirements of its supervising or examining authority, then for the purposes of
this Section and to the extent permitted by the Trust Indenture Act, the
combined capital and surplus of such Person shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time the Trustee with respect to the Securities of any
series shall cease to
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be eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.
SECTION 610. Resignation and Removal; Appointment of Successor.
No resignation or removal of the Trustee and no appointment of
a successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 611.
The Trustee may resign at any time with respect to the
Securities of one or more series by giving written notice thereof to the
Company. If the instrument of acceptance by a successor Trustee required by
Section 611 shall not have been delivered to the Trustee within 30 days after
the giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee with
respect to the Securities of such series.
The Trustee may be removed at any time with respect to the
Securities of any series by Act of the Holders of a majority in principal amount
of the Outstanding Securities of such series, delivered to the Trustee and to
the Company.
If at any time:
(1) the Trustee shall fail to comply with Section 608 after
written request therefor by the Company or by any Holder who has been a
bona fide Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609
and shall fail to resign after written request therefor by the Company
or by any such Holder, or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of its
property shall be appointed or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (A) the Company by a Board Resolution may remove the
Trustee with respect to all Securities, or (B) subject to Section 514, any
Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Securities and the appointment of a successor Trustee or Trustees.
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
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successor Trustee may be appointed with respect to the Securities of one or more
or all of such series and that at any time there shall be only one Trustee with
respect to the Securities of any particular series) and shall comply with the
applicable requirements of Section 611. If, within one year after such
resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee with respect to the Securities of any series shall be
appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance
of such appointment in accordance with the applicable requirements of Section
611, become the successor Trustee with respect to the Securities of such series
and to that extent supersede the successor Trustee appointed by the Company. If
no successor Trustee with respect to the Securities of any series shall have
been so appointed by the Company or the Holders and accepted appointment in the
manner required by Section 611, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee with respect to the Securities of such
series.
The Company shall give notice of each resignation and each
removal of the Trustee with respect to the Securities of any series and each
appointment of a successor Trustee with respect to the Securities of any series
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
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rights, powers, trusts and duties of the retiring Trustee with respect to the
Securities of that or those series as to which the retiring Trustee is not
retiring shall continue to be vested in the retiring Trustee, and (3) shall add
to or change any of the provisions of this Indenture as shall be necessary to
provide for or facilitate the administration of the trusts hereunder by more
than one Trustee, it being understood that nothing herein or in such
supplemental indenture shall constitute such Trustees co-trustees of the same
trust and that each such Trustee shall be trustee of a trust or trusts hereunder
separate and apart from any trust or trusts hereunder administered by any other
such Trustee; and upon the execution and delivery of such supplemental indenture
the resignation or removal of the retiring Trustee shall become effective to the
extent provided therein and each such successor Trustee, without any further
act, deed or conveyance, shall become vested with all the rights, powers, trusts
and duties of the retiring Trustee with respect to the Securities of that or
those series to which the appointment of such successor Trustee relates; but, on
request of the Company or any successor Trustee, such retiring Trustee shall
duly assign, transfer and deliver to such successor Trustee all property and
money held by such retiring Trustee hereunder with respect to the Securities of
that or those series to which the appointment of such successor Trustee relates.
Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts referred
to in the first or second preceding paragraph, as the case may be.
No successor Trustee shall accept its appointment unless at
the time of such acceptance such successor Trustee shall be qualified and
eligible under this Article.
SECTION 612. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to all or substantially all the corporate
trust business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
SECTION 613. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the
Company (or any other obligor upon the Securities), the Trustee shall be subject
to the provisions of the Trust Indenture Act regarding the collection of claims
against the Company (or any such other obligor).
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SECTION 614. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents with
respect to one or more series of Securities which shall be authorized to act on
behalf of the Trustee to authenticate Securities of such series issued upon
original issue and upon exchange, registration of transfer or partial redemption
thereof or pursuant to Section 306, and Securities so authenticated shall be
entitled to the benefits of this Indenture and shall be valid and obligatory for
all purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in this Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and shall at all times be a corporation organized and
doing business under the laws of the United States of America, any State thereof
or the District of Columbia, authorized under such laws to act as Authenticating
Agent, having a combined capital and surplus of not less than $50,000,000 and
subject to supervision or examination by Federal or State authority. If such
Authenticating Agent publishes reports of condition at least annually, pursuant
to law or to the requirements of said supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such
Authenticating Agent shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time an
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which such
Authenticating Agent shall be a party, or any corporation succeeding to the
corporate agency or corporate trust business of an Authenticating Agent, shall
continue to be an Authenticating Agent, provided such corporation shall be
otherwise eligible under this Section, without the execution or filing of any
paper or any further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving
written notice thereof to the Trustee and to the Company. The Trustee may at any
time terminate the agency of an Authenticating Agent by giving written notice
thereof to such Authenticating Agent and to the Company. Upon receiving such a
notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall give notice of such
appointment in the manner provided in Section 106 to all Holders of Securities
of the series with respect to which such Authenticating Agent will serve. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section.
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The Trustee agrees to pay to each Authenticating Agent from
time to time reasonable compensation for its services under this Section, and
the Trustee shall be entitled to be reimbursed for such payments, subject to the
provisions of Section 607.
If an appointment with respect to one or more series is made
pursuant to this Section, the Securities of such series may have endorsed
thereon, in addition to the Trustee's certificate of authentication, an
alternative certificate of authentication in the following form:
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This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
NATIONAL CITY BANK, As Trustee
By
-----------------------------------
As Authenticating Agent
By
-----------------------------------
Authorized Officer
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the
Trustee
(1) semi-annually, not later than June 15 and December 15 in
each year, a list, in such form as the Trustee may reasonably require,
of the names and addresses of the Holders of Securities of each series
as of the preceding June 1 or December 1, as the case may be, and
(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.
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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 time and in the manner provided pursuant thereto.
A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock exchange upon
which any Securities are listed, with the Commission and with the Company. The
Company will notify the Trustee when any Securities are listed on any stock
exchange.
SECTION 704. Reports by Company.
The Company shall file with the Trustee and the Commission,
and transmit to Holders, such information, documents and other reports, and such
summaries thereof, as may be required pursuant to the Trust Indenture Act at the
time and in the manner provided pursuant to the Trust Indenture Act; provided
that any such information, document 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:
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(1) in case the Company shall consolidate with or merge into
another Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, the Person formed by such
consolidation or into which the Company is merged or the Person which
acquires by conveyance or transfer, or which leases, the properties and
assets of the Company substantially as an entirety shall be a
corporation, partnership or trust, shall be organized and validly
existing under the laws of the United States of America, any State
thereof or the District of Columbia and shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the Trustee,
in form satisfactory to the Trustee, the due and punctual payment of
the principal of and any premium and interest on all the Securities and
the performance or observance of every covenant of this Indenture on
the part of the Company to be performed or observed;
(2) immediately after giving effect to such transaction and
treating any indebtedness which becomes an obligation of the Company or
any Subsidiary as a result of such transaction as having been incurred
by the Company or such Subsidiary at the time of such transaction, no
Event of Default, and no event which, after notice or lapse of time or
both, would become an Event of Default, shall have happened and be
continuing;
(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 mortgage, pledge, lien, security interest or
other encumbrance 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.
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ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when
authorized by a Board Resolution, and the Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto, in form
satisfactory to the Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the
Company and the assumption by any such successor of the covenants of
the Company herein and in the Securities; or
(2) to add to the covenants of the Company for the benefit of
the Holders of all or any series of Securities (and if such covenants
are to be for the benefit of less than all series of Securities,
stating that such covenants are expressly being included solely for the
benefit of such series) or to surrender any right or power herein
conferred upon the Company; or
(3) to add any additional Events of Default for the benefit of
the Holders of all or any series of Securities (and if such additional
Events of Default are to be for the benefit of less than all series of
Securities, stating that such additional Events of Default are
expressly being included solely for the benefit of such series); or
(4) to add to or change any of the provisions of this
Indenture to such extent as shall be necessary to permit or facilitate
the issuance of Securities in bearer form, registrable or not
registrable as to principal, and with or without interest coupons, or
to permit or facilitate the issuance of Securities in uncertificated
form; or
(5) to add to, change or eliminate any of the provisions of
this Indenture in respect of one or more series of Securities, provided
that any such addition, change or elimination (A) shall neither (i)
apply to any Security of any series created prior to the execution of
such supplemental indenture and entitled to the benefit of such
provision nor (ii) modify the rights of the Holder of any such Security
with respect to such provision or (B) shall become effective only when
there is no such Security Outstanding; or
(6) to secure the Securities pursuant to the requirements of
Section 1007 or otherwise; or
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(7) to establish the form or terms of Securities of any series
as permitted by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one
or more series and to add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Trustee,
pursuant to the requirements of Section 611; or
(9) to cure any ambiguity, to correct or supplement any
provision herein which may be defective or inconsistent with any other
provision herein, or to make any other provisions with respect to
matters or questions arising under this Indenture, provided that such
action pursuant to this clause (9) shall not adversely affect the
interests of the Holders of Securities of any series in any material
respect.
SECTION 902. Supplemental Indentures With Consent of Holders.
With the consent of the Holders of not less than 66-2/3% 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
installment 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 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 the 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
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(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).
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.
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.
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SECTION 906. Reference in Securities to Supplemental Indentures.
Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and shall
if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Company shall
so determine, new Securities of any series so modified as to conform, in the
opinion of the Trustee and the Company, to any such supplemental indenture may
be prepared and executed by the Company and authenticated and delivered by the
Trustee in exchange for Outstanding Securities of such series.
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of each
series of Securities that it will duly and punctually pay the principal of and
any premium and interest on the Securities of that series in accordance with the
terms of the Securities and this Indenture.
SECTION 1002. Maintenance of Office or Agency.
The Company will maintain in each Place of Payment for any
series of Securities an office or agency where Securities of that series may be
presented or surrendered for payment, where Securities of that series may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Company in respect of the Securities of that series and
this Indenture may be served. The Company will give prompt written notice to the
Trustee of the location, and any change in the location, of such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.
The Company may also from time to time designate one or more
other offices or agencies where the Securities of one or more series may be
presented or surrendered for any or all such purposes and may from time to time
rescind such designations; provided, however, that no such designation or
rescission shall in any manner relieve the Company of its obligation to maintain
an office or agency in each Place of Payment for Securities of any series for
such purposes. The Company will give prompt written notice to the Trustee of any
such designation or rescission and of any change in the location of any such
other office or agency.
SECTION 1003. Money for Securities Payments to Be Held in Trust.
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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 terms 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, 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.
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SECTION 1004. 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 1005. 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 1006. 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 1007. Restrictions on Secured Debt.
The Company will not itself, and will not permit any
Restricted Subsidiary to, incur, issue, assume, or guarantee any loans, whether
or not evidenced by negotiable instruments or securities, or any notes, bonds,
debentures or other similar evidences of indebtedness for money borrowed (loans,
and notes, bonds, debentures or other similar evidences of indebtedness for
money borrowed being hereinafter in this Section 1007 called "Debt"), secured
after the date hereof by pledge of, or mortgage or lien on, any Principal
Property of the Company or any Restricted Subsidiary or any shares of Capital
Stock of or Debt of any Restricted Subsidiary
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(mortgages, pledges and liens being hereinafter in this Section 1007 called
"Mortgage" or "Mortgages"), without effectively providing that the Securities
(together with, if the Company shall so determine, any other Debt of the Company
or such Restricted Subsidiary then existing or thereafter created which is not
subordinated to the Securities) shall be secured equally and ratably with (or,
at the option of the Company, prior to) such secured Debt, so long as such
secured Debt shall be so secured, unless, after giving effect thereto, the
aggregate amount of all such secured Debt plus all Attributable Debt of the
Company and its Restricted Subsidiaries with respect to sale and lease back
transactions to which Section 1008 is applicable would not exceed 10% of
Consolidated Net Tangible Assets; provided, however, that this Section 1007
shall not apply to, and there shall be excluded from secured Debt in any
computation under this Section 1007, Debt secured by:
(1) Mortgages on property of, or on any shares of Capital
Stock of or Debt of, any corporation existing at the time such
corporation becomes a Restricted Subsidiary;
(2) Mortgages in favor of the Company or any Restricted
Subsidiary;
(3) Mortgages in favor of any governmental body to secure
progress, advance or other payments pursuant to any contract or
provision of any statute;
(4) Mortgages on property, shares of Capital Stock or Debt
existing at the time of acquisition thereof (including acquisition
through merger or consolidation) or to secure the payment of all or any
part of the purchase price thereof or construction thereon or to secure
any Debt incurred prior to, at the time of, or within 180 days after
the later of the acquisition of such property, shares of Capital Stock
or Debt or the completion of construction, for the purpose of financing
all or any part of the purchase price thereof or construction thereon;
(5) Mortgages securing obligations issued by a State,
territory or possession of the United States, any political subdivision
of any of the foregoing, or the District of Columbia, or any
instrumentality of any of the foregoing to finance the acquisition or
construction of property, and on which the interest is not, in the
opinion of tax counsel of recognized standing or in accordance with a
ruling issued by the Internal Revenue Service, includible in gross
income of the holder by reason of Section 103(a)(1) of the Internal
Revenue Code (or any successor to such provision) as in effect at the
time of the issuance of such obligations; or
(6) Any extension, renewal or replacement (or successive
extensions, renewals or replacements), as a whole or in part, of any
Mortgage referred to in the foregoing clauses (1) to (5), inclusive;
provided, however, that such extension, renewal or replacement Mortgage
shall be limited to all or part of the same property, shares of Capital
Stock or Debt that secured the Mortgage extended, renewed or replaced
(plus improvements on such property).
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SECTION 1008. Restrictions on Sales and Leasebacks.
The Company will not itself, and will not permit any
Restricted Subsidiary to enter into any transaction after the date hereof with
any bank, insurance company or other lender or investor, or any such transaction
to which any such bank, company, lender or investor is a party, providing for
the leasing by the Company or a Restricted Subsidiary of any Principal Property
which has been or is to be sold or transferred by the Company or such Restricted
Subsidiary to such bank, company, lender or investor, or any person to whom
funds have been or are to be advanced by such bank, company, lender or investor
on the security of such Principal Property (herein referred to as a "sale and
leaseback transaction") unless, after giving effect thereto, the aggregate
amount of all Attributable Debt with respect to all such transactions plus all
secured Debt to which Section 1007 is applicable would not exceed 10% of
Consolidated Net Tangible Assets. This covenant shall not apply to, and there
shall be excluded from Attributable Debt in any computation under this Section
1008 or Section 1007 Attributable Debt with respect to, any sale and leaseback
transaction if:
(1) the lease in such sale and lease back transaction is for a
period, including renewal rights, of not in excess of three years, or
(2) the Company or a Restricted Subsidiary, within 180 days
after the sale or transfer shall have been made by the Company or by a
Restricted Subsidiary, applies an amount equal to the greater of the
net proceeds of the sale of the Principal Property leased pursuant to
such arrangement or the fair market value of the Principal Property so
leased at the time of entering into such arrangement (as determined in
any manner approved by the Board of Directors) to
(a) the retirement of the Securities, other Funded
Debt of the Company ranking on a parity with or senior to the
Securities, or Funded Debt of a Restricted Subsidiary,
provided, however, that the amount to be applied to the
retirement of such Funded Debt of the Company or a Restricted
Subsidiary shall be reduced by (x) the principal amount of any
Securities (or other notes or debentures constituting such
Funded Debt) delivered within such 180-day period to the
Trustee or other applicable trustee for retirement and
cancellation and (y) the principal amount of such Funded Debt,
other than items referred to in the preceding clause (x),
voluntarily retired by the Company or a Restricted Subsidiary
within 180 days after such sale, and provided, further, that,
notwithstanding the foregoing, no retirement referred to in
this clause (a) may be effected by any payment at maturity or
pursuant to any mandatory sinking fund payment or any
mandatory prepayment provision; or
(b) the purchase of other property which will
constitute a Principal Property having a fair market value, in
the opinion of the Board of Directors, at least equal to the
fair market value of the Principal Property leased in such
sale and lease back transaction, or
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(3) such sale and leaseback transaction is entered into prior
to, at the time of, or within 180 days after the later of the
acquisition of the Principal Property or the completion of construction
thereon, or
(4) the lease in such sale and leaseback transaction secures
or relates to obligations issued by a State, territory or possession of
the United States, or any political subdivision of any of the
foregoing, the District of Columbia, or any instrumentality of any of
the foregoing to finance the acquisition or construction of property,
and on which the interest is not, in the opinion of tax counsel of
recognized standing or in accordance with a ruling issued by the
Internal Revenue Service, includible in gross income of the holder by
reason of Section 103(a)(1) of the Internal Revenue Code (or any
successor to such provision) as in effect at the time of the issuance
of such obligations, or
(5) such sale and leaseback transaction is entered into
between the Company and a Restricted Subsidiary or between Restricted
Subsidiaries.
SECTION 1009. 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 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(18), 901(2) or 901(7) for the benefit of the Holders of such series or in
any of Sections 1004 to 1008, inclusive, if before the time for such compliance
the Holders of at least 66 2/3 % 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
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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 of 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.
The Trustee shall promptly notify the Company in writing of
the Securities selected for redemption as aforesaid and, in the 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
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in part. In the case of any such redemption in part, the unredeemed portion of
the principal amount of the Security shall be in an authorized denomination
(which shall not be less than the minimum authorized denomination) for such
Security.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities
shall relate, in the case of any Securities redeemed or to be redeemed only in
part, to the portion of the principal amount of such Securities which has been
or is to be redeemed.
SECTION 1104. Notice of Redemption.
Notice of redemption shall be given by first-class mail,
postage prepaid, mailed not less than 30 nor more than 60 days prior to the
Redemption Date, to each Holder of Securities to be redeemed, at his address
appearing in the Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Securities of
any series consisting of more than a single Security are to be
redeemed, the identification (and, in the case of partial
redemption of any such Securities, the principal amounts) of
the particular Securities to be redeemed and, if less than all
the Outstanding Securities of any series consisting of a
single Security are to be redeemed the principal amount of the
particular Security to be redeemed,
(4) that on the Redemption Date the Redemption Price
will become due and payable upon each such Security to be
redeemed and, if applicable, that interest thereon will cease
to accrue on and after said date,
(5) the place or places where each such Security is
to be surrendered for payment of the Redemption Price, and
(6) that the redemption is for a sinking fund, if
such is the case.
Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the Company's
request, by the Trustee in the name and at the expense of the Company and shall
be irrevocable.
SECTION 1105. Deposit of Redemption Price.
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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, installments of interest
whose Stated Maturity is on or prior to the Redemption Date will be payable to
the Holders of such Securities, or one or more Predecessor Securities,
registered as such at the close of business on the relevant Record Dates
according to their terms and the provisions of Section 307.
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal and any premium shall,
until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Security.
SECTION 1107. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be
surrendered at a Place of Payment therefor (with, if the Company or the Trustee
so requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Company and the Trustee duly executed by, the Holder thereof
or his attorney duly authorized in writing), and the Company shall execute, and
the Trustee shall authenticate and deliver to the Holder of such Security
without service charge, a new Security or Securities of the same series and of
like tenor, of any authorized denomination as requested by such Holder, in
aggregate principal amount equal to and in exchange for the unredeemed portion
of the principal of the Security so surrendered.
ARTICLE TWELVE
SINKING FUNDS
SECTION 1201. Applicability of Article.
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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 45 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.
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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 1005 through 1009, inclusive, and any covenants provided
pursuant to Section 301(18), 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 1005 through 1008, inclusive,
and any such covenants provided pursuant to Section 301(18), 901(2) or 901(7)),
501(5) and 501(8) shall be deemed not
<PAGE> 76
65
to be or result in an Event of Default, in each case with respect to such
Securities as provided in this Section on and after the date the conditions set
forth in Section 1304 are satisfied (hereinafter called "Covenant Defeasance").
For this purpose, such Covenant Defeasance means that, with respect to such
Securities, the Company may omit to comply with and shall have no liability in
respect of any term, condition or limitation set forth in any such specified
Section (to the extent so specified in the case of Section 501(4)), whether
directly or indirectly by reason of any reference elsewhere herein to any such
Section or by reason of any reference in any such Section to any other provision
herein or in any other document, but the remainder of this Indenture and such
Securities shall be unaffected thereby.
SECTION 1304. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to the application of
Section 1302 or Section 1303 to any Securities or any series of Securities, as
the case may be:
(1) The Company shall irrevocably have deposited or caused to
be deposited with the Trustee (or another trustee which satisfies the
requirements contemplated by Section 609 and agrees to comply with the
provisions of this Article applicable to it) as trust funds in trust
for the purpose of making the following payments, specifically pledged
as security for, and dedicated solely to, the benefits of the Holders
of such Securities, (A) money in an amount, or (B) U.S. Government
Obligations which through the scheduled payment of principal and
interest in respect thereof in accordance with their terms will
provide, not later than one day before the due date of any payment,
money in an amount, or (C) a combination thereof, in each case
sufficient, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge, and which shall
be applied by the Trustee (or any such other qualifying trustee) to pay
and discharge, the principal of and any premium and interest on such
Securities on the respective Stated Maturities, in accordance with the
terms of this Indenture and such Securities. As used herein, "U.S.
Government Obligation" means (x) any security which is (i) a direct
obligation of the United States of America for the payment of which the
full faith and credit of the United States of America is pledged or
(ii) an obligation of a Person controlled or supervised by and acting
as an agency or instrumentality of the United States of America the
payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either
case (i) or (ii), is not callable or redeemable at the option 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.
<PAGE> 77
66
Government Obligation or the specific payment of principal or interest
evidenced by such depositary receipt.
(2) In the event of an election to have Section 1302 apply to
any Securities or any series of Securities, as the case may be, the
Company shall have delivered to the Trustee an Opinion of Counsel
stating that (A) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling or (B) since the
date of this instrument, there has been a change in the applicable
Federal income tax law, in either case (A) or (B) to the effect that,
and based thereon such opinion shall confirm that, the Holders of such
Securities will not recognize gain or loss for Federal income tax
purposes as a result of the deposit, Defeasance and discharge to be
effected with respect to such Securities and will be subject to Federal
income tax on the same amount, in the same manner and at the same times
as would be the case if such deposit, Defeasance and discharge were not
to occur.
(3) In the event of an election to have Section 1303 apply to
any Securities or any series of Securities, as the case may be, the
Company shall have delivered to the Trustee an Opinion of Counsel to
the effect that the Holders of such Securities will not recognize gain
or loss for Federal income tax purposes as a result of the deposit and
Covenant Defeasance to be effected with respect to such Securities and
will be subject to Federal income tax on the same amount, in the same
manner and at the same times as would be the case if such deposit and
Covenant Defeasance were not to occur.
(4) The Company shall have delivered to the Trustee an
Officer's Certificate to the effect that neither such Securities nor
any other Securities of the same series, if then listed on any
securities exchange, will be delisted as a result of such deposit.
(5) No event which is, or after notice or lapse of time or
both would become, an Event of Default with respect to such Securities
or any other Securities shall have occurred and be continuing at the
time of such deposit or, with regard to any such event specified in
Sections 501(6) and (7), at any time on or prior to the 90th day after
the date of such deposit (it being understood that this condition shall
not be deemed satisfied until after such 90th day).
(6) Such Defeasance or Covenant Defeasance shall not cause the
Trustee to have a conflicting interest within the meaning of the Trust
Indenture Act (assuming all Securities are in default within the
meaning of the Trust Indenture 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
<PAGE> 78
67
Investment Company Act unless such trust shall be registered under such
Act or exempt from registration thereunder.
(9) The Company shall have delivered to the Trustee an
Officer's Certificate and an Opinion of Counsel, each stating that all
conditions precedent with respect to such Defeasance or Covenant
Defeasance have been complied with.
SECTION 1305. Deposited Money and U.S. Government Obligations to Be Held
in Trust; Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section
1003, all money and U.S. Government Obligations (including the proceeds thereof)
deposited with the Trustee or other qualifying trustee (solely for purposes of
this Section and Section 1306, the Trustee and any such other trustee are
referred to collectively as the "Trustee") pursuant to Section 1304 in respect
of any Securities shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Securities and this Indenture, to the
payment, either directly or through any such Paying Agent (including the Company
acting as its own Paying Agent) as the Trustee may determine, to the Holders of
such Securities, of all sums due and to become due thereon in respect of
principal and any premium and interest, but money so held in trust need not be
segregated from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U.S. Government
Obligations deposited pursuant to Section 1304 or the principal and interest
received in respect thereof other than any such tax, fee or other charge which
by law is for the account of the Holders of Outstanding Securities.
Anything in this Article to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or U.S. Government Obligations held by it as provided in
Section 1304 with respect to any Securities which, in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, are in excess of the
amount thereof which would then be required to be deposited to effect the
Defeasance or Covenant Defeasance, as the case may be, with respect to such
Securities.
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
<PAGE> 79
68
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.
* * * * *
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.
<PAGE> 80
69
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.
PARKER-HANNIFIN CORPORATION
By /s/ Joseph D. Whiteman
-----------------------------
Vice President, General Counsel
and Secretary
Attest:
/s/ Thomas A. Piraino
- ---------------------
Assistant Secretary
NATIONAL CITY BANK
By /s/ Janet A. Schwartz
-----------------------------
Vice President
Attest:
/s/ Holly K. Pattison
- -----------------------
Assistant Vice President
<PAGE> 81
70
STATE OF OHIO )
) SS:
COUNTY OF CUYAHOGA )
On the 15th day of May, 1996, before me personally came Joseph
D. Whiteman, to me known, who, being by me duly sworn, did depose and say that
he is the Vice President, General Counsel and Secretary of Parker-Hannifin
Corporation, one of the corporations described in and which executed the
foregoing instrument; that he knows the seal of said corporation; that the seal
affixed to said instrument is such corporate seal; that it was so affixed by
authority of the Board of Directors of said corporation, and that he signed his
name thereby by like authority.
/s/ Deanne P. Kelley
--------------------------
STATE OF OHIO )
) SS:
COUNTY OF CUYAHOGA )
On the 14th day of May, 1996, before me personally came Janet
A. Schwartz, to me known, who, being by me duly sworn, did depose and say that
she is Vice President of National City Bank, 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 thereby by like authority.
/s/ Penny J. Jarrel
--------------------------
<PAGE> 1
Exhibit 5.1
March 13, 1998
Parker-Hannifin Corporation
6035 Parkland Boulevard
Cleveland, Ohio 44124-4141
Re: $600,000,000 Aggregate Amount of Senior Debt
Securities of Parker-Hannifin Corporation
-----------------------------------------
Gentlemen:
We are acting as counsel for Parker-Hannifin Corporation, an
Ohio corporation (the "Company"), in connection with the creation and
authorization of the issuance and sale of up to $600,000,000 aggregate amount of
Senior Debt Securities (the "Securities"), to be issued pursuant to an
Indenture, dated as of May 3, 1996 (the "Indenture"), entered into between the
Company and National City Bank, as Trustee (the "Trustee").
We have examined such documents, records and matters of law as
we have deemed necessary for purposes of this opinion, and based thereupon, but
subject to the assumptions and qualifications set forth below, we are of the
opinion that:
1. The Indenture constitutes a valid and binding instrument of
the Company.
2. The Securities have been duly authorized and, when duly
executed, authenticated and delivered to and paid for by the purchasers thereof
in accordance with the terms of such Securities, the Indenture and the U.S.
Distribution Agreement, will be valid and binding obligations of the Company
and will be entitled to the benefits of the Indenture.
In rendering the foregoing opinions we have also assumed that
the U.S. Distribution Agreement will be executed and delivered by the Company
and the Agents in
<PAGE> 2
Parker-Hannifin Corporation
March 13, 1998
Page 2
substantially the form filed as Exhibit 1.1 to the Registration Statement on
Form S-3 filed by the Company to effect registration of the Securities under the
Securities Act of 1933 (the "Registration Statement").
We hereby consent to the filing of this opinion as Exhibit 5.1
to the Registration Statement and to the reference to us under the caption
"Legal Matters" in the Prospectus constituting a part of such Registration
Statement.
Very truly yours,
Jones, Day, Reavis & Pogue
<PAGE> 1
Exhibit 12.1
PARKER-HANNIFIN CORPORATION
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(In thousands)
<TABLE>
<CAPTION>
Six months ended
December 31, Fiscal Year Ended June 30,
EARNINGS 1997 1996 1997 1996 1995 1994 1993
- -------- -------------------------- ---------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Income from continuing operations
before income taxes $231,899 $161,982 $424,867 $374,479 $348,407 $112,449 $108,066
Add:
Interest on indebtedness, exclusive of
interest capitalized in accordance
with FASB #34 and interest on
ESOP loan guarantee 23,371 24,115 46,373 35,665 28,884 34,687 43,055
Amortization of deferred loan costs 148 141 286 146 128 297 237
Portion of rents representative of
interest factor 5,551 4,983 11,102 9,966 8,791 7,157 10,299
Equity share of losses of companies
for which debt obligations are not
guaranteed ---- 331 1,327 513 392 1,359 1,566
Amortization of previously
capitalized interest 151 109 220 219 216 217 206
-------------------------- ---------------------------------------------------------------
Income as adjusted $261,120 $191,661 $484,175 $420,988 $386,818 $156,166 $163,429
========================== ===============================================================
FIXED CHARGES
- -------------
Interest on indebtedness, exclusive of
interest capitalized in accordance
with FASB #34 and interest on
ESOP loan guarantee $ 23,371 $ 24,115 $ 46,373 $ 35,665 $ 28,884 $ 34,687 $ 43,055
Capitalized interest ---- 165 272 538 283 298 32
Amortization of deferred loan costs 148 141 286 146 128 297 237
Portion of rents representative of
interest factor 5,551 4,983 11,102 9,966 8,791 7,157 10,299
-------------------------- ---------------------------------------------------------------
Fixed charges $ 29,070 $ 29,404 $ 58,033 $ 46,315 $ 38,086 $ 42,439 $ 53,623
========================== ===============================================================
RATIO OF EARNINGS TO FIXED
- --------------------------
CHARGES 8.98x 6.52x 8.34x 9.09x 10.16x 3.68x 3.05x
- -------
</TABLE>
<PAGE> 1
Exhibit 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration
statement of Parker-Hannifin Corporation on Form S-3 of our report dated July
31, 1997, on our audits of the consolidated financial statements and financial
statement schedule of Parker-Hannifin Corporation as of June 30, 1997 and 1996,
and for the years ended June 30, 1997, 1996 and 1995. We also consent to the
reference to our firm under the caption "Experts."
COOPERS & LYBRAND L.L.P.
Cleveland, Ohio
March 13, 1998
<PAGE> 1
Exhibit 24.1
PARKER-HANNIFIN CORPORATION
REGISTRATION STATEMENT ON FORM S-3
POWER OF ATTORNEY
Parker-Hannifin Corporation, an Ohio corporation (the
"Corporation"), hereby constitutes and appoints, Duane E. Collins, Michael J.
Hiemstra, Joseph D. Whiteman, Timothy K. Pistell, Thomas A. Piraino and Thomas
C. Daniels and each of them, with full power of substitution and resubstitution,
as attorneys-in-fact or attorney-in-fact of the Corporation, for it and in its
name, place and stead, to execute and file with the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933 one or more
Registration Statement(s) on Form S-3 relating to the registration for sale of
one or more series of debt securities (the "Securities") of the Corporation,
with any and all amendments, supplements and exhibits thereto (including
pre-effective and post-effective amendments or supplements), to execute and file
any and all other applications or other documents to be filed with the
Commission and all documents required to be filed with any state securities
regulating board or commission pertaining to such Securities registered pursuant
to the Registration Statement(s) on Form S-3, with any and all amendments,
supplements and exhibits thereto each such attorney to have full power to act
with or without the others, and to have full power and authority to do and
perform, in the name and on behalf of the Corporation, every act whatsoever
necessary, advisable or appropriate to be done in the premises, hereby ratifying
and approving the act of said attorneys and any of them and any such substitute.
EXECUTED as of March 13, 1998.
PARKER-HANNIFIN CORPORATION
By: /s/ Joseph D. Whiteman
------------------------------------
Name: Joseph D. Whiteman
Title: Vice President, General Counsel and
Secretary
<PAGE> 2
Exhibit 24.1
DIRECTORS AND OFFICERS OF
PARKER-HANNIFIN CORPORATION
REGISTRATION STATEMENT ON FORM S-3
POWER OF ATTORNEY
The undersigned directors and officers of Parker-Hannifin
Corporation, an Ohio corporation, do hereby constitute and appoint, Duane E.
Collins, Michael J. Hiemstra, Joseph D. Whiteman, Timothy K. Pistell, Thomas A.
Piraino and Thomas C. Daniels and each of them, with full power of substitution
and resubstitution, as attorneys-in-fact or attorney-in-fact of the undersigned,
for him/her and in his/her name, place and stead, to execute and file with the
Securities and Exchange Commission (the "Commission") under the Securities Act
of 1933 one or more Registration Statement(s) on Form S-3 relating to the
registration for sale of one or more series of debt securities (the
"Securities") of the Corporation, with any and all amendments, supplements and
exhibits thereto (including pre-effective and post-effective amendments or
supplements), to execute and file any and all other applications or other
documents to be filed with the Commission and all documents required to be filed
with any state securities regulating board or commission pertaining to such
Securities registered pursuant to the Registration Statement(s) on Form S-3,
with any and all amendments, supplements and exhibits thereto each such attorney
to have full power to act with or without the others, and to have full power and
authority to do and perform, in the name and on behalf of the undersigned, every
act whatsoever necessary, advisable or appropriate to be done in the premises as
fully and to all intents and purposes as the undersigned might or could do in
person, hereby ratifying and approving the act of said attorneys and any of them
and any such substitute.
EXECUTED as of March 13, 1998.
<TABLE>
<S> <C>
/s/ Duane E. Collins /s/ Patrick S. Parker
- ----------------------------------------- -------------------------------------------
Duane E. Collins, President, Patrick S. Parker,
Chief Executive Officer and Director Chairman of the Board of Directors
(Principal Executive Officer)
/s/ John G. Breen
-------------------------------------------
/s/ Michael J. Hiemstra John G. Breen, Director
- -----------------------------------------
Michael J. Hiemstra, Vice-President -
Finance and Administration
(Principal Financial Officer) /s/ Paul C. Ely, Jr.
-------------------------------------------
Paul C. Ely, Jr., Director
/s/ Harold C. Gueritey, Jr.
- -----------------------------------------
Harold C. Gueritey, Jr., Controller /s/ Allen H. Ford
(Principal Accounting Officer) -------------------------------------------
Allen H. Ford, Director
/s/ Peter W. Likins
-------------------------------------------
Peter W. Likins, Director
</TABLE>
<PAGE> 3
/s/ Allan L. Rayfield
------------------------------------
Allan L. Rayfield, Director
/s/ Paul G. Schloemer
------------------------------------
Paul G. Schloemer, Director
/s/ Wolfgang R. Schmitt
------------------------------------
Wolfgang R. Schmitt, Director
/s/ Dennis W. Sullivan
------------------------------------
Dennis W. Sullivan, Director
/s/ Stephanie A. Streeter
------------------------------------
Stephanie A. Streeter, Director
/s/ Hector R. Ortino
------------------------------------
Hector R. Ortino, Director
/s/ Michael A. Treschow
------------------------------------
Michael A. Treschow, Director
/s/ Debra L. Starnes
------------------------------------
Debra L. Starnes, Director
2
<PAGE> 1
Exhibit 25.1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------
FORM T-1
STATEMENT OF ELIGIBILITY AND QUALIFICATION
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)
NATIONAL CITY BANK
(Exact name of Trustee as specified in its charter)
34-0420310
(I.R.S. Employer Identification No.)
1900 East Ninth Street
Cleveland, Ohio 44114
(Address of principal executive (zip code)
offices)
David L. Zoeller
Senior Vice President and General Counsel
National City Corporation
1900 East Ninth Street
Cleveland, Ohio 44114
(216) 575-9313
(Name, address and telephone number of agent for service)
--------
PARKER-HANNIFIN CORPORATION
(Exact name of obligor as specified in its charter)
OHIO 34-0451060
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
6035 Parkland Avenue
Cleveland, OH 44124
(Address of principal (zip code)
executive offices)
Shelf Registration of Senior Debt Securities
(Title of the Indenture securities)
<PAGE> 2
GENERAL
1. General information. Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which
it is subject.
Comptroller of the Currency, Washington, D.C.
The Federal Reserve Bank of Cleveland, Cleveland, Ohio
Federal Deposit Insurance Corporation, Washington, D.C.
(b) Whether it is authorized to exercise corporate trust powers.
National City Bank is authorized to exercise corporate trust powers.
2. Affiliations with obligor. If the obligor is an affiliate of the trustee,
describe such affiliation.
NONE
16. List of exhibits
(1) A copy of the Articles of Association of the Trustee.
Incorporated herein by reference is Charter No. 786 Merger No. 1043
the Articles of Association of National City Bank, which Articles of
Association were included as a part of Exhibit 1 to Form T-1 filing
made by said National City Bank with the Securities and Exchange
Commission in November 1973 (File No. 2-49786).
Incorporated herein by reference is an amendment to the Articles of
Association of National City Bank, which amendment was included as a
part of Exhibit 1 to Form T-1 filing made by said National City Bank
with the Securities and Exchange Commission in April 1996 (File No.
333-02761)
(2) A copy of the certificate of authority of the Trustee to commence
business:
(a) a copy of the certificate of NCB National Bank to commence
business.
<PAGE> 3
Incorporated herein by reference is a true and correct copy of the
certificate issued by the Comptroller of the Currency under date of
April 26, 1973, whereby NCB National Bank was authorized to commence
the business of banking as a National banking Association, which
true copy of said Certificate was included as Exhibit 2(a) to Form
T-1 filing made by said National City Bank with the Securities and
Exchange Commission in November 1973 (File 2-49786)
(b) a copy of the approval of the merger of The National City Bank
of Cleveland into NCB National Bank under the charter of NCB
National Bank and under the title "National City Bank."
Incorporated herein by reference is a true and correct copy of the
certificate issued by the Comptroller of the Currency under date of
April 27, 1973, whereby the National City Bank of Cleveland was
merged into NCB National Bank, which true copy of said certificate
was included as Exhibit 2(b) to Form T-1 filing made by said
National City Bank with the Securities and Exchange Commission in
November 1973 (File 2-49786).
(3) A copy of the authorization of the Trustee to exercise corporate
trust powers.
Incorporated herein by reference is a true and correct copy of the
certificate dated April 13, 1973 issued by the Comptroller of the
Currency whereby said National City Bank has been granted the right
to exercise certain trust powers, which true copy of said
certificate was included as Exhibit 3 to Form T-1 filing made by
said National City Bank with the Securities and Exchange Commission
in November 1973 (File 2-49786).
(4) A copy of existing By-Laws of the Trustee.
Incorporated herein by reference is a true and correct copy of the
National City Bank By-Laws as amended through January 1, 1993. This
true copy of said By-Laws was included as Exhibit 4 to Form T-1
filing made by National City Bank with the Securities and Exchange
Commission in March, 1995 (File 22-26594).
(5) Not applicable.
<PAGE> 4
(6) Consent of the United States Institutional Trustee required by
Section 321(b) of the Act.
Attached hereto as Exhibit 6 is the Consent of the Trustee in
accordance with Section 321 (b) of the Trust Indenture Act of 1939
as amended.
(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.
Attached hereto as Exhibit 7 is the latest report of condition of
National City Bank.
(8) Not applicable.
(9) Not applicable.
<PAGE> 5
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, National City Bank, 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 Cleveland, and State of Ohio, on
the 10th day of March, 1998.
NATIONAL CITY BANK
By: /s/ Janet A. Schwartz
---------------------------
Janet A. Schwartz
Vice President
<PAGE> 6
CONSENT
In accordance with Section 321(b) of the Trust Indenture Act of 1939,
as amended, and to the extent required thereby to enable it to act as an
indenture trustee, National City Bank hereby consents as of the date hereof that
reports of examinations of it by the Treasury Department, the Comptroller of the
Currency, the Board of Governors of the Federal Reserve Banks, the Federal
Deposit Insurance Corporation or of any other Federal or State authority having
the right to examine National City Bank, may be furnished by similar authorities
to the Securities and Exchange Commission upon request thereon.
NATIONAL CITY BANK
By: /s/ Janet A. Schwartz
---------------------------
Janet A. Schwartz
Vice President
<PAGE> 7
REPORT OF CONDITION
-------------------
NATIONAL CITY BANK
------------------
(Including Domestic and Foreign Subsidiaries)
<TABLE>
<CAPTION>
Of Cleveland, In the State of Ohio, at the close of business on December 31, 1997,
published in response to call made by Comptroller of the Currency, under Title 12,
United States Code, Section 161.
ASSETS
------
(In Thousands)
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin....................................... $984,829
Interest-bearing balances................................................................ 1,650
Securities:
Held-to-maturity securities.............................................................. 0
Available-for-sale securities............................................................ 1,696,594
Federal funds sold and securities purchased under agreements to resell in domestic
offices of the bank and of its Edge and Agreement subsidiaries, and in IBFs.............. 1,116,347
Loans and lease financing receivables:
Loans and leases, net of unearned income........................................$11,978,802
Less: Allowance for loan and lease losses...........................................185,728
Loans and leases, net of unearned income and allowance..................................... 11,793,074
Assets held in trading accounts................................................................ 558
Premises and fixed assets (including capitalized leases)....................................... 165,115
Other real estate owned........................................................................ 1,542
Customers' liability to this bank on acceptances outstanding................................... 22,854
Intangible assets.............................................................................. 52,976
Other assets................................................................................... 704,678
-----------
TOTAL ASSETS............................................................................... $16,540,217
===========
LIABILITIES
-----------
Deposits:
In domestic offices........................................................................ $10,045,568
Non-interest bearing.........................................................$2,740,449
Interest-bearing..............................................................7,305,119
In foreign OFFICES, Edge and Agreement subsidiaries, and IBFs.............................. 1,011,125
Interest-bearing..............................................................1,011,125
Federal funds purchased and securities sold under agreements to repurchase..................... 11419,399
Demand notes issued to the U.S. Treasury....................................................... 256,676
Trading Liabilities ........................................................................... 0
Other borrowed money:
With a remaining maturity of one year or less.............................................. 485,714
With a remaining maturity of more than one year through three years........................ 400,223
With a remaining maturity of more than three years......................................... 1,042,601
Bank's liability on acceptances executed and outstanding....................................... 22,854
Subordinated notes and debentures.............................................................. 248,608
Other liabilities.............................................................................. 464,844
-----------
TOTAL LIABILITIES.......................................................................... 15,397,612
-----------
EQUITY CAPITAL
--------------
Common Stock................................................................................... 23,441
Surplus........................................................................................ 168,268
Undivided profits and capital reserves......................................................... 941,169
Net unrealized holding gains (losses) on available-for-sale securities......................... 9,727
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TOTAL EQUITY CAPITAL....................................................................... 1,142,605
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TOTAL LIABILITIES AND EQUITY CAPITAL........................................................ 16,540,217
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I, Gary M. Small, Senior Vice President and Chief Financial Officer of the above
named bank do hereby declare that this Report of Condition is true and correct
to the best of my knowledge and belief.
Gary M. Small
