<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 25, 1995
REGISTRATION NO. 33-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
VANGUARD CELLULAR SYSTEMS, INC.
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C>
NORTH CAROLINA 56-1549590
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
</TABLE>
2002 PISGAH CHURCH ROAD
SUITE 300
GREENSBORO, NORTH CAROLINA 27455
(910) 282-3690
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
RICHARD C. ROWLENSON
SENIOR VICE PRESIDENT AND GENERAL COUNSEL
VANGUARD CELLULAR SYSTEMS, INC.
2002 PISGAH CHURCH ROAD
SUITE 300
GREENSBORO, NORTH CAROLINA 27455
(910) 282-3690
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
COPIES OF COMMUNICATIONS TO:
DORIS R. BRAY
SCHELL BRAY AYCOCK ABEL & LIVINGSTON L.L.P.
POST OFFICE BOX 21847
GREENSBORO, NORTH CAROLINA 27420
(910) 370-8800
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. []
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with the 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
[CAPTION]
<TABLE>
<S> <C> <C> <C>
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS AMOUNT TO BE OFFERING PRICE AGGREGATE
OF SECURITIES TO BE REGISTERED REGISTERED (1) PER UNIT OFFERING PRICE
<S> <C> <C> <C>
Senior Debentures; Senior Subordinated
Debentures; )
and Subordinated Debentures (collectively,)
"Debentures"); )
Preferred Stock ($.01 par value per share); ) $250,000,000 $250,000,000
Depositary Shares representing Preferred
Stock; )
Class A Common Stock ($.01 par value per
share); )
Class B Common Stock ($.01 par value per
share); )
and Warrants )
<CAPTION>
TITLE OF EACH CLASS AMOUNT OF
OF SECURITIES TO BE REGISTERED REGISTRATION FEE (2)
<S> <C>
Senior Debentures; Senior Subordinated
Debentures; )
and Subordinated Debentures (collectively,)
"Debentures"); )
Preferred Stock ($.01 par value per share); ) $86,207
Depositary Shares representing Preferred
Stock; )
Class A Common Stock ($.01 par value per
share); )
Class B Common Stock ($.01 par value per
share); )
and Warrants )
</TABLE>
(1) Such amount in U.S. dollars or the equivalent thereof in foreign currencies
as shall result in an aggregate initial offering price for all securities of
$250,000,000. In addition, this Registration Statement includes such
presently indeterminate number of Securities (as defined herein) as may be
issuable from time to time upon conversion or exchange of the Securities
being registered hereunder.
(2) The registration fee has been calculated in accordance with Rule 457(o)
under the Securities Act of 1933, as amended, and reflects the offering
price rather than the principal amount of any Debentures issued at a
discount or liquidation value of any Preferred Stock.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(A), MAY
DETERMINE.
<PAGE>
SUBJECT TO COMPLETION, DATED JULY 25, 1995
PROSPECTUS
(VANGUARD CELLULAR SYSTEMS, INC.(R) LOGO APPEARS HERE)
SENIOR DEBENTURES, SENIOR SUBORDINATED DEBENTURES,
SUBORDINATED DEBENTURES, PREFERRED STOCK, CLASS A COMMON STOCK,
CLASS B COMMON STOCK AND WARRANTS
Vanguard Cellular Systems, Inc. (the "Company") may offer and issue from
time to time (i) its senior debentures ("Senior Debentures"), senior
subordinated debentures ("Senior Subordinated Debentures"), and subordinated
debentures ("Subordinated Debentures") (collectively, the "Debentures"), (ii)
shares of its Preferred Stock, $.01 par value per share, which may be
represented by depositary shares as described herein (the "Preferred Stock"),
(iii) shares of its Class A Common Stock, par value $.01 per share (the "Class A
Common Stock"), (iv) shares of its Class B Common Stock, par value $.01 per
share (the "Class B Common Stock") or (v) Warrants to purchase Debentures,
Preferred Stock, Class A Common Stock or Class B Common Stock or other
securities or rights (the "Warrants"), all for an aggregate initial offering
price not to exceed $250,000,000 (or the equivalent thereof denominated in one
or more foreign currencies or foreign currency units). The Debentures, Preferred
Stock, Class A Common Stock, Class B Common Stock and Warrants are herein
collectively referred to as the "Securities." The Securities may be offered in
one or more separate classes or series, in amounts, at prices and on terms to be
determined by market conditions at the time of sale and to be set forth in a
supplement or supplements to this Prospectus (a "Prospectus Supplement"). Any
Securities may be offered with other Securities or separately. Securities may be
sold for U.S. dollars, foreign currency or currency units; amounts payable with
respect to any Securities may likewise be payable in U.S. dollars, foreign
currency or currency units -- in each case, as the Company designates.
Debentures and Preferred Stock may be convertible and/or exchangeable for
Securities or other securities or rights.
Certain terms of any Debentures in respect of which this Prospectus is
being delivered will be set forth in the accompanying Prospectus Supplement
including, where applicable, the specific designation (including whether senior,
senior subordinated or subordinated and whether convertible and/or
exchangeable), aggregate principal amount, purchase price, maturity, interest
rate and time of payment of interest (if any), terms (if any) for the
redemption, conversion or exchange thereof, listing (if any) on a securities
exchange and any other specific terms of the Debentures. Certain terms of any
Preferred Stock in respect of which this Prospectus is being delivered will be
set forth in the accompanying Prospectus Supplement, including the specific
designation, number of shares, purchase price and the rights, preferences and
privileges thereof and any qualifications or restrictions thereon (including
dividends, liquidation value, voting rights, terms for the redemption,
conversion or exchange thereof and any other specific terms of the Preferred
Stock), listing (if any) on a securities exchange, and whether the Company has
elected to offer the Preferred Stock in the form of depositary shares. Certain
terms of any Warrants in respect of which this Prospectus is being delivered
will be set forth in the accompanying Prospectus Supplement, including the
specific designation, the number, purchase price and terms thereof, any listing
of the Warrants or the underlying Securities on a securities exchange and any
other terms in connection with the offering, sale and exercise of the Warrants,
as well as the terms on which and the securities for which such Warrants may be
exercised.
SEE "RISK FACTORS" BEGINNING ON PAGE 4 HEREOF FOR A DISCUSSION OF CERTAIN
FACTORS THAT SHOULD BE CONSIDERED BY PROSPECTIVE INVESTORS.
The Securities may be sold on a negotiated or competitive bid basis to or
through underwriters or dealers designated from time to time or to other
purchasers directly or through agents designated from time to time. Certain
terms of the offering and sale of the Securities, including, where applicable,
the names of the underwriters, dealers or agents, if any, the principal amount
or number of shares or Warrants to be purchased, the purchase price of the
Securities and the proceeds to the Company from such sale, and any applicable
commissions, discounts and other items constituting compensation of such
underwriters, dealers or agents, will also be set forth in the accompanying
Prospectus Supplement.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED ON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS, ANY REPRESENTATION TO
THE
CONTRARY IS A CRIMINAL OFFENSE
(The redherring appears on the left-hand side of this page, rotated 90
degrees. Text appears as follows:)
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 by 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.
THE DATE OF THIS PROSPECTUS IS , 1995
<PAGE>
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS, IF ANY, MAY OVER-ALLOT
OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICES OF THE
SECURITIES AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH TRANSACTIONS MAY BE EFFECTED IN THE OVER-THE-COUNTER MARKET OR
OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents have been previously filed by the Company with the
Securities and Exchange Commission (the "Commission") and are hereby
incorporated by reference in this Prospectus as of their respective dates: (a)
Annual Report on Form 10-K for the year ended December 31, 1994, (b) Quarterly
Report on Form 10-Q for the quarter ended March 31, 1995, (c) Current Report on
Form 8-K filed on January 9, 1995 (d) Current Report on Form 8-K filed on
February 13, 1995 and (e) description of the Company's Class A Common Stock
contained in a Registration Statement of the Company on Form 8-A dated February
29, 1988, as amended by a Form 8-A/A dated July 25, 1995.
Additionally, all reports and any definitive proxy or information
statements filed by the Company with the Commission pursuant to Section 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), subsequent to the date of this Prospectus and prior to the
termination of the offering hereby shall be deemed to be incorporated by
reference in this Prospectus and to be a part hereof from the date of filing of
such documents. Any statements contained in a document incorporated or deemed to
be incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any other subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of 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 incorporated herein by reference (other than
exhibits to such documents which are not specifically incorporated by reference
in such documents). Written requests for such copies should be directed to the
Assistant Treasurer, Vanguard Cellular Systems, Inc., 2002 Pisgah Church Road,
Suite 300, Greensboro, NC 27455. Telephone requests may be directed to (910)
282-3690.
CERTAIN DEFINITIONS
As used in this Prospectus, "pops" means the Donnelly Marketing Service
estimate of the 1994 population of a Metropolitan Statistical Area ("MSA") or
Rural Service Area ("RSA") multiplied by a percentage ownership interest in an
entity licensed or designated to receive a license by the Federal Communications
Commission (the "FCC") to construct or operate a cellular telephone system in
that MSA or RSA. An MSA or RSA is referred to herein as a "market." The number
of pops should not be confused with the current number of users of cellular
service and is not necessarily indicative of the number of users of cellular
services in the future. "Nonwireline" refers to a company that is not owned by
or primarily affiliated with a landline telephone company. A nonwireline license
is one of two licenses granted in each cellular market area. "Control markets"
refer to all markets in which the Company's current ownership interest is in
excess of 50.0% as well as the Wilmington and Jacksonville, North Carolina
markets which are jointly controlled by the Company and a subsidiary of GTE
Corporation. "Operating Cash Flow" or "EBITDA" refers to the Company's income
(loss) from operations before depreciation and amortization. Operating Cash Flow
has been used by the Company, in conjunction with external financing, to satisfy
debt service obligations and to fund capital expenditures and other operational
needs. In addition, certain covenants in the long-term credit facility are based
upon calculations using Operating Cash Flow. Operating Cash Flow does not
represent and should not be considered as an alternative to net income or
operating income as determined by generally accepted accounting principles.
2
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Exchange
Act and in accordance therewith files reports, proxy and information statements
and other information with the Commission. Such reports, proxy and information
statements and other information can be inspected and copied at the public
reference facilities maintained by the Commission at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the Commission's Regional Offices
located at Suite 1400, 500 West Madison Street, Chicago, Illinois 60661 and 7
World Trade Center, New York, New York 10048, and copies of such materials can
be obtained from the Public Reference Section of the Commission, Washington,
D.C. 20549, at prescribed rates.
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 of 1933 (the "Securities Act"). This Prospectus omits 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 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.
NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH ANY OFFERING OF
SECURITIES DESCRIBED HEREIN, AND IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY
OR ANY OTHER PERSON. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A
SOLICITATION OF AN OFFER TO BUY, ANY SECURITIES OTHER THAN THOSE SPECIFICALLY
OFFERED HEREBY OR ANY SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY
PERSON TO WHOM IT IS UNLAWFUL TO MAKE AN OFFER OR SOLICITATION IN SUCH
JURISDICTION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE
INFORMATION HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
3
<PAGE>
THE COMPANY
The Company owns and operates nonwireline cellular telephone systems in the
Eastern United States and is one of the largest independent operators of solely
nonwireline cellular telephone systems in the United States with 7.5 million
aggregate pops and 27 control cellular markets as of June 30, 1995. The
Company's control cellular markets are grouped into five operating
metro-clusters consisting of the Mid-Atlantic Supersystem and the Florida,
Carolinas, New England and West Virginia metro-clusters. The Mid-Atlantic
Supersystem, together with the New England metro-cluster, represent 75% of the
Company's pops as of June 30, 1995 and are contiguous to four of the nation's
seven largest MSAs -- New York, Philadelphia, Baltimore/Washington and Boston.
The Company was founded as a Delaware corporation in July 1984 and
reincorporated under North Carolina law in February 1987. As used in this
Prospectus, the term "Company" refers to Vanguard Cellular Systems, Inc. and its
subsidiaries, as well as the partnerships or corporations holding cellular
licenses for markets not 100% owned by the Company or its subsidiaries, to the
extent of their interests therein. The location and mailing address of the
principal executive offices of the Company is 2002 Pisgah Church Road, Suite
300, Greensboro, North Carolina 27455, telephone (910) 282-3690.
USE OF PROCEEDS
Except as may otherwise be set forth in the Prospectus Supplement, the net
proceeds from the sale of the Securities offered hereby will be used for capital
expenditures, acquisitions, working capital and general corporate purposes.
Pending such application of the proceeds, the Company will temporarily reduce
bank debt or invest the proceeds of this offering in certificates of deposit,
United States government securities or certain other interest-bearing
securities.
RISK FACTORS
Before purchasing any Securities offered hereby a prospective investor
should consider, among other things, the following factors:
NET LOSSES. The Company's activities have concentrated on the investment in
and development of its cellular systems to improve service and expand geographic
coverage. As a result, in each year of its operations the Company has incurred a
net loss. There can be no assurance that the Company will become and/or remain
profitable in the future.
EXISTING INDEBTEDNESS; ADDITIONAL FINANCING. The Company has relied
primarily upon borrowings under its bank credit facilities to finance
operations, capital expenditures and acquisitions. Total outstanding borrowings
under its existing loan agreement (the "Loan Agreement") were $459.0 million at
June 30, 1995 and the Company expects to continue to borrow funds under this
agreement. The Loan Agreement provides for total borrowings of up to $675
million; however, under the financial covenants of the agreement, borrowing
availability is dependent on continued improvement in the Company's operating
performance. In addition, the Company is currently required to pay only interest
under the Loan Agreement at rates which vary with specified indices, but
beginning March 31, 1998, the Company will be required to begin repaying
principal under the Loan Agreement with all amounts due by December 31, 2003.
Although the Company has generated positive Operating Cash Flow since 1991, the
Company's cash flow must continue to improve for it to meet the financial
covenants of the Loan Agreement and to service its debt and meet its other cash
requirements without additional financing. There can be no assurance that such
improvements will be achieved or, if not achieved, that additional financing
will be available, or that any available financing will be on terms that are
attractive to the Company. If cash flows do not continue to improve sufficiently
or if such financing is not available to the Company, the Company may be
materially limited in its ability to make acquisitions and capital expenditures
to improve its operations or may fail to meet the financial covenants and debt
service requirements of the Loan Agreement which would result in outstanding
borrowings under the agreement becoming immediately due and payable.
DEFICIENCY OF EARNINGS TO FIXED CHARGES. Fixed charges of the Company have
exceeded its earnings before extraordinary item and fixed charges in each year
of its operations. There can be no assurance that the Company's earnings before
fixed charges will be sufficient to pay interest on any debt securities offered
hereby. See "Ratio of Earnings to Combined Fixed Charges and Preferred Stock
Dividends."
COMPETITION FROM WIRELINE TELEPHONE COMPANIES AND NEW TECHNOLOGIES.
Although current policies of the FCC authorize only two licensees to operate
cellular systems in each market, there is, and the Company expects there will
continue to be, significant competition from the other licensee authorized to
serve each cellular market in which the Company operates. Competition for
subscribers between cellular licensees is based principally upon the services
and enhancements offered, the
4
<PAGE>
technical quality of the cellular system, customer service, system coverage
and capacity, and price. The Company competes with a wireline licensee in
each of its cellular markets, some of which are larger and have access to
more substantial capital resources than does the Company.
As a result of regulatory and legislative initiatives, the Company's
cellular operations are also expected to face increased competition from
entities providing other communications technologies and services, including but
not limited to personal communications services ("PCS"). Some of these
technologies and services are currently operational and others are being
developed or may be developed in the future. Accordingly, there can be no
assurance that one or more of the technologies currently utilized by the Company
in its business will not become obsolete at some time in the future.
REGULATION. The licensing, construction, operation and sale of controlling
interests in cellular systems are regulated by the FCC. In addition, certain
aspects of cellular system operations, including but not limited to rates and
the resale of cellular service, may be subject to public utility regulation in
the state in which service is provided. Changes in the regulation of the
Company's activities, such as increased price regulation or deregulation of
interconnection arrangements or a decision by the FCC to permit more than two
licensees in each cellular market, could adversely affect the Company's results
of operations. In addition, all cellular licenses in the United States were
granted for an initial 10-year term and are subject to renewal. The majority of
the Company's cellular licenses expire within the next two years. While the
Company believes that each of these licenses will be renewed based upon FCC
rules establishing a presumption in favor of licensees that have complied with
their regulatory obligations during the initial license period, there can be no
assurance that all of the Company's licenses will be renewed.
CHALLENGES OF GROWTH BY ACQUISITIONS. The Company will continue to pursue
opportunities to acquire additional interests in cellular systems proximate to
its existing metro-clusters as well as additional interests in licensees in
which it currently owns less than a 100% interest. If the Company is successful
in pursuing such acquisitions, the Company may require substantial additional
financing to acquire and develop additional systems. There can be no assurance
that the Company will be able to obtain such additional financing. Furthermore,
in acquiring additional cellular systems, the Company will be subject to the
risks that new systems will not perform as expected and that the returns from
such systems will not support the indebtedness incurred to acquire, or the
capital expenditures incurred to develop, such systems. In addition, in seeking
to acquire additional cellular systems or licenses in its primary markets, the
Company competes with other communications companies, many of which are larger
and have access to more substantial capital resources than does the Company.
Competition among bidders for acquisition targets is based upon a variety of
factors, including price, terms and conditions, size and access to capital,
ability to offer cash, stock or other forms of consideration, and similar
matters.
OPTIONS TO MAKE ADDITIONAL INVESTMENT IN GEOTEK. As of June 30, 1995, the
Company had purchased 2,500,000 shares of Common Stock of Goetek Communications,
Inc. ("Geotek"), for a purchase price of $30 million and had agreed to purchase
531,463 shares of Geotek Series L Cumulative Convertible Preferred Stock on
September 1, 1995 for a purchase price of $5 million. In addition, as of June
30, 1995, the Company had earned approximately 400,000 shares of Goetek Common
Stock pursuant to a five year consulting agreement with Geotek expiring in 1999
and the Company holds options to invest up to $86 million for an aggregate of
approximately 5.3 million shares of common stock of Geotek. The options are
exercisable in series on or before September 1, 1996, subject to certain
extensions and qualifications. Should the Company exercise all or any portion of
these options, the exercise would require funds that might otherwise be
available for cellular system acquisitions, capital expenditures or other
corporate purposes. Any exercise would require approval of the Company's lenders
under its Loan Agreement or other financing alternatives.
DIVIDEND AND OTHER RESTRICTIONS UNDER THE LOAN AGREEMENT. The terms of the
Company's Loan Agreement prohibit the payment of dividends or other
distributions on any shares of the Company's capital stock (other than dividends
payable in shares of the Company's capital stock). The Company does not
anticipate paying any cash dividend or other distribution on its Common Stock in
the foreseeable future.
CONTROL OF THE COMPANY; CERTAIN PROVISIONS OF THE ARTICLES OF INCORPORATION
AND BYLAWS. Existing management of the Company and members and affiliates of the
"Richardson Family" own approximately 30% of the Company's outstanding Class A
Common Stock as of June 30, 1995, and consequently, if they act in concert, are
probably in a position to control the management and the affairs of the Company.
The articles of incorporation and bylaws of the Company contain certain
provisions that may render more difficult a hostile takeover, make it more
difficult to remove or change the composition of the Company's incumbent Board
of Directors and its officers, adversely affect shareholders who desire to
participate in a tender offer and deprive shareholders of possible opportunities
to sell their shares at prices higher than prevailing market prices. See
"Description of Common Stock."
5
<PAGE>
VALUE OF FCC LICENSES. The underlying value of the Company's assets relates
primarily to its intangible assets, principally interests in entities holding
FCC construction permits and licenses, the value of which depend significantly
upon the success of the Company's business and the growth of the industry in
general. While the Company believes that there is presently a market for such
assets, such market may not exist in the future or the values obtainable may be
lower than at
present. As a consequence, in the event of default on indebtedness of the
Company or any other event which would result in the liquidation of the
Company's assets, there can be no assurance that the proceeds would be
sufficient to pay its obligations, including any obligations pursuant to the
Securities offered hereby.
RADIOFREQUENCY EMISSION CONCERNS. Media reports have suggested that certain
radiofrequency ("RF") emissions from portable cellular telephones may be linked
to cancer. The FCC has a rulemaking proceeding pending to update the guidelines
and methods it uses for evaluating RF emissions from radio equipment, including
cellular telephones. While the proposal would impose more restrictive standards
on RF emissions from low power devices such as portable cellular telephones, it
is anticipated that all cellular telephones currently marketed and in use
already comply with the new proposed standards.
RATIO OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDENDS
For the purposes of calculating the Company's ratio of earnings to combined
fixed charges and preferred stock dividends, "earnings" consist of income from
continuing operations before income taxes, extraordinary items, minority
interests and fixed charges (other than capitalized interest) and "fixed
charges" consist of interest, whether expensed or capitalized. The Company has
never issued any shares of preferred stock. Earnings have not been adequate to
cover fixed charges in any period of the Company's operations. The following
table sets forth the amount of the coverage deficiency in the periods indicated:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED
YEAR ENDED DECEMBER 31, MARCH 31,
1990 1991 1992 1993 1994 1994 1995
<S> <C> <C> <C> <C> <C> <C> <C>
(IN THOUSANDS)
Fixed charges in excess of earnings.......... $(30,717) $(33,738) $(27,151) $(15,317) $(14,476) $(3,284) $(7,382)
</TABLE>
6
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DESCRIPTION OF DEBENTURES
The Company may offer under this Prospectus Senior Debentures, Senior
Subordinated Debentures and Subordinated Debentures, any of which Debentures may
be issued as convertible and/or exchangeable Debentures.
The Debentures will represent unsecured general obligations of the Company,
unless otherwise provided in the Prospectus Supplement. The Senior Debentures
will be senior to all subordinated indebtedness of the Company, and pari passu
with other unsecured, unsubordinated indebtedness of the Company. The Senior
Subordinated Debentures will be subordinate in right of payment to the Senior
Debentures and to certain other debt obligations of the Company and senior to
the Subordinated Debentures. The Subordinated Debentures will be subordinate in
right of payment to the Senior Debentures, the Senior Subordinated Debentures
and to certain other debt obligations of the Company..
The Senior Debentures, the Senior Subordinated Debentures and the
Subordinated Debentures will be issued under separate Indentures that have been
qualified under the Trust Indenture Act of 1939 and that will be entered into
between the Company and trustees eligible under the Trust Indenture Act of 1939
to be designated prior to issuance of the respective Debentures. In this
Prospectus, the indentures with respect to the Senior Debentures, Senior
Subordinated Debentures and Subordinated Debentures are referred to as the
"Senior Indenture," "Senior Subordinated Indenture" and "Subordinated
Indenture," respectively. In addition, the Senior Indenture, the Senior
Subordinated Indenture and the Subordinated Indenture are sometimes collectively
referred to herein as the "Indentures" and the Trustee under the Senior
Indenture, the Trustee under the Senior Subordinated Indenture and the Trustee
under the Subordinated Indenture are sometimes collectively referred to as the
"Trustees" and individually as a "Trustee." The following summary of certain
provisions of the Indentures does not purport to be complete and is subject to,
and qualified in its entirety by, reference to all the provisions of the
Indentures, including the definitions therein of certain terms. Wherever
particular sections or defined terms of the Indentures are referred to, it is
intended that such sections or defined terms shall be incorporated herein by
reference. As used in the Indentures and in this section, the term the "Company"
means Vanguard Cellular Systems, Inc. without reference to its consolidated
subsidiaries.
GENERAL
The Indentures do not limit the aggregate principal amount of Debentures
which may be issued thereunder and provide that Debentures may be issued in one
or more series, in such form or forms, with such terms and up to the aggregate
principal amount authorized from time to time by the Company (Sections 2.1 and
2.2 of the Indentures). Unless otherwise provided in the Prospectus Supplement,
the Debentures may be presented for registration of transfer and exchange and
for payment or, if applicable, for conversion and/or exchange at the office of
the applicable Trustee, unless the Company appoints a different office or agency
for such purpose. (Section 4.2 of the Indentures). At the option of the Company,
the payment of interest may also be made by check mailed to the address of the
person entitled thereto as it appears in the Debenture register. (Section 4.1 of
the Indentures).
The applicable Prospectus Supplement will describe the following terms of
any Debentures (the "Offered Debentures") in respect of which this Prospectus is
being delivered (to the extent applicable to the Offered Debentures): (1) the
designation (including whether they are Senior Debentures, Senior Subordinated
Debentures or Subordinated Debentures), aggregate principal amount and
authorized denominations, if other than denominations of $1,000 and any integral
multiple thereof, of the Offered Debentures; (2) the percentage of the principal
amount at which such Offered Debentures will be issued; (3) the date or dates
(and whether fixed or extendable) on which the principal of the Offered
Debentures is payable or the method of determination thereof; (4) the rate or
rates at which the Offered Debentures will bear interest, if any, the method of
calculating such rates, the date or dates from which such interest will accrue,
the interest payment dates on which such interest shall be payable and the
record dates for the determination of Debentureholders to whom interest will be
payable; (5) the place or places where the principal of, premium, if any, and
interest, if any, on the Offered Debentures will be payable; (6) any provisions
relating to the issuance of the Offered Debentures at an original issue
discount; (7) the price or prices at which, the period or periods within which,
and the terms and conditions upon which the Offered Debentures may be redeemed,
in whole or in part, at the option of the Company, pursuant to any sinking fund
or otherwise (including the form or method of payment if other than cash, which
may include securities of other issuers); (8) the obligation, if any, of the
Company to redeem, repay or purchase the Offered Debentures pursuant to any
mandatory redemption, sinking fund or analogous provisions or at the option of
the Debentureholder and the price or prices at which, the period or periods
within which and the terms and conditions upon which the Offered Debentures will
be redeemed, repaid or purchased, in whole or in part, pursuant to any such
obligation (including the form or method of payment if other than in cash, which
may include securities of other issuers), and any provisions for the remarketing
of such Debentures; (9) if other than the principal amount thereof, the portion
of the
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principal amount of the Offered Debentures which will be payable upon
declaration of acceleration of the maturity thereof or provable in bankruptcy;
(10) any Events of Default in addition to or in lieu of those described herein
and remedies therefor; (11) whether the Offered Debentures are convertible or
exchangeable and, if so, the securities or rights into which the Offered
Debentures are convertible or exchangeable (which may include other Debentures,
Preferred Stock, Class A Common Stock, Class B Common Stock or other securities
or rights of the Company (including rights to receive payment in cash or
securities based on the value, rate or price of one or more specified
commodities, currencies or indices) or exchangeable for securities of other
issuers or a combination of the foregoing) and the terms and conditions upon
which such conversion or exchange will be effected including the initial
conversion or exchange price or rate, the conversion or exchange period and any
other provision in addition to or in lieu of those described herein; (12) any
trustees, authenticating or paying agents, transfer agents or registrars or any
other agents with respect to the Offered Debentures; (13) the currency or
currencies, including composite currencies, in which the Offered Debentures will
be denominated if other than the currency of the United States of America; (14)
if other than the coin or currency in which the Offered Debentures are
denominated, the coin or currency in which payment of the principal of, premium,
if any, or interest on the Offered Debentures will be payable; (15) if the
principal of, premium, if any, or interest on the Offered Debentures are to be
payable, at the election of the Company or a holder thereof, in a coin or
currency other than that in which the Offered Debentures are denominated, the
period or periods within which, and terms and conditions upon which, such
election may be made; (16) if the amount of payments of principal of, premium,
if any, and interest on the Offered Debentures may be determined with reference
to the value, rate or price of one or more specified commodities, currencies or
indices, the manner in which such amounts shall be determined; (17) whether and
under what circumstances the Company will pay additional amounts on the Offered
Debentures held by a person who is not a United States of America person in
respect of any tax, assessment or governmental charge withheld or deducted and,
if so, whether the Company will have the option to redeem such Debentures rather
than pay such additional amounts; (18) if receipt of certain certificates or
other documents or satisfaction of other conditions will be necessary for any
purpose, including, without limitation, as a condition to the issuance of the
Offered Debentures in definitive form (whether upon original issue or upon
exchange of a temporary Debenture), the form and terms of such certificates,
documents or conditions; (19) any other affirmative or negative covenants with
respect to the Offered Debentures; (20) whether the Offered Debentures will be
issued in whole or in part in the form of one or more Global Debentures and, in
such case, the Depositary therefor and the circumstances under which any Global
Debenture may be exchanged for Offered Debentures registered in the name of, and
under which any transfer of such Global Debenture may be registered in the name
of, any person other than the Depositary; and (21) any other specific terms of
the Offered Debentures. (Section 2.2 of the Indentures).
The Debentures will be exchangeable or transferable without charge
therefor, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith. (Sections 2.6
and 2.10 of the Indentures).
Debentures may be issued and sold at a substantial discount below their
principal amount or their redemption value. (Section 2.2 of the Indentures). If
so issued, certain federal income tax and other considerations, if applicable,
will be described in the Prospectus Supplement relating thereto.
SUBORDINATION
The Subordinated Debentures will be subordinated, to the extent and in the
manner set forth in the Subordinated Indenture, in right of payment to the prior
payment in full of all Senior Indebtedness as defined in the Subordinated
Indenture. (Section 3.1 of the Subordinated Indenture). Senior Indebtedness is
defined in the Subordinated Indenture as (a) the principal of and premium, if
any, and interest on: (i) all indebtedness for money borrowed by the Company,
whether outstanding on the date of the Indenture or thereafter created or
incurred; (ii) all indebtedness for money borrowed by another person, in which
the Company has an equity interest or has the right to purchase an equity
interest, and guaranteed directly or indirectly by the Company (whether such
guarantee is outstanding on the date of the Indenture or thereafter created or
incurred); and (iii) all indebtedness constituting purchase money indebtedness
(as defined) for the payment of which the Company is directly or contingency
liable (whether outstanding on the date of the Indenture or thereafter created
or incurred); (b) any obligation to purchase or guarantee indebtedness of, to
supply funds to or invest in, another person in which the Company has an equity
interest or has the right to purchase an equity interest (whether such
obligation is outstanding on the date of the Indenture or is thereafter created
or incurred); (c) any obligation of the Company to any person in respect of
surety or similar bonds issued by such person in connection with entering into,
renewing or extending any cellular license granted by a governmental authority
or any construction in respect of any cellular telephone system by the Company
or any other person in which the Company has an equity interest or has the right
to purchase an equity interest; and (d) all renewals, extensions or refundings
of any such obligations, indebtedness and guarantees; provided, however, that
Senior Indebtedness shall not
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include any obligation, indebtedness or guarantee which is created or
evidenced by an instrument the terms of which expressly provide that such
obligation, indebtedness or guarantee is subordinate to the Subordinated
Debentures or to all other indebtedness of the Company or is not superior in
right of payment or performance to the Subordinated Debentures. (Section 1.1
of the Subordinated Indenture).
The Senior Subordinated Debentures will be subordinated to the extent and
in the manner set forth in the Senior Subordinated Indenture, in right of
payment to the prior payment in full of all Senior Indebtedness as defined in
the Senior Subordinated Indenture. (Section 3.1 of the Senior Subordinated
Indenture). Senior Indebtedness is defined in the Senior Subordinated Indenture
in the same manner as Senior Indebtedness is defined in the Subordinated
Indenture except that Senior Indebtedness as defined in the Senior Subordinated
Indenture does not include: (i) the Subordinated Debentures; or (ii) any
obligation, indebtedness or guarantee which is created or evidenced by an
instrument the terms of which expressly provide that such obligation,
indebtedness or guarantee is subordinate to the Senior Subordinated Indentures
or to all other indebtedness of the Company or is not superior in right of
payment or performance to the Senior Subordinated Debentures or that such
obligation, indebtedness or guarantee is subordinate to senior indebtedness and
senior indebtedness is defined by such instrument in substantially the same
manner as senior indebtedness is defined in the indenture for the Subordinated
Debentures unless the definition of senior indebtedness expressly provides that
such obligation, indebtedness or guarantee is not subordinate to the Senior
Subordinate Debentures or is superior in right of payment or performance to the
Senior Subordinated Debentures. (Section 1.1 of the Senior Subordinated
Indentures).
At June 30, 1995, the Company had approximately $459.1 million of Senior
Indebtedness and other indebtedness to which the Subordinated Debentures and the
Senior Subordinated Debentures may be effectively subordinated. There is no
limitation in the Indentures on the incurrence of additional Senior Indebtedness
and the Company expects to incur such additional indebtedness.
No payment on account of the principal of, premium, if any, or interest on
the Senior Subordinated Debentures or Subordinated Debentures may be made, if,
at the time of such payment or immediately after giving effect thereto, there
exists a default in payment of the principal of, premium, if any, or interest on
any Senior Indebtedness (as defined in the Senior Subordinated Indenture or
Subordinated Indenture, as applicable), whether at expressed maturity,
acceleration thereof or otherwise, except as otherwise provided in the
applicable Indenture. (Section 3.2 of the Senior Subordinated and Subordinated
Indentures). Upon any payment or distribution of assets of the Company of any
kind or character, upon any dissolution or winding up or total or partial
liquidation or reorganization of the Company, whether voluntary or involuntary,
in bankruptcy, insolvency or receivership, or upon an assignment for the benefit
of creditors or any other marshalling of the assets and liabilities of the
Company or otherwise, all principal of, premium, if any, and interest due on all
Senior Indebtedness (including any outstanding Senior Debentures and, in the
case of the Subordinated Debentures, any outstanding Senior Subordinated
Indebtedness) must be paid or provided for in full before the holders of the
Senior Subordinated or Subordinated Debentures are entitled to receive or retain
any payment. (Section 3.2 of the Senior Subordinated and Subordinated
Indentures). Subject to the payment in full of all Senior Indebtedness (as
defined in the Senior Subordinated Indenture or the Subordinated Indenture, as
the case may be), the holders of the Senior Subordinated Debentures or
Subordinated Debentures, as applicable, will be subrogated to the rights of the
holders of Senior Indebtedness (as respectively defined) to receive payments or
distributions of assets of the Company applicable to Senior Indebtedness until
the Senior Subordinated or Subordinated Debentures are paid in full. (Section
3.2 of the Senior Subordinated and Subordinated Indentures). By reason of such
subordination, in the event of a distribution of assets upon insolvency, certain
general creditors of the Company may recover more, ratably, than the holders of
the Senior Subordinated or Subordinated Debentures.
CONVERTIBLE DEBENTURES
The terms, if any, on which Offered Debentures may be (mandatorily or
otherwise) exchanged for or converted into other Debentures or shares of
Preferred Stock, Class A Common Stock, Class B Common Stock or other securities
or rights of the Company (including rights to receive payments in cash or
securities based on the value, rate or price of one or more specified
commodities, currencies or indices) or securities of other issuers or any
combination of the foregoing will be set forth in the Prospectus Supplement for
such Offered Debentures.
Unless otherwise indicated in the Prospectus Supplement, the following
provisions will apply to Offered Debentures that may be exchanged for or
converted into stock of any class of the Company ("Capital Stock"):
The holder of any Debentures convertible into capital stock will have the
right exercisable at any time during the time period specified in the Prospectus
Supplement, unless previously redeemed by the Company, to convert such
Debentures into shares of capital stock (which may include Preferred Stock,
Class A Common Stock or Class B Common Stock) as specified
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in the Prospectus Supplement, at the conversion rate for each $1,000 principal
amount of Debentures set forth in the Prospectus Supplement, subject to
adjustment. The holder of a convertible Debenture may convert a portion
thereof which is $1,000 or any integral multiple of $1,000. (Section 13.2 of
the Indentures). In the case of Debentures called for redemption, conversion
rights will expire at the close of business on the date fixed for the
redemption as may be specified in the Prospectus Supplement, except that
in the case of redemption at the option of the Debentureholder, if applicable,
such right will terminate upon receipt of written notice of the exercise of
such option. (Section 13.2 of the Indentures).
In certain events, the conversion rate will be subject to adjustment as set
forth in the Indentures. Such events include the issuance of shares of any class
of Capital Stock of the Company as a dividend on the class of Capital Stock into
which the Debentures of such series are convertible; subdivisions, combination
and reclassifications of the class of Capital Stock into which Debentures of
such series are convertible; the issuance to all holders of the class of Capital
Stock into which Debentures of such series are convertible of rights or warrants
entitling the Debentureholders (for a period not exceeding 45 days) to subscribe
for or purchase shares of such class of Capital Stock at a price per share less
than the current market price per share of such class of Capital Stock (as
defined in the Indentures); and the distribution to all holders of the class of
Capital Stock into which Debentures of such series are convertible of evidences
of indebtedness of the Company or of assets (excluding cash dividends paid from
retained earnings and dividends payable in Capital Stock for which adjustment is
made as referred to above) or subscription rights or warrants (other than those
referred to above). No adjustment of the conversion rate will be required unless
an adjustment would require a cumulative increase or decrease of at least 1% in
such rate. (Section 13.5 of the Indentures.) Fractional shares of Capital Stock
will not be issued upon conversion but, in lieu thereof, the Company will pay a
cash adjustment. Convertible Debentures surrendered for conversion between the
record date for an interest payment, if any, and the interest payment date
(except convertible Debentures called for redemption on a redemption date during
such period) must be accompanied by payment of an amount equal to the interest
thereon which the registered holder is to receive. (Article 13 of the
Indentures).
MODIFICATION OF THE INDENTURES
Modification of any Indenture with respect to the Debentures of any series
may be made by the Company and the applicable Trustee with the consent of the
holders of not less than 66 2/3% in aggregate principal amount of outstanding
Debentures of such series; provided that no such modification may, without the
consent of the holder of each Debenture of such series affected thereby, (1)
extend the time or times of payment of the principal amount of, premium, if any,
or the interest on, any Debentures; (2) reduce the principal amount of, premium,
if any, or the rate of interest on any Debentures (and/or such other amount or
amounts as any Debentures or supplemental indentures with respect thereto may
provide to be due and payable upon declaration of acceleration of the maturity
thereof); (3) change the currency of payment of principal of, premium, if any,
or the interest on any Debenture; (4) reduce any amount payable on redemption
thereof; (5) alter or impair the right to convert or exchange the Debentures at
the rate and upon the terms provided in the Indenture; (6) alter or impair the
right to require redemption at the option of the holder; or (7) reduce the
percentage of Debentures of any series, the vote of the holders of which is
necessary to modify the Indenture. (Section 12.2 of the Indentures).
Modifications of any Indenture with respect to the Debentures of any series
may be made by the Company and the Trustee without the consent of the
Debentureholders: (a) to add to the covenants and agreements of the Company or
to surrender any right or power reserved to or conferred upon the Company in the
Indenture; (b) to cure any ambiguity or to cure, correct or supplement any
defect or inconsistent provision contained in the Indenture; (c) to make such
provisions in regard to matters arising under the Indenture which may be
necessary or desirable, or otherwise change the Indenture in any manner, which
shall not adversely affect the interests of the Debentureholders of any series;
(d) to evidence the succession of another corporation to the Company and the
assumption by the successor corporation of the covenants, agreements and
obligations of the Company pursuant to the Indenture and to provide for the
adjustment of conversion rights pursuant to Section 13.7 upon consolidation,
merger, sale or conveyance of the Company; (e) to establish the form or terms of
the Debentures of any series as permitted by the Indenture; (f) to change or
eliminate any of the provisions of the Indenture, provided that any such change
or elimination shall become effective only when there is no Debenture
outstanding of any series created prior thereto which is entitled to the benefit
of such provisions; (g) to add or change any of the provisions of the Indenture
to such extent as shall be necessary to permit or facilitate the issuance of
Debentures in bearer form or to provide for uncertificated Debenture (so long as
any "registration-required obligation" within the meaning of Section 163(f)(2)
of the Internal Revenue Code of 1986, as amended (the "Code"), is in registered
form for purposes of the Code); (h) to amend or supplement any provision
contained in the Indenture, which was required to be contained in the Indenture
in order for the Indenture to be qualified under the Trust Indenture Act of
1939, if the Trust Indenture Act of 1939 or regulations thereunder change what
is so required to be included in qualified indentures, in any manner not
inconsistent with what then
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may be required for such qualification; (i) to add any additional events of
default; (j) to convey, transfer, assign, mortgage or pledge to the Trustee,
as security for the Debentures of one or more series, any property or assets;
or (k) to add to or change any of the provisions of the Indenture as
contemplated in Section 11.7(b) relating to successor trustees. (Section 12.1
of the Indentures).
DEFAULTS AND NOTICE
The following are to be Events of Default with respect to Debentures of any
series, unless it is either inapplicable to a particular series or is
specifically deleted or modified for Debentures of a particular series, as
described in the Prospectus Supplement: (1) failure to pay the principal of, or
premium, if any, on any Debenture of such series when due and payable (whether
at maturity, by call for redemption, through any mandatory sinking fund, by
redemption at the option of the holder, by declaration of acceleration or
otherwise, and, with respect to Debentures issued pursuant to the Senior
Subordinated Indenture and the Subordinated Indenture, whether or not payment is
prohibited by the subordination provisions of such Indentures); (2) failure to
make a payment of any interest on any Debenture of such series when due,
continued for 30 days (with respect to Debentures issued pursuant to the Senior
Subordinated Indenture and the Subordinated Indenture, whether or not payment is
prohibited by the subordination provisions of such Indentures); (3) failure of
the Company to perform or observe any other covenants or agreements of the
Company in the Indenture or in the Debentures of such series (other than
agreements or covenants included in the Indentures solely for the benefit of a
series of Debentures other than the series), continued for 90 days after written
notice; (4) certain events of bankruptcy, insolvency or reorganization of the
Company; and (5) as to Senior Subordinated and Subordinated Debentures, an event
of default under any Senior Indebtedness (as respectively defined) that has
resulted in the acceleration of such indebtedness prior to the expressed
maturity thereof, which acceleration has not been rescinded or annulled within
30 business days after written notice and which acceleration is not contested by
the Company in good faith. If an Event of Default with respect to Debentures of
any series shall happen and be continuing, the Trustee or the holders of not
less than 25% in aggregate principal amount of the then outstanding Debentures
of such series may declare the principal amount (or, if the Debentures of such
series are issued at an original issue discount, such portion of the principal
amount as may be specified in the terms of the Debentures of such series) of all
Debentures of such series and/or such other amount or amounts as the Debentures
or supplemental indenture with respect to such series may provide, to be due and
payable immediately. (Section 7.1 of the Indentures).
The Indentures provide that the Trustee will, within 90 days after the
occurrence of a default, give to holders of Debentures of any series notice of
all incurred defaults with respect to such series known to it; provided,
however, that, except in the case of a default that results from the failure to
make any payment of the principal of, premium, if any, or interest on the
Debentures of any series, or in the payment of any mandatory sinking fund
installment with respect to Debentures of such series, the Trustee may withhold
such notice if it in good faith determines that the withholding of such notice
is in the interest of the holders of Debentures of such series. (Section 11.3 of
the Indentures).
The Indentures contain a provision entitling the Trustee to be indemnified
by holders of Debentures before proceeding to exercise any trust or power under
the Indentures at the request of such holders. (Section 11.1 of the Indentures).
The Indentures provide that the holders of a majority in aggregate principal
amount of the then outstanding Debentures of any series may direct the time,
method and place of conducting any proceedings for any remedy available to the
Trustee or of exercising any trust or power conferred upon the Trustee with
respect to the Debentures of such series, provided, however, that the Trustee
may decline to follow any such direction if, among other reasons, the Trustee
determines in good faith that the actions or proceedings as directed may not
lawfully be taken, would involve the Trustee in personal liability or would be
unduly prejudicial to the holders of the Debentures of such series not joining
in such direction. (Section 7.6 of the Indentures). The right of a holder to
institute a proceeding with respect to the Indenture is subject to certain
conditions precedent including, without limitation, that the holders of a
majority in aggregate principal amount of the Debentures of such series then
outstanding make a written request upon the Trustee to exercise its powers under
the Indenture, indemnify the Trustee and afford the Trustee reasonable
opportunity to act, but the holder has an absolute right to receipt of the
principal of, premium, if any, and interest when due, to require conversion or
exchange of Debentures if the Indentures provide for convertibility or
exchangeability at the option of the holder, and to institute suit for the
enforcement thereof. (Section 7.7 of the Indentures).
REPORTS TO HOLDERS OF DEBENTURES
The Company intends to furnish to holders of Debentures all quarterly and
annual reports that it furnishes to holders of the Company's Class A Common
Stock.
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DESCRIPTION OF PREFERRED STOCK
The Board of Directors of the Company is authorized to issue in one or more
series up to a maximum of 1,000,000 shares of preferred stock, par value $.01
per share. The shares can be issued with such designations, preferences,
qualifications, privileges, limitations, restrictions, options, conversion or
exchange rights and other special or relative rights as the Board of Directors
shall from time to time fix by resolution, which could adversely affect the
voting powers of the holders of Common Stock. Issuance of the Preferred Stock
could have the effect of acting as an anti-takeover device to delay or prevent a
change of control of the Company. The dividend, the liquidation preference, and
other specific terms of each series of the Preferred Stock will be set forth in
the Prospectus Supplement. The Company currently has no shares of Preferred
Stock outstanding.
The applicable Prospectus Supplement will describe the following terms of
any Preferred Stock in respect of which this Prospectus is being delivered (to
the extent applicable to such Preferred Stock): (1) the specific designation,
number of shares, seniority and purchase price; (2) any liquidation preference
per share; (3) any date of maturity; (4) any redemption, repayment or sinking
fund provisions; (5) any dividend rate or rates and the dates on which any such
dividends will be payable (or the method by which such rates or dates will be
determined); (6) any voting rights; (7) if other than the currency of the United
States of America, the currency or currencies including composite currencies in
which such Preferred Stock is denominated and/or in which payments will or may
be payable; (8) the method by which amounts in respect of such Preferred Stock
may be calculated and any commodities, currencies or indices, or value, rate or
price, relevant to such calculation; (9) whether the Preferred Stock is
convertible or exchangeable and, if so, the securities or rights to which such
Preferred Stock is convertible or exchangeable (which may include other
Preferred Stock, Debentures, Class A Common Stock, Class B Common Stock or other
securities or rights of the Company (including rights to receive payment in cash
or securities based on the value, rate or price of one or more specified
commodities, currencies or indices) or securities of other issuers or a
combination of the foregoing), and the terms and conditions upon which such
conversions or exchanges will be effected including the initial conversion or
exchange prices or rates, the conversion or exchange period and any other
related provisions; (10) the place or places where dividends and other payments
on the Preferred Stock will be payable; (11) any additional voting, dividend,
liquidation, redemption and other rights, preferences, privileges, limitations
and restrictions; and (12) if applicable, a discussion of certain federal income
tax considerations with respect to such Preferred Stock..
As described under "Description of Depositary Shares," the Company may, at
its option, elect to offer depositary shares ("Depositary Shares") evidenced by
depositary receipts ("Depositary Receipts"), each representing an interest (to
be specified in the Prospectus Supplement relating to the particular series of
the Preferred Stock) in a share of the particular series of the Preferred Stock
issued and deposited with a Depositary (as defined below).
All shares of Preferred Stock offered, or issuable upon conversion,
exchange or exercise of Securities, will, when issued, be fully paid and
nonassessable.
DESCRIPTION OF DEPOSITARY SHARES
The description below sets forth certain general terms and provisions of
the Deposit Agreement (as defined below) and of the Depositary Shares and
Depositary Receipts. The specific terms of the Depositary Shares and, if
applicable, a discussion of certain federal income tax considerations with
respect thereto will be described in the Prospectus Supplement relating to such
Depositary Shares. The following description does not purport to be complete and
is subject to, and qualified in its entirety by reference to, the form of
Deposit Agreement and form of Depositary Receipts relating to each series of the
Preferred Stock.
GENERAL
The Company may, at its option, elect to have shares of Preferred Stock
represented by Depositary Shares. The shares of any series of the Preferred
Stock underlying the Depositary Shares will be deposited under a separate
deposit agreement (the "Deposit Agreement") between the Company and a bank or
trust company selected by the Company (the "Depositary"). The Prospectus
Supplement relating to a series of Depositary Shares will set forth the name and
address of the Depositary. Subject to the terms of the Deposit Agreement, each
owner of a Depositary Share will be entitled, in proportion to the applicable
interest in the number of shares of Preferred Stock underlying such Depositary
Share, to all the rights and preferences of the Preferred Stock underlying such
Depositary Share (including dividend, voting, redemption, conversion, exchange
and liquidation rights).
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The Depositary Shares will be evidenced by Depositary Receipts issued
pursuant to the Deposit Agreement, each of which will represent the applicable
interest in a number of shares of a particular series of the Preferred Stock
described in the applicable Prospectus Supplement.
Unless otherwise specified in the Prospectus Supplement, a holder of
Depositary Shares is not entitled to receive the shares of Preferred Stock
underlying the Depositary Shares.
DIVIDENDS AND OTHER DISTRIBUTIONS
The Depositary will distribute all cash dividends or other cash
distributions received in respect of the Preferred Stock to the record holders
of Depositary Shares representing such Preferred Stock in proportion to the
number of such Depositary Shares owned by such holders on the relevant record
date.
In the event of a distribution other than in cash, the Depositary will
distribute property received by it to the record holders of Depositary Shares
entitled thereto or the Depositary may, with the approval of the Company, sell
such property and distribute the net proceeds from such sale to such holders.
The Deposit Agreement also contains provisions relating to the manner in
which any subscription or similar rights offered by the Company to holders of
Preferred Stock shall be made available to holders of Depositary Shares.
CONVERSION AND EXCHANGE
If any Preferred Stock underlying the Depositary Shares is subject to
conversion or exchange as set forth in the Prospectus Supplement relating
thereto, each record holder of Depositary Shares will have the right or
obligation to convert or exchange such Depositary Shares pursuant to the terms
thereof.
REDEMPTION OF DEPOSITARY SHARES
If Preferred Stock underlying the Depositary Shares is subject to
redemption, the Depositary Shares will be redeemed from the proceeds received by
the Depositary resulting from the redemption, in whole or in part, of the
Preferred Stock held by the Depositary. The redemption price per Depositary
Share will be equal to the aggregate redemption price payable with respect to
the number of shares of Preferred Stock underlying the Depositary Shares.
Whenever the Company redeems Preferred Stock from the Depositary, the Depositary
will redeem as of the same redemption date a proportionate number of Depositary
Shares representing the shares of Preferred Stock that were redeemed. If less
than all the Depositary Shares are to be redeemed, the Depositary Shares to be
redeemed will be selected by lot or pro rata as may be determined by the
Company.
After the date fixed for redemption, the Depositary Shares so called for
redemption will no longer be deemed to be outstanding and all rights of the
holders of the Depositary Shares will cease, except the right to receive the
redemption price payable upon such redemption. Any funds deposited by the
Company with the Depositary for any Depositary Shares which the holders thereof
fail to redeem shall be returned to the Company after a period of two years from
the date such funds are so deposited.
VOTING
Upon receipt of notice of any meeting, or action in lieu of any meeting, at
which the holders of any shares of Preferred Stock underlying the Depositary
Shares are entitled to vote, the Depositary will mail the information contained
in such notice to the record holders of the Depositary Shares relating to such
Preferred Stock. Each record holder of such Depositary Shares on the record date
(which will be the same date as the record date for the Preferred Stock) will be
entitled to instruct the Depositary as to the exercise of the voting rights
pertaining to the number of shares of Preferred Stock underlying such holder's
Depositary Shares. The Depositary will endeavor, insofar as practicable, to vote
the number of shares of Preferred Stock underlying such Depositary Shares in
accordance with such instructions, and the Company will agree to take all action
which may be deemed necessary by the Depositary in order to enable the
Depositary to do so.
AMENDMENT TO THE DEPOSIT AGREEMENT
The form of Depositary Receipt evidencing the Depositary Shares and any
provision of the Deposit Agreement may at any time be amended by agreement
between the Company and the Depositary, provided, however, that any amendment
which materially and adversely alters the rights of the existing holders of
Depositary Shares will not be effective unless such amendment has been approved
by a majority of the Depositary Shares then outstanding.
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CHARGES OF DEPOSITARY
The Company will pay all transfer and other taxes and governmental charges
that arise solely from the existence of the depositary arrangements. The Company
will pay charges of the Depositary in connection with the initial deposit of the
Preferred Stock and any exchange or redemption of the Preferred Stock. Holders
of Depositary Shares will pay all other transfer and other taxes and
governmental charges, and, in addition, such other charges as are expressly
provided in the Deposit Agreement to be for their accounts.
MISCELLANEOUS
The Company, or at the option of the Company, the Depositary, will forward
to the holders of Depositary Shares all reports and communications from the
Company which the Company is required to furnish to the holders of Preferred
Stock.
Neither the Depositary nor the Company will be liable if it is prevented or
delayed by law or any circumstances beyond its control in performing its
obligations under the Deposit Agreement. The obligations of the Company and the
Depositary under the Deposit Agreement will be limited to performance in good
faith of their duties thereunder, and neither will be obligated to prosecute or
defend any legal proceeding in respect of any Depositary Share or Preferred
Stock unless satisfactory indemnity has been furnished. The Company and the
Depositary may rely upon written advice of counsel or accountants or information
provided by persons presenting Preferred Stock for deposit, holders of
Depositary Shares or persons believed to be competent and documents believed to
be genuine.
RESIGNATION AND REMOVAL OF DEPOSITARY; TERMINATION OF THE DEPOSIT AGREEMENT
The Depositary may resign at any time by delivering to the Company notice
of its election to do so, and the Company may at any time remove the Depositary,
any such resignation or removal to take effect upon the appointment of a
successor Depositary and its acceptance of such appointment. Such successor
Depositary will be appointed by the Company within 60 days after delivery of the
notice of resignation or removal. The Deposit Agreement may be terminated at the
direction of the Company or by the Depositary if a period of 90 days shall have
expired after the Depositary has delivered to the Company written notice of its
election to resign and a successor depositary shall not have been appointed.
Upon termination of the Deposit Agreement, the Depositary will discontinue the
transfer of Depositary Receipts, will suspend the distribution of dividends to
the holders thereof, and will not give any further notices (other than notice of
such termination) or perform any further acts under the Deposit Agreement except
that the Depositary will continue to deliver Preferred Stock certificates,
together with such dividends and distributions and the net proceeds of any sales
or rights, preferences, privileges or other property in exchange for Depositary
Receipts surrendered. Upon request of the Company, the Depositary shall deliver
all books, records, certificates evidencing Preferred Stock, Depositary Receipts
and other documents relating to the subject matter of the Deposit Agreement to
the Company.
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DESCRIPTION OF COMMON STOCK
The statements made under this caption include summaries of certain
provisions contained in the Company's Articles of Incorporation and bylaws.
These statements do not purport to be complete and are qualified in their
entirety by reference to such Articles of Incorporation and bylaws.
The authorized capital stock of the Company consists of 250,000,000 shares
of Class A Common Stock par value $.01 per share, 30,000,000 shares of Class B
Common Stock, par value $.01 per share, and the Preferred Stock. As of June 30,
1995, 41,190,848 shares of Class A Common Stock were issued and outstanding in
the names of approximately 1,200 holders of record, and no shares of Class B
Common Stock were issued and outstanding.
CLASS A COMMON STOCK
Holders of the Company's Class A Common Stock are entitled ratably, share
for share, to such dividends as may be declared upon the Class A Common Stock by
the Board of Directors and, upon any liquidation of the Company, to participate
ratably in the distribution of any corporate assets remaining after payment of
all debts and the liquidation preferences, if any, of Preferred Stock that then
may be issued and outstanding. However, the Company has entered into a Loan
Agreement which substantially prohibits the payment of dividends or other
distributions with respect to the Class A Common Stock. See
"Risk Factors -- "Existing Indebtedness; Additional Financing" and "Dividend and
Other Restrictions under the Loan Agreement."
Holders of the Company's Class A Common Stock are entitled to one vote per
share on all matters submitted to a vote of holders of Class A Common Stock. No
holder of Class A Common Stock of the Company is entitled as a matter of right
to subscribe for or to purchase any shares of stock or any security convertible
into shares of stock of any class of the Company. Each outstanding share of
Class A Common Stock is validly issued, fully paid and nonassessable.
CLASS B COMMON STOCK
The Board of Directors has the authority, without any vote or action by the
shareholders, to issue Class B Common Stock. The Company's Articles of
Incorporation provide that the Class B Common Stock would have the same
characteristics as the Class A Common Stock, except that the holders of Class B
Common Stock would be entitled to one-tenth of one vote per share, voted as a
single class with the Class A Common Stock, except as required by law. Under
North Carolina law, the holders of Class B Common Stock generally would have the
right to vote as a separate voting group on (i) certain amendments to the
Articles of Incorporation, including amendments that would increase or decrease
the authorized number of shares of the class, effect an exchange or
reclassification of their shares for shares of another class, or change the
rights of the class, (ii) a plan of merger if the plan contains a provision
that, if contained in a proposed amendment to the Articles of Incorporation,
would give rise to the right to vote, except where the consideration to be
received in exchange for the shares consists solely of cash, and (iii) a plan of
share exchange if the shares are to be acquired in the exchange. Issuance of
Class B Common Stock could have the effect of acting as an anti-takeover device
to delay or prevent a change of control of the Company.
CERTAIN PROVISIONS OF THE ARTICLES OF INCORPORATION AND BYLAWS
A provision of the Company's Articles of Incorporation requires the holders
of at least 66 2/3% of the outstanding shares of stock of the Company then
entitled to vote in elections of directors or a majority of the "disinterested"
members of the Board of Directors to approve certain major corporate
transactions involving the Company and a holder of 10% or more of any class of
equity security of the Company ("Interested Shareholder") or the affiliate of an
Interested Shareholder, including a merger or consolidation with the Interested
Shareholder or the sale, lease or exchange of substantially all of the assets of
the Company or of the Interested Shareholder to the other, or any dissolution of
the Company. "Disinterested" directors are directors who are neither Interested
Shareholders nor affiliated with any Interested Shareholder. In addition, the
Company's bylaws permit (i) directors to be removed only for cause and upon the
affirmative vote of the holders of at least 66 2/3% of the outstanding shares of
the Company's capital stock entitled to vote generally in the election of
directors and (ii) newly created directorships and vacancies caused by any
reason to be filled only by the vote of the majority of directors then in office
or by the shareholders. Both the Articles of Incorporation and the bylaws
require the affirmative vote of the holders of at least 66 2/3% of the
outstanding shares of capital stock of the Company entitled to vote generally in
the election of directors to amend these provisions. These provisions could make
it more difficult for a third party to acquire control of the Company.
The Board of Directors of the Company is divided into three classes, with
one class elected annually by the shareholders to a three-year term. The effect
of the staggered Board of Directors is to negate substantially the possibility
of minority
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shareholders' obtaining representation on the Board of Directors. The holders of
common stock of the Company do not have the right to vote cumulatively in the
election of directors.
FCC RESTRICTIONS
The transfer of shares of Class A and Class B Common Stock may, in certain
circumstances, be subject to provisions of the Communications Act of 1934, as
amended, and rules and policies requiring prior FCC approval of the transfer of
control of cellular, microwave and other licensees, restricting the percentage
of alien ownership of such licensees, limiting the ownership of interests in
cellular systems serving the same area, and establishing other licensee
qualifications.
TRANSFER AGENT AND REGISTRAR
First Union National Bank, Charlotte, North Carolina, is the transfer agent
and registrar for the Class A Common Stock.
DESCRIPTION OF WARRANTS
GENERAL
The Company may issue Warrants to purchase Securities or other securities
or rights of the Company (including rights to receive payment in cash or
securities based on the value, rate or price of one or more specified
commodities, currencies or indices) or securities of other issuers or any
combination of the foregoing. Warrants may be issued independently or together
with any Securities and may be attached to or separate from such Securities.
Each series of Warrants will be issued under a separate warrant agreement (each
a "Warrant Agreement") to be entered into between the Company and a warrant
agent ("Warrant Agent"). The following sets forth certain general terms and
provisions of the Warrants. Further terms of the Warrants and the applicable
Warrant Agreement are set forth in the applicable Prospectus Supplement.
The applicable Prospectus Supplement will describe the following terms of
any Warrants in respect of which this Prospectus is being delivered: (1) the
title of such Warrants; (2) the aggregate number of such Warrants; (3) the price
or prices at which such Warrants will be issued; (4) the currency or currencies,
including composite currencies, in which the price of such Warrants may be
payable; (5) the Securities or other securities or rights of the Company
(including rights to receive payment in cash or securities based on the value,
rate or price of one or more specified commodities, currencies or indices) or
securities of other issuers or any combination of the foregoing purchasable upon
exercise of such Warrants; (6) the price at which and the currency or
currencies, including composite currencies, in which the Securities purchasable
upon exercise of such Warrants may be purchased; (7) the date on which the right
to exercise such Warrants shall commence and the date on which such right shall
expire; (8) if applicable, the minimum or maximum amount of such Warrants which
may be exercised at any one time; (9) if applicable, the designation and terms
of the Securities with which such Warrants are issued and the number of such
Warrants issued with each such Security; (10) if applicable, the date on and
after which such Warrants and the related Securities will be separately
transferable; (11) information with respect to book-entry procedures, if any;
(12) if applicable, a discussion of certain United States Federal income tax
considerations; and (13) any other terms of such Warrants, including terms,
procedures and limitations relating to the exchange and exercise of such
Warrants.
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PLAN OF DISTRIBUTION
The Company may sell Securities on a negotiated or competitive bid basis to
or through underwriters or dealers and also may sell Securities directly to
other purchasers or through agents. Any such underwriter, dealer or agent
involved in the offer and sale of Securities, and any applicable commissions,
discounts and other items constituting compensation to such underwriters, dealer
or agent, will be set forth in the Prospectus Supplement.
The distribution of 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.
Unless otherwise indicated in a Prospectus Supplement, the obligations of
any underwriters to purchase Securities will be subject to certain conditions
precedent and the underwriters will be obligated to purchase all of the
applicable Securities if any are purchased. If a dealer is utilized in the sale,
the Company will sell the Securities to the dealer as principal. The dealer may
then resell the Securities to the public at varying prices to be determined by
such dealer at the time of resale.
Offers to purchase Securities may be solicited by the Company or agents
designated by the Company from time to time. Unless otherwise indicated in a
Prospectus Supplement, any such agent will be acting on a best efforts basis for
the period of its appointment.
Underwriters, dealers and agents that participate in the distribution of
Securities may be deemed to be underwriters as that term is defined in the
Securities Act of 1933 (the "Securities Act"), and any discounts or commissions
received by them from the Company and any profits on the resale of the
Securities by them may be deemed to be underwriting discounts and commissions
under the Securities Act. Underwriters, dealers and agents may be entitled,
under agreements entered into with the Company, to indemnification against and
contribution toward certain civil liabilities, including liabilities under the
Securities Act.
If so indicated in the Prospectus Supplement, the Company will authorize
agents and underwriters to solicit offers by certain specified institutions to
purchase Securities from the Company at the public offering price set forth in
the Prospectus Supplement pursuant to delayed delivery contracts providing for
payment and delivery on a specified date in the future. Institutions with whom
such contracts, when authorized, may be made include commercial and savings
banks, insurance companies, pension funds, investment companies, educational and
charitable institutions and other institutions but shall in all cases be subject
to the approval of the Company. Such contracts will be subject only to those
conditions set forth in the Prospectus Supplement and the Prospectus Supplement
will set forth the commission payable for solicitation of such contracts.
LEGAL OPINIONS
The validity of the Securities that may be offered hereby will be passed
upon for the Company by Schell Bray Aycock Abel & Livingston L.L.P. Greensboro,
North Carolina. Certain additional legal matters will be passed upon for the
Company by Richard C. Rowlenson, Senior Vice President and General Counsel for
the Company. As of June 30, 1995, Mr. Rowlenson beneficially owned 115,302
shares of Class A Common Stock. Doris R. Bray, a partner of Schell Bray Aycock
Abel & Livingston L.L.P., is a director of the Company and, as of June 30, 1995,
beneficially owned 4,800 shares of Class A Common Stock.
EXPERTS
The financial statements and schedules incorporated by reference in this
Prospectus and elsewhere in the Registration Statement, to the extent and for
the periods indicated in their reports, have been audited by Arthur Andersen
LLP, independent public accountants, and are incorporated by reference herein in
reliance upon the reports of said firm and upon 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.
All of the expenses in connection with the offering are as follows:
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee............................................................... $ 86,207
Legal fees and expenses........................................................................................... 25,000*
Printing.......................................................................................................... 10,000*
Accountant's fees and expenses.................................................................................... 10,000*
Blue Sky qualification fees and expenses.......................................................................... 5,000*
Miscellaneous..................................................................................................... 3,793*
Total........................................................................................................... 140,000*
</TABLE>
* Estimated
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article VIII of the Company's Bylaws provides:
"ARTICLE VIII
INDEMNIFICATION
1. EXTENT. In addition to the indemnification otherwise provided by law,
the corporation shall indemnify and hold harmless its directors and Indemnified
Officers (as hereinafter defined) against all liability and litigation expense,
including reasonable attorneys' fees, arising out of their status as directors
or officers or their activities in any of such capacities or in any capacity in
which any of them is or was serving, at the corporation's request, in another
corporation, partnership, joint venture, trust or other enterprise, and the
corporation shall indemnify and hold harmless those persons who are officers,
directors or employees and are deemed to be fiduciaries of the corporation's
present and future employee pension and welfare benefit plans as defined under
the Employee Retirement Income Security Act of 1974, as amended ("ERISA
fiduciaries"), against all liability and litigation expense, including
reasonable attorneys' fees, arising out of their status or activities as ERISA
fiduciaries; provided, however, that the corporation shall not indemnify a
director or Indemnified Officer against liability or litigation expense that he
may incur on account of his activities that at the time taken were known or
reasonably should have been known by him to be clearly in conflict with the best
interests of the corporation, and the corporation shall not indemnify an ERISA
fiduciary against any liability or litigation expense that he may incur on
account of his activities that at the time taken were known or reasonably should
have been known by him to be clearly in conflict with the best interests of the
employee benefit plan to which the activities relate. The corporation shall also
indemnify the director, Indemnified Officer or ERISA fiduciary for reasonable
costs, expenses and attorneys' fees in connection with the enforcement of rights
to indemnification granted herein, if it is determined in accordance with
Section 2 of this Article that the director, officer or ERISA fiduciary is
entitled to indemnification hereunder.
2. DETERMINATION. Any indemnification under Section 1 shall be paid by the
corporation in any specific case only after a determination that the director,
Indemnified Officer or ERISA fiduciary did not act in a manner, at the time the
activities were taken, that was known or reasonably should have been known by
him to be clearly in conflict with the best interests of the corporation, or the
employee benefit plan to which the activities relate, as the case may be. Such
determination shall be made (a) by the affirmative vote of a majority (but not
less than two) of directors who are or were not parties to such action, suit or
proceeding or against whom any such claim is asserted ("disinterested
directors") even though less than a quorum, or (b) if a majority (but not less
than two) of disinterested directors so direct, by independent legal counsel in
a written opinion, or (c) if there are less than two disinterested directors, by
the affirmative vote of all of the directors, or (d) by the vote of a majority
of all of the voting shares other than those owned or controlled by directors,
officers or ERISA fiduciaries who were parties to such action, suit or
proceeding or against whom such claim is asserted, or by a unanimous vote of all
of the voting shares, or (e) by a court of competent jurisdiction.
3. ADVANCED EXPENSES. Expenses incurred by a director, Indemnified Officer
or ERISA fiduciary in defending a civil or criminal claim, action, suit or
proceeding may, upon approval of a majority (but not less than two) of the
disinterested
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directors, even though less than a quorum, or, if there are less
than two disinterested directors, upon unanimous approval of the Board of
Directors, be paid by the corporation in advance of the final disposition of
such claim, action, suit or proceeding upon receipt of an undertaking by or
on behalf of the director, Indemnified Officer or ERISA fiduciary to repay
such amount unless it shall ultimately be determined that he is entitled to
be indemnified against such expenses by the corporation.
4. CORPORATION. For purposes of this Article, references to directors,
officers, or ERISA fiduciaries of the "corporation" shall be deemed to include
directors, officers and ERISA fiduciaries of Vanguard Cellular Systems, Inc.,
its subsidiaries, and all constituent corporations absorbed into Vanguard
Cellular Systems, Inc. or any of its subsidiaries by a consolidation or merger.
5. INDEMNIFIED OFFICER. For purposes of the Article, "Indemnified Officer"
shall mean all executive officers of the corporation who are also directors of
the corporation, the Treasurer of the corporation and any other officer who is
designated by the Board of Directors as an Indemnified Officer.
6. RELIANCE AND CONSIDERATION. Any director, Indemnified Officer, or ERISA
fiduciary who at any time after the adoption of this Bylaw serves or has served
in any of the aforesaid capacities for or on behalf of the corporation shall be
deemed to be doing or to have done so in reliance upon, and as consideration
for, the right of indemnification provided herein. Such right shall inure to the
benefit of the legal representatives of any such person and shall not be
exclusive of any other rights to which such person may be entitled apart from
the provision of this Bylaw. No amendment, modification or repeal of this
Article VIII shall adversely affect the right of any director, Indemnified
Officer or ERISA fiduciary to indemnification hereunder with respect to any
activities occurring prior to the time of such amendment, modification or
repeal.
7. INSURANCE. The corporation may purchase and maintain insurance on behalf
of its directors, officers, employees and agents and those persons who were
serving at the request of the corporation as a director, officer, partner or
trustee of, or in some other capacity in, another corporation, 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 the provisions of this Article or otherwise. Any
full or partial payment made by an insurance company under any insurance policy
covering any director, officer, employee or agent made to or on behalf of a
person entitled to indemnification under this Article shall relieve the
corporation of its liability for indemnification provided for in this Article or
otherwise to the extent of such payment, and no insurer shall have a right of
subrogation against the corporation with respect to such payment."
The North Carolina General Statutes contain provisions prescribing the
extent to which directors and officers shall or may be indemnified. These
statutory provisions are set forth below:
CH. 55 N.C. BUSINESS CORPORATION ACT
PART 5. INDEMNIFICATION.
(SECTION MARK) 55-8-50. POLICY STATEMENT AND DEFINITIONS.
(a) It is the public policy of this State to enable corporations organized
under this Chapter to attract and maintain responsible, qualified directors,
officers, employees and agents, and, to that end, to permit corporations
organized under this Chapter to allocate the risk of personal liability of
directors, officers, employees and agents through indemnification and insurance
as authorized in this Part.
(b) Definitions in this Part:
(1) "Corporation" includes any domestic or foreign predecessor entity
of a corporation in a merger or other transaction in which the
predecessor's existence ceased upon consummation of the transaction.
(2) "Director" means an individual who is or was a director of a
corporation or an individual who, while a director of a corporation, is or
was serving at the corporation's request as a director, officer, partner,
trustee, employee, or agent of another foreign or domestic corporation,
partnership, joint venture, trust, employee benefit plan, or other
enterprise. A director is considered to be serving an employee benefit plan
at the corporation's request if his duties to the corporation also impose
duties on, or otherwise involve services by, him to the plan or to
participants in or beneficiaries of the plan. "Director" includes, unless
the context requires otherwise, the estate or personal representative of a
director.
(3) "Expenses" means expenses of every kind incurred in defending a
proceeding, including counsel fees.
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(4) "Liability" means the obligation to pay a judgment, settlement,
penalty, fine (including an excise tax assessed with respect to an employee
benefit plan), or reasonable expenses incurred with respect to a
proceeding.
(5) "Official capacity" means: (i) when used with respect to a
director, the office of director in a corporation; and (ii) when used with
respect to an individual other than a director, as contemplated in G.S.
55-8-56, the office in a corporation held by the officer or the employment
or agency relationship undertaken by the employee or agent on behalf of the
corporation. "Official capacity" does not include service for an other
foreign or domestic corporation or any partnership, joint venture, trust,
employee benefit plan, or other enterprise.
(6) "Party" includes an individual who was, is, or is threatened to be
made a named defendant or respondent in a proceeding.
(7) "Proceeding" means any threatened, pending, or completed action,
suit, or proceeding, whether civil, criminal, administrative, or
investigative and whether formal or informal.
(SECTION MARK) 55-8-51. AUTHORITY TO INDEMNIFY.
(a) Except as provided in subsection (d), a corporation may indemnify an
individual made a party to a proceeding because he is or was a director against
liability incurred in the proceeding if:
(1) He conducted himself in good faith; and
(2) He reasonably believed (i) in the case of conduct in his official
capacity with the corporation, that his conduct was in its best interests;
and (ii) in all other cases, that his conduct was at least not opposed to
its best interests; and
(3) In the case of any criminal proceeding, he had no reasonable cause
to believe his conduct was unlawful.
(b) A director's conduct with respect to an employee benefit plan for a
purpose he reasonably believed to be in the interests of the participants in and
beneficiaries of the plan is conduct that satisfies the requirement of
subsection (a)(2)(ii).
(c) The termination of a proceeding by judgment, order, settlement,
conviction, or upon a plea of no contest or its equivalent is not, of itself,
determinative that the director did not meet the standard of conduct described
in this section.
(d) A corporation may not indemnify a director under this section:
(1) In connection with a proceeding by or in the right of the
corporation in which the director was adjudged liable to the corporation;
or
(2) In connection with any other proceeding charging improper personal
benefit to him, whether or not involving action in his official capacity,
in which he was adjudged liable on the basis that personal benefit was
improperly received by him.
(e) Indemnification permitted under this section in connection with a
proceeding by or in the right of the corporation that is concluded without a
final adjudication on the issue of liability is limited to reasonable expenses
incurred in connection with the proceeding.
(f) The authorization, approval or favorable recommendation by the board of
directors of a corporation of indemnification, as permitted by this section,
shall not be deemed an act or corporate transaction in which a director has a
conflict of interest, and no such indemnification shall be void or voidable on
such ground.
(SECTION MARK) 55-8-52. MANDATORY INDEMNIFICATION.
Unless limited by its articles of incorporation, a corporation shall
indemnify a director who was wholly successful, on the merits or otherwise, in
the defense of any proceeding to which he was a party because he is or was a
director of the corporation against reasonable expenses incurred by him in
connection with the proceeding.
(SECTION MARK) 55-8-53. ADVANCE FOR EXPENSES.
Expenses incurred by a director in defending a proceeding may be paid by
the corporation in advance of the final disposition of such proceeding as
authorized by the board of directors in the specific case or as authorized or
required under any provision in the articles of incorporation or bylaws or by
any applicable resolution or contract upon receipt of an undertaking by or on
behalf of the director to repay such amount unless it shall ultimately be
determined that he is entitled to be indemnified by the corporation against such
expenses.
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(SECTION MARK) 55-8-54. COURT-ORDERED INDEMNIFICATION.
Unless a corporation's articles of incorporation provide otherwise, a
director of the corporation who is a party to a proceeding may apply for
indemnification to the court conducting the proceeding or to another court of
competent jurisdiction. On receipt of an application, the court after giving any
notice the court considers necessary may order indemnification if it determines:
(1) The director is entitled to mandatory indemnification under G.S.
55-8-52, in which case the court shall also order the corporation to pay the
director's reasonable expenses incurred to obtain court-ordered indemnification;
or
(2) The director is fairly and reasonably entitled to indemnification in
view of all the relevant circumstances, whether or not he met the standard of
conduct set forth in G.S. 55-8-51 or was adjudged liable as described in G.S.
55-8-51(d), but if he was adjudged so liable his indemnification is limited to
reasonable expenses incurred.
(SECTION MARK) 55-8-55. DETERMINATION AND AUTHORIZATION OF INDEMNIFICATION.
(a) A corporation may not indemnify a director under G.S. 55-8-51 unless
authorized in the specific case after a determination has been made that
indemnification of the director is permissible in the circumstances because he
has met the standard of conduct set forth in G.S. 55-8-51.
(b) The determination shall be made:
(1) By the board of directors by majority vote of a quorum consisting
of directors not at the time parties to the proceeding;
(2) If a quorum cannot be obtained under subdivision (1), by majority
vote of a committee duly designated by the board of directors (in which
designation directors who are parties may participate), consisting solely
of two or more directors not at the time parties to the proceeding;
(3) By special legal counsel (i) selected by the board of directors or
its committee in the manner prescribed in subdivision (1) or (2); or (ii)
if a quorum of the board of directors cannot be obtained under subdivision
(1) and a committee cannot be designated under subdivision (2), selected by
majority vote of the full board of directors (in which selection directors
who are parties may participate); or
(4) By the shareholders, but shares owned by or voted under the
control of directors who are at the time parties to the proceeding may not
be voted on the determination.
(c) Authorization of indemnification and evaluation as to reasonableness of
expenses shall be made in the same manner as the determination that
indemnification is permissible, except that if the determination is made by
special legal counsel, authorization of indemnification and evaluation as to
reasonableness of expenses shall be made by those entitled under subsection
(b)(3) to select counsel.
(SECTION MARK) 55-8-56. INDEMNIFICATION OF OFFICERS, EMPLOYEES, AND AGENTS.
Unless a corporation's articles of incorporation provide otherwise:
(1) An officer of the corporation is entitled to mandatory indemnification
under G.S. 55-8-52, and is entitled to apply for court-ordered indemnification
under G.S. 55-8-54, in each case to the same extent as a director.
(2) The corporation may indemnify and advance expenses under this Part to
an officer, employee, or agent of the corporation to the same extent as to a
director; and
(3) A corporation may also indemnify and advance expenses to an officer,
employee, or agent who is not a director to the extent, consistent with public
policy, that may be provided by its articles of incorporation, bylaws, general
or specific action of its board of directors, or contract.
(SECTION MARK) 55-8-57. ADDITIONAL INDEMNIFICATION AND INSURANCE.
(a) In addition to and separate and apart from the indemnification provided
for in G.S. 55-8-51, 55-8-52, 55-8-54, 55-8-55 and 55-8-56, a corporation may in
its articles of incorporation or bylaws or by contract or resolution indemnify
or agree to indemnify any one or more of its directors, officers, employees, or
agents against liability and expenses in any proceeding (including without
limitation a proceeding brought by or on behalf of the corporation itself)
arising out of their status as such or their activities in any of the foregoing
capacities; provided, however, that a corporation may not indemnify or agree to
II-4
<PAGE>
indemnify a person against liability or expenses he may incur on account of his
activities which were at the time taken known or believed by him to be clearly
in conflict with the best interests of the corporation. A corporation may
likewise and to the same extent indemnify or agree to indemnify any person who,
at the request of the corporation, is or was serving as a director, officer,
partner, trustee, employee, or agent of another foreign or domestic corporation,
partnership, joint venture, trust or other enterprise or as a trustee or
administrator under an employee benefit plan. Any provision in any articles of
incorporation, bylaw, contract, or resolution permitted under this section may
include provisions for recovery from the corporation of reasonable costs,
expenses, and attorneys' fees in connection with the enforcement of rights to
indemnification granted therein and may further include provisions establishing
reasonable procedures for determining and enforcing the rights granted therein.
(b) The authorization, adoption, approval, or favorable recommendation by
the board of directors of a public corporation of any provision in any articles
of incorporation, bylaw, contract or resolution, as permitted in this section,
shall not be deemed an act or corporate transaction in which a director has a
conflict of interest, and no such articles of incorporation or bylaw provision
or contract or resolution shall be void or voidable on such grounds. The
authorization, adoption, approval, or favorable recommendation by the board of
directors of a nonpublic corporation of any provision in any articles of
incorporation, bylaw, contract or resolution, as permitted in this section,
which occurred prior to July 1, 1990, shall not be deemed an act or corporate
transaction in which a director has a conflict of interest, and no such articles
of incorporation, bylaw provision, contract or resolution shall be void or
voidable on such grounds. Except as permitted in G.S. 55-8-31, no such bylaw,
contract, or resolution not adopted, authorized, approved or ratified by
shareholders shall be effective as to claims made or liabilities asserted
against any director prior to its adoption, authorization, or approval by the
board of directors.
(c) A corporation may purchase and maintain insurance on behalf of an
individual who is or was a director, officer, employee, or agent of the
corporation, or who, while a director, officer, employee, or agent of the
corporation, is or was serving at the request of the corporation as a director,
officer, partner, trustee, employee, or agent of another foreign or domestic
corporation, partnership, joint venture, trust, employee benefit plan, or other
enterprise, against liability asserted against or incurred by him in that
capacity or arising from his status as a director, officer, employee, or agent,
whether or not the corporation would have power to indemnify him against the
same liability under any provision of this Chapter.
(SECTION MARK) 55-8-58. APPLICATION OF PART.
(a) If articles of incorporation limit indemnification or advance for
expenses, indemnification and advance for expenses are valid only to the extent
consistent with the articles.
(b) This Part does not limit a corporation's power to pay or reimburse
expenses incurred by a director in connection with his appearance as a witness
in a proceeding at a time when he has not been made a named defendant or
respondent to the proceeding.
(c) This Part shall not affect rights or liabilities arising out of acts or
omissions occurring before July 1, 1990.
II-5
<PAGE>
ITEM 16. EXHIBITS.
The following exhibits are filed as part of the Registration Statement:
<TABLE>
<CAPTION>
EXHIBIT SEQUENTIAL
NO. DESCRIPTION PAGE NO.
<C> <S> <C>
*4 (a) Articles of Incorporation of the Registrant as amended through July 25, 1995, filed as Exhibit 1 to
the Registrant's Form 8-A/A dated July 25, 1995.
*4 (b) Bylaws of Registrant (compilation of July 25, 1995), filed as Exhibit 2 to the Registrant's Form
8-A/A dated July 25, 1995.
4 (c)(1) Form of Indenture for Senior Debentures.
4 (c)(2) Form of Indenture for Senior Subordinated Debentures.
4 (c)(3) Form of Indenture for Subordinated Debentures.
*4 (d) Specimen Common Stock Certificate, filed as Exhibit 4(a) to the Registrant's Registration Statement
on Form, S-1 (File No. 33-18067).
*4 (e)(1) Amended and Restated Loan Agreement between the Registrant and various lenders led by The Bank of New
York and The Toronto-Dominion Bank as agents, dated as of December 23, 1994, filed as of December
23, 1994, filed as Exhibit 2(a) to the Registrant's Current Report on Form 8-K dated as of December
23, 1994.
*4 (e)(2) Security Agreement between the Registrant and various lenders led by The Bank of New York and The
Toronto-Dominion Bank, as Secured Party, dated as of December 23, 1994, filed as Exhibit 2(b) to
the Registrant's Current Report on Form 8-K dated as of December 23, 1994.
*4 (e)(3) Master Subsidiary Security Agreement between the Registrant, certain of its subsidiaries and various
lenders led by The Bank of New York and The Toronto-Dominion Bank, as Secured Party, dated as of
December 23, 1994, filed as Exhibit 2(c) to the Registrant's Current Report on Form 8-K dated as of
December 23, 1994.
5 Opinion of Schell Bray Aycock Abel & Livingston L.L.P. as to legality of securities.
12 Calculation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends.
23 (a) Consent of Arthur Andersen LLP.
23 (b) Consent of Schell Bray Aycock Abel & Livingston L.L.P. is contained in its opinion included as
Exhibit 5.
24 Power of Attorney is contained on the signature page of this registration statement.
</TABLE>
* Incorporation by reference to the statement or report indicated.
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
Registration Statement; notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) ((section mark)230.424(b) of this chapter) if, in
the aggregate, the changes in volume and price represent no more than a 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 paragraphs (1)(i) and (1)(ii) do not apply if
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
II-6
<PAGE>
by the Registrant pursuant to section 13 or section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the Registration
Statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
The undersigned Registrant hereby undertakes that, for the purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
The undersigned Registrant hereby undertakes (1) to use its best efforts to
distribute prior to the opening of bids, to prospective bidders, underwriters,
and dealers, a reasonable number of copies of a prospectus which at that time
meets the requirements of section 10(a) of the Securities Act of 1933, and
relating to the securities offered at competitive bidding, as contained in the
registration statement, together with any supplements thereto, and (2) to file
an amendment to the registration statement reflecting the results of bidding,
the terms of the reoffering and related matters to the extent required by the
applicable form, not later than the first use, authorized by the issuer after
the opening of bids, of a prospectus relating to the securities offered at
competitive bidding, unless no further public offering of such securities by the
issuer and no reoffering of such securities by the purchasers is proposed to be
made.
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.
"The undersigned registrant hereby undertakes to file an application for
the purpose of determining the eligibility of the trustee to act under
subsection (a) of section 310 of the Trust Indenture Act ("Act") in accordance
with the rules and regulations prescribed by the Commission under section
305(b)(2) of the Act."
II-7
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Greensboro, State of North Carolina, on July 25,
1995.
VANGUARD CELLULAR SYSTEMS, INC.
By: /s/ HAYNES G. GRIFFIN
HAYNES G. GRIFFIN, PRESIDENT
AND CHIEF EXECUTIVE OFFICER
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Haynes G. Griffin and Stuart S.
Richardson, and each of them (will full power to each of them to act alone), his
or her true and lawful attorneys-in-fact and agents for him or her and on his or
her behalf and in his or her name, place and stead, in any and all capacities,
to sign any and all amendments (including post-effective amendments) to this
registraton statement and any and all registration statements for registering,
pursuant to Rule 462 of the Securities and Exchange Commission, additional
securities included in this registration statement and to file the same, with
exhibits and any and all other documents filed with respect thereto, with the
Securities and Exchange Commission (or any other governmental or regulatory
authority), granting unto said attorneys, and each of them, full power and
authority to do and to perform each and every act and thing requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully to all intents and purposes as he or she might or could do if
personally present, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or any of them, may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<C> <S> <C>
/s/ STUART S. RICHARDSON Chairman of the Board of Directors July 25, 1995
STUART S. RICHARDSON
/s/ HAYNES G. GRIFFIN President, Chief Executive Officer and July 25, 1995
Director
HAYNES G. GRIFFIN
/s/ L. RICHARDSON PREYER, JR. Vice Chairman of the Board of Directors July 25, 1995
L. RICHARDSON PREYER, JR.
/s/ STEPHEN L. HOLCOMBE Chief Financial Officer (principal accounting July 25, 1995
and principal financial officer)
STEPHEN L. HOLCOMBE
/s/ F. COOPER BRANTLEY Director July 25, 1995
F. COOPER BRANTLEY
/s/ DORIS R. BRAY Director July 25, 1995
DORIS R. BRAY
Director
ROBERT M. DEMICHELE
</TABLE>
II-8
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<C> <S> <C>
/s/ STEPHEN R. LEEOLOU Director July 25, 1995
STEPHEN R. LEEOLOU
/s/ L. RICHARDSON PREYER, SR. Director July 25, 1995
L. RICHARDSON PREYER, SR.
/s/ ROBERT A. SILVERBERG Director July 25, 1995
ROBERT A. SILVERBERG
</TABLE>
II-9
Exhibit 4(c)(1)
VANGUARD CELLULAR SYSTEMS, INC.
AND
, Trustee
INDENTURE
Dated as of
Senior Debentures
<PAGE>
VANGUARD CELLULAR SYSTEMS, INC.
Reconciliation and Tie between Indenture
and
Trust Indenture Act of 1939
Trust Indenture Indenture
Act Section Section
310 (a)(1).................................11.5
(a)(2).................................11.5
(a)(3).................................Not applicable
(a)(4).................................Not applicable
(b)....................................11.4, 11.5
311 (a)....................................11.9
(b)....................................11.9
312 (a)....................................4.6(d),11.1
(b)....................................11.11
(c)....................................11.11
313 (a)....................................11.10(a)
(b)(1).................................Not applicable
(b)(2).................................11.10(b)
(c)....................................11.10(c)
(d)....................................11.10(c)
314 (a)(1).................................4.6(a)
(a)(2).................................4.6(b)
(a)(3).................................4.6(c)
(b)....................................Not applicable
(c)....................................3.8
(d)....................................Not applicable
(e)....................................3.8
315 (a)....................................11.1(a),(b)
(b)....................................11.3
(c)....................................11.1(a)
(d)....................................11.1(a),11.1(b),13.3
(e)....................................7.7
316 (a)(1)(A)..............................7.6,13.3
(a)(1)(B)..............................7.1,7.5,13.3
(a)(2).................................Not required
(b)....................................7.7
317 (a)....................................7.2
(b)....................................4.8
318 (a)....................................3.4
NOTE: This reconciliation and tie shall not, for any
purpose, be deemed to be part of the Indenture.
-i-
<PAGE>
VANGUARD CELLULAR SYSTEMS, INC.
INDENTURE
TABLE OF CONTENTS*
Page
Parties.................................................... 1
Recitals................................................... 1
Consideration.............................................. 1
ARTICLE I
DEFINITIONS: TRUST INDENTURE ACT CONTROLLING
SECTION 1.1 Definitions.............................. 1
Affiliate.......................... 1
Authenticating Agent............... 2
Authorized Newspaper............... 2
Bankruptcy Law..................... 2
Board; Board of Directors.......... 2
Business day....................... 2
Capital Stock...................... 3
Certified Resolution............... 3
Class A Common Stock............... 3
Class B Common Stock............... 3
Closing Price...................... 3
Code............................... 3
Company............................ 4
Debenture.......................... 4
Debentureholder, holder of
Debentures.................... 4
Depositary......................... 4
Event of Default................... 4
Global Debenture................... 4
Indenture.......................... 4
Officers' Certificate.............. 5
Opinion of Counsel................. 5
Original issue discount............ 5
Original Issue Discount Debenture.. 5
Outstanding........................ 5
Paying Agent....................... 6
Person............................. 6
Principal.......................... 6
Principal amount................... 6
*This table of contents shall not, for any purpose, be
deemed to be part of the Indenture.
-ii-
<PAGE>
CONTENTS - (Continued)
Page
Responsible Officer................ 6
Securities Exchange Act............ 7
Trustee; principal office.......... 7
U.S. Government Obligations........ 7
SECTION 1.2. Trust Indenture Act definitions
controlling........................ 7
ARTICLE II
FORM, ISSUE AND REGISTRATION OF DEBENTURES
SECTION 2.1. Forms generally and dating.............. 7
SECTION 2.2. Amount unlimited; Issuable in series.... 8
SECTION 2.3. Denominations........................... 12
SECTION 2.4. Execution of Debentures; Authentication. 12
SECTION 2.5. Issue of Debentures..................... 15
SECTION 2.6. Transfer of Debentures.................. 16
SECTION 2.7. Persons deemed owners of Debentures..... 16
SECTION 2.8. Provisions for Debentures in temporary
form............................... 16
SECTION 2.9. Mutilated, destroyed, lost or stolen
Debentures......................... 17
SECTION 2.10. Exchanges of Debentures................. 17
SECTION 2.11. Cancellation of surrendered Debentures.. 18
SECTION 2.12. Payment of interest; Defaulted interest. 19
SECTION 2.13. Global Debentures; Depositary........... 19
ARTICLE III
MISCELLANEOUS PROVISIONS
SECTION 3.1. Rights under Indenture limited to the
parties and holders of Debentures.. 21
SECTION 3.2. Certificate of independent accountants
conclusive......................... 22
SECTION 3.3. Treatment of Debentures owned or held
by the Company in determining
required percentages............... 22
SECTION 3.4. Remaining provisions not affected by
invalidity of any other
provisions - required provisions of
Trust Indenture Act of 1939 to
control............................ 22
SECTION 3.5. Company released from Indenture
requirements if entitled to have
Indenture cancelled................ 23
SECTION 3.6. Date of execution........................ 23
SECTION 3.7. Execution of documents furnished under
the Indenture...................... 23
SECTION 3.8. Officers' Certificates and Opinions of
Counsel to be furnished Trustee.... 23
-iii-
<PAGE>
CONTENTS - (Continued)
Page
SECTION 3.9. Presentation of notices and demands..... 24
SECTION 3.10. Successors and assigns bound by
Indenture.......................... 25
SECTION 3.11. Descriptive headings for convenience
only............................... 25
SECTION 3.12. North Carolina law to govern............. 25
SECTION 3.13. Indenture may be executed in
counterparts....................... 25
ARTICLE IV
COVENANTS OF THE COMPANY
SECTION 4.1. Payment of Principal and interest....... 26
SECTION 4.2. Maintenance of office or agency......... 26
SECTION 4.3. Corporate existence..................... 26
SECTION 4.4. Restrictions on mergers, sales and
consolidations..................... 27
SECTION 4.5. Further assurances....................... 27
SECTION 4.6. File certain reports and information
with the Trustee and the Securities
and Exchange Commission - transmit
to Debentureholders summaries of
certain documents filed with the
Trustee - furnish list of
Debentureholders to the Trustee.... 27
SECTION 4.7. File statement by officers annually
with the Trustee................... 28
SECTION 4.8. Duties of Paying Agent................... 29
ARTICLE V
REDEMPTION OF DEBENTURES; SINKING FUND
SECTION 5.1. Applicability of Article................. 30
SECTION 5.2. Notice of redemption to be given to
Trustee - deposit of cash (or
other form of payment) with
Trustee - selection by Trustee
of Debentures to be redeemed....... 30
SECTION 5.3. Debentures called for redemption to
become due - rights of holders
of redeemed Debentures - return
of funds on conversion............. 32
SECTION 5.4. Credit against sinking fund.............. 33
SECTION 5.5. Redemption through sinking fund.......... 33
SECTION 5.6. Debentures no longer Outstanding after
notice to Trustee and deposit
of cash............................ 35
SECTION 5.7. Conversion arrangement on call for
redemption......................... 35
-iv-
<PAGE>
CONTENTS - (Continued)
Page
ARTICLE VI
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 6.1. Satisfaction and discharge of Indenture
with respect to Debentures of
any series......................... 36
SECTION 6.2. Deposits for payment or redemption of
Debentures to be held in trust..... 37
SECTION 6.3. Repayment of moneys...................... 38
ARTICLE VII
REMEDIES OF DEFAULT
SECTION 7.1. Events of Default defined - acceleration
of maturity upon default - waiver
of default after acceleration...... 39
SECTION 7.2. Covenant of Company to pay to Trustee
whole amount due on default in
payment of Principal or interest -
Trustee may recover judgment for
whole amount due - application
of moneys received by Trustee...... 41
SECTION 7.3. Trustee may enforce rights of action
without possession of Debentures... 44
SECTION 7.4. Delays or omissions not to impair any
rights or powers accruing upon
default............................ 44
SECTION 7.5. In Event of Default Trustee may protect
and enforce its rights by
appropriate proceedings - holders
of majority in aggregate Principal
amount of Debentures of a series
may waive default.................. 45
SECTION 7.6. Holders of majority in aggregate
Principal amount of Debentures of
any series may direct exercise of
remedies........................... 45
SECTION 7.7. Limitation on suits by Debentureholders.. 46
SECTION 7.8. No Debentures owned or held by, for the
account of or for the benefit of
the Company to be deemed
Outstanding for purpose of
payment of distribution............ 47
SECTION 7.9. Company and Trustee restored to
former position on discontinuance
or abandonment of proceedings...... 47
-v-
<PAGE>
CONTENTS - (Continued)
Page
ARTICLE VIII
EVIDENCE OF ACTION BY DEBENTUREHOLDERS
SECTION 8.1. Evidence of action by Debentureholders... 47
ARTICLE IX
IMMUNITY OF INCORPORATORS,
STOCKHOLDERS, OFFICERS AND DIRECTORS
SECTION 9.1. Immunity of incorporators, stockholder,
officers, directors and employees.. 49
ARTICLE X
MERGER, CONSOLIDATION, SALE OR LEASE
SECTION 10.1. Documents required to be filed with the
Trustee upon consolidation, merger,
sale, transfer or lease - execution
of supplemental indentures - acts
of successor corporation........... 49
SECTION 10.2. Trustee may rely upon Opinion of
Counsel............................ 50
ARTICLE XI
CONCERNING THE TRUSTEE
SECTION 11.1. Acceptance of Trust - responsibilities
of Trustee......................... 51
SECTION 11.2. Trustee to be entitled to compensation -
Trustee not to be accountable for
application of proceeds - moneys
held by Trustee to be trust funds.. 54
SECTION 11.3. Trustee to give Debentureholders notice
of default......................... 55
SECTION 11.4. Trustee acquiring conflicting interest
must eliminate it or resign........ 55
SECTION 11.5. Eligibility of Trustee................... 56
SECTION 11.6. Resignation or removal of Trustee........ 56
SECTION 11.7. Acceptance by successor Trustee.......... 58
SECTION 11.8. Successor to Trustee by merger or
consolidation, etc................. 59
SECTION 11.9. Limitations on right of Trustee as a
creditor to obtain payment of
certain claims..................... 60
SECTION 11.10 Trustee to make annual report to
Debentureholders - Trustee to
make other reports to
Debentureholders - Debentureholders
to whom reports to be transmitted... 60
-vi-
<PAGE>
CONTENTS - (Continued)
Page
SECTION 11.11. Preservation of information by Trustee -
Trustee to give certain information
to Debentureholders upon
application........................ 61
SECTION 11.12. Trustee may hold Debentures and
otherwise deal with Company........ 63
SECTION 11.13. Trustee may comply with any rule,
regulation or order of the
Securities and Exchange
Commission......................... 63
SECTION 11.14 Appointment of Authenticating Agent...... 63
ARTICLE XII
SUPPLEMENTAL INDENTURES
SECTION 12.1. Company and Trustee may enter into
supplemental indenture for
special purposes................... 65
SECTION 12.2. Modification of Indenture with consent
of Debentureholders................ 67
SECTION 12.3. Effect of supplemental indentures........ 68
SECTION 12.4. Supplemental indentures to conform to
Trust Indenture Act................ 69
SECTION 12.5. Notation on or exchange of Debentures... 69
ARTICLE XIII
CONVERSION OF DEBENTURES
SECTION 13.1. Applicability of Article................ 69
SECTION 13.2. Right of Debentureholders to convert
Debentures......................... 70
SECTION 13.3. Issuance of shares of Capital Stock on
conversion......................... 70
SECTION 13.4. No payment or adjustment for interest
or dividends....................... 71
SECTION 13.5. Adjustment of conversion rate........... 72
SECTION 13.6. No fractional shares to be issued....... 76
SECTION 13.7. Preservation of conversion rights upon
consolidation, merger, sale or
conveyance......................... 77
SECTION 13.8. Notice to Debentureholders of a series
prior to taking certain types
of action.......................... 78
SECTION 13.9. Covenant to reserve shares for
issuance on conversion of
Debentures......................... 79
SECTION 13.10. Compliance with governmental
requirements....................... 79
SECTION 13.11. Payment of taxes upon certificates for
shares issued upon conversion...... 79
-vii-
<PAGE>
CONTENTS - (Continued)
Page
SECTION 13.12. Trustee's duties with respect to
conversion provisions.............. 80
-viii-
<PAGE>
INDENTURE dated as of the day of ,
between Vanguard Cellular Systems, Inc., a corporation
organized and existing under the laws of the State of North
Carolina (hereinafter called the "Company"), and , a
banking corporation with its principal offices in
, as Trustee hereunder (hereinafter called the "Trustee").
WHEREAS, the Company for its lawful corporate purposes
has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of
its debentures, notes or other evidences of indebtedness
(hereinafter called the "Debentures"), to be issued in one
or more series, the amount and terms of each series to be
determined as hereinafter provided.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
THAT, in consideration of the premises and of the
mutual covenants herein contained and of the purchase and
acceptance of the Debentures by the holders thereof, and for
other valuable consideration the receipt whereof is hereby
acknowledged, and intending to be legally bound hereby, it
is hereby agreed between the Company and the Trustee, for
the benefit of those who shall hold the Debentures, as
follows:
ARTICLE I
DEFINITIONS; TRUST INDENTURE ACT
CONTROLLING
SECTION 1.1. Definitions. Unless otherwise
specified or the context otherwise requires, the terms
defined in this Article I shall for all purposes of this
Indenture and of any indenture supplemental hereto have the
meanings herein specified, the following definitions to be
equally applicable to both the singular and plural forms of
any of the terms herein defined. All accounting terms not
otherwise defined herein have the meanings assigned to them
in accordance with generally accepted accounting principles
in the United States of America, and 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.
Affiliate
An "Affiliate" shall mean any person directly or
indirectly controlling or controlled by or under direct or
indirect common control with the Company or any other
obligor under this Indenture.
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Authenticating Agent
The term "Authenticating Agent" means any Person
authorized by the Trustee pursuant to Section 11.14 to act
on behalf of the Trustee to authenticate Debentures of one
or more series.
Authorized Newspaper
The term "Authorized Newspaper" shall mean a newspaper
in the English language or in an official language of the
country of publication, customarily printed on each Business
day, whether or not published on Saturdays, Sundays or
holidays, and of general circulation in the place in
connection with which the term is used or in the financial
community of such place. If, because of temporary
suspension of publication or general circulation of any
newspaper or for any other reason, it is impossible or, in
the opinion of the Trustee, impracticable to make any
publication of any notice required by this Indenture in the
manner herein provided, such publication or other notice in
lieu thereof which is made at the written direction of the
Company by the Trustee shall constitute a sufficient
publication of such notice. Where successive publications
are required to be made in Authorized Newspapers, the
successive publications may be made in the same or in
different newspapers in the same place meeting the foregoing
requirements and in each case on any Business day.
Bankruptcy Law
The term "Bankruptcy Law" means Title 11 of the United
States Code, as now constituted or hereafter in effect, or
any other applicable Federal or State bankruptcy, insolvency
or other similar law.
Board; Board of Directors
The term "Board" or "Board of Directors" shall mean the
Board of Directors of the Company or the Executive
Committee, if any, of such Board or any other committee of
such Board duly authorized to act hereunder.
Business day
The term "Business day" shall mean, with respect to any
Debenture, a day that, in the city (or in any of the cities,
if more than one) in which amounts are payable, as specified
in the terms of such Debentures, is not a day upon which
banking institutions are authorized or required by law, or
by executive order issued by a governmental authority or
agency regulating such banking institutions, to close.
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Capital Stock
The term "Capital Stock" shall mean stock of any class
of the Company.
Certified Resolution
The term "Certified Resolution" shall mean 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.
Class A Common Stock
The term "Class A Common Stock" shall mean the Class A
Common Stock, $.01 par value, of the Company.
Class B Common Stock
The term "Class B Common Stock" shall mean the Class B
Common Stock, $.01 par value, of the Company.
Closing Price
The term "Closing Price" on any day when used with
respect to any class of Capital Stock shall mean (i) if the
stock is then listed or admitted to trading on a national
securities exchange in the United States, the last reported
sale price, regular way, for the stock as reported in the
consolidated transaction or other reporting system for
securities listed or traded on such exchange, or (ii) if the
stock is listed on the National Association of Securities
Dealers', Inc. Automated Quotations System National Market
System (the "NASDAQ National Market System"), the last
reported sale price, regular way, for the stock, as reported
on such list, or (iii) if the stock is not so admitted for
trading on any national securities exchange or the NASDAQ
National Market System, the average of the last reported
closing bid and asked prices reported by the National
Association of Securities Dealers', Inc. Automated
Quotations System as furnished by any member in good
standing of the National Association of Securities Dealers',
Inc., selected from time to time by the Company for that
purpose or as quoted by the National Quotation Bureau
Incorporated. In the event that no such quotation is
available for any day, the Board of Directors shall be
entitled to determine the current market price on the basis
of such quotations as it considers appropriate.
Code
The term "the Code" means the Internal Revenue Code of
1986, as amended.
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Company
The term "Company" shall mean Vanguard Cellular
Systems, Inc., a North Carolina corporation, and, subject to
the provisions of Article X, shall include its successors
and assigns.
Company Order
The term "Company Order" means a written order signed
in the name of the Company by its Chairman of the Board,
President, any Vice Chairman of the Board or any Vice
President, and by its Treasurer, any Assistant Treasurer,
Secretary or any Assistant Secretary and delivered to the
Trustee.
Debenture
The term "Debenture" shall mean one of the debentures,
notes or other evidences of indebtedness that are issued
from time to time in one or more series under this Indenture
and, more particularly, any Debenture authenticated and
delivered under this Indenture.
Debentureholder; holder of Debentures
The term "Debentureholder" or "holder of Debentures" or
other similar term shall mean any person who shall at the
time be the registered holder of any Debenture or Debentures
as shown by the register or registers kept by the Company or
its agent for that purpose in accordance with the terms of
this Indenture.
Depositary
The term "Depositary" has the meaning specified in
Section 2.13.
Event of Default
The term "Event of Default" shall mean an event listed
in Section 7.1, continued for the period of time, if any,
and after the required notices, if any, therein designated.
Global Debenture
The term "Global Debenture" has the meaning specified
in Section 2.13.
Indenture
The term "Indenture" shall mean this instrument as
originally executed or, if amended or supplemented as herein
provided, as so
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amended or supplemented and, unless the context otherwise
indicates, shall include the form and terms of each
particular series of Debentures established as contemplated
hereunder.
Officers' Certificate
The term "Officers' Certificate" shall mean a
certificate signed by the Chairman of the Board, President,
any Vice Chairman of the Board or any Vice President and by
the Treasurer or any Assistant Treasurer or the Secretary or
any Assistant Secretary of the Company, in their capacities
as such officers of the Company and delivered to the
Trustee. Each such certificate shall include the statements
provided for in Section 3.8, if and to the extent required
by the provisions thereof.
Opinion of Counsel
The term "Opinion of Counsel" shall mean an opinion in
writing signed by Schell Bray Aycock Abel & Livingston
L.L.P. or other legal counsel (who may be an employee of the
Company) acceptable in form and substance to the Trustee and
delivered to the Trustee. Such opinion shall include the
statements provided for in Section 3.8, if and to the extent
required by the provisions thereof.
Original issue discount
The term "original issue discount" with respect to any
debt security, including an Original Issue Discount
Debenture, has the same meaning as set forth in Section 1273
of the Code, or any successor provision, and the applicable
Treasury Regulations thereunder.
Original Issue Discount Debenture
The term "Original Issue Discount Debenture" means any
Debenture which provides for an amount less than the
principal amount thereof to be due and payable upon
acceleration of the maturity thereof pursuant to Section
7.1.
Outstanding
The term "Outstanding", when used with respect to the
Debentures, shall, subject to Section 3.3, mean, as of the
date of determination, all Debentures theretofore
authenticated and delivered under this Indenture, except:
(a) Debentures for the payment or redemption of which cash
(or other form of payment if permitted by the terms of such
Debentures) in the necessary amount shall have been
deposited in trust with the Trustee or any paying agent
(other than the Company) provided that, if such Debentures
are to be redeemed prior to the maturity thereof,
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notice of such redemption shall have been duly given or
provision satisfactory to the Trustee shall have been made
for giving such notice; (b) Debentures converted into
Capital Stock in accordance with Article XIII hereof, if the
terms of such Debentures provide for convertibility pursuant
to Section 2.2; (c) Debentures paid or in lieu of or in
substitution for which other Debentures shall have been
authenticated and delivered pursuant to the terms of Section
2.9, unless proof satisfactory to the Trustee is presented
that any such Debentures are held by persons in whose hands
such Debentures are valid, binding and legal obligations;
and (d) Debentures which have been cancelled by the Trustee
or delivered to the Trustee for cancellation.
Paying Agent
The term "Paying Agent" shall mean any person
authorized by the Company to pay the principal of, premium,
if any, and interest on any Debentures.
Person
The term "Person" shall mean an individual, a
corporation, a partnership, an association, a joint-stock
company, a trust, any unincorporated organization, or a
government or political subdivision thereof.
Principal
The term "principal" of a debt security, including any
Debenture, on any day and for any purpose means the amount
(including, without limitation, in the case of an Original
Issue Discount Debenture, any accrued original issue
discount, but excluding interest) that is payable with
respect to such debt security as of such date and for such
purpose (including, without limitation, in connection with
any sinking fund, upon any redemption at the option of the
Company upon any purchase or exchange at the option of the
Company or the holder of such debt security and upon any
acceleration of the maturity of such debt security).
Principal amount
The term "principal amount" of a debt security,
including any Debenture, means the principal amount as set
forth on the face of such debt security.
Responsible Officer
The term "Responsible Officer", when used with respect
to the Trustee, shall mean any officer of the Trustee
assigned by the Trustee to administer its corporate trust
matters.
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Securities Exchange Act
The term "Securities Exchange Act" shall mean the
Securities Exchange Act of 1934, as amended.
Trustee; principal office
The term "Trustee" shall mean the trustee or trustees
hereunder for the time being, whether original or successor.
"Trustee" as used with respect to the Debentures of any
series shall mean the Trustee with respect to Debentures of
such series. The term "principal office" of the Trustee
shall mean the principal office of the Trustee at which, at
any particular time, the corporate trust business of the
Trustee shall be administered, which office as of the date
hereof is .
U.S. Government Obligations
The term "U.S. Government Obligations" means direct
obligations of, or obligations entitled to the full faith
and credit of, the United States of America.
SECTION 1.2. Trust Indenture Act definitions
controlling. All terms used in this Indenture which are
defined in the Trust Indenture Act of 1939, as amended, or
which are by reference therein defined in the Securities Act
of 1933 (except as herein otherwise expressly provided or
unless the context otherwise requires) shall have the
meanings assigned to such terms in such Trust Indenture Act
and such Securities Act as they were respectively in force
at the date of this Indenture, except as otherwise provided
in Section 12.3.
ARTICLE II
FORM, ISSUE AND REGISTRATION OF DEBENTURES
SECTION 2.1. Forms generally and dating. The
Debentures of each series shall be in the form or forms
(including temporary or permanent global form) established
from time to time by or pursuant to a resolution of the
Board of Directors or in one or more indentures supplemental
hereto which shall set forth the information required by
Section 2.2. The Debentures and the Trustee's certificate
of authentication shall have such appropriate insertions,
omissions, substitutions and other variations as are
required or permitted by this Indenture or by a resolution
of the Board of Directors and may have such notations,
legends or endorsements as the Company may deem appropriate
and as are not inconsistent with the provisions of this
Indenture or as may be required by law, stock exchange rule
or usage. The
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Company shall approve and provide the form of the Debentures
and any notation, legend or endorsement on them. If the
form of Debentures of any series is established by action
taken pursuant to a resolution of the Board of Directors, 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 2.5
for the authentication and delivery of such Debentures.
Each Debenture shall be dated the date of its
authentication. The form of the Trustee's certificate of
authentication to be borne by the Debentures shall be
substantially as follows:
(FORM OF TRUSTEE'S CERTIFICATE)
This is one of the Debentures of the series referred to
on the reverse hereof.
as Trustee
By:
Authorized Officer
SECTION 2.2. Amount unlimited; Issuable in series.
The aggregate principal amount of the Debentures which
may be authenticated and delivered under this Indenture is
unlimited.
The Debentures may be issued in one or more series.
There shall be established in or pursuant to one or more
resolutions of the Board of Directors, or established in or
pursuant to one or more indentures supplemental hereto,
prior to the issuance of the Debentures of any series:
(1) the title of the Debentures of the series
(which shall distinguish Debentures of the series from
all other Debentures);
(2) any limit upon the aggregate principal
amount of the Debentures of the series which may be
authenticated and delivered under this Indenture
(except for the Debentures authenticated and delivered
upon registration of transfer of, or in exchange for,
or in lieu of, other Debentures of the series pursuant
to Section 2.6, 2.8, 2.9, 2.10, 2.11, 5.2 or 12.5) and
except for any Debentures which pursuant to Section 2.4
are deemed not to have been authenticated and delivered
hereunder;
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(3) the date or dates (and whether fixed or
extendable) on which the principal of the Debentures of
the series is payable or the method of determination
thereof;
(4) the rate or rates at which the Debentures
of the series shall bear interest, if any, the method
of calculating such rates, the date or dates from which
such interest shall accrue or the manner of determining
such dates, the interest payment dates on which such
interest shall be payable and the record dates for the
determination of Debentureholders to whom interest is
payable;
(5) the place or places where the principal of
and premium, if any, and interest on the Debentures, if
any, of the series shall be payable;
(6) if other than 100% of their principal
amount, the percentage of the principal amount at which
the Debentures will be issued;
(7) any provisions relating to the issuance of
the Debentures of such series at an original issue
discount;
(8) the price or prices at which, the period or
periods within which and the terms and conditions upon
which the Debentures of the series may be redeemed, in
whole or in part, at the option of the Company,
pursuant to any sinking fund or otherwise (including,
without limitation, the form or method of payment
thereof if other than in cash);
(9) the obligation, if any, of the Company to
redeem, purchase or repay the Debentures of the series
pursuant to any mandatory redemption, sinking fund or
analogous provisions or at the option of a
Debentureholder thereof and the price or prices at
which and the period or periods within which and the
terms and conditions upon which the Debentures of the
series shall be redeemed, purchased or repaid, in whole
or in part, pursuant to such obligation (including,
without limitation, the form or method of payment
thereof if other than in cash), and any provisions for
the remarketing of such Debentures;
(10) if other than denominations of $1,000 and
any integral multiple thereof, the denominations in
which the Debentures of the series shall be issuable;
(11) if other than the principal amount thereof,
the portion of the principal amount of the Debentures
of the series which shall be payable upon declaration
of acceleration of the maturity thereof pursuant to
Section 7.1 or provable in bankruptcy pursuant to
Section 7.2, or, if applicable, which is convertible in
accordance with Article XIII;
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(12) any Events of Default with respect to the
Debentures of a particular series, in lieu of or in
addition to those set forth herein and the remedies
therefor;
(13) the obligation, if any, of the Company to
permit the conversion or exchange of the Debentures of
such series and, if any, the securities or rights into
which the Debentures of the series are convertible or
exchangeable (which may include other debentures,
Capital Stock or other securities or rights of the
Company (including rights to receive payment in cash or
securities based on the value, rate or price of one or
more specified commodities, currencies or indices) or
exchangeable for securities of other series or a
combination of the foregoing), and the terms and
conditions upon which such conversion or exchange shall
be effected (including, without limitation, the initial
conversion price or rate, the conversion period and any
other provision in addition to or in lieu of those set
forth in this Indenture relative to such obligation);
(14) any trustees, authenticating or paying
agents, transfer agents or registrars or any other
agents with respect to the Debentures of such series;
(15) the currency or currencies, including
composite currencies, in which the Debentures of the
series shall be denominated if other than the currency
of the United States of America, and, if so, whether
the Debentures of the series may be satisfied and
discharged other than as provided in Article VI;
(16) if other than the coin or currency in which
the Debentures of that series are denominated, the coin
or currency in which payment of the principal of,
premium, if any, or interest on the Debentures of such
series shall be payable;
(17) if the principal of, premium, if any, or
interest on the Debentures of such series are to be
payable, at the election of the Company or a
Debentureholder thereof, in a coin or currency other
than that in which the Debentures are denominated, the
period or periods within which, and the terms and
conditions upon which, such election may be made;
(18) if the amount of payments of principal of,
premium, if any, and interest on the Debentures of the
series may be determined with reference to an index,
the manner in which such amounts shall be determined;
(19) whether and under what circumstances the
Company will pay additional amounts on the Debentures
of the series held by a person who is not a United
States of America person in respect of any tax,
assessment or governmental charge withheld or deducted
and, if so, whether the Company will have the option to
redeem such Debentures rather than pay such additional
amounts;
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(20) if receipt of certain certificates or other
documents or satisfaction of other conditions will be
necessary for any purpose, including, without
limitation, as a condition to the issuance of the
Debentures of such series in definitive form (whether
upon original issue or upon exchange of a temporary
Debenture of such series), the form and terms of such
certificates, documents or conditions;
(21) any other affirmative or negative covenants
with respect to the Debentures of such series;
(22) whether the Debentures of such series shall
be issued in whole or in part in the form of one or
more Global Debentures and in such case (i) the
Depositary for such Global Debenture or Debentures,
which Depositary must be a clearing agency registered
under the Securities Exchange Act, (ii) the
circumstances under which any such Global Debenture may
be exchanged for Debentures registered in the name of,
and under which any transfer of such Global Debenture
may be registered in the name of, any Person other than
such Depositary or its nominee, if other than as set
forth in Section 2.13 and (iii) any other provisions
regarding such Global Debentures which provisions may
be in addition to or in lieu of, in whole or in part,
the provisions of Section 2.13; and
(23) any other terms of a particular series and
any other provisions expressing or referring to the
terms and conditions upon which the Debentures of such
series are to be issued under the Indenture, which
terms and provisions are not in conflict with the
provisions of this Indenture; provided, however, that
the addition to or subtraction from or variation of
Articles IV, V, VI, VII, and X (and Section 1.1,
insofar as it relates to the definition of certain
terms as used in such Articles) with regard to the
Debentures of a particular series shall not be deemed
to constitute a conflict with the provisions of those
Articles.
All Debentures of any one series shall be substantially
identical except as to denomination and except as may
otherwise be provided in or pursuant to such resolution of
the Board of Directors or in any such indenture supplemental
hereto. Not all Debentures of any one series need be issued
at the same time, and, unless otherwise so provided, a
series may be reopened for issuances of
additional Debentures of such series.
If any of the terms of the Debentures of a series are
established by action taken pursuant to a resolution of the
Board of Directors, a copy of any appropriate record of such
action shall be certified by the Secretary or an Assistant
Secretary of the Company and delivered to the Trustee with
an Officers' Certificate setting forth the terms of the
Debentures of such
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series. With respect to Debentures of a series which are not
to be issued at one time, such resolution of the Board of
Directors or action may provide general terms or parameters
for Debentures of such series and provide either that the
specific terms of particular Debentures of such series shall
be specified in a Company Order or that such terms shall be
determined by the Company or its agents in accordance with a
Company Order as contemplated by the proviso clause of
Section 2.5.
SECTION 2.3. Denominations. The Debentures of
each series shall be registered Debentures without coupons,
in such denominations as shall be specified as contemplated
by Section 2.2. In the absence of any such provisions with
respect to the Debentures of any series, the Debentures of
such series shall be issuable in denominations of $1,000 or
of any integral multiple of $1,000.
SECTION 2.4. Execution of Debentures;
Authentication. The Debentures shall be executed on behalf
of the Company by its President or one of its Vice Chairmen
or Vice Presidents, whose signatures may be manual or
facsimile, and its corporate seal shall be thereunto affixed
(or a facsimile thereof shall be engraved, printed, or
otherwise reproduced thereon) and attested by the manual or
facsimile signature of its Secretary or one of its Assistant
Secretaries. In case any officer of the Company who shall
have signed any of the Debentures shall cease to be such
officer before the Debentures so signed and attested shall
actually have been authenticated and delivered by the
Trustee or the Authenticating Agent or disposed of by the
Company, such Debentures nevertheless may be authenticated,
issued and delivered or disposed of with the same force and
effect as though the person or persons who signed or
attested such Debentures had not ceased to be such officer
of the Company; and any such Debenture may be signed and
attested on behalf of the Company by such persons, as at the
actual date of the execution of such Debenture, shall be the
proper officers of the Company, although at the date of such
Debenture or the date of execution of this Indenture any
such person was not such officer.
No Debenture of any series shall be entitled to the
benefits hereof or shall be or become valid or obligatory
for any purpose unless there shall appear on the Debenture a
certificate of authentication, substantially in the form
hereinbefore recited, manually executed by the Trustee for
such series or an Authenticating Agent; and such certificate
on any Debenture issued by the Company shall be conclusive
evidence that it has been duly authenticated and delivered
hereunder.
Notwithstanding the foregoing, if any Debenture shall
have been duly authenticated and delivered hereunder but
never issued and sold by the Company, and the Company shall
deliver such
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Debenture to the Trustee for cancellation as provided in
Section 2.11 together with a written statement (which need
not be accompanied by an Opinion of Counsel) stating that
such Debenture has not been issued and sold by the Company,
for all purposes of this Indenture such Debenture shall be
deemed not to have been authenticated and delivered
hereunder and shall not be entitled to the benefits of this
Indenture.
If the form or forms or terms of the Debentures of any
series have been established in or pursuant to one or more
resolutions of the Board of Directors or indentures
supplemental hereto as permitted by Sections 2.1 and 2.2, in
authenticating such Debentures, and accepting the additional
responsibilities under this Indenture in relation to such
Debentures, the Trustee and the Authenticating Agent shall
be entitled to receive, and (subject to Section 11.2) shall
be fully protected in relying upon, a copy of such
resolution or resolutions delivered to the Trustee and the
Authenticating Agent and certified by the Secretary or
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 an Opinion of Counsel
stating:
(1) if the form or forms of such Debentures
have been established by or pursuant to a resolution of
the Board of Directors or indenture supplemental
hereto, that such form or forms have been established
in conformity with the provisions of this Indenture;
(2) if the terms of such Debentures have been
established by or pursuant to a resolution of the Board
of Directors or indenture supplemental hereto, that
such terms have been established in conformity with the
provisions of this Indenture; and
(3) that such Debentures, when authenticated
and delivered by the Trustee or an Authenticating Agent
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
conveyance, reorganization and other laws of general
applicability relating to or affecting the enforcement
of creditors' rights and to general equity principles
(or such other similar matters as in the opinion of
such counsel shall not materially adversely affect such
enforceability).
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provided, however, that, with respect to Debentures of a
series which are not to be issued at one time, the Trustee
and the Authenticating Agent shall be entitled to receive
such Opinion of Counsel only once at or prior to the time of
the first authentication of Debentures of such series and
that the opinions described in clauses (2) and (3) above may
state, respectively:
(a) that, when the terms of such Debentures
shall have been established pursuant to a Company Order
or pursuant to such procedures as may be specified from
time to time by a Company Order, all as contemplated by
and in accordance with a resolution of the Board of
Directors or an Officers' Certificate pursuant to a
resolution of the Board of Directors or indenture
supplemental hereto, as the case may be, such terms
will have been established in conformity with the
provisions of this Indenture; and
(b) that such Debentures, when (i) executed by
the Company, (ii) completed, authenticated and
delivered by the Trustee or the Authenticating Agent in
accordance with this Indenture, (iii) issued and
delivered by the Company, and (iv) paid for, all as
contemplated by and in accordance with the aforesaid
Company Order or specified procedures, as the case may
be, will constitute valid and legally binding
obligations of the Company, enforceable in accordance
with their terms, subject to bankruptcy, insolvency,
fraudulent conveyance, reorganization and other laws of
general applicability relating to or affecting the
enforcement of creditors' rights and to general
equitable principles (or such other similar matters as
in the opinion of such counsel shall not materially
adversely affect such enforceability).
Notwithstanding the provisions of Sections 2.1, 2.2,
3.8 and this Section, if all the Debentures of a series are
not to be originally issued at one time, the resolution of
the Board of Directors or indenture supplemental hereto, the
certified copy of the record of action taken pursuant to
such resolution or supplemental indenture, the Officers'
Certificate, the Company Order and any other documents
otherwise required pursuant to such Sections need not be
delivered at or prior to the time of authentication of each
Debenture of such series if such documents are delivered at
or prior to the authentication upon original issuance of the
first Debenture of such series to be issued;
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provided, however, that any subsequent request by the
Company to the Trustee or the Authenticating Agent to
authenticate Debentures of such series shall constitute a
representation and warranty by the Company that, as of the
date of such request, the statements made in the Officers'
Certificate delivered pursuant to Section 3.8 at or prior to
authentication of the first such Debenture shall be true and
correct on the date thereof as if made on and as of the date
hereof.
The Trustee or the Authenticating Agent shall not be
required to authenticate such Debentures if the issue of
such Debentures pursuant to this Indenture will adversely
affect the Trustee's or the Authenticating Agent's own
rights, duties or immunities under the Debentures and this
Indenture or otherwise in a manner which is not reasonably
acceptable to the Trustee or the Authenticating Agent.
With respect to Debentures of a series which are not
all issued at one time, the Trustee and the Authenticating
Agent may conclusively rely, as to the authorization by the
Company of any such Debentures, the form and terms thereof
and the legality, validity, binding effect and
enforceability thereof, upon the Opinion of Counsel,
Officers' Certificate and other documents delivered pursuant
to Sections 2.1, 2.2, 3.8 and this Section, as applicable,
at or prior to the time of the first authentication of
Debentures of such series unless and until such opinion,
certificate or other documents have been superseded or
revoked in a writing delivered to the Trustee. In
connection with the authentication and delivery of
Debentures of a series which are not all issued at one time,
the Trustee and the Authenticating Agent shall be entitled
to assume that the Company's instructions to authenticate
and deliver such Debentures do not violate any rules,
regulations or orders of any governmental agency or
commission having jurisdiction over the Company.
SECTION 2.5. Issue of Debentures. The Trustee and
the Authenticating Agent, forthwith upon the execution and
delivery of this Indenture and from time to time thereafter,
upon the execution and delivery to it of Debentures of any
series by the Company as herein provided, and without
further action on the part of the Company, shall
authenticate such Debentures up to a maximum amount, if any,
designated for such series pursuant to Section 2.2 and
deliver them to or upon the receipt of a Company Order;
provided, however, that if not all the Debentures of a
series are to be issued at one time and if the resolution of
the Board of Directors or indenture supplemental hereto
establishing such series as contemplated by Sections 2.1 and
2.2 shall so permit, such Company Order may set forth
procedures acceptable to the Trustee for the issuance of
such Debentures and for determining the form or forms or
terms of particular Debentures of such series including, but
not limited to, interest rate, if
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any, maturity date, date of issuance and date from which
interest, if any, shall accrue.
SECTION 2.6. Transfer of Debentures. The transfer
of any Debenture of any series may be registered by the
registered owner thereof, in person or by his attorney duly
authorized in writing, at the office or agency of the
Company to be maintained by it as provided in Section 4.2,
by delivering such Debenture for cancellation, accompanied
by delivery of a duly executed instrument of transfer, in a
form approved by the Company and satisfactory to the
Trustee, and thereupon the Company shall execute in the name
of the transferee or transferees, and the Trustee or the
Authenticating Agent shall authenticate and deliver, a new
Debenture or Debentures of the same series and of like form
for the same aggregate principal amount.
SECTION 2.7. Persons deemed owners of Debentures.
Prior to due presentation of any Debenture for registration
of transfer, the person in whose name a Debenture of any
series shall be registered, on books kept for such purpose
in accordance with Section 4.2, shall be deemed the absolute
owner thereof for all purposes of this Indenture, whether or
not such Debenture is overdue, and neither the Company, the
Trustee nor any Paying Agent or conversion agent nor any
Debenture registrar shall be affected by notice to the
contrary. Subject to the provisions of Section 2.12, payment
of or on account of the principal, premium, if any, and
interest shall be made only to or upon the order in writing
of such registered owner thereof, but such registration may
be changed as above provided. All such payments shall be
valid and effectual to satisfy and discharge the liability
upon such Debenture to the extent of the sum or sums so
paid.
SECTION 2.8. Provisions for Debentures in
temporary form. Until Debentures of any series in
definitive form are ready for delivery, the Company may
execute and, upon its request in writing, the Trustee or the
Authenticating Agent shall authenticate and deliver, in lieu
thereof and subject to the same conditions, one or more
printed or lithographed Debentures in temporary form,
substantially of the tenor of Debentures of the same series,
without a recital of specific redemption prices and with
such other appropriate omissions, variations and insertions,
all as may be determined by the Board of Directors. Until
exchanged for Debentures of the same series in definitive
form such Debentures in temporary form shall be entitled to
the benefits of this Indenture. The Company shall, without
unreasonable delay after the issue of Debentures in
temporary form, prepare, execute and deliver definitive
Debentures of the same series to the Trustee, and upon the
presentation and surrender of Debentures in temporary form,
the Trustee or the Authenticating Agent shall authenticate
and deliver, in exchange therefor, Debentures of the same
series in definitive form for
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the same aggregate principal amount as the Debentures in
temporary form surrendered. Such exchange shall be made by
the Company at its own expense and without any charge
therefor.
SECTION 2.9. Mutilated, destroyed, lost or stolen
Debentures. Upon receipt by the Company, the Trustee and
the Authenticating Agent of evidence satisfactory to them
that any Debenture of any series has been mutilated,
destroyed, lost or stolen, and upon receipt of indemnity
(and in case of a destroyed, lost or stolen Debenture, proof
of ownership) satisfactory to them, the Company shall, in
the case of a mutilated Debenture, and may in the case of a
lost, stolen or destroyed Debenture, execute, and thereupon
the Trustee or the Authenticating Agent shall authenticate
and deliver, a new Debenture of the same series of like
tenor bearing a serial number not contemporaneously
outstanding (bearing such notation, if any, as may be
required by the rules of any stock exchange upon which the
Debentures of the same series are listed or are to be
listed), in exchange and substitution for, and upon
surrender and cancellation of, the mutilated Debenture, or
in lieu of and in substitution for the Debenture so
destroyed, lost or stolen; or, if any mutilated, destroyed,
lost or stolen Debenture of any series shall have matured or
be about to mature, instead of issuing a new Debenture, the
Company, upon written notice to the Trustee or the
Authenticating Agent, may pay the same without surrender of
the destroyed, lost or stolen Debenture. The Company may
require payment of the expenses which may be incurred by the
Company or any agent thereof and the charges and expenses of
the Trustee and the Authenticating Agent in the premises.
Any Debenture issued under the provisions of this Section
2.9 in lieu of any Debenture alleged to have been destroyed,
lost or stolen, shall constitute an additional contractual
obligation of the Company, whether or not the Debenture
alleged to have been destroyed, lost or stolen shall be
found at any time, and shall be equally and proportionately
entitled to the benefits of this Indenture with all other
Debentures of the same series issued under this Indenture.
All Debentures shall be held and owned upon the express
condition that the foregoing provisions are exclusive with
respect to the replacement or payment of mutilated,
destroyed, lost or stolen Debentures, and shall preclude, to
the extent lawful, any and all other rights or remedies,
notwithstanding any law or statute existing or hereafter
enacted to the contrary with respect to the replacement or
payment of negotiable instruments or other securities
without their surrender.
SECTION 2.10. Exchanges of Debentures. Debentures of
any series may, upon surrender thereof as hereinafter
provided in this Section 2.10, be exchanged for one or more
Debentures of the same series of the same aggregate
principal amount, in authorized
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denominations. The Debentures to be exchanged shall be
surrendered at the office or agency of the Company to be
maintained by it as provided in Section 4.2, accompanied by
duly executed instruments of transfer in a form acceptable
to the Company and the Trustee, and the Company shall
execute and the Trustee or the Authenticating Agent shall
authenticate and deliver, in exchange therefor, the
Debenture or Debentures of the same series, bearing numbers
not contemporaneously outstanding, which the Debentureholder
making the exchange shall be entitled to receive. Every
exchange of Debentures of any series shall be effected in
such manner as may be prescribed by the Company with the
approval of the Trustee, and as may be necessary to comply
with the regulations of any stock exchange upon which
Debentures of such series are listed or are to be listed or
to conform to usage in respect thereof.
Upon every exchange or registration of transfer of
Debentures, no service charge shall be made but the Company
may require the payment of any taxes or other governmental
charges required to be paid with respect to such exchange or
registration, as a condition precedent to the exercise of
the privilege of such exchange or registration.
All Debentures executed, authenticated and delivered in
exchange or upon registration of transfer shall be the valid
obligations of the Company, evidencing the same debt as the
Debentures surrendered, and shall be entitled to the
benefits of this Indenture to the same extent as the
Debentures in exchange for which they were authenticated and
delivered.
The Company shall not be required to make exchanges or
registrations of transfer under any provision of this
Article II of: (a) the Debentures of any series for the
period of 15 days next preceding the date of any designation
of Debentures of such series to be redeemed, as provided in
Article V, or (b) any Debenture or portion thereof called or
to be called for redemption.
SECTION 2.11. Cancellation of Surrendered
Debentures. All Debentures of any series surrendered for
the purpose of payment, exchange, conversion or cancellation
(including Debentures authenticated which the Company has
not issued and sold) shall, if surrendered to the Company
or any Paying Agent or conversion agent, be delivered to the
Trustee and cancelled by it, or, if surrendered to the
Trustee, shall be cancelled by it, and no Debentures shall
be issued in lieu thereof except as expressly permitted by
any of the provisions of this Indenture or as otherwise
provided in the resolution of the Board of Directors or
indenture supplemental hereto establishing such series as
contemplated by Section 2.2. All Debentures of any series
surrendered for the purpose of redemption or credit against
any
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sinking fund shall similarly be delivered to the Trustee for
cancellation, and no Debentures shall be issued in lieu
thereof except Debentures of the same series in the case of
redemption of a Debenture in part only. If the Company
shall acquire any of the Debentures, such acquisition shall
not operate as a redemption or satisfaction of the
indebtedness represented by such Debentures unless and until
the same are delivered to the Trustee for cancellation.
Unless otherwise directed in writing by the Company, the
Trustee shall destroy all cancelled Debentures and furnish
to the Company a certificate evidencing such destruction.
SECTION 2.12. Payment of interest; Defaulted
interest. Except as provided in Section 13.4, interest
(except defaulted interest) on the Debentures of any series
which is payable on any interest payment date shall be paid
to the persons who are Debentureholders of such series at
the close of business on the record date specified for that
purpose as contemplated by Section 2.2. At the option of
the Company, payment of interest on any Debenture may be
made by check mailed to the holder's registered address.
If the Company defaults in a payment of interest on the
Debentures of any series, it shall pay the defaulted
interest to the persons who are Debentureholders of such
series at the close of business on a subsequent special
record date. The Company shall fix the record date (which
shall be not less than five Business days prior to the date
of payment of such defaulted interest) and payment date. At
least 15 days before the record date, the Company shall mail
to each Debentureholder of such series a notice that states
the record date, the payment date and the amount of
defaulted interest to be paid. The Company shall notify the
Trustee in writing of the amount of defaulted interest
proposed to be paid on each Debenture of such series and the
date of the proposed payment, and at the same time the
Company shall deposit with the Trustee or any paying agent
for such series an amount of money in immediately available
funds by 10:00 a.m. New York time on the payment date equal
to the aggregate amount proposed to be paid in respect of
such defaulted interest or shall make arrangements
satisfactory to any Paying Agent for such series for such
deposit prior to the date of the proposed payment. The
Company may pay defaulted interest in any other lawful
manner not inconsistent with the requirements of any
securities exchange on which the Debenture may be listed,
and upon 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 payment shall
be deemed practicable by the Trustee.
SECTION 2.13. Global Debentures; Depositary. For
the purposes of this Section, the term "Agent Member" means
a member
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of, or participant in, a Depositary; the term "Depositary"
means, with respect to Debentures issuable or issued in
whole or in part in the form of one or more Global
Debentures, the entity designated as Depositary by the
Company pursuant to Section 2.2, and, if at any time there
is more than one such person, "Depositary" as used with
respect to the Debentures shall mean the respective
Depositary with respect to particular series of Debentures;
and the term "Global Debenture" means a global certificate
evidencing all or part of the series of Debentures as shall
be specified herein, issued to the Depositary for the series
or such portion of the series, and registered in the name of
such Depositary or its nominee. The Global Debenture may
provide that it shall represent the aggregate amount of
Outstanding Debentures from time to time endorsed thereon
which may from time to time be reduced to reflect exchanges.
Any endorsement to reflect the amount, or any increase or
decrease in the amount, of Outstanding Debentures shall be
made by the Trustee.
Notwithstanding Section 2.10, except as otherwise
specified as contemplated by Section 2.2., hereof, any
Global Debenture shall be exchangeable only as provided in
this paragraph. A Global Debenture shall be exchangeable
pursuant to this Section 2.13 if (i) the Depositary notifies
the Company that it is unwilling or unable to continue as
Depositary for such Global Debenture or if at any time the
Depositary ceases to be a clearing agency registered under
the Securities Exchange Act, (ii) the Company in its sole
discretion determines that all Global Debentures of any
series then outstanding under the Indenture shall be
exchangeable for definitive Debentures of such series in
registered form or (iii) an Event of Default with respect to
the Debentures of the series represented by such Global
Debenture has occurred and is continuing. Any Global
Debenture of such series exchangeable pursuant to the
preceding sentence shall be exchangeable for definitive
Debentures of such series in registered form, bearing
interest (if any) at the same rate or pursuant to the same
formula, having the same date of issuance, redemption,
conversion (if any) and other provisions, and of differing
denominations aggregating a like amount. Such definitive
Debentures of such series shall be registered in the names
of the owners of the beneficial interests in such Global
Debentures of such series as such names are from time to
time provided by the relevant participants in the Depositary
holding such Global Debentures (as such participants are
identified from time to time by such Depositary).
No Global Debenture may be transferred except as a
whole by a nominee of the Depositary to the Depositary or
another nominee of the Depositary or by the Depositary or
any such nominee or a successor of the Depositary or a
nominee of such successor. Except as provided above, owners
solely of beneficial interests
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in a Global Debenture shall not be entitled to receive
physical delivery of Debentures of such series in definitive
form and will not be considered the Debentureholders thereof
for any purpose under this Indenture.
Any Global Debenture that is exchangeable pursuant to
the preceding paragraph shall be exchangeable for Debentures
of such series in authorized denominations and registered in
such names as the Depositary that is the Debentureholder of
such Global Debentures of such series shall direct.
In the event that a Global Debenture is surrendered for
redemption in part pursuant to Section 5.2 or 5.5, the
Company shall execute, and the Trustee or the Authenticating
Agent shall authenticate and delivery to the Depositary for
such Global Debenture, without service charge, a new Global
Debenture in a denomination and tenor equal to and in
exchange for the unredeemed portion of the principal for the
Global Debenture so surrendered.
The Agent Members shall have no rights under this
Indenture with respect to any Global Debenture held on their
behalf by a Depositary, and such Depositary may be treated
by the Company, the Trustee, and any agent of the Company or
the Trustee as the owner of such Global Debenture for all
purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent the Company, the Trustee, or any agent
of the Company or the Trustee, from giving effect to any
written certification, proxy or other authorization
furnished by a Depositary or impair, as between a Depositary
and its Agent Members, the operation of customary practices
governing the exercise of the rights of a holder of a
Debenture of any series, including without limitation, the
granting of proxies or other authorization of participants
to give or take any request, demand, authorization,
direction, notice, consent, waiver or other action which a
Debentureholder is entitled to give or take under the
Indenture.
The Trustee shall not be required to authenticate
Global Debentures until it has received documentation
satisfactory to it.
ARTICLE III
MISCELLANEOUS PROVISIONS
SECTION 3.1. Rights under Indenture limited to the
parties and holders of Debentures. Nothing in this
Indenture or the Debentures, express or implied, is intended
or shall be construed to confer upon, or to give to, any
person or corporation, other than the parties hereto, their
successors and assigns, and the holders of the Debentures,
any right, remedy or claim under or by reason of this
Indenture or any provision hereof; and the
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provisions of this Indenture are for the exclusive benefit
of the parties hereto, their successors and assigns, and the
holders of the Debentures.
SECTION 3.2. Certificate of independent accountants
conclusive. Unless otherwise specifically provided, the
certificate or opinion of Arthur Andersen & Co., or of any
other independent firm of public accountants of recognized
standing selected by the Board of Directors and acceptable
to the Trustee in the exercise of reasonable care (which
firm may be regular independent accountants to the Company),
shall be conclusive evidence of the correctness of any
computation made under the provisions of this Indenture, and
wherever reference is made in this Indenture to "generally
accepted accounting principles" the certificate or opinion
of such a firm shall be conclusive evidence thereof. The
Company shall furnish to the Trustee upon its request a copy
of any such certificate or opinion.
SECTION 3.3. Treatment of Debentures owned or held by
the Company in determining required percentages. For all
purposes of this Indenture, in determining whether the
holders of a required percentage or proportion of the
principal amount of Debentures of one or more series have
concurred in any request, waiver, vote, direction or
consent, Debentures owned or held by or for the account or
for the benefit of the Company or any other obligor under
this Indenture or any Affiliate shall be disregarded and
deemed not Outstanding, except that, for the purposes of
determining whether the Trustee shall be protected in
relying on any such request, waiver, direction or consent,
only Debentures which the Trustee knows to be so owned or
held shall be so disregarded. Debentures so owned which
have been pledged in good faith to secure an obligation may
be regarded as Outstanding for all such purposes, if the
Trustee receives an Officers' Certificate stating that said
Debentures have been so pledged, that the pledgee is
entitled to vote with respect to such Debentures and that
the pledgee is not the Company or any other obligor on the
Debentures, an Affiliate of the Company or an Affiliate of
such other obligor. In case of a dispute as to such right,
any decision by the Trustee taken upon the advice of counsel
shall be conclusive, and, subject to the provisions of
Section 11.1 of this Indenture, shall afford full protection
to the Trustee.
SECTION 3.4. Remaining provisions not affected by
invalidity of any other provisions-required provisions of
Trust Indenture Act of 1939 to control. In case anyone or
more of the provisions contained in this Indenture or in the
Debentures of any series shall for any reason be held to be
invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect
any other provision of this Indenture, but this Indenture
shall be construed as if such
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invalid, illegal or unenforceable provisions had never been
contained herein.
If any provision of this Indenture limits, qualifies or
conflicts with any other provision of this Indenture which
is required to be included in an indenture qualified under
the Trust Indenture Act of 1939, as amended, such provision
which is so required to be included shall control.
SECTION 3.5. Company released from Indenture
requirements if entitled to have Indenture cancelled.
Whenever by the terms of this Indenture the Company shall be
required to do or not to do anything so long as any of the
Debentures shall be Outstanding of any series, the Company
shall, notwithstanding any such provision, not be required
to comply with such provision with respect to such series if
it shall be entitled to have this Indenture satisfied and
discharged pursuant to the provisions hereof, even though in
either case the holders of any of the Debentures of such
series shall have failed to present and surrender such
Debentures for payment pursuant to the terms of this
Indenture.
SECTION 3.6. Date of execution. Although this
Indenture, for convenience and for the purpose of reference,
is dated as of the date first above written, the actual date
of execution by the Company and by the Trustee is as
indicated by their respective acknowledgements hereto
annexed.
SECTION 3.7. Execution of documents furnished under
the Indenture. Unless otherwise expressly provided, any
order, notice, request, demand, certificate or statement of
the Company required or permitted to be made or given under
any provision hereof shall be sufficiently executed if
signed by its Chairman of the Board, President, any Vice
Chairman of the Board or any Vice President, and by its
Treasurer, any Assistant Treasurer, Secretary or any
Assistant Secretary.
SECTION 3.8. Officers' Certificates and Opinions of
Counsel to be furnished Trustee. Upon any application,
demand or request by the Company to the Trustee to take any
action under any of the provisions of this Indenture, the
Company shall furnish to the Trustee an Officers'
Certificate stating that all conditions precedent, if any,
provided for in this Indenture relating to the proposed
action have been complied with, and an Opinion of Counsel
stating that in the opinion of such counsel all such
conditions precedent have been complied with and that such
action is in compliance with applicable law.
Each certificate or opinion with respect to compliance
with a condition or covenant provided for in this Indenture
shall include (a) a statement that the person making such
certificate
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or opinion has read such covenant or condition; (b) a brief
statement as to the nature and scope of the examination or
investigation upon which the statements or opinions
contained in such certificate or opinion are based; (c) a
statement that, in the opinion of such person, he has made
such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such
covenant or condition has been complied with; and (d) a
statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.
Any certificate, statement 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 that the certificate
or opinion or representations with respect to the matters
upon which his certificate, statement or opinion may be
based as aforesaid are erroneous, or in the exercise of
reasonable care should know that the same are erroneous.
Any certificate, statement or opinion of counsel may be
based, insofar as it relates to factual matters, information
with respect to which is in the possession of the Company,
upon the certificate, statement or opinion of or
representations by an officer or officers of the Company,
unless such counsel knows that the certificate, statement or
opinion or representations with respect to the matters upon
which his certificate, statement or opinion may be based as
aforesaid are erroneous, or in the exercise of reasonable
care should know that the same are erroneous.
Any certificate, statement or opinion of an officer of
the Company or of counsel may be based, insofar as it
relates to accounting matters, upon a certificate or opinion
of or representations by an accountant or firm of
accountants in the employ of the Company, unless such
officer or counsel, as the case may be, knows that the
certificate or opinion or representations with respect to
the accounting matters upon which his certificate, statement
or opinion may be based as aforesaid are erroneous, or in
the exercise of reasonable care should know that the same
are erroneous. Any certificate or opinion of any
independent firm of public accountants filed with the
Trustee shall contain a statement that such firm is
independent.
SECTION 3.9. Presentation of notices and demands. All
notices to or demands upon the Trustee shall be in writing
and may be served or presented at the principal office of
the Trustee. Any notice to or demand upon the Company shall
be deemed to have been sufficiently given or served by the
Trustee or the Debentureholders, for all purposes, by being
mailed by first class mail addressed to the Company,
attention of the President, at 2002 Pisgah Church Road,
Suite 300, Greensboro, North Carolina 27455, and to Schell
Bray Aycock Abel &
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Livingston, 230 North Elm Street, Suite 1500, Greensboro,
North Carolina 27401, Attention: Kenneth N. Shelton, Esq.,
or at such other address or to such other counsel, as may be
filed in writing by the Company with the Trustee.
Except as otherwise expressly provided herein, where
this Indenture provides for notice to holders of Debentures
of any event, such notice shall be sufficiently given to
holders of Debentures if in writing and mailed, first-class
postage prepaid, to each holder of a Debenture affected by
such event, at the address of such holder as it appears in
the Debenture register, not later than the latest date, and
not earlier than the earliest date, prescribed for the
giving of such notice.
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 to holders of Debentures
by mail, then such notification as shall be made with the
approval of the Trustee shall constitute a sufficient
notification for every purpose hereunder. In any case where
notice to holders of Debentures is given by mail, neither
the failure to mail such notice, nor any defect in any
notice so mailed, to any particular holder of a Debenture
shall affect the sufficiency of such notice with respect to
other holders of Debentures.
SECTION 3.10. Successors and assigns bound by
Indenture. All the covenants, promises and agreements in
this Indenture contained by or on behalf of the Company, or
by or on behalf of the Trustee, shall bind and inure to the
benefit of their respective successors and assigns, whether
so expressed or not.
SECTION 3.11 Descriptive headings for convenience
only. The descriptive headings of the several Articles of
this Indenture are inserted for convenience only and shall
not control or affect the meaning or construction of any of
the provisions hereof.
SECTION 3.12. North Carolina law to govern. This
Indenture and each Debenture shall be deemed to be a
contract made under the laws of the State of North Carolina,
and for all purposes shall be construed in accordance with
the laws of said jurisdiction, except that the rights,
obligations, duties, immunities and limitations of rights of
the Trustee shall be construed in accordance with the laws
of the State of .
SECTION 3.13. Indenture may be executed in
counterparts. This Indenture may be simultaneously executed
in any number of counterparts, each of which when so
executed and delivered shall be an original, but such
counterparts shall together constitute but one and the same
instrument. , as Trustee, hereby accepts the trusts in this
Indenture declared and provided upon the terms and
conditions hereinbefore set forth.
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ARTICLE IV
COVENANTS OF THE COMPANY
The Company covenants and agrees as follows:
SECTION 4.1 Payment of Principal and interest. The
Company will for the benefit of each series of Debentures
duly and punctually pay or cause to be paid the principal
of, premium, if any, and interest on the Debentures of such
series at the times and place and in the manner specified in
this Indenture and in the Debentures of such series. At the
option of the Company, interest on the Debentures shall be
payable without presentation of such Debentures by a check
to the registered holder.
SECTION 4.2 Maintenance of office or agency. So long
as any of the Debentures of any series remain unpaid, the
Company will at all times keep an office or agency in
where Debentures of such series may be presented for
registration of transfer and exchange as in this Indenture provided,
where notices and demands with respect to the Debentures and
this Indenture may be served and where the Debentures may be
presented for payment or, for Debentures of each series that
is convertible, for conversion. The principal office of the
Trustee shall be the office or agency for all of the
aforesaid purposes, unless the Company shall maintain some
other office or agency with respect to the Debentures of any
series for such purposes and shall give the Trustee written
notice of the location thereof. In case the Company shall
fail to maintain such office or agency, presentations may be
made and notices and demands may be served at the principal
office of the Trustee.
The Company shall keep, at said office or agency, a
register or registers in which, subject to such reasonable
regulations as it may prescribe, the Company shall register
or cause to be registered Debentures of each series and
shall register or cause to be registered the transfer or
exchange of Debentures of each series as in Article II
provided. Such register or registers shall be in written
form in the English language or any other form capable of
being converted into written form within a reasonable time.
At all reasonable times, such register or registers shall be
open for inspection by the Trustee.
SECTION 4.3 Corporate existence. So long as any of
the Debentures remain unpaid, the Company will at all times
(except as otherwise provided or permitted elsewhere in this
Indenture) do or cause to be done all things necessary to
preserve and keep in full force and effect its corporate
existence.
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SECTION 4.4 Restrictions on mergers, sales and
consolidations. So long as any of the Debentures remain
unpaid, the Company will not consolidate or merge with or
sell, convey or lease all or substantially all of its
property to any other corporation except as permitted in
Article X hereof.
SECTION 4.5 Further assurances. From time to time
whenever requested by the Trustee, the Company will execute
and deliver such further instruments and assurances and do
such further acts as may be reasonably necessary or proper
to carry out more effectually the purposes of this Indenture
or to secure the rights and remedies hereunder of the
holders of the Debentures of any series.
SECTION 4.6 File certain reports and information with
the Trustee and the Securities and Exchange Commission -
transmit to Debentureholders summaries of certain documents
filed with the Trustee - furnish list of Debentureholders to
the Trustee. The Company will:
(a) file with the Trustee, within 15 days after
the Company files the same with the Securities and
Exchange Commission, copies of the annual reports and
of the information, documents and other reports which
the Company may be required to file with the Securities
and Exchange Commission pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934
(or copies of such portions thereof as may be
prescribed by the Securities and Exchange Commission);
or, if the Company is not required to file with the
Securities and Exchange Commission information,
documents or reports pursuant to either Section 13 or
Section 15(d) of the Securities Exchange Act of 1934,
then the Company will file with the Trustee and will
file with the Securities and Exchange Commission, in
accordance with rules and regulations prescribed by the
Securities and Exchange Commission, such of the
supplementary and periodic information, documents and
reports required pursuant to Section 13 of the
Securities Exchange Act of 1934 in respect of a
security listed and registered on a national securities
exchange as may be prescribed in such rules and
regulations;
(b) file with the Trustee and the Securities and
Exchange Commission, in accordance with the rules and
regulations prescribed from time to time by the
Securities and Exchange Commission, such additional
information, documents and reports with respect to
compliance by the Company with the conditions and
covenants provided for in this Indenture as may be
required by such rules and regulations;
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(c) transmit to the Debentureholders, in the
manner and to the extent provided in subdivision (c) of
Section 11.10, such summaries of any information,
documents and reports required to be filed with the
Trustee pursuant to the provisions of subdivisions (a)
and (b) of this Section 4.6 as may be required by the
rules and regulations of the Securities and Exchange
Commission; and
(d) furnish or cause to be furnished to the
Trustee, not more than 15 days after each record date
(but in no event less frequently than every six months)
for the payment of interest with respect to Debentures
of any series, and at such other times as the Trustee
may request in writing, within 30 days after receipt by
the Company of any such request, a list in such form as
the Trustee may reasonably require containing all
information in the possession or control of the Company
or of any paying agent, other than the Trustee, as to
the names and addresses of the holders of Debentures of
such series obtained since the date as of which the
next previous list, if any, was furnished; provided,
that so long as the Trustee is Debenture registrar for
such series, no such list need be furnished. Any such
list may be dated as of a date not more than 15 days
prior to the time such information is furnished or
caused to be furnished, and need not include
information received after such date (excluding from
any such list names and addresses received by the
Trustee in its capacity as Debenture registrar).
SECTION 4.7 File statement by officers annually with
the Trustee. Within 120 days after the close of the fiscal
year ending and within 120 days after the close of each
fiscal year thereafter, the Company will file with the
Trustee a brief certificate from the principal executive
officer, principal financial officer or principal accounting
officer as to his or her knowledge of the Company's
compliance with all conditions and covenants under this
Indenture. For purposes of this paragraph, such compliance
shall be determined without regard to any period of grace or
requirement of notice provided under this Indenture.
At the time such Officers' Certificate is filed, the
Company will also file with the Trustee a letter or
statement of the independent accountants who shall have
certified the financial statements of the Company for its
preceding fiscal year in connection with the annual report
of the Company to its shareholders for such year to the
effect that, in making the examination necessary for
certification of such financial statements, they have
obtained no knowledge of any default by the Company in the
performance or fulfillment of any covenant, agreement or
condition contained in this Indenture, which default remains
uncured at the date of such letter or statement, or, if
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they shall have obtained knowledge of any such uncured
default, specifying in such letter or statement such default
or defaults and the nature and status thereof, it being
understood that such accountants shall not be liable
directly or indirectly for failure to obtain knowledge of
any such default or defaults, and that nothing contained in
this Section 4.7 shall be construed to require such
accountants to make any investigation beyond the scope
required in connection with such examination.
SECTION 4.8 Duties of Paying Agent. The Company will
cause each Paying Agent for the Debentures of any series
other than the Trustee to execute and deliver to the Trustee
an instrument in which such agent shall agree with the
Trustee:
(a) that it will hold all sums held by it as
such agent for the payment of the principal of,
premium, if any, or interest on the Debentures of such
series (whether such sums have been paid to it by the
Company or by any other obligor on the Debentures of
such series) in trust for the benefit of the holders of
the Debentures of such series;
(b) that it will give the Trustee written notice
of any failure by the Company (or by any other obligor
on the Debentures of such series) to make any payment
of the principal of, premium, if any, or interest on
the Debentures of such series when the same shall be
due and payable; and
(c) that it will, at any time during the
continuance of any Event of Default with respect to
such series, upon the written request of the Trustee,
forthwith pay to the Trustee all sums so held in trust
by such Paying Agent.
If the Company acts as its own paying Agent for the
Debentures of any series, it will, on or before each due
date of the principal of, premium, if any, or interest on
the Debentures of such series, set aside and segregate and
hold in trust for the benefit of the holders of the
Debentures of such series a sum sufficient to pay such
principal, premium, if any, or interest and will notify the
Trustee of such action or any failure to take such action.
Whenever the Company shall have one or more Paying
Agents for any series of Debentures, it will, on or before
each due date of the principal of, premium, if any, or
interest on any Debentures of such series, deposit with the
Paying Agent or Agents for the Debentures of such series a
sum, by 10:00 a.m. New York time in immediately available
funds on the payment date, sufficient to pay the principal,
premium, if any, or interest so becoming due with respect to
the Debentures of such series, and (unless such paying agent
is the Trustee) the Company will promptly notify the Trustee
in writing of any failure so to act.
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The Company may at any time, for the purpose of
obtaining the satisfaction and discharge of this Indenture
with respect to the Debentures of one or more series or for
any other purpose, pay, or by Company order direct any
Paying Agent for such series to pay, to the Trustee all sums
held in trust by the Company or such Paying Agent, such sums
to be held by the Trustee upon the same trusts as those upon
which such sums were held by the Company or such Paying
Agent; and, upon such payment by any Paying Agent to the
Trustee, such Paying Agent shall be released from all
further liability with respect to such payment.
Anything in this Section 4.8 to the contrary
notwithstanding, the agreement to hold sums in trust as
provided in this Section 4.8 shall be subject to the
provisions of Section 6.3.
ARTICLE V
REDEMPTION OF DEBENTURES; SINKING FUND
SECTION 5.1 Applicability of Article. Debentures of
any series which are redeemable before their stated maturity
at the election of the Company or through the operation of
any sinking fund for the retirement of Debentures of such
series shall be redeemable in accordance with their terms
established pursuant to Section 2.2 and (except as otherwise
established pursuant to Section 2.2 for Debentures of such
series) in accordance with this Article.
SECTION 5.2 Notice of redemption to be given to
Trustee - deposit of cash (or other form of payment) with
Trustee - selection by Trustee of Debentures to be redeemed.
Not less than 30 days (or such lesser number of days as the
Trustee shall approve) nor more than 60 days (or such
greater number of days as the Trustee shall approve) prior
to the date fixed by the Company for the redemption at the
option of the Company of any Debentures of any series which
are subject to redemption or portions thereof, the Company
shall give written notice, by delivering a Company Order to
the Trustee, stating the aggregate principal amount of
Debentures of such series which the Company elects to redeem
and the date and place fixed for redemption, that the
Company, in the case of any redemption of Debentures subject
to any restrictions on such redemption provided in the terms
of Debentures of such series established pursuant to Section
2.2 or elsewhere in this Indenture, is in compliance with
such restrictions. On or before 10:00 a.m. New York time of
the date fixed for redemption, the Company shall deposit
with the Trustee or the Paying Agent money in immediately
available funds on such redemption date (or other form of
payment if permitted by the terms of such Debentures) an
amount sufficient to redeem on the
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date fixed for redemption all the Debentures of such series
or portions thereof to be redeemed, other than any
Debentures of such series called for redemption on such date
which have been converted prior to the date of such deposit,
at the appropriate redemption price, together with any
accrued interest to the date fixed for redemption. If less
than all the Debentures then Outstanding of such series are
to be redeemed, the Trustee shall select, substantially pro
rata or by lot, in such manner as it shall deem appropriate
and fair, in its sole discretion, the numbers of the
Debentures to be redeemed as a whole or in part, and shall
thereafter promptly notify the Company in writing of the
numbers of the Debentures to be redeemed; provided, however,
that Debentures of such series registered in the name of the
Company shall be excluded from any such selection for
redemption until all Debentures of such series not so
registered shall have been previously selected for
redemption. For the purpose of such selection in case of
redemption of less than all of the Debentures of any series,
the Trustee and the Company shall have the option to treat
as Outstanding Debentures any Debentures of such series
which are surrendered for conversion after the fifteenth day
immediately preceding the mailing of the notice of such
redemption, and need not treat as Outstanding Debentures any
Debentures authenticated and delivered during such period in
exchange for the unconverted portion of any Debentures
converted in part during such period. In case any Debenture
shall be redeemed in part only, the notice of redemption
shall specify the principal amount thereof to be redeemed
and shall state that, upon surrender thereof for redemption,
a new Debenture or new Debentures of the same series of an
aggregate principal amount equal to the unredeemed portion
of such Debenture will be issued in lieu thereof; and in
such case the Company shall execute and the Trustee or the
Authenticating Agent shall authenticate and deliver such new
Debenture or Debentures of such series to or upon the
written order of the Debentureholder at the expense of the
Company. Provisions of this Indenture that apply to
Debentures called for redemption also apply to portions of
Debentures called for redemption.
Upon or after the receipt of such notice, the Trustee,
in the name of the Company and as its agent, shall mail by
first-class mail, postage prepaid, to each registered holder
of a Debenture to be redeemed in whole or in part at his
last address appearing on the registration books of the
Company, a notice of redemption. Such notice of redemption
shall identify the Debentures to be so redeemed in whole or
in part and whether such Debentures are to be redeemed in
whole or in part and shall state: (i) the date fixed for
redemption; (ii) the redemption price at which Debentures
are to be redeemed and method of payment, if other than in
cash; (iii) if applicable, the current conversion price or
rate; (iv) if applicable, that the right of the
Debentureholder to convert Debentures called for redemption
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shall terminate at the close of business on the date fixed
for redemption (or such other day as may be specified as
contemplated by Section 2.2 for Debentures of any series);
(v) if applicable, that Debentureholders who want to convert
Debentures called for redemption must satisfy the
requirements for conversion contained in such Debentures;
(vi) that, subject to Section 13.4, interest, if any,
accrued to the date fixed for redemption will be paid as
specified in said notice and that on and after said date
interest thereon shall cease to accrue; (vii) the provision
of the Debenture or this Indenture under which the
redemption is being made; and (viii) that the Company so
elects to redeem such Debentures or portions thereof at the
place or places specified in such notice. Such notice shall
be mailed not later than the tenth, and not earlier than the
sixtieth, day before the date fixed for redemption. Any
notice which is mailed in the manner herein provided shall
be conclusively presumed to have been duly given, whether or
not the holder receives such notice; and failure duly to
give such notice by mail, or any defect in such notice, to
the holder of any Debenture designated for redemption as a
whole or in part shall not affect the validity of the
proceedings for the redemption of any other Debenture.
The Company shall pay to the Trustee the cost of
mailing notices of redemption and any other necessary
expenses incurred by the Trustee in connection therewith.
SECTION 5.3. Debentures called for redemption to
become due - rights of holders of redeemed Debentures -
return of funds on conversion. The notice of election to
redeem having been mailed as hereinbefore provided, the
Debentures or portions thereof called for redemption shall
become due and payable on the redemption date at the
applicable redemption price, together with interest accrued
to the date fixed for redemption, at the place or places
specified in such notice, and if cash (or other form of
payment if permitted by the terms of such Debentures) in the
amount necessary to redeem such Debentures or portions
thereof has been deposited with the Trustee, interest on
such Debentures or portions thereof shall cease to accrue
from and after the date fixed for redemption (unless the
Company shall default in the payment of the redemption
price, plus accrued interest, if any) and the right to
convert such Debentures or portions thereof, if the terms of
such Debentures provide for conversion pursuant to Section
2.2, shall terminate at the close of business on the date
fixed for redemption or such other day as may be specified
as contemplated by Section 2.2 for Debentures of such
series. The respective registered holders of Debentures or
portions thereof so called for redemption shall be entitled
to receive payment of the applicable redemption price,
together with interest accrued to the date fixed for
redemption on or after the date fixed for redemption (unless
the Company shall default in the payment of the redemption
price, plus accrued interest, if any), upon
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presentation and surrender at the place or places of payment
specified in such notice. Notwithstanding the foregoing,
subject to Section 13.4, if the record date for payment or
interest is on or prior to the redemption date, such
interest shall be payable to the persons who are holders of
such Debentures on such record date according to the terms
of such Debentures and Section 2.12.
If any Debenture called for redemption pursuant to
Section 5.1 is converted pursuant to Article XIII, any
monies deposited with the Trustee for the purpose of paying
or redeeming any such Debenture shall be promptly paid to
the Company.
SECTION 5.4 Credits against sinking fund. Against any
one or more sinking fund payments to be made pursuant to the
terms of the Debentures of any series providing for a
sinking fund, the Company may elect, by delivery of an
Officers' Certificate to the Trustee, at least 45 days prior
to the sinking fund payment date (or such shorter period as
may be acceptable to the Trustee or is otherwise specified
as contemplated by Section 2.2 for Debentures of any
series), to take credit for any Debentures of such series or
portions thereof acquired or redeemed by the Company,
pursuant to the terms of such Debentures or through the
application of permitted optional sinking fund payments
pursuant to the terms of such Debentures, which have not
previously been used by the Company for the purposes
permitted in this Section 5.4 and for any Debentures which
have been converted pursuant to the terms of such
Debentures. Such Debentures shall be received and credited
for such purpose by the Trustee at the redemption price
specified in such Debentures for redemption through
operation of the sinking fund and the amount of such sinking
fund payment shall be reduced accordingly. Upon any such
election the Company shall receive credit against such
sinking fund payments required to be made in the order in
which they are to be made. Any Debenture for which credit is
elected to be taken which shall not theretofore have been
delivered to the Trustee for cancellation shall at the time
of such election be delivered to the Trustee for
cancellation by the Trustee.
SECTION 5.5 Redemption through sinking fund. Each
sinking fund payment made under the terms of the Debentures
of any series established pursuant to Section 2.2 shall be
applied to the redemption of Debentures of such series on
the date for redemption specified in the Debentures of such
series next succeeding such sinking fund payment date;
provided, however, if at any time the amount of cash to be
paid into the sinking fund for such series on the next
succeeding sinking fund payment date, together with any
unused balance of any preceding sinking fund payment or
payments for such series, shall not exceed in the aggregate
$10,000, the Trustee, unless requested by the Company, shall
not give notice of the redemption of Debentures of such
series through the operation of the sinking fund on the
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succeeding date for redemption specified in the Debentures
of such series. At least 45 days (or such lesser number of
days as the Trustee shall approve) prior to the date on
which a sinking fund payment with respect to the Debentures
of any series is due, the Company shall give written notice
to the Trustee of the principal amount of Debentures of such
series registered in the name of the Company (which shall be
excluded from such redemption) and the Trustee shall select,
substantially pro rata or by lot, in such manner as it shall
deem appropriate and fair, the principal amount of
Debentures of such series to be redeemed in accordance with
the terms of the Debentures of such series after allowance
for any credit elected under Section 5.4 and shall, in the
name and at the expense of the Company and as its agent,
give notice of such redemption, all in the manner provided
for in Section 5.2, except that such notice shall state that
the Debentures of such series are being redeemed for the
sinking fund. The notice of redemption having been mailed
as hereinbefore provided, the Debentures or portions thereof
called for redemption shall become due and payable on the
next succeeding date for redemption specified in the
Debentures of such series at the sinking fund redemption
price thereof, all in the manner and with the effect
provided for in Section 5.3.
Any sinking fund payment not so required to be applied
to the redemption of Debentures of any series on the date
for redemption specified in the Debentures of such series
next succeeding any sinking fund payment date may, at the
direction of the Company as evidenced by a Company Order, be
applied by the Trustee prior to the forty-fifth day
preceding the next following sinking fund payment date for
such series, in such manner and from time to time, in such
amount as the Company may direct the Trustee in writing, so
far as such moneys shall be adequate, to the purchase for
the sinking fund of Debentures of such series or portions
thereof, in the open market, from the Company or otherwise,
at prices (exclusive of accrued interest and brokerage
commissions) not in excess of the sinking fund redemption
price for such series. The Company agrees to pay to the
Trustee, upon request, accrued interest and brokerage
commissions paid by the Trustee with respect to any
Debentures of such series so purchased by the Trustee and
such accrued interest and brokerage commissions shall not be
charged against the sinking fund for such series.
Any unused balance of sinking fund moneys with respect
to Debentures of any series remaining in the hands of the
Trustee on the forty-fifth day preceding the sinking fund
payment date for such series in any year shall be added to
any sinking fund payment for such series to be made in cash
in such year, and together with such payment, if any, shall
be applied to the redemption or purchase of Debentures of
such series in accordance with the provisions of this
Section 5.5, provided that any sinking fund moneys so
remaining in the hands of the Trustee
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after the date specified in the Debentures of such series
and not utilized in the purchase of Debentures of such
series as provided in this Section 5.5 shall be applied by
the Trustee to the payment of Debentures at maturity.
SECTION 5.6 Debentures no longer Outstanding after
notice to Trustee and deposit of cash. If the Company,
having given notice to the Trustee as provided in Section
5.1 or 5.2, shall have deposited with the Trustee or the
Paying Agent, for the benefit of the holders of any
Debentures of any series or portions thereof called for
redemption in whole or in part cash or other form of payment
if permitted by the terms of such Debentures (which amount
shall be immediately due and payable to the holders of such
Debentures or portions thereof) in the amount necessary so
to redeem all such Debentures or portions thereof on the
date fixed for redemption and provision satisfactory to the
Trustee shall have been made for the giving of notice of
such redemption, such Debentures, or portions thereof, shall
thereupon, for all purposes of this Indenture, be deemed to
be no longer Outstanding, and the holders thereof shall be
entitled to no rights thereunder or hereunder, except the
right to receive payment of the applicable redemption price,
together with interest accrued to the date fixed for
redemption, on or after the date fixed for redemption of
such Debentures or portions thereof and the right to convert
such Debentures or portions thereof, if the terms of such
Debentures provide for convertibility pursuant to Section
2.2, at or prior to the close of business on the date fixed
for redemption.
SECTION 5.7. Conversion arrangement on call for
redemption. In connection with any redemption of
Debentures, the Company may arrange for the purchase and
conversion of any Debentures called for redemption by an
agreement with one or more investment bankers or other
purchasers to purchase such Debentures by paying to the
Trustee or the Paying Agent in trust for the
Debentureholders, on or before 10:00 a.m., New York time, on
the redemption date, an amount no less than the redemption
price, together with interest, if any, accrued to the
redemption date of such Debentures, in immediately available
funds. Notwithstanding anything to the contrary contained in
this Article V, the obligation of the Company to pay the
redemption price of such Debentures, including all accrued
interest, if any, shall be deemed to be satisfied and
discharged to the extent such amount is so paid by such
purchasers. If such an agreement is entered into, any
Debentures not duly surrendered for conversion by the
holders thereof may, at the option of the Company, be
deemed, to the fullest extent permitted by law, acquired by
such purchasers from such holders and (notwithstanding
anything to the contrary contained in Article XIII)
surrendered by such purchasers for conversion, all as of
immediately prior to the close of business on the last day
on which Debentures of such series called for
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redemption may be converted in accordance with this
Indenture and the terms of such Debentures, subject to
payment of the above amount aforesaid. The Trustee or the
Paying Agent shall hold and pay to the Debentureholders
whose Debentures are selected for redemption any such amount
paid to it in the same manner as it would moneys deposited
with it by the Company for the redemption of Debentures.
Without the Trustee's and the Paying Agent's prior written
consent, no arrangement between the Company and such
purchasers for the purchase and conversion of any Debentures
shall increase or otherwise affect any of the powers,
duties, responsibilities or obligations of the Trustee as
set forth in this Indenture, and the Company agrees to
indemnify the Trustee from, and hold it harmless against,
any loss, liability or expense arising out of or in
connection with any such arrangement for the purchase and
conversion of any Debentures between the Company and such
purchasers, including the costs and expenses incurred by the
Trustee and the Paying Agent in the defense of any claim or
liability arising out of or in connection with the exercise
or performance of any of its powers, duties,
responsibilities or obligations under this Indenture.
ARTICLE VI
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 6.1 Satisfaction and discharge of Indenture
with respect to Debentures of any series. If (a) the
Company shall deliver to the Trustee for cancellation all
Debentures of any series theretofore authenticated (other
than any such Debentures which shall have been destroyed,
lost or stolen and in lieu of or in substitution for which
other such Debentures shall have been authenticated and
delivered or Debentures for whose payment money (or other
form of payment if permitted by the terms of such
Debentures) has theretofore been held in trust and
thereafter repaid to the Company, as provided in Section
6.3) and not theretofore cancelled, or (b) the Company shall
irrevocably deposit (subject to Section 6.3) with the
Trustee or Paying Agent as trust funds the entire amount in
cash or U.S. Government Obligations sufficient to pay at
maturity or upon redemption all of the Debentures of such
series (other than any Debentures which shall have been
destroyed, lost or stolen and in lieu of or in substitution
for which other Debentures shall have been authenticated and
delivered or Debentures for whose payment money (or other
form of payment if permitted by the terms of such
Debentures) has theretofore been held in trust and
thereafter repaid to the Company, as provided in Section
6.3) not theretofore paid, surrendered or delivered to the
Trustee for cancellation, including the principal, premium,
if any, and interest due or to become due to such date of
maturity or redemption date, as the case may be, and if in
either case the Company shall also pay or cause to be paid
all other sums payable
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hereunder by the Company and the Company shall deliver to
the Trustee an Officers' Certificate and an Opinion of
Counsel, each stating that in the opinion of the signers all
conditions precedent to the satisfaction and discharge of
this Indenture with respect to the Debentures of such series
have been complied with (and, in the event that such deposit
shall be made more than one year prior to the maturity of
the Debentures of such series, such Opinion of Counsel shall
also state that such deposit will not result in an
obligation of the Company, the Trustee or the trust fund
created by such deposit to register as an investment company
under the Investment Company Act of 1940, as amended) and a
certificate (upon which the Trustee may rely) of a firm of
independent public accountants of recognized national
standing selected by the Board of Directors (who may be the
regular accountants employed by the Company) stating that
the cash, if any, and U.S. Government Obligations, if any,
deposited as set forth above are sufficient to pay at
maturity or upon redemption all of the Debentures of such
series as set forth above, then, except with respect to the
remaining rights of conversion of any Debentures the terms
of which provide for conversion (which shall continue in
full force and effect pursuant to the terms set forth in
Article XIII to the extent provided for in such terms) or to
rights of exchange or registration of transfer or of the
Company's right of optional redemption of any Debentures of
such series, this Indenture shall cease to be of further
effect with respect to the Debentures of such series, and
the Trustee, on demand of and at the cost and expense of the
Company, shall execute proper instruments acknowledging
satisfaction of and discharging this Indenture with respect
to the Debentures of such series. Notwithstanding the
satisfaction and discharge of this Indenture with respect to
the Debentures of such series, the obligations of the
Company to the Trustee under Section 11.2 shall survive, and
if moneys or U.S. Government Obligations shall have been
irrevocably deposited with the Trustee or Paying Agent
pursuant to clause (b) of this Section, the obligations of
the Trustee under Section 6.2 and the first paragraph of
Section 6.3 shall survive.
In order to have money available on a payment date to
pay the principal of, premium, if any, or interest, if any,
on the Debentures, the U.S. Government Obligations shall be
payable as to principal or interest on or before such
payment date in such amounts as will provide the necessary
money. Such U.S. Government Obligations shall not be
callable at the issuer's option.
SECTION 6.2 Deposits for payment or redemption of
Debentures to be held in trust. Subject to the provisions
hereinafter contained in this Article VI, any moneys or U.S.
Government Obligations (or other form of payments if
permitted by the terms of such Debenture) which at any time
shall be deposited by the
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Company, or on its behalf with the Trustee or the Paying
Agent, for the purpose of paying or redeeming any of the
Debentures of any series shall be held in trust and applied
by the Trustee to the payment to the holders of the
particular Debentures for the payment or redemption of which
such moneys (or other form of payments if permitted by the
terms of such Debenture) have been deposited, of all sums
due and to become due thereon for principal, premium, if
any, and interest, upon presentation and surrender of such
Debentures at the office or agency of the Company maintained
as provided in this Indenture. Neither the Company nor the
Trustee (except as provided in Section 11.2) nor any Paying
Agent shall be required to pay interest on any moneys so
deposited.
SECTION 6.3 Repayment of moneys. Any moneys or U.S.
Government Obligations deposited with the Trustee or any
Paying Agent remaining unclaimed by the holders of
Debentures for two years after the date upon which the
principal of or interest on such Debentures shall have
become due and payable, shall (unless otherwise required by
mandatory provisions of applicable escheat or abandoned or
unclaimed property law) be repaid to the Company by the
Trustee or Paying Agent and such holders shall (unless
otherwise required by mandatory provisions of applicable
escheat or abandoned or unclaimed property law) thereafter
be entitled to look to the Company only for payment thereof;
provided, however, that, before being required to make any
such payment to the Company, the Trustee or Paying Agent
may, at the expense and written direction of the Company,
cause to be published once, in an Authorized Newspaper, a
notice that such moneys remain unclaimed and that, after the
date set forth in said notice, the balance of such moneys
then unclaimed will be returned to the Company.
Upon the satisfaction and discharge of this Indenture,
all moneys then held by any Paying Agent other than the
Trustee hereunder shall, upon demand of the Company, be
repaid to it and thereupon such paying agent shall be
released from all further liability with respect to such
moneys.
The Trustee or any Paying Agent shall deliver or pay to
the Company from time to time upon a request in writing by
the Company any moneys or U.S. Government Obligations (or
the principal or interest on such U.S. Government
Obligations) held by it as provided in Section 6.1 which, in
the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification
thereof to the Trustee, are then in excess of the amount
thereof which then would have been required to be deposited
for the purpose for which such money or U.S. Government
Obligations were deposited or received.
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ARTICLE VII
REMEDIES UPON DEFAULT
SECTION 7.1. Events of Default defined-acceleration of
maturity upon default-waiver of default after acceleration.
The following events are hereby defined for all purposes of
this Indenture (except where the term is otherwise defined
for specific purposes) as Events of Default with respect to
Debentures of a particular series, unless it is either
inapplicable to a particular series or is specifically
deleted or modified as contemplated by Section 2.2 for the
Debentures of such series, in addition to any other events
as may be defined as Events of Default pursuant to Section
2.2 for the Debentures of such series:
(a) Failure of the Company to pay or provide for
payment of the principal of or premium, if any, on any
of the Debentures of such series, when and as the same
shall become due and payable, whether at maturity
thereof, by call for redemption, through any mandatory
sinking fund, by redemption at the option of the holder
of any Debenture pursuant to the terms of such
Debenture, by declaration of acceleration or otherwise;
or
(b) Failure of the Company to pay or provide for
payment of any installment of interest on any of the
Debentures of such series, when and as the same shall
become due and payable, which failure shall have
continued for a period of 30 days; or
(c) Failure of the Company to perform or observe
any other of the covenants or agreements on the part of
the Company in this Indenture or in the Debentures of
such series (other than a covenant or agreement which
has expressly been included in this Indenture solely
for the benefit of Debentures of any series other than
that series or is expressly made inapplicable to the
Debentures of such series pursuant to by Section 2.2),
which failure shall have continued for a period of 90
days after written notice by certified or registered
mail given to the Company by the Trustee hereunder or
to the Company and to the Trustee from the holders of
not less than 25% of the aggregate principal amount of
Debentures then Outstanding of such series under this
Indenture specifying such Event of Default or failure
and requesting that it be remedied and stating that
such notice is a notice of an event which, if continued
for 90 days after such written notice, will become an
Event of Default; or
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(d) The institution by the Company of
proceedings to be adjudicated a bankrupt or insolvent,
or the consent by it to the institution of bankruptcy
or insolvency proceedings against it, or the filing by
it of a petition or answer or consent seeking relief
under any Bankruptcy Law or the consent by it to the
institution of proceedings thereunder or the filing of
any such petition or to the appointment of a receiver,
liquidator, assignee, trustee, custodian, sequestrator
(or other similar official) of the Company or of any
substantial part of its property, or the making by the
Company of an assignment for the benefit of creditors,
or the admission by the Company in writing of its
inability to pay its debts generally as they become
due; or
(e) The entry of a decree or order by a court
having jurisdiction for relief in respect of the
Company, or 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
Bankruptcy Law or appointing a 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 unstayed and in effect for a period of 180
consecutive days.
If one or more Events of Default shall happen and be
continuing with respect to Debentures then outstanding of
any series, then, and in each and every such case, either
the Trustee, by notice in writing to the Company, or the
holders of not less than 25% in aggregate principal amount
of the Debentures then Outstanding of such series, by notice
in writing to the Company and to the Trustee, may declare
the principal amount (or, if the Debentures of such series
are Original Issue Discount Debentures, such portion of the
principal amount as may be specified in the terms of the
Debentures of such series) of all Debentures of such series
and/or such other amount or amounts as the Debentures or
supplemental indenture with respect to such series may
provide, if not already due and payable, to be immediately
due and payable; and upon any such declaration all
Debentures of such series shall become and be immediately
due and payable, anything in this Indenture or in any of the
Debentures of such series contained to the contrary
notwithstanding. This provision, however, is subject to the
condition that if, at any time after the principal of
(and/or such other specified amount on) the Debentures of
such series shall so become due and payable, and before any
judgment or decree for the payment of the moneys due shall
have been obtained or entered as hereinafter provided, the
Company shall pay or shall deposit with the Trustee a sum
sufficient to pay all matured installments of interest upon
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all the Debentures of such series and the principal of
(and/or such other specified amount) and premium, if any, on
any and all Debentures of such series which shall have
become due otherwise than by acceleration, with interest on
such principal (and/or such other specified amount) and
premium, if any, and (to the extent that payment of such
interest is enforceable under applicable law) on any overdue
installment of interest, at the rate specified in the
Debentures of such series (or, if no such rate is specified,
at the rate borne by the Debentures of such series), to the
date of such payment or deposit, and the reasonable
compensation and expenses of the Trustee, and any and all
defaults under this Indenture with respect to the Debentures
or such series, other than the nonpayment of principal of
(and/or such other specified amount) or premium, if any, and
accrued interest on Debentures of such series which shall
have become due by acceleration, shall have been remedied,
then and in every such case the Trustee shall, upon written
request or consent of the holders of a majority in aggregate
principal amount of the Debentures then Outstanding of such
series delivered to the Company and to the Trustee, waive
such default and its consequences and rescind or annul such
declaration and its consequences, but no such waiver,
rescission or annulment shall extend to or affect any
subsequent default, or impair any right consequent thereon.
For all purposes under this Indenture, if the portion
of the principal amount as may be specified in the terms of
any Original Issue Discount Debentures shall have been
accelerated and declared due and payable pursuant to the
provisions hereof, then, from and after such declaration,
unless such declaration has been rescinded and annulled,
payment of such portion of the principal amount thereof,
together with interest, if any, thereon and all other
amounts owing thereunder, shall constitute payment in full
of such Original Issue Discount Debentures.
SECTION 7.2 Covenant of Company to pay to Trustee
whole amount due on default in payment of Principal or
interest-Trustee may recover judgment for whole amount
due-application of moneys received by the Trustee. In case
the Company shall commit an Event of Default with respect to
the Debentures of any series described in Section 7.1(a) or
(b), then upon demand of the Trustee, the Company shall pay
to the Trustee, for the benefit of the holders of the
Debentures then Outstanding of such series, the whole amount
which then shall have become due on all such Debentures of
such series for principal, premium, if any, and interest,
with interest on the overdue principal and premium, if any,
and (to the extent that payment of such interest is
enforceable under applicable law) upon overdue installments
of interest, at the rate specified in the Debentures of such
series (or, if no such rate is specified, at the rate borne
by the Debentures of such series), and in addition thereto,
such
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additional amount as shall be sufficient to cover the
costs and expenses of collection, including the reasonable
compensation, expenses, liabilities, disbursements and
advances of the Trustee, any predecessor Trustee, their
agents and counsel. In case the Company shall pay the same
in accordance with the provision of this Section 7.2 and,
prior to such payment neither the Trustee nor the holders of
the Debentures then Outstanding of such series shall have
taken any steps to begin enforcing their rights under this
Indenture and so long as no additional Event of Default with
respect to the Debentures of such series shall have
occurred, from and after such payment, the Event of Default
giving rise to the demand by the Trustee pursuant to this
Section 7.2 shall be deemed to be no longer continuing and
shall be deemed to have thereupon been remedied, cured or
waived without further action upon the part of either the
Trustee or any of the Debentureholders. In case the Company
shall fail to pay the same forthwith upon such demand, the
Trustee, in its own name and as trustee of an express trust,
may institute any judicial proceedings at law or in equity
for the collection of the sums so due and unpaid and may
prosecute such proceedings to judgment or final decree, and
may enforce the same against the Company or any other
obligor upon the Debentures of such series and collect the
moneys adjudged or decreed to be payable in the manner
provided by law out of the property of the Company or any
other obligor upon the Debentures of such series, wherever
situated. The right of the Trustee to recover such judgment
shall not be affected by the exercise of any other right,
power or remedy for the enforcement of the provisions of
this Indenture.
In case of the pendency of any receivership,
insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial
proceeding relative to the Company or any other obligor upon
the Debentures or the property of the Company or of such
other obligor or their creditors, the Trustee (irrespective
of whether the principal of any Debentures shall then be due
and payable as therein expressed or by declaration of
acceleration or otherwise and irrespective of whether the
Trustee shall have made any demand on the Company for the
payment of overdue principal or interest) shall be entitled
and empowered to file and prove a claim for the whole amount
of principal, premium, if any, and interest owing and unpaid
in respect of the Debentures of any series for which it
serves as Trustee and to file such other papers or documents
as may be necessary or advisable in order to have the claims
of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the
Trustee, any predecessor Trustee, their agents and counsel)
and of the Debentureholders of such series allowed in such
judicial proceeding, and to receive payment of or on account
of such claims and to distribute the same after the
deduction of its charges and expenses; and any receiver,
assignee, trustee, liquidator, sequestrator (or other
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similar official) in any judicial proceeding is hereby
irrevocably authorized and instructed by each of the
Debentureholders of such series to make such payments to the
Trustee, and, in the event that the Trustee shall consent to
the making of such payments directly to the Debentureholders
of such series, to pay to the Trustee any amount due it or
any predecessor Trustee, for compensation and expenses,
including counsel fees incurred up to the date of such
distribution. Nothing contained in this Indenture shall be
deemed to give to the Trustee any right to accept or consent
to any plan or reorganization, arrangement, adjustment or
composition affecting the Debentureholders or the rights of
any Debentureholder, or to authorize the Trustee to vote in
respect of the claim of any Debentureholder in any such
proceeding.
Any moneys or property received by the Trustee under
this Section 7.2 shall be applied in the following order, at
the date or dates fixed by the Trustee and, in case of the
distribution of such moneys or property on account or
principal, premium, if any, or interest, upon presentation
of the several Debentures of the series in respect of which
such moneys were received, and stamping thereon the payment,
if only partially paid, and upon surrender thereof if fully
paid:
First: To the payment of costs and expenses of
collections, and reasonable compensation to the
Trustee, its agents, attorneys and counsel, and all
advances made and expenses and liabilities incurred by
the Trustee, except as a result of its negligence or
bad faith and all other amounts owing to the Trustee or
any predecessor Trustee pursuant to Section 11.2
hereof;
Second: In case the principal of the Outstanding
Debentures in respect of which such moneys were
received shall not have become due and be unpaid, to
the payment of interest on such Debentures, in the
order of the maturity of the installments of such
interest, with interest (so far as may be lawful) upon
the overdue installments of interest at the rate
specified in such Debentures (or, if no such rate is
specified, at the rate borne by the Debentures of such
series), such payments to be made ratably to the
persons entitled thereto;
Third: In case the principal of the Outstanding
Debentures in respect of which such moneys were
received and/or such other amount or amounts as the
Debentures or supplemental indenture with respect to
such series shall provide, shall have become due, by
declaration or otherwise, to the payment of the whole
amount then owing and unpaid upon such Debentures for
principal (and/or such other specified amount),
premium, if any, and interest, with interest on the
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overdue principal (and/or such other specified amount),
premium, if any, and (so far as may be lawful) upon
overdue installments of interest, at the rate specified
in such Debentures (or, if no such rate is specified,
at the rate borne by the Debentures of such series),
and in case such moneys shall be insufficient to pay in
full the whole amount so due and unpaid upon such
Debentures, then to the payment of such principal
(and/or such other specified amount), premium, if any,
and interest, with interest on the overdue principal
(and/or such other specified amount), premium, if any,
and (so far as may be lawful) upon overdue installments
of interest, at the rate specified in such Debentures
(or, if no such rate is specified, at the rate borne by
the Debentures of such series), without preference or
priority of principal (and/or such other specified
amount) and premium, if any, over interest, or of
interest over principal (and/or specified amount) and
premium, if any, or of any installment of interest over
any other installment of interest, or of any such
Debenture over any other such Debenture, ratably to the
aggregate of such principal (and/or such other
specified amount), premium, if any, and accrued and
unpaid interest;
Fourth: To the payment of the remainder, if any,
to the Company, its successors or assigns, or to
whomever may be so lawfully entitled to receive the
same, or as a court of competent jurisdiction may
direct.
SECTION 7.3 Trustee may enforce rights of action
without possession of Debentures. All rights of action
under this Indenture or any of the Debentures Outstanding of
any series hereunder enforceable by the Trustee may be
enforced by the Trustee without the possession of any of the
Debentures or the production thereof at the trial or other
proceedings relative thereto, and any such suit or
proceeding instituted by the Trustee shall be brought for
the ratable benefit of the holders of the Debentures with
respect to which the rights are being exercised, subject to
the provisions of this Indenture.
SECTION 7.4 Delays or omissions not to impair any
rights or powers accruing upon default. No delay or
omission of the Trustee or of the Debentureholders to
exercise any rights or powers accruing upon any default
which shall not have been remedied shall impair any such
right or power, or shall be construed to be a waiver of any
such default or acquiescence therein; and every power and
remedy given by this Article VII to the Trustee and the
holders of the Debentures of any series may be exercised
from time to time and as often as may be deemed expedient by
the Trustee or by the holders of the Debentures of such
series.
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SECTION 7.5 In Event of Default Trustee may protect
and enforce its rights by appropriate proceedings-holders of
majority in aggregate Principal amount of Debentures of a
series may waive default. If any one or more Events of
Default shall happen and be continuing, the Trustee may, in
its discretion, proceed to protect and enforce the rights
vested in it by this Indenture by such appropriate judicial
proceedings as the Trustee, being advised by its counsel,
shall deem most effectual to protect and enforce any of said
rights, either by suit in equity or by action at law or by
proceeding in bankruptcy or otherwise, whether for the
specific performance of any covenant or agreement contained
in this Indenture or in aid of the exercise of any power
granted in this Indenture, or to enforce any other legal or
equitable right vested in the Trustee by this Indenture or
by law.
Provided the Debentures of any series shall not then be
due and payable by reason of a declaration pursuant to
Section 7.1 hereof, the holders of a majority in aggregate
principal amount of the Debentures of such series then
Outstanding may on behalf of the holders of all of the
Debentures of such series waive by written notice any past
default hereunder and its consequences, except a default in
the payment of interest on or principal and premium, if any,
of any of the Debentures of such series. In the case of any
such waiver, the Company, the Trustee and the holders of the
Debentures of such series shall be restored to their former
positions and rights hereunder, respectively; but no such
waiver shall extend to any subsequent or other default or
impair any right consequent thereon.
SECTION 7.6 Holders of majority in aggregate Principal
amount of Debentures of any series may direct exercise of
remedies. The holders of a majority in aggregate principal
amount of the Debentures then Outstanding of any series
shall have the right, by an instrument in writing executed
and delivered to the Trustee, to direct the time, method and
place of conducting any proceedings for any remedy available
to the Trustee, or of exercising any power or trust
conferred upon the Trustee under this Indenture, with
respect to the Debentures of such series; provided, however,
that subject to the provisions of Section 11.1 of this
Indenture, the Trustee shall have the right to decline to
follow any such direction if the Trustee, being advised by
counsel, determines that the action or proceedings so
directed may not lawfully be taken or if the Trustee in good
faith shall, by Responsible Officers, determine that the
action or proceedings so directed would involve the Trustee
in personal liability, or would be unduly prejudicial to the
holders of the Debentures of such series not joining in such
direction, and the Trustee may take any other action deemed
proper by the Trustee which is not inconsistent with such
direction.
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SECTION 7.7 Limitation on suits by Debentureholders.
No holder of any Debenture of any series shall have the
right to institute any suit, action or proceeding, in equity
or at law, for the execution of any trust or power hereof,
or for the enforcement of any other remedy under or upon
this Indenture or the Debentures of such series, unless the
holders of a majority in aggregate principal amount of the
Debentures then Outstanding of such series shall have made
written request upon the Trustee and shall have afforded to
it a reasonable opportunity either to proceed to exercise
the powers hereinbefore granted or to institute such suit,
action or proceeding in its own name, as Trustee hereunder,
and shall have offered to the Trustee reasonable indemnity
against the costs, expenses and liabilities to be incurred
therein or thereby, and the Trustee shall have refused or
neglected to comply with such request for 60 days after its
receipt of such request and no direction inconsistent with
such request shall have been given to the Trustee pursuant
to Section 7.6; it being understood and intended that no one
or more holders of Debentures of any series shall have any
right under this Indenture or under the Debentures, by his
or their action, to enforce any right hereunder except in
the manner herein provided, and that all proceedings
hereunder, at law or in equity, shall be instituted, had and
maintained in the manner herein provided and for the ratable
benefit of all holders of the Debentures of such series.
Notwithstanding any provision of this Indenture to the
contrary, the right, which is absolute and unconditional, of
any Debentureholder to receive the payment of the principal
of, premium, if any, and interest on his Debentures at and
after the respective due dates (including maturity by call
for redemption, through any sinking fund, declaration unless
annulled pursuant to Section 7.1 hereof, or otherwise), of
such principal, premium, if any, or interest, or the right,
which is also absolute and unconditional, of any
Debentureholder to require conversion of his Debentures
pursuant to Article XIII hereof if the terms of such
Debentures provide for convertibility pursuant to Section
2.2, or the right to institute suit for the enforcement of
any such payment at or after such due dates or of such right
to convert, shall not be impaired or affected without the
consent of such holder, and the obligation of the Company,
which is also absolute and unconditional, to pay the
principal of, premium, if any, and interest on each of the
Debentures to the respective holders thereof at the times
and places in the Debentures expressed shall not be impaired
or affected.
Notwithstanding anything to the contrary contained in
this Section 7.7, the parties to this Indenture and the
Debentureholders agree as follows:
Any court may in its discretion require, in any suit
for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action
taken, suffered or
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omitted by it as Trustee, the filing by any party litigant
in such suit of an undertaking to pay the costs of such
suit, and such court may in its discretion assess reasonable
costs, including reasonable attorneys' fees, against any
party litigant in such suit, having due regard to the merits
and good faith of the claims or defenses made by such party
litigant; provided, however, that the provisions of this
paragraph shall not apply to any suit instituted, directly
or through an agent or agents, by the Trustee, to any suit
instituted by any Debentureholder of any series, or group of
Debentureholders of any series, holding in the aggregate
more than 10% in aggregate principal amount of the
Debentures then Outstanding of such series or to any suit
instituted by any Debentureholder of any series for the
enforcement of the payment of the principal of, premium, if
any, or interest on, any Debenture of such series at or
after the respective due dates of such principal, premium,
if any, or interest expressed in his Debenture of such
series.
SECTION 7.8. No Debentures owned or held by, for the
account of or for the benefit of the Company to be deemed
Outstanding for purpose of payment or distribution. No
Debentures owned or held by, for the account of or for the
benefit of the Company or any Affiliate (other than
Debentures pledged in good faith which would be deemed
Outstanding under the provisions of Section 3.3) shall be
deemed Outstanding for the purpose of any payment or
distribution provided for in this Article VII.
SECTION 7.9. Company and Trustee restored to former
position on discontinuance or abandonment of proceedings.
If the Trustee shall have proceeded to enforce any right
under this Indenture with respect to the Debentures of any
series, and such proceedings shall have been discontinued or
abandoned because of waiver, or for any other reason, or
shall have been determined adversely to the Trustee, then,
and in any such case, the Company, the Trustee and the
Debentureholders of such series shall each be restored to
their former positions and rights hereunder, and all rights,
remedies and powers of the Trustee shall continue as though
no such proceeding had been taken.
ARTICLE VIII
EVIDENCE OF ACTION BY DEBENTUREHOLDERS
SECTION 8.1. Evidence of action by Debentureholders.
Any demand, request, consent, proxy or other instrument
which this Indenture may require or permit to be signed and
executed by the Debentureholders of any series may be in any
number of concurrent instruments of similar tenor, and may
be signed or executed by such Debentureholders in person or
by an attorney duly authorized in writing. Proof of the
execution of any such demand, request, consent, proxy or
other instrument, or of a writing appointing
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any such attorney, shall be sufficient for any purpose of
this Indenture if made in the following manner: the fact and
date of the execution by any person of such demand, request,
consent, proxy or other instrument or writing may be proved
by the certificate of any notary public, or other officer
authorized to take acknowledgments of deeds to be recorded
in any state or country, that the person signing such
request or other instrument or writing acknowledged to him
the execution thereof, or by an affidavit of a witness of
such execution. Where such execution is by an officer of a
corporation or association or a member of a partnership on
behalf of such corporation, association or partnership, or
by a trustee or other fiduciary, such certificate or
affidavit shall also constitute sufficient proof of his
authority. The Trustee may nevertheless in its discretion
accept such other proof or require further proof of any
matter referred to in this Section 8.1 as it shall deem
reasonable. The ownership of Debentures shall be proved by
the registry books or by a certificate of the registrar
thereof.
The Trustee shall not be bound to recognize any person
as a Debentureholder of any series unless and until his
title to the Debentures of such series held by him is proved
in the manner in this Article VIII provided.
Any demand, request, direction, waiver, consent, vote
or other action of the holder of any Debenture shall be
conclusive and shall bind all future holders of the same
Debenture and of any Debenture issued in exchange or
substitution therefor irrespective of whether or not any
notation in regard thereto is made upon such Debenture. Any
such holder, however, may revoke the consent as to his
Debenture or portion thereof. Such revocation shall be
effective only if the Trustee receives the notice of
revocation before the date the amendment, supplement, waiver
or other action becomes effective. An amendment,
supplement, waiver or other action shall become effective on
receipt by the Trustee of written consents from the
Debentureholders of the requisite percentage in aggregate
principal amount of the Outstanding Debentures of the
relevant series. After an amendment, supplement, waiver or
other action becomes effective, it shall bind every
Debentureholder of each series of Debentures so affected.
The Company or the Trustee, as applicable, may set a
date for the purpose of determining the Debentureholders
entitled to consent, vote or take any other action referred
to in this Section 8.1, which date shall be not less than 10
days nor more than 60 days prior to the taking of the
consent, vote or other action.
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ARTICLE IX
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
SECTION 9.1. Immunity of incorporators, stockholders,
officers, directors and employees. No recourse shall be had
for the payment of the principal of, premium, if any, or
interest on any Debenture or for any claim based thereon or
otherwise in any manner in respect thereof, or in respect of
this Indenture, to or against any subsidiary, incorporator,
stockholder, officer, director or employee, as such, past,
present or future, of the Company or any subsidiary,
incorporator, stockholder, officer, director or employee, as
such, past, present or future, of any predecessor or
successor corporation, either directly or through the
Company or such predecessor or successor corporation,
whether by virtue of any constitutional provision or statute
or rule of law, or by the enforcement of any assessment or
penalty, or in any other manner, all such liability being
expressly waived and released by the acceptance of any
Debenture and as part of the consideration for the issue
thereof.
ARTICLE X
MERGER, CONSOLIDATION, SALE OR LEASE
SECTION 10.1. Documents required to be filed with the
Trustee upon consolidation, merger, sale, transfer or lease
- execution or supplemental indentures - acts of successor
corporation. Nothing in this Indenture or in the Debentures
shall prevent any consolidation or merger of the Company
with or into any other corporation, or any consolidation or
merger of any other corporation with or into the Company, or
any sale, transfer or lease of all or substantially all of
the property and assets of the Company to any other
corporation lawfully entitled to acquire the same; provided,
however, and the Company hereby covenants and agrees, that
any such consolidation, merger, sale, transfer or lease
shall be upon the condition that (a) the due and punctual
payment of the principal of, premium, if any, and interest
on all the Debentures according to their tenor, and the due
and punctual performance and observance of all the terms,
covenants and conditions of this Indenture to be kept or
performed by the Company shall, by an indenture supplemental
hereto complying with the provisions of Section 12.1,
executed and delivered to the Trustee, be expressly assumed
by the corporation (other than the Company) formed by or
resulting from any such consolidation or merger, or which
shall have received the transfer or lease of all or
substantially all of the property and assets of the Company,
just as fully and effectually as if such successor
corporation had been an original party hereto; and (b) the
Company or such successor corporation, as the case may
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be, shall not, immediately after such consolidation, merger,
sale, transfer or lease be in default in the performance of
any such covenant or condition. Thereafter, unless otherwise
specified pursuant to Section 2.2 for the Debentures of any
series, all obligations of the predecessor corporation under
the Debentures of such series shall terminate. In the event
of any such sale, transfer or lease, the predecessor Company
may be dissolved, wound up and liquidated at any time
thereafter.
Every such successor corporation, upon executing an
indenture supplemental hereto as provided in this Section
10.1 in form satisfactory to the Trustee, shall succeed to
and be substituted for the Company with the same effect as
if it had been named herein as the Company; and any order,
certificate or resolution of the Board or officers of the
Company provided for in this Indenture may be made by like
officials of such successor corporation. Such successor
corporation may thereupon cause to be signed, either in its
own name or in the name of the Company, with such suitable
reference, if any, to such consolidation, merger, sale,
transfer or lease as may be required by the Trustee, any or
all of the Debentures which shall not theretofore have been
signed by the Company and authenticated by the Trustee or
any Authenticating Agent; and upon the written order of such
successor corporation in lieu of the Company, signed by the
President or any Vice President and Treasurer or any
Assistant Treasurer of such successor corporation, and
subject to all the terms, conditions and restrictions herein
prescribed with respect to the authentication and delivery
of the Debentures, the Trustee or any Authenticating Agent
shall authenticate and deliver any and all Debentures which
shall have been previously signed by the proper officers of
the Company and delivered to the Trustee or any
Authenticating Agent for authentication and any of such
Debentures which such successor corporation shall
thereafter, in accordance with the provisions of this
Indenture, cause to be signed and delivered to the Trustee
or any Authenticating Agent for such purpose. All
Debentures of any series so authenticated and delivered
shall in all respects have the same rank as the Debentures
of such series theretofore or thereafter authenticated and
delivered in accordance with the terms of this Indenture.
SECTION 10.2. Trustee may rely upon Opinion of
Counsel. The Trustee may receive and shall, subject to the
provisions of Section 11.1 of this Indenture, be fully
protected in relying upon an Officers' Certificate and
Opinion of Counsel as conclusive evidence that any
supplemental indenture executed under the foregoing Section
10.1 complies with the foregoing conditions and provisions
of this Article X.
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ARTICLE XI
CONCERNING THE TRUSTEE
SECTION 11.1. Acceptance of Trust - responsibilities
of Trustee. (a) The Trustee, prior to the occurrence of an
Event of Default and after the curing or waiving of all
Events of Default which may have occurred, undertakes to
perform such duties and only such duties as are specifically
set forth in this Indenture or in the Trust Indenture Act of
1939, and no implied covenants or conditions shall be read
into this Indenture against the Trustee. In case an Event
of Default with respect to the Debentures of a particular
series has occurred (but only during the continuance
thereof), the Trustee shall exercise with respect to the
Debentures of such series such of the rights and powers
vested in it by this Indenture, and use the same degree of
care and skill in their exercise, as a prudent man would
exercise or use under the circumstances in the conduct of
his own affairs.
The Trustee, upon receipt of all resolutions,
certificates, statements, opinions, reports, documents,
orders or other instruments furnished to the Trustee
pursuant to any provision of this Indenture, shall examine
them to determine whether they conform to the requirements
of this Indenture.
(b) No provision of this Indenture shall be construed
to relieve the Trustee from liability for its own negligent
action, its own negligent failure to act, or its own willful
misconduct, except that
(i) prior to the occurrence of an Event of
Default with respect to the Debentures of any series
hereunder and after the curing or waiving of all Events
of Default with respect to the Debentures of such
series which may have occurred, the Trustee shall not
be liable with respect to the Debentures of such series
except for the performance of such duties as are
specifically set forth in this Indenture, and no
implied covenants or obligations shall be read into
this Indenture against the Trustee, but the duties and
obligations of the Trustee with respect to the
Debentures of such series, prior to the occurrence of
an Event of Default with respect to the Debentures of
such series and after the curing or waiving of all
Events of Default with respect to the Debentures of
such series which may have occurred, shall be
determined solely by the express provisions of this
Indenture;
(ii) Subject to the limitations contained in
subsection (a) of this Section 11.1, prior to the
occurrence of an Event of Default with respect to the
Debentures of any series hereunder and after the curing
or waiving of all events of Default with respect to the
Debentures of such series which
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may have occurred, and in the absence of bad faith on
the part of the Trustee, the Trustee may conclusively
rely, as to the truth of the statements and the
correctness of the opinions expressed herein, upon
certificates or opinions conforming to the requirements
of this Indenture;
(iii) the Trustee shall not be personally liable
for any error of judgment made in good faith by a
Responsible Officer or Officers of the Trustee unless
it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts; and
(iv) the Trustee shall not be personally liable
with respect to any action taken, suffered or omitted
to be taken by it in good faith in accordance with the
direction of the holders of not less than a majority in
aggregate principal amount of the Debentures then
Outstanding of any series relating to the time, method
and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or
power conferred upon the Trustee, under this Indenture
with respect to the Debentures of such series.
(c) Subject to the limitations contained in
subsections (a) and (b) of this Section 11.1, the recitals
contained herein and in the Debentures (except in the
Trustee's certificate of authentication) shall be taken as
the statements of the Company, and the Trustee assumes no
responsibility for the correctness of the same. The Trustee
makes no representations as to the validity or sufficiency
of this Indenture or of the Debentures except that the
Trustee represents that it is duly authorized to execute and
deliver this Indenture and to perform its obligations
hereunder.
(d) Subject to the limitations contained in
subsections (a) and (b) of this Section 11.1:
(i) the Trustee may rely and shall be protected
in acting or refraining from acting upon any
resolution, certificate, opinion, notice, consent,
request, order, appraisal, report, bond or other paper
or document believed by it to be genuine and to have
been signed or presented by the proper party or
parties;
(ii) the Trustee may consult with counsel and the
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 accordance with such
advice or Opinion of Counsel;
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(iii) whenever in the administration of the
trusts of this Indenture, prior to an Event of Default
hereunder and after the curing or waiving of all Events
of Default which may have occurred, the Trustee shall
deem it necessary or desirable that a matter be proved
or established prior to taking, suffering or omitting
any action hereunder, such matter (unless other
evidence in respect thereof be herein specifically
prescribed) may be deemed to be conclusively proved and
established by an Officers' Certificate delivered to
the Trustee, and such certificate shall be full warrant
to the Trustee for any action taken, suffered or
omitted by it under the provisions of this Indenture
upon the faith thereof;
(iv) the Trustee shall be under no obligation to
exercise any of the trusts or powers hereof at the
request, order or direction of any of the
Debentureholders, pursuant to the provisions of this
Indenture, unless such Debentureholders shall have
offered to the Trustee reasonable indemnity against all
the costs, expenses and liabilities which might be
incurred therein;
(v) the Trustee shall not be liable for any
action taken or omitted to be taken by it in good faith
and believed by it to be authorized or within the
discretion or power conferred upon it by this
Indenture;
(vi) prior to the occurrence of an Event of
Default with respect to the Debentures of any series
hereunder and after the curing or waiving of all Events
of Default with respect to the Debentures of such
series which may have occurred, the Trustee shall not
be bound to make any investigation into the facts or
matters stated in any resolution, certificate, opinion,
notice, consent, request, order, appraisal, report,
bond or other document or instrument concerning such
series, unless requested in writing to do so by the
holders of not less than a majority in aggregate
principal amount of the Debentures then Outstanding of
such series; provided, however, that if the payment
within a reasonable time to the Trustee of the costs,
expenses or liabilities likely to be incurred by it in
the making of such investigation is, in the opinion of
the Trustee (subject to the limitations contained in
subsections (a) and (b) of this Section 11.1), not
reasonably assured to the Trustee by the security
afforded to it by the terms of this Indenture, the
Trustee may require reasonable indemnity against such
expense or liability as a condition to so proceeding;
and provided, further, that nothing in this subdivision
(d)(vi) shall require the Trustee to give the
Debentureholders any notice other than that required by
Section 11.3 hereof. The reasonable expense of every
such investigation shall be paid by the Company or, if
paid by the Trustee, shall be repaid by the Company
upon demand;
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(vii) the Trustee may execute any of the trusts
or powers hereunder or perform any duties hereunder
either directly or by or through agents or attorneys
and the Trustee shall not be responsible for any
misconduct or negligence on the part of any agent or
attorney appointed with due care by it hereunder; and
(viii) none of the provisions of this Indenture
shall require the Trustee to expend or risk its own
funds or otherwise incur any personal financial
liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or
powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate
indemnity against such risk or liability is not
reasonably assured to it.
SECTION 11.2. Trustee to be entitled to compensation -
Trustee not to be accountable for application of proceeds -
moneys held by Trustee to be trust funds. The Company
covenants and agrees to pay to the Trustee from time to
time, and the Trustee shall be entitled to reasonable
compensation (which shall not be limited by any provision of
law in regard to the compensation of a trustee of an express
trust) for services rendered by it in the execution of the
trusts hereby created, and shall also be entitled to payment
of reasonable expenses and disbursements actually made or
incurred hereunder, including the reasonable fees and
expenses of counsel, accountants and of all persons not
regularly in its employ, and all taxes which may have been
assessed against the Trustee as such on any funds on deposit
with the Trustee. The Company also agrees to indemnify each
of the Trustee and any predecessor Trustee for and hold it
harmless against loss, liability or expense incurred arising
out of or in connection with the acceptance or
administration of this trust or performance of its duties
hereunder, including the cost and expenses of defending
itself against any claim of liability in the premises,
except to the extent that such loss, liability or expense is
incurred due to the negligence or bad faith of the Trustee
or predecessor Trustee. If any property other than cash
shall at any time be subject to a lien in favor of the
Debentureholders, the Trustee, if and to the extent
authorized by a receivership or bankruptcy court of
competent jurisdiction or by the supplemental instrument
subjecting such property to such lien, shall be entitled to
make advances for the purpose of preserving such property or
of discharging tax liens or other prior liens or
encumbrances thereon. The obligations of the Company under
this Section 11.2 to compensate the Trustee and to
indemnify, pay or reimburse the Trustee or any predecessor
Trustee for expenses, disbursements and advances shall
constitute additional indebtedness hereunder and shall
survive the satisfaction and discharge or any other
termination pursuant to any Bankruptcy Law hereof. Such
additional indebtedness shall be secured by a lien prior to
that of the Debentures of all series with respect to which
the Trustee acts as Trustee upon all property and funds held
or collected by the Trustee as such, except funds held in
trust for the benefit of the holders of particular
Debentures.
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The Trustee shall not be accountable for the use or
application by the Company of any Debentures authenticated
and delivered hereunder or of the proceeds of such
Debentures, or for the use or application of any moneys paid
over by the Trustee in accordance with any provision of this
Indenture, or for the use or application of any moneys
received by any paying agent.
All moneys received by the Trustee in trust under or
pursuant to any provision of this Indenture shall constitute
trust funds for the purposes for which they were paid or
were held, but need not be segregated in any manner from any
other moneys and may be deposited by the Trustee, under such
conditions as may be prescribed by law, in its general
banking department, and the Trustee shall not be liable for
any interest thereon, except as otherwise agreed with the
Company.
The parties hereto, and the Debentureholders by their
acceptance of their Debentures, hereby agree, that when the
Trustee incurs expenses and renders services after an Event
of Default occurs, such expenses and the compensation for
such services are intended by the holders of the Debentures
and Company to constitute expenses of administration under
any Bankruptcy Law.
SECTION 11.3. Trustee to give Debentureholders notice
of default. The Trustee shall give to the Debentureholders
of any series notice of the happening of all defaults with
respect to the Debentures of such series known to it, within
90 days after the occurrence thereof unless such defaults
shall have been cured before the giving of such notice;
provided, however, that, except in the case of a default
resulting from the failure to make any payment of principal
of, premium, if any, or interest on the Debentures of any
series, or in the payment of any mandatory sinking fund
installment with respect to the Debentures of such series,
the Trustee may withhold the giving of such notice if and so
long as the board of directors, the executive committee or a
trust committee of directors and/or Responsible Officers of
the Trustee in good faith determine that the withholding of
such notice is in the interest of the Debentureholders of
such series. For the purpose of this Section 11.3, the term
"default" means any event which is, or after notice or lapse
of time or both would become, an Event of Default. Such
notice shall be given to the Debentureholders of such series
in the manner and to the extent provided in subsection (c)
of Section 11.10.
SECTION 11.4. Trustee acquiring conflicting interest
must eliminate it or resign. Reference is made to Section
310(b) of the Trust Indenture Act of 1939, as amended,
and with respect to the Debentures of each series, the Trustee
shall comply therewith. To the extent permitted under
Section 310(b)(1) thereof, the Trustee shall not be deemed
to have a conflicting interest by virtue of being a
trustee under this Indenture with respect to Debentures
of more than one series.
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SECTION 11.5. Eligibility of Trustee. There shall at
all times be a corporate Trustee under this Indenture which
shall be a bank or trust company organized and doing
business under the laws of the United States or of any State
or the District of Columbia and having a combined capital
and surplus of not less than $50,000,000 which is authorized
under the laws of its jurisdiction of incorporation to
exercise corporate trust powers and is subject to
supervision or examination by Federal, State or District of
Columbia authority and which has an office or agency in
. If the Trustee publishes reports of conditions at
least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, the combined
capital of the Trustee shall be deemed to be its combined
capital and surplus as set forth in its most recent report
of condition so published. If the Trustee shall at any time
cease to meet the foregoing standards of eligibility, then
such Trustee shall resign immediately in the manner and with
the effect specified in Section 11.6.
SECTION 11.6. Resignation or removal of Trustee.
(a) Subject to the limitations contained in subsection
(d) of this Section 11.6, the Trustee may resign and be
discharged from the trust hereby created with respect to the
Debentures of one or more series by giving notice thereof to
the Company and by giving notice thereof to the
Debentureholders of such series, in the manner and to the
extent provided in subsection (c) of Section 11.10. Upon
receiving such notice of resignation, the Company shall
promptly appoint a successor trustee or trustees (it being
understood that any such successor trustee may be appointed
with respect to the Debentures of one or more or all of such
series with respect to which the resigning trustee has
resigned and that at any time there shall be only one
trustee with respect to the Debentures of any particular
series) by written instrument, in duplicate, executed by
order of the Board of Directors, one copy of which
instrument shall be delivered to the resigning trustee and
one copy to the successor trustee. If no successor trustee
shall have been so appointed and have accepted appointment
within 60 days after the mailing of such notice of
resignation, the resigning trustee may petition any court of
competent jurisdiction for the appointment of a successor
trustee, or any Debentureholder of such series who has been
a bona fide holder of a Debenture or Debentures of such
series for at least six months may on behalf of himself and
all others similarly situated, petition any such court for
the appointment of a successor trustee. Such court may
thereupon, after such notice, if any, as it may deem proper
and prescribe, appoint a successor trustee.
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(b) In case at any time any of the following
shall occur-
(1) the Trustee shall fail to comply with the
provisions of Section 11.4 with respect to the
Debentures of any series after written request therefor
by the Company or by any Debentureholder of such series
who has been a bona fide holder of a Debenture or
Debentures of such series for at least six months; or
(2) the Trustee shall cease to be eligible in
accordance with the provisions of Section 11.5 with
respect to the Debentures of any series and shall fail
to resign after written request therefor by the Company
or by any such Debentureholder; 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
then, in such case, the Company may remove the Trustee with
respect to all Debentures of such series and appoint a duly
qualified successor trustee by written instrument, in
duplicate, executed by order of the Board of Directors of
the Company, one copy of which instrument shall be delivered
to the Trustee so removed and one copy to the successor
trustee so appointed, or, subject to the provisions of
Section 7.7, any Debentureholder who has been a bona fide
holder of a Debenture or Debentures of such series for at
least six months may, on behalf of himself and all others
similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee with respect to
all Debentures of such series and the appointment of a
successor trustee. Such court may thereupon after such
notice, if any, as it may deem proper and prescribe, remove
the Trustee and appoint a duly qualified successor trustee
with respect to the Debentures of such series.
(c) The holders of a majority in aggregate principal
amount of the Debentures then Outstanding of any series may
at any time remove the Trustee and appoint a duly qualified
successor trustee with respect to such series by delivery to
the Trustee so removed, to the successor trustee and to the
Company of the evidence provided for in Section 8.1 of the
action in that regard taken by Debentureholders.
(d) Any resignation or removal of the Trustee and any
appointment of a duly qualified successor trustee pursuant
to any
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of the provisions of this Section shall become effective upon
acceptance of appointment by the successor trustee as provided
in Section 11.7.
SECTION 11.7. Acceptance by successor Trustee.
(a) In case of the appointment hereunder of a
successor trustee with respect to all Debentures, every duly
qualified successor trustee so appointed under any of the
methods herein provided shall execute, acknowledge and
deliver to its predecessor trustee and to the Company an
instrument in writing accepting such appointment hereunder
and thereupon such successor trustee, without any further
act, deed or conveyance, shall become fully vested with the
rights, powers, trusts, duties and obligations of its
predecessor in the trust hereunder with like effect as if
originally named as Trustee herein. The predecessor trustee
shall, nevertheless, at the written request of the successor
trustee, pay over to the successor trustee all moneys at the
time held by it herein; and the Company and the predecessor
trustee upon payment or provision therefor of any amounts
then due the predecessor trustee pursuant to the provisions
of Section 11.2, shall execute and deliver such instruments
and do such other things as may reasonably be required for
more fully and certainly vesting and confirming in the
successor trustee all such rights, powers, trusts, duties
and obligations. The Company shall promptly give notice of
the appointment of such successor trustee to the
Debentureholders in the manner and to the extent provided in
subsection (c) of Section 11.10.
(b) In the case of the appointment hereunder of a
successor trustee with respect to the Debentures of one or
more (but not all) series, the Company, the predecessor
trustee and each successor trustee with respect to the
Debentures of such series shall execute and deliver an
indenture supplemental hereto wherein each successor trustee
shall accept such appointment and which (i) 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
predecessor trustee with respect to the Debentures of such
series to which the appointment of such successor trustee
relates, (ii) if the predecessor trustee is not retiring
with respect to all Debentures of such series, shall contain
such provisions as shall be deemed necessary or desirable to
confirm that all the rights, powers, trusts and duties of
the predecessor trustee with respect to the Debentures of
such series as to which the predecessor trustee is not
retiring shall continue to be vested in the predecessor
trustee, and (iii) shall add to or change any of the
provisions of this Indenture as shall be
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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 predecessor
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 predecessor trustee
with respect to the Debentures of such series to which the
appointment of such successor trustee relates; but, on
request of the Company or any successor trustee, such
predecessor trustee upon payment of its charges shall duly
assign, transfer and deliver to such successor trustee all
property and money held by such predecessor trustee
hereunder with respect to the Debentures of such 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
this subsection (b) of this Section.
SECTION 11.8. Successor to Trustee by merger or
consolidation, etc. Any corporation or national banking
association into which the Trustee may be merged, or with
which it may be consolidated, or to which the Trustee
transfers all or substantially all of its corporate trust
assets, or any corporation or national banking association
resulting from any merger or consolidation or conversion to
which the Trustee shall be a party, shall be the successor
trustee under this Indenture without the execution or filing
of any instruments or any further act on the part of any of
the parties hereto.
In case at the time such successor trustee shall
succeed to the trusts created by this Indenture any of the
Debentures shall have been authenticated but not delivered,
any such successor trustee may adopt the certificate of
authentication of its predecessor trustee, and deliver such
Debentures so authenticated; and in case at that time any of
the Debentures shall not have been authenticated, any
successor trustee may authenticate such Debentures either in
the name of any predecessor hereunder or in the name of the
successor trustee; and in all such cases such certificates
shall have the full force which it is anywhere in the
Debentures or in this Indenture provided that the
certificate of authentication of the Trustee shall have;
provided, however, that the right to adopt the certificate
of authentication of any predecessor trustee or authenticate
Debentures in the name of any predecessor trustee
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shall apply only to its successor or successors by merger,
conversion or consolidation.
SECTION 11.9. Limitations on right of Trustee as a
creditor to obtain payment of certain claims. Reference is
made to Section 311 of the Trust Indenture Act of 1939, as
amended, for purposes of which the following terms shall
have the following meanings:
(i) the term "cash transaction" shall mean any
transaction in which full payment for goods or
securities sold is made within seven days after
delivery of the goods or securities in currency or in
checks or other orders drawn upon banks or bankers and
payable upon demand; and
(ii) the term "self-liquidating paper" shall mean
any draft, bill of exchange, acceptance or obligation
which is made, drawn, negotiated or incurred by the
Company for the purpose of financing the purchase,
processing, manufacturing, shipment, storage or sale of
goods, wares or merchandise and which is secured by
documents evidencing title to, possession of, or a lien
upon, the goods, wares or merchandise or the
receivables or proceeds arising from the sale of the
goods, wares or merchandise previously constituting the
security, provided the security is received by the
Trustee simultaneously with the creation of the
creditor relationship with the Company arising from the
making, drawing, negotiating or incurring of the draft,
bill of exchange, acceptance or obligation.
SECTION 11.10. Trustee to make annual report to
Debentureholders - Trustee to make other reports to
Debentureholders - Debentureholders to whom reports to be
transmitted.
(a) The Trustee shall, so long as any Debentures are
Outstanding of any series with respect to which it acts as
Trustee, transmit to the Debentureholders of such series,
within 60 days after of each year beginning
with the year , a brief report as of such
that complies with Section 313(a) of the Trust Indenture Act
of 1939, as amended, to the extent any such report is
required pursuant to such Section.
(b) The Trustee shall, so long as any Debentures of any
series with respect to which it acts as Trustee shall be
Outstanding, also transmit to the Debentureholders of such
series, as hereinafter provided, within the times
hereinafter specified, a brief report with respect to the
character and amount of any advances (and if the Trustee
elects so to state the circumstances surrounding the making
thereof) made by the
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Trustee, as such, since the date of the last report
transmitted pursuant to the provisions of subsection (a) of
this Section 11.10 (or if no such report has been so
transmitted, since the date of the execution of this
Indenture), for the reimbursement of which it claims or may
claim a lien or charge prior to that of the Debentures of
such series, on property or funds held or collected by the
Trustee, as such, and which it has not previously reported
pursuant to this subsection (b), if such advances remaining
unpaid at any time aggregate more than 10% of the principal
amount of the Debentures of such series then Outstanding,
such report to be so transmitted within 90 days after such
time.
(c) All reports required by this Section 11.10, and all
other reports or notices which are required by any other
provision of this Indenture to be transmitted in accordance
with the provisions of this Section 11.10, shall be
transmitted by mail; (i) to all registered holders of
Debentures of such series, as the names and addresses of
such holders appear upon the Debenture register; (ii) to
such holders of Debentures of such series as have, within
the two years preceding such transmission, filed their names
and addresses with the Trustee for that purpose; and (iii)
except in the case of reports pursuant to subsection (b) of
this Section 11.10, to all holders of Debentures of such
series whose names and addresses have been furnished to or
received by the Trustee pursuant to Section 4.6(d).
(d) The Trustee shall, at the time of the transmission
to the Debentureholders of any report or notice pursuant to
this Section 11.10, file a copy thereof with the Securities
and Exchange Commission. The Company will notify the
Trustee if and when the Debentures of any series become
listed on any stock exchange and the Trustee will thereafter
file a copy of any such report or notice with such stock
exchange.
SECTION 11.11. Preservation of information by Trustee
- Trustee to give certain information to Debentureholders
upon application. The Trustee shall preserve, in as current
a form as is reasonably practicable, all information
furnished it pursuant to subsection (d) of Section 4.6
hereof or received by it as Debenture registrar hereunder.
The Trustee may destroy such information upon receipt of new
information updating information previously furnished.
Within five Business days after receipt by the Trustee
of a written application by any three or more
Debentureholders stating that the applicants desire to
communicate with other Debentureholders with respect to
their rights under this Indenture or under the Debentures,
and accompanied by a copy of the form of proxy or other
communication which such applicants propose to transmit, and
by reasonable proof that each such
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applicant has owned a Debenture or Debentures for a period
of at least six months preceding such application, the
Trustee shall, at its election, either (a) afford to such
applicants access to all information so furnished to or
received by the Trustee and not destroyed pursuant to the
provisions of this Section 11.11, or (b) inform such
applicants as to the approximate number of Debentureholders
according to the most recent information so furnished to or
received by the Trustee, and as to the approximate cost of
mailing to the Debentureholders the form of proxy or other
communication, if any, specified in such application. If
the Trustee shall elect not to afford to such applicants
access to such information, the Trustee shall, upon the
written request of such applicants, mail to all
Debentureholders whose names and addresses are contained in
the then current information filed with the Trustee as
aforesaid copies of the form of proxy or other communication
which is specified in such request, with reasonable
promptness after a tender to the Trustee of the material to
be mailed and the payment, or provision for the payment, of
the reasonable expenses of such mailing, unless within five
business days after such tender, the Trustee shall mail to
such applicants, and file with the Securities and Exchange
Commission, together with a copy of the material to be
mailed, a written statement to the effect that, in the
opinion of the Trustee, such mailing would be contrary to
the best interests of the Debentureholders or would be in
violation of applicable law. Such written statement shall
specify the basis of such opinion. If the Securities and
Exchange Commission, after granting opportunity for a
hearing upon the objections specified in said written
statement and on notice to the Trustee, shall enter an order
refusing to sustain any of such objections, or, if, after
the entry of an order sustaining one or more of such
objections, the Securities and Exchange Commission shall
find, after notice and opportunity for a hearing, that all
objections sustained have been met and shall enter an order
so declaring, the Trustee shall mail copies of such material
to all such Debentureholders with reasonable promptness
after such determination and the renewal of the aforesaid
tender; otherwise the Trustee shall be relieved of any
obligation or duty to such applicants respecting their
application.
Neither the Company, the Trustee nor any person acting
as Debenture registrar or paying agent shall be liable or
accountable to the Company or to any Debentureholder by
reason of the disclosure of any such information as to the
names and addresses of Debentureholders in accordance with
the provisions of this Section 11.11, regardless of the
source from which such information was derived, nor by
reason of the mailing of any material pursuant to a request
made under this Section 11.11.
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SECTION 11.12. Trustee may hold Debentures and
otherwise deal with Company. The Trustee, the Debenture
registrar, any paying agent or any other agent of the
Company in its individual or any other capacity may buy,
own, hold and sell any of the Debentures or any other
evidences of indebtedness or other securities, whether
heretofore or hereafter created or issued, of the Company or
any subsidiary or Affiliate with the same rights it would
have it if were not Trustee, Debenture registrar, paying
agent or such other agent; and subject to the provisions of
this Article XI, the Trustee may engage or be interested in
any financial or other transaction with the Company or any
subsidiary or Affiliate, including without limitation,
secured and unsecured loans to the Company or any subsidiary
or Affiliate; and may maintain any and all other general
banking and business relations with the Company and any
subsidiary or Affiliate with like effect and in the same
manner and to the same extent as if the Trustee were not a
party to this Indenture; and no implied covenant shall be
read into this Indenture against the Trustee in respect of
any such matters.
SECTION 11.13. Trustee may comply with any rule,
regulation or order of the Securities and Exchange
Commission. The Trustee may comply in good faith with any
rule, regulation or order of the Securities and Exchange
Commission made pursuant to the terms and provisions of the
Trust Indenture Act of 1939 and shall be fully protected in
so doing notwithstanding that such rule, regulation or order
may thereafter be amended or rescinded or determined by
judicial or other authority to be invalid for any reason,
but nothing herein contained shall require the Trustee to
take any action or omit to take any action in accordance
with such rule, regulation or order, except as is in this
Indenture otherwise required.
SECTION 11.14. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents
with respect to one or more series of Debentures which shall
be authorized to act on behalf of the Trustee to
authenticate Debentures of such series upon exchange,
registration of transfer or partial redemption or partial
conversion thereof or pursuant to Section 2.9, and if the
Trustee is required to appoint one or more Authenticating
Agents with respect to any series of Debentures, to
authenticate Debentures of such series and to take such
other actions as are specified in Sections 2.4, 2.8, 2.11,
5.2 and 13.3 and Debentures 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. Whenever reference is made in this
Indenture to the authentication and delivery of Debentures
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
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authentication executed on behalf of the Trustee by an
Authenticating Agent (except in respect to an original
issue). 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
$1,000,000 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
11.14, 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 11.14, such Authenticating Agent
shall resign immediately in the manner and with the effect
specified in this Section 11.14.
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 such Authenticating Agent,
shall continue to be an Authenticating Agent, provided such
corporation shall be otherwise eligible under this Section
11.14, without the execution or filing of any paper or any
further act on the part of the Trustee or such
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 or 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 11.14, the Trustee may appoint a
successor Authenticating Agent which shall be acceptable to
the Company and shall provide notice to the holders of the
Debentures of the series as to which the Authenticating
Agent will serve as provided in Section 3.9. 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 11.14.
The Trustee agrees to pay each Authenticating Agent
from time
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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 11.2.
If an appointment with respect to one or more series is
made pursuant to this Section 11.14, the Debentures of such
series may have endorsed thereon, in addition to the
Trustee's certificate of authentication, as alternative
certificate of authentication in the following form:
This is one of the Debentures of the series designated
therein referred to in the within-mentioned Indenture.
, As Trustee
By
As Authenticating Agent
By
Authorized Officer
If all of the Debentures of a series may not be
originally issued at one time, and if the Trustee does not
have an office capable of authenticating Debentures upon
original issuance located where the Company wishes to have
Debentures of such series authenticated upon original
issuance, the Trustee, if so requested by the Company in
writing (which writing need not comply with Section 3.8 and
need not be accompanied by an Opinion of Counsel), shall
appoint in accordance with this Section 11.14 an
Authenticating Agent having an office in a place designated
by the Company with respect to such series of Debentures.
ARTICLE XII
SUPPLEMENTAL INDENTURES
SECTION 12.1. Company and Trustee may enter into
supplemental indenture for special purposes. Without the
consent of any of the Debentureholders, the Company, when
authorized by resolution of its Board of Directors, and the
Trustee from time to time and at any time, subject to the
conditions and restrictions in this Indenture contained, may
enter into an indenture or indentures supplemental hereto in
form satisfactory to the Trustee, which thereafter shall
form a part hereof, for any one or more of the following
purposes:
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(a) to add to the covenants and agreements of the
Company in this Indenture contained, other covenants
and agreements thereafter to be observed for the
benefit of the Holders of all or any series of
Debentures (and if such covenants and agreements are to
be for the benefit of less than all series of
Debentures, stating that such covenants and agreements
are expressly being included solely for the benefit of
such series) or to surrender any right or power herein
reserved to or conferred upon the Company; or
(b) to cure any ambiguity or to cure, correct or
supplement any defect or inconsistent provision
contained in this Indenture or in any supplemental
indenture; or
(c) to make sure provisions in regard to matters
or questions arising under this Indenture which may be
necessary or desirable, or otherwise change this
Indenture in any manner, which shall not adversely
affect the interests of the Debentureholders of any
series; or
(d) to evidence the succession of another
corporation to the Company, or successive successions,
and the assumption by the successor corporation of the
covenants, agreements and obligations of the Company
pursuant to Article X and to provide for the adjustment
of conversion rights pursuant to Section 13.7; or
(e) to establish the form or terms of the
Debentures of any series as permitted by Sections 2.1
and 2.2; or
(f) to change or eliminate any of the provisions
of this Indenture, provided that, except as otherwise
contemplated by Section 2.2(23), any such change or
elimination shall become effective only when there is
no Debenture outstanding of any series created prior
thereto which is entitled to the benefit of such
provision; or
(g) to add or change any of the provisions of
this Indenture to such extent as shall be necessary to
permit or facilitate the issuance of Debentures in
bearer form, registrable or not registrable as to
principal, and with or without interest coupons, or to
provide for uncertificated Debentures in addition to
certificated Debentures (so long as any
"registration-required obligation" within the meaning
of Section 163(f)(2) of the Code is in registered form
for purposes of the Code); or
(h) to amend or supplement any provision
contained herein, which was required to be contained
herein in order for this Indenture to be qualified
under the Trust Indenture Act of 1939, if the Trust
Indenture Act
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of 1939 or regulations thereunder change what is so
required to be included in qualified indentures, in any
manner not inconsistent with what then may be required
for such qualification; or
(i) to add any additional Events of Default (and
if such Events of Default are to be applicable to less
than all series of Securities, stating that such Events
of Default are expressly being included solely to be
applicable to such series); or
(j) to convey, transfer, assign, mortgage or
pledge to the Trustee as security for the Debentures of
one or more series any property or assets; or
(k) to add to or change any of the provisions of
this Indenture as contemplated in Section 11.7(b)
and the Company hereby covenants that it will fully perform
all the requirements of any such supplemental indenture
which may be in effect from time to time. Nothing in this
Article XII contained shall affect or limit the right or
obligation of the Company to execute and deliver to the
Trustee any instrument of further assurance or other
instrument which elsewhere in this Indenture it is provided
shall be delivered to the Trustee.
The Trustee shall join with the Company in the
execution of any such supplemental indenture, make any
further appropriate agreements and stipulations which may be
therein contained and accept the conveyance, transfer,
assignment, mortgage or pledge of any property thereunder,
but the Trustee shall not be obligated to enter into any
such supplemental indenture which adversely affects the
Trustee's own rights, duties or immunities under this
Indenture or otherwise.
Any supplemental indenture authorized by the provisions
of this Section 12.1 may be executed by the Company and the
Trustee without the consent of the holders of any of the
Debentures at the time Outstanding, notwithstanding any of
the provisions of Section 12.2.
SECTION 12.2. Modification of Indenture with consent
of Debentureholders. With the consent (evidenced as provided
in Section 8.1) of the holders of not less than 66 2/3% in
aggregate principal amount of the Debentures at the time
Outstanding of each series affected by such supplement, the
Company, when authorized by a resolution of its Board of
Directors, and the Trustee may from time to time and at any
time enter into an indenture or indentures supplemental
hereto for the purpose of adding any provision to or
changing in any manner or eliminating any of the provisions
of this Indenture or of any supplemental
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indenture or of modifying in any manner the rights of the
holders of such series of the Debentures; provided, however,
that no such supplemental indenture shall (i) extend the
time or times of payment of the principal of, premium, if
any, or the interest on, any Debenture, or reduce the
principal amount of, premium, if any, or the rate of
interest on, any Debenture (and/or such other amount or
amounts as any Debentures or supplemental indentures with
respect thereto may provide to be due and payable upon
declaration of acceleration of the maturity thereof pursuant
to Section 7.1) or change the currency of payment of
principal of, premium, if any, or interest on, any Debenture
or reduce any amount payable on redemption thereof or alter
or impair the right to convert the same at the rate and upon
the terms provided in the Indenture or alter or impair the
right to require redemption at the option of the holder,
without the consent of the holder of each Debenture so
affected, or (ii) reduce the percentage of Debentures of any
series, the vote or consent of the holders of which is
required for such modifications and alterations, without the
consent of the holders of all Debentures then Outstanding of
such series under the Indenture. Notwithstanding the
foregoing, no consent of the Debentureholders shall be
necessary to permit the execution of supplemental indentures
pursuant to Section 13.7.
Upon the request of the Company, accompanied by a copy
of a resolution of its Board of Directors certified by the
Secretary or an Assistant Secretary of the Company
authorizing the execution of any such supplemental
indenture, and upon the filing with the Trustee of evidence
of the consent of Debentureholders as aforesaid, the Trustee
shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture
affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise, in which case the Trustee may,
in its discretion, but shall not be obligated, to enter into
such supplemental indenture.
It shall not be necessary for the consent of the
Debentureholders under this Section 12.2 to approve the
particular form of any proposed supplemental indenture, but
it shall be sufficient if such consent shall approve the
substance thereof.
A supplemental indenture which changes or eliminates
any provision of this Indenture which has expressly been
included solely for the benefit of one or more particular
series of Debentures, or which modifies the rights of the
holders of Debentures of such series with respect to such
provision, shall be deemed not to affect the rights under
this Indenture of the holders of Debentures of any other
series.
SECTION 12.3. Effect of supplemental indentures. Upon
the execution of any supplemental indenture pursuant to the
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provisions of this Article XII, this Indenture shall be and
be deemed to be modified and amended in accordance therewith
and the respective rights, limitations of rights,
obligations, duties and immunities under this Indenture of
the Trustee, the Company and the holders of Debentures shall
thereafter be determined, exercised and enforced hereunder
subject in all respects to such modifications and
amendments, and all the terms and conditions of any such
supplemental indenture shall be and be deemed to be part of
the terms and conditions of this Indenture for any and all
purposes.
The Trustee, subject to the provisions of Section 11.1
may receive an Opinion of Counsel as conclusive evidence
that any such supplemental indenture complies with the
provisions of this Article XII.
SECTION 12.4. Supplemental indentures to conform to
Trust Indenture Act. Any supplemental indenture executed and
delivered pursuant to the provisions of this Article XII
shall conform in all respects to the requirements of the
Trust Indenture Act of 1939, as amended, as then in effect.
SECTION 12.5. Notation on or exchange of Debentures.
If an amendment, supplement or waiver changes the terms of a
Debenture of any series, the Trustee may require the Holder
of the Debenture to deliver it to the Trustee. The Trustee
may place an appropriate notation on the Debenture about the
changed terms and return it to the Holder. Alternatively,
if the Company or the Trustee so determines, the Company in
exchange for the Debenture of any series shall issue and the
Trustee shall authenticate a new Debenture of such series
that reflects the changed terms.
ARTICLE XIII
CONVERSION OF DEBENTURES
SECTION 13.1. Applicability of Article. Debentures
of any series which are convertible into Capital Stock at
the option of the Debentureholder shall be convertible in
accordance with their terms and (unless otherwise specified
as contemplated by Section 2.2. for Debentures of any
series) in accordance with this Article. Each reference in
this Article XIII to "a Debenture" or "the Debentures"
refers to the Debentures of the particular series that is
convertible into Capital Stock. Each reference in this
Article to "Capital Stock" into which Debentures of any
series are convertible refers to the class of Capital Stock
into which the Debentures of such series are convertible in
accordance with their terms (as specified as contemplated by
Section 2.2). If more than one series of Debentures with
conversion privileges are outstanding at any time, the
provisions of this Article XIII shall be applied separately
to each such series.
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SECTION 13.2. Right of Debentureholders to convert
Debentures. Subject to and upon compliance with the terms
of the Debentures and the provisions of Section 5.7 and this
Article XIII, at the option of the holder thereof, any
Debenture of any series of any authorized denomination, or
any portion of the principal amount thereof which is $1,000
or any integral multiple of $1,000, may, at any time during
the period specified in the Debentures of such series, or in
case such Debenture or portion thereof shall have been
called for redemption, then in respect of such Debenture or
portion thereof until and including, but not after (unless
the Company shall default in payment due upon the redemption
thereof) the close of business on the date fixed for
redemption except that in the case of redemption at the
option of the Debentureholder, if specified in the terms of
such Debentures, such right shall terminate upon receipt of
written notice of the exercise of such option, be converted
into duly authorized, validly issued, fully paid and
nonassessable shares of the class of Capital Stock, or
combination thereof, as specified in such Debenture, at the
conversion rate for each $1,000 principal amount of
Debentures (such initial conversion rate reflecting an
initial conversion price specified in such Debenture) in
effect on the conversion date, or, in case an adjustment in
the conversion rate has taken place pursuant to the
provisions of Section 13.5, then at the applicable
conversion rate as so adjusted, upon surrender of the
Debenture or Debentures, the principal amount of which is so
to be converted, to the Company at any time during usual
business hours at the office or agency to be maintained by
it in accordance with the provisions of Section 4.2,
accompanied by a written notice of election to convert as
provided in Section 13.3 and, if so required by the Company
and the Trustee, by a written instrument or instruments of
transfer in form satisfactory to the Company and the Trustee
duly executed by the registered holder or his attorney duly
authorized in writing. All Debentures surrendered for
conversion shall, if surrendered to the Company or any
conversion agent, be delivered to the Trustee for
cancellation and cancelled by it, or shall, if surrendered
to the Trustee, be cancelled by it, as provided in Section
2.11.
The initial conversion price or conversion rate in
respect of a series of Debentures shall be specified on the
Debentures of such series. The conversion price or
conversion rate will be subject to adjustment on the terms
set forth in Section 13.5 or such other or different terms,
if any, as may be specified by Section 2.2 for Debentures of
such series. Provisions of this Indenture that apply to
conversion of all of a Debenture also apply to conversion of
a portion of it.
SECTION 13.3. Issuance of shares of Capital Stock
on conversion. As promptly as practicable after the
surrender, as herein provided, of any Debenture or
Debentures for conversion,
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the Company shall deliver or cause to be delivered at its
said office or agency to or upon the written order of the
holder of the Debenture or Debentures so surrendered a
certificate or certificates representing the number of duly
authorized, validly issued, fully paid and nonassessable
shares of Capital Stock into which such Debenture or
Debentures may be converted in accordance with the terms
thereof and the provisions of this Article XIII. Prior to
delivery of such certificate or certificates, the Company
shall require a written notice at its said office or agency
from the holder of the Debenture or Debentures so
surrendered stating that the holder irrevocably elects to
convert such Debenture or Debentures, or, if less than the
entire principal amount thereof is to be converted, stating
the portion thereof to be converted. Such notice shall also
state the name or names (with address and social security or
other taxpayer identification number) in which said
certificate or certificates are to be issued. Such
conversion shall be deemed to have been made at the time
that such Debenture or Debentures shall have been
surrendered for conversion and such notice shall have been
received by the Company or the Trustee, the rights of the
holder of such Debenture or Debentures as a Debentureholder
shall cease at such time, the person or persons entitled to
receive the shares of Capital Stock upon conversion of such
Debenture or Debentures shall be treated for all purposes as
having become the record holder or holders of such shares of
Capital Stock at such time and such conversion shall be at
the conversion rate in effect at such time. In the case of
any Debenture of any series which is converted in part only,
upon such conversion, the Company shall execute and the
Trustee or any Authenticating Agent shall authenticate and
deliver to the holder thereof, as requested by such holder,
a new Debenture or Debentures of such series of authorized
denominations in aggregate principal amount equal to the
unconverted portion of such Debenture.
If the last day on which a Debenture may be converted
is not a Business day in a place where a conversion agent is
located, the Debenture may be surrendered to that conversion
agent on the next succeeding day that is a Business day.
The Company will not be required to deliver
certificates for shares of Capital Stock upon conversion
while its stock transfer books are closed for a meeting of
shareholders or for the payment of dividends or for any
other purpose, but certificates for shares of Capital Stock
shall be delivered as soon as the stock transfer books shall
again be opened.
SECTION 13.4. No payment or adjustment for interest
or dividends. Unless otherwise specified as contemplated by
Section 2.2 for Debentures of such series, Debentures
surrendered for conversion during the period from the close
of business on any regular record date (or special record
date for payment of
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defaulted interest) next preceding any interest payment date
to the opening of business on such interest payment date
(except Debentures called for redemption on a redemption
date within such period) when surrendered for conversion
must be accompanied by payment of an amount equal to the
interest thereon which the registered holder is to receive
on such interest payment date. Payment of interest shall be
made as of such interest payment date or such date, as the
case may be, to the holder of record of the Debentures as of
such regular, or special record date, as applicable. Except
where Debentures surrendered for conversion must be
accompanied by payment as described above, no interest on
converted Debentures will be payable by the Company on any
interest payment date subsequent to the date of conversion.
No other payment or adjustment for interest or dividends is
to be made upon conversion. Notwithstanding the foregoing,
upon conversion of any Debentures with original issue
discount, the fixed number of shares of Capital Stock into
which such Debenture is convertible delivered by the Company
to the holder thereof shall be applied, first, to pay the
accrued original issue discount attributable to the period
from the date of issuance to the date of conversion of such
Debenture, and, second, to pay the balance of the principal
amount of such Debenture.
SECTION 13.5. Adjustment of conversion rate.
Unless otherwise specified as contemplated by Section 2.2
for Debentures of such series, the conversion rate for
Debentures in effect at any time shall be subject to
adjustment as follows:
(a) In case the Company shall (i) declare a
dividend or make a distribution on the class of Capital
Stock into which Debentures of such series are
convertible in shares of its Capital Stock, (ii)
subdivide the outstanding shares of the class of
Capital Stock into which Debentures of such series are
convertible into a greater number of shares, (iii)
combine the outstanding shares of the class of Capital
Stock into which Debentures of such series are
convertible into a smaller number of shares, or (iv)
issue by reclassification of the shares of the class of
Capital Stock into which Debentures of such series are
convertible (including any such reclassification in
connection with a consolidation or merger in which the
Company is the continuing corporation) any shares, the
conversion rate for the Debentures of such series in
effect at the time of the record date for such dividend
or distribution, or the effective date of such
subdivision, combination or reclassification, shall be
proportionately adjusted so that the holder of any
Debenture of such series surrendered for conversion
after such time shall be entitled to receive the number
and kind of shares which he would have owned or have
been entitled to receive had such Debenture been
converted immediately prior to such time. Similar
adjustments shall be made whenever any event listed
above shall occur.
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(b) In case the Company shall fix a record date
for the issuance of rights or warrants to all holders
of the class of Capital Stock into which Debentures of
such series are convertible entitling them (for a
period expiring within 45 days after such record date)
to subscribe for or purchase shares of such class of
Capital Stock (or securities convertible into shares of
such class of Capital Stock ) at a price per share (or,
in the case of a right or warrant to purchase
securities convertible into such class of Capital
Stock, having a conversion price per share, after
adding thereto the exercise price, computed on the
basis of the maximum number of shares of such class of
Capital Stock issuable upon conversion of such
convertible securities, per share of such class of
Capital Stock, so issuable) less than the current
market price per share of such class of Capital Stock
(as defined in subsection (d) below) on the date on
which such issuance was declared or otherwise announced
by the Company (the "Determination Date"), the number
of shares of such class of Capital Stock into which
each $1,000 principal amount of Debentures shall be
convertible after such record date shall be determined
by multiplying the number of shares of such class of
Capital Stock into which such principal amount of
Debentures was convertible immediately prior to such
record date by a fraction, of which the numerator shall
be the number of shares of such class of Capital Stock
outstanding on the Determination Date plus the number
of additional shares of such class of Capital Stock
offered for subscription or purchase (or in the case of
a right or warrant to purchase securities convertible
into such class of Capital Stock, the aggregate number
of additional shares of such class of Capital Stock
into which the convertible securities so offered are
initially convertible), and of which the denominator
shall be the number of shares of such class of Capital
Stock outstanding on the Determination Date plus the
number of shares of such class of Capital Stock
obtained by dividing the aggregate offering price of
the total number of shares so offered (or, in the case
of a right or warrant to purchase securities
convertible into such class of Capital Stock, the
aggregate initial conversion price of the convertible
securities so offered, after adding thereto the
aggregate exercise price of such rights or warrants
computed on the basis of the maximum number of shares
of such class of Capital Stock issuable upon conversion
of such convertible securities) by such current market
price. Shares of such class of Capital Stock of the
Company owned by or held for the account of the Company
shall not be deemed outstanding for the purpose of any
such computation. Such adjustment shall be made
successively whenever such a record date is fixed; and
to the extent that shares of such class of Capital
Stock are not delivered (or securities convertible
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into shares of such class of Capital Stock are not
delivered) after the expiration of such rights or
warrants (or, in the case of rights or warrants to
purchase securities convertible into such class of
Capital Stock once exercised, the expiration of the
conversion right of such securities) the conversion
rate shall be readjusted to the conversion rate which
would then be in effect had the adjustments made upon
the issuance of such rights or warrants (or securities
convertible into shares) been made upon the basis of
delivery of only the number of shares actually
delivered. In the event that such rights or warrants
are not so issued, the conversion rate shall again be
adjusted to be the conversion rate which would then be
in effect if such record date had not been fixed.
(c) In case the Company shall fix a record date
for the making of a distribution to all holders of the
class of Capital Stock into which Debentures of such
series are convertible (including any such distribution
made in connection with a consolidation or merger in
which the Company is the continuing corporation) of
evidences of its indebtedness or assets (excluding any
cash dividends paid from retained earnings and
dividends payable in Capital Stock for which adjustment
is made pursuant to subsection (a) above) or
subscription rights or warrants (excluding subscription
rights or warrants to purchase the class of Capital
Stock into which Debentures of such series are
convertible), the number of shares of such class of
Capital Stock into which each $1,000 principal amount
of Debentures of such series shall be convertible after
such record date shall be determined by multiplying the
number of shares of such class of Capital Stock into
which such principal amount of Debentures was
convertible immediately prior to such record date by a
fraction, of which the numerator shall be the fair
market value of the assets of the Company, after
deducting therefrom all liabilities of the Company and
all preferences (including accrued but unpaid
dividends) in respect of classes of Capital Stock
having a preference with respect to the assets of the
Company over such class of Capital Stock (all as
determined by the Board of Directors, whose
determination shall be conclusive, and described in a
certificate signed by any Vice Chairmen of the Board,
Vice President or Assistant Vice President and
Treasurer of the Company, filed with the Trustee and
each conversion agent) on such record date, and of
which the denominator shall be such fair market value
after deducting therefrom such liabilities and
preferences, less the fair market value (as determined
by the Board of Directors, whose determination shall be
conclusive, and described in a statement filed with the
Trustee and each conversion agent) of the assets or
evidences of indebtedness, so distributed or of such
subscription rights or warrants applicable, so
distributed. Such adjustment shall be made
successively
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whenever such a record date is fixed; and in the event
that such distribution is not so made, the conversion
rate shall again be adjusted to the conversion rate
which would then be in effect if such record date had
not been fixed.
(d) For the purpose of any computation under
subsection (b) above and Section 13.6, the current
market price per share of the Capital Stock on any date
as of which such price is to be computed shall mean the
average of the Closing Prices for the 30 consecutive
Business days commencing 45 Business days before such
date.
(e) No adjustment in the conversion rate shall
be required unless such adjustment would require a
cumulative increase or decrease of at least 1% in such
rate; provided, however, that any adjustments which by
reason of this subsection (e) are not required to be
made shall be carried forward and taken into account in
any subsequent adjustment, and provided, further, that
adjustments shall be required and made in accordance
with the provisions of this Article XIII (other than
this subsection (e)) not later than such time as may be
required in order to preserve the tax-free nature of a
distribution for United States income tax purposes to
the holders of Debentures or the class of Capital Stock
into which such Debentures are convertible. All
calculations under this Article XIII shall be made to
the nearest cent or to the nearest one-thousandth of a
share, as the case may be. Anything in this Section
13.5 to the contrary notwithstanding, the Company shall
be entitled to make such adjustments in the conversion
rate, in addition to those required by this Section
13.5, as it in its discretion shall determine to be
advisable in order that any stock dividend, subdivision
of shares, distribution of rights to purchase stock or
securities, or distribution of securities convertible
into or exchangeable for stock hereafter made by the
Company to its shareholders shall not be taxable for
United States income tax purposes.
(f) Whenever the conversion rate is adjusted,
as herein provided, the Company shall promptly file
with the Trustee and with the office or agency
maintained by the Company for the conversion of
Debentures of such series pursuant to Section 4.2, a
certificate of a firm of independent public accountants
of recognized national standing selected by the Board
of Directors (who may be the regular accountants
employed by the Company) setting forth the conversion
rate after such adjustment and setting forth a brief
statement of the facts requiring such adjustment and a
computation thereof. Such certificate shall be
conclusive evidence of the correctness of such
adjustment. Neither the Trustee nor any conversion
agent shall be under any duty or
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responsibility with respect to any such certificate or
any facts or computations set forth therein, except to
exhibit said certificate from time to time to any
Debentureholder of such series desiring to inspect the
same. The Company shall promptly cause a notice
setting forth the adjusted conversion rate to be mailed
to the holders of Debentures of such series, as their
names and addresses appear upon the registration books
of the Company.
(g) In the event that at any time, as a result
of shares of any other class of Capital Stock becoming
issuable in exchange or substitution for or in lieu of
shares of the class of Capital Stock into which such
Debentures are convertible or as a result of an
adjustment made pursuant to subsection (a) above, the
holder of any Debenture of such series thereafter
surrendered for conversion shall become entitled to
receive any shares of the Company other than shares of
the class of Capital Stock into which the Debentures of
such series are convertible, thereafter the number of
such other shares so receivable upon conversion of any
Debenture shall be subject to adjustment from time to
time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the class
of Capital Stock into which the Debentures of such
series are convertible contained in subsections (a) to
(f), inclusive, above, and the provisions of this
Article XIII with respect to the class of Capital Stock
into which the Debentures of such series are
convertible shall apply on like terms to any such other
shares.
(h) The conversion rate with respect to any
Debentures with original issue discount, the terms of
which provide for convertibility, shall not be adjusted
during the term of such Original Issue Discount
Debentures for accrued original issue discount.
(i) In the event that the Debentures of any
series are convertible into more than one class of
Capital Stock, the provisions of this Section 13.5
shall apply separately to events affecting each such
class.
SECTION 13.6. No fractional shares to be issued.
No fractional shares of Capital Stock shall be issued upon
conversions of Debentures. If more than one Debenture of
any series shall be surrendered for conversion at one time
by the same holder, the number of full shares which shall be
issuable upon conversion thereof shall be computed on the
basis of the aggregate principal amount of the Debentures of
such series (or specified portions thereof to the extent
permitted hereby) so surrendered. Instead of a fraction of
a share of Capital Stock which would otherwise be issuable
upon conversion of any Debenture or Debentures (or specified
portions thereof), the
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Company shall pay a cash adjustment in respect of such
fraction of a share in an amount equal to the same
fractional interest of the current market price (as defined
in Section 13.5) per share of Capital Stock on the Business
day next preceding the day of conversion.
SECTION 13.7. Preservation of conversion rights upon
consolidation, merger, sale or conveyance. In case of any
consolidation of the Company with, or merger of the Company
into, any other corporation (other than a consolidation or
merger in which the Company is the continuing corporation),
or in the case of any sale or transfer of all or
substantially all of the assets of the Company, the
corporation formed by such consolidation or the corporation
into which the Company shall have been merged or the
corporation which shall have acquired such assets, as the
case may be, shall execute and deliver to the Trustee, a
supplemental indenture, subject to the provisions of Article
X and XII as they relate to supplemental indentures,
providing that the holder of each Debenture then Outstanding
of a series which was convertible into Capital Stock shall
have the right thereafter to convert such Debenture into the
kind and amount of shares of stock and other securities and
property, including cash, receivable upon such
consolidation, merger, sale or transfer by a holder of the
number of shares of Capital Stock of the Company into which
such Debentures might have been converted immediately prior
to such consolidation, merger, sale or transfer. Such
supplemental indenture shall conform to the provisions of
the Trust Indenture Act of 1939 as then in effect and shall
provide for adjustments which shall be as nearly equivalent
as may be practicable to the adjustments provided for in
this Article XIII. Neither the Trustee nor any conversion
agent shall be under any responsibility to determine the
correctness of any provision contained in any such
supplemental indenture relating either to the kind or amount
of shares of stock or other securities or property
receivable by Debentureholders upon the conversion of their
Debentures after any such consolidation, merger, sale or
transfer, or to any adjustment to be made with respect
thereto and, subject to the provisions of Section 11.1, may
accept as conclusive evidence of the correctness of any such
provisions, and shall be protected in relying upon, an
Opinion of Counsel with respect thereto. If in the case of
any such consolidation, merger, sale or transfer, the stock
or other securities and property receivable by a holder of
the Debentures includes stock or other securities and
property of a corporation other than the successor or
purchasing corporation, then such supplemental indenture
shall also be executed by such other corporation and shall
contain such additional provisions to protect the interests
of the holders of the Debentures as the Board of Directors
shall reasonably consider necessary. The above provisions
of this Section 13.7 shall similarly apply to successive
consolidations, mergers, sales or transfers.
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SECTION 13.8. Notice to Debentureholders of a series
prior to taking certain types of action. With respect to
the Debentures of any series, in case:
(a) the Company shall authorize the issuance to
all holders of the class of Capital Stock into which
Debentures of such series are convertible of rights or
warrants to subscribe for or purchase shares of its
Capital Stock or of any other right;
(b) the Company shall authorize the distribution
to all holders of the class of Capital Stock into which
Debentures of such series are convertible of evidences
of its indebtedness or assets (except for the
exclusions with respect to certain dividends set forth
in Section 13.5(c);
(c) of any subdivision, combination or
reclassification of the class of Capital Stock into
which Debentures of such series are convertible or of
any consolidation or merger to which the Company is a
party and for which approval by the shareholders of the
Company is required, or of the sale or transfer of all
or substantially all of the assets of the Company; or
(d) of the voluntary or involuntary dissolution,
liquidation or winding up of the Company;
the Company shall cause to be filed with the Trustee and at
the office or agency maintained for the purpose of
conversion of Debentures of such series pursuant to Section
4.2, and shall cause to be mailed to the holders of
Debentures of such series, at their last addresses as they
shall appear upon the registration books of the Company, at
least ten days prior to the applicable record date
hereinafter specified, a notice stating (i) the date as of
which the holders of such class of Capital Stock to be
entitled to receive any such rights, warrants or
distributions are to be determined, or (ii) the date on
which any such subdivision, combination, reclassification,
consolidation, merger, sale, transfer, dissolution,
liquidation, winding up or other action is expected to
become effective, and the date as of which it is expected
that holders of record of such class of Capital Stock shall
be entitled to exchange their Capital Stock of such class
for securities or other property, if any, deliverable upon
such subdivision, combination, reclassification,
consolidation, merger, sale, transfer, dissolution,
liquidation, winding up or other action. The failure to
give the notice required by this Section 13.8 or any defect
therein shall not affect the legality or validity of any
distribution, right, warrant, subdivision, combination,
reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation, winding up or other action, or the
vote upon any of the
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foregoing. Such notice shall also be published by and at
the expense of the Company not later than the aforesaid
filing date at least once in an Authorized Newspaper.
SECTION 13.9. Covenant to reserve shares for issuance
on conversion of Debentures. The Company covenants that at
all times it will reserve and keep available out of each
class of its authorized Capital Stock, free from preemptive
rights, solely for the purpose of issue upon conversion of
Debentures of any series as herein provided, such number of
shares of Capital Stock of such class as shall then be
issuable upon the conversion of all Outstanding Debentures
of such series. The Company covenants that all shares of
Capital Stock which shall be so issuable shall, when issued
or delivered, be duly and validly issued shares of the class
of authorized Capital Stock into which Debentures of such
series are convertible, and shall be fully paid and
nonassessable, free of all liens and charges and not subject
to preemptive rights and that, upon conversion, the
appropriate capital stock accounts of the Company will be
duly credited.
SECTION 13.10. Compliance with governmental
requirements. The Company covenants that if any shares of
Capital Stock required to be reserved for purposes of
conversion of Debentures hereunder require registration or
listing with or approval of any governmental authority under
any Federal or State law, pursuant to the Securities Act of
1933, as amended, or the Securities Exchange Act, or any
national or regional securities exchange on which such
Capital Stock is listed at the time of delivery of any
shares of such Capital Stock, before such shares may be
issued upon conversion, the Company will use its best
efforts to cause such shares to be duly registered, listed
or approved, as the case may be.
SECTION 13.11. Payment of taxes upon certificates for
shares issued upon conversion. The issuance of certificates
for shares of Capital Stock upon the conversion of
Debentures shall be made without charge to the converting
Debentureholders for any tax (including, without limitation,
all documentary and stamp taxes) in respect of the issuance
and delivery of such certificates, and such certificates
shall be issued in the respective names of, or in such names
as may be directed by, the holders of the Debentures
converted; provided, however, that the Company shall not be
required to pay any tax which may be payable in respect of
any transfer involved in the issuance and delivery of any
such certificate in a name other than that of the holder of
the Debenture converted, and the Company shall not be
required to issue or deliver such certificates unless or
until the person or persons requesting the issuance thereof
shall have paid to the Company the amount of such tax or
shall have established to the satisfaction of the Company
that such tax has been paid.
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SECTION 13.12. Trustee's duties with respect to
conversion provisions. The Trustee and any conversion agent
shall not at any time be under any duty or responsibility to
any Debentureholder to determine whether any facts exist
which may require any adjustment of the conversion rate, or
with respect to the nature or extent of any such adjustment
when made, or with respect to the method employed, or herein
or in any supplemental indenture provided to be employed, in
making the same. Neither the Trustee nor any conversion
agent shall be accountable with respect to the registration
under securities laws, listing, validity or value (or the
kind or amount) of any shares of Capital Stock, or of any
other securities or property, which may at any time be
issued or delivered upon the conversion of any Debenture;
and neither the Trustee nor any conversion agent makes any
representation with respect thereto. Neither the Trustee
nor any conversion agent shall be responsible for any
failure of the Company to make any cash payment or to issue,
transfer or deliver any shares of stock or stock
certificates or other securities or property upon the
surrender of any Debenture for the purpose of conversion;
and the Trustee, subject to the provisions of Section 11.1,
and any conversion agent shall not be responsible for any
failure of the Company to comply with any of the covenants
of the Company contained in this Article XIII.
IN WITNESS WHEREOF, VANGUARD CELLULAR SYSTEMS, INC. has
caused this Indenture to be signed in its corporate name,
and , as Trustee, has caused this
Indenture to be signed in its corporate name, all as of the
day and year first above written.
VANGUARD CELLULAR SYSTEMS, INC.
By:
(CORPORATE SEAL) Title:
ATTEST:
Secretary
By:
(CORPORATE SEAL) Title:
ATTEST:
Secretary
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NORTH CAROLINA
COUNTY OF GUILFORD ss.
On this day of , before me
personally came , to me known, who, being by
me duly sworn, did depose and say the he resides at ,
that he is the of Vanguard Cellular Systems,
Inc., a North Carolina corporation, the corporation described in
and which executed the above instrument; that he knows the
corporate seal of said corporation; that the seal affixed to the
said instrument is such corporate seal; that it was so affixed by
authority of the Board of Directors of said corporation; and
that he signed his name thereto by like authority.
(NOTORIAL SEAL)
STATE OF
COUNTY OF ss.
On this day of , before me
personally came , to me known, who, being by
me duly sworn, did depose and say that he resides at ;
that he is a of , the banking
corporation described in and which executed the above instrument;
that he knows the seal of said banking
corporation; that the seal affixed to the said instrument is such
seal; that it was so affixed by authority of the Board of
Directors of said banking corporation; and that
he signed his name thereto by like authority.
(NOTORIAL SEAL)
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Exhibit 4(c)(2)
VANGUARD CELLULAR SYSTEMS, INC.
AND
, Trustee
INDENTURE
Dated as of
Senior Subordinated Debentures
<PAGE>
VANGUARD CELLULAR SYSTEMS, INC.
Reconciliation and Tie between Indenture
and
Trust Indenture Act of 1939
Trust Indenture Indenture
Act Section Section
310 (a)(1).................................11.5
(a)(2).................................11.5
(a)(3).................................Not applicable
(a)(4).................................Not applicable
(b)....................................11.4, 11.5
311 (a)....................................11.9
(b)....................................11.9
312 (a)....................................4.6(d),11.1
(b)....................................11.11
(c)....................................11.11
313 (a)....................................11.10(a)
(b)(1).................................Not applicable
(b)(2).................................11.10(b)
(c)....................................11.10(c)
(d)....................................11.10(c)
314 (a)(1).................................4.6(a)
(a)(2).................................4.6(b)
(a)(3).................................4.6(c)
(b)....................................Not applicable
(c)....................................14.8
(d)....................................Not applicable
(e)....................................14.8
315 (a)....................................11.1(a),(b)
(b)....................................11.3
(c)....................................11.1(a)
(d)....................................11.1(a),11.1(b),13.3
(e)....................................7.7
316 (a)(1)(A)..............................7.6,13.3
(a)(1)(B)..............................7.1,7.5,13.3
(a)(2).................................Not required
(b)....................................7.7
317 (a)....................................7.2
(b)....................................4.8
318 (a)....................................14.4
NOTE: This reconciliation and tie shall not, for any purpose,
be deemed to be part of the Indenture.
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<PAGE>
VANGUARD CELLULAR SYSTEMS, INC.
INDENTURE
TABLE OF CONTENTS*
Page
Parties.................................................... 1
Recitals................................................... 1
Consideration.............................................. 1
ARTICLE I
DEFINITIONS: TRUST INDENTURE ACT CONTROLLING
SECTION 1.1 Definitions.............................. 1
Affiliate.......................... 1
Authenticating Agent............... 1
Authorized Newspaper............... 2
Bankruptcy Law..................... 2
Board; Board of Directors.......... 2
Business day....................... 2
Capital Stock...................... 2
Certified Resolution............... 3
Class A Common Stock............... 3
Class B Common Stock............... 3
Closing Price...................... 3
Code............................... 3
Company............................ 3
Company order...................... 4
Debenture.......................... 4
Debentureholder, holder of
Debentures................... 4
Depositary......................... 4
Event of Default................... 4
Global Debenture................... 4
Indenture.......................... 4
Officers' Certificate.............. 4
Opinion of Counsel................. 5
Original issue discount............ 5
Original Issue Discount Debenture.. 5
Outstanding........................ 5
Paying Agent....................... 6
Person............................. 6
Principal.......................... 6
Principal amount................... 6
*This table of contents shall not, for any purpose, be
deemed to be part of the Indenture.
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<PAGE>
CONTENTS - (Continued)
Page
Responsible Officer................ 6
Securities Exchange Act............ 6
Senior Indebtedness................ 6
Trustee; principal office.......... 8
U.S. Government Obligations........ 8
SECTION 1.2. Trust Indenture Act definitions
controlling........................ 8
ARTICLE II
FORM, ISSUE AND REGISTRATION OF DEBENTURES
SECTION 2.1. Forms generally and dating.............. 8
SECTION 2.2. Amount unlimited; Issuable in series.... 9
SECTION 2.3. Denominations........................... 13
SECTION 2.4. Execution of Debentures; Authentication. 13
SECTION 2.5. Issue of Debentures..................... 16
SECTION 2.6. Transfer of Debentures.................. 16
SECTION 2.7. Persons deemed owners of Debentures..... 17
SECTION 2.8. Provisions for Debentures in temporary
form.............................. 17
SECTION 2.9. Mutilated, destroyed, lost or stolen
Debentures........................ 17
SECTION 2.10. Exchanges of Debentures................ 18
SECTION 2.11. Cancellation of surrendered Debentures.. 19
SECTION 2.12. Payment of interest; Defaulted interest. 19
SECTION 2.13. Global Debentures; Depositary........... 20
ARTICLE III
SUBORDINATION OF DEBENTURES
SECTION 3.1. Debentures subordinated to Senior
Indebtedness....................... 22
SECTION 3.2. Payment over of proceeds of Debentures
on dissolution, etc................ 22
SECTION 3.3. Debentures may be paid over prior to
dissolution, etc................... 26
SECTION 3.4. Rights of holders of Senior Indebtedness
not to be impaired, etc............ 27
SECTION 3.5. Authorization to Trustee to take action
to effectuate subordination........ 27
SECTION 3.6. Trustee's rights as holder of Senior
Indebtedness....................... 27
SECTION 3.7. Trustee's disclaimer..................... 28
SECTION 3.8. Application by Trustee of monies or U.S.
Governmental Obligations deposited
with it 28
SECTION 3.9. Trustee compensation not prejudiced...... 29
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<PAGE>
CONTENTS - (Continued)
Page
ARTICLE IV
COVENANTS OF THE COMPANY
SECTION 4.1. Payment of Principal and interest....... 28
SECTION 4.2. Maintenance of office or agency......... 29
SECTION 4.3. Corporate existence..................... 29
SECTION 4.4. Restrictions on mergers, sales and
consolidations.................... 29
SECTION 4.5. Further assurances...................... 29
SECTION 4.6. File certain reports and information
with the Trustee and the Securities
and Exchange Commission - transmit
to Debentureholders summaries of
certain documents filed with the
Trustee - furnish list of
Debentureholders to the Trustee... 30
SECTION 4.7. File statement by officers annually
with the Trustee.................. 31
SECTION 4.8. Duties of Paying Agent.................. 31
ARTICLE V
REDEMPTION OF DEBENTURES; SINKING FUND
SECTION 5.1. Applicability of Article................ 33
SECTION 5.2. Notice of redemption to be given to
Trustee - deposit of cash (or
other form of payment) with
Trustee - selection by Trustee
of Debentures to be redeemed...... 33
SECTION 5.3. Debentures called for redemption to
become due - rights of holders
of redeemed Debentures - return
of funds on conversion............ 35
SECTION 5.4. Credit against sinking fund............. 35
SECTION 5.5. Redemption through sinking fund......... 36
SECTION 5.6. Debentures no longer Outstanding after
notice to Trustee and deposit
of cash............................ 37
SECTION 5.7. Conversion arrangement on call for
redemption......................... 38
ARTICLE VI
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 6.1. Satisfaction and discharge of Indenture
with respect to Debentures of
any series......................... 38
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<PAGE>
CONTENTS - (Continued)
Page
SECTION 6.2. Deposits for payment or redemption of
Debentures to be held in trust.... 40
SECTION 6.3. Repayment of moneys..................... 40
ARTICLE VII
REMEDIES OF DEFAULT
SECTION 7.1. Events of Default defined - acceleration
of maturity upon default - waiver
of default after acceleration...... 41
SECTION 7.2. Covenant of Company to pay to Trustee
whole amount due on default in
payment of Principal or interest -
Trustee may recover judgment for
whole amount due - application
of moneys received by Trustee...... 44
SECTION 7.3. Trustee may enforce rights of action
without possession of Debentures... 47
SECTION 7.4. Delays or omissions not to impair any
rights or powers accruing upon
default............................ 47
SECTION 7.5. In Event of Default Trustee may protect
and enforce its rights by
appropriate proceedings - holders
of majority in aggregate Principal
amount of Debentures of a series
may waive default.................. 47
SECTION 7.6. Holders of majority in aggregate
Principal amount of Debentures of
any series may direct exercise of
remedies........................... 48
SECTION 7.7. Limitation on suits by Debentureholders.. 48
SECTION 7.8. No Debentures owned or held by, for the
account of or for the benefit of
the Company to be deemed
Outstanding for purpose of
payment of distribution............ 49
SECTION 7.9. Company and Trustee restored to
former position on discontinuance
or abandonment of proceedings...... 50
ARTICLE VIII
EVIDENCE OF ACTION BY DEBENTUREHOLDERS
SECTION 8.1. Evidence of action by Debentureholders.. 50
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<PAGE>
CONTENTS - (Continued)
Page
ARTICLE IX
IMMUNITY OF INCORPORATORS,
STOCKHOLDERS, OFFICERS AND DIRECTORS
SECTION 9.1. Immunity of incorporators, stockholder,
officers, directors and employees.. 51
ARTICLE X
MERGER, CONSOLIDATION, SALE OR LEASE
SECTION 10.1. Documents required to be filed with the
Trustee upon consolidation, merger,
sale, transfer or lease - execution
of supplemental indentures - acts
of successor corporation........... 51
SECTION 10.2. Trustee may rely upon Opinion of
Counsel............................ 53
ARTICLE XI
CONCERNING THE TRUSTEE
SECTION 11.1. Acceptance of Trust - responsibilities
of Trustee......................... 53
SECTION 11.2. Trustee to be entitled to compensation -
Trustee not to be accountable for
application of proceeds - moneys
held by Trustee to be trust funds.. 56
SECTION 11.3. Trustee to give Debentureholders notice
of default......................... 57
SECTION 11.4. Trustee acquiring conflicting interest
must eliminate it or resign........ 58
SECTION 11.5. Eligibility of Trustee.................. 58
SECTION 11.6. Resignation or removal of Trustee....... 58
SECTION 11.7. Acceptance by successor Trustee......... 60
SECTION 11.8. Successor to Trustee by merger or
consolidation, etc................. 61
SECTION 11.9. Limitations on right of Trustee as a
creditor to obtain payment of
certain claims..................... 62
SECTION 11.10 Trustee to make annual report to
Debentureholders - Trustee to
make other reports to
Debentureholders - Debentureholders
to whom reports to be transmitted.. 62
SECTION 11.11. Preservation of information by Trustee -
Trustee to give certain information
to Debentureholders upon
application........................ 63
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<PAGE>
CONTENTS - (Continued)
Page
SECTION 11.12. Trustee may hold Debentures and
otherwise deal with Company........ 64
SECTION 11.13. Trustee may comply with any rule,
regulation or order of the
Securities and Exchange
Commission......................... 65
SECTION 11.14 Appointment of Authenticating Agent...... 65
ARTICLE XII
SUPPLEMENTAL INDENTURES
SECTION 12.1. Company and Trustee may enter into
supplemental indenture for
special purposes................... 67
SECTION 12.2. Modification of Indenture with consent
of Debentureholders................ 69
SECTION 12.3. Effect of supplemental indentures....... 70
SECTION 12.4. Supplemental indentures to conform to
Trust Indenture Act................ 71
SECTION 12.5. Notation on or exchange of Debentures... 71
ARTICLE XIII
CONVERSION OF DEBENTURES
SECTION 13.1. Applicability of Article................ 71
SECTION 13.2. Right of Debentureholders to convert
Debentures......................... 71
SECTION 13.3. Issuance of shares of Capital Stock on
conversion......................... 72
SECTION 13.4. No payment or adjustment for interest
or dividends....................... 73
SECTION 13.5. Adjustment of conversion rate........... 74
SECTION 13.6. No fractional shares to be issued....... 78
SECTION 13.7. Preservation of conversion rights upon
consolidation, merger, sale or
conveyance......................... 78
SECTION 13.8. Notice to Debentureholders of a series
prior to taking certain types
of action.......................... 79
SECTION 13.9. Covenant to reserve shares for
issuance on conversion of
Debentures......................... 80
SECTION 13.10. Compliance with governmental
requirements....................... 80
SECTION 13.11. Payment of taxes upon certificates for
shares issued upon conversion...... 81
SECTION 13.12. Trustee's duties with respect to
conversion provisions.............. 81
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CONTENTS - (Continued)
Page
ARTICLE XIV
MISCELLANEOUS PROVISIONS
SECTION 14.1. Rights under Indenture limited to the
parties and holders of Debentures.. 81
SECTION 14.2. Certificate of independent accountants
conclusive......................... 82
SECTION 14.3. Treatment of Debentures owned or held
by the Company in determining
required percentages............... 82
SECTION 14.4. Remaining provisions not affected by
invalidity of any other
provisions - required provisions of
Trust Indenture Act of 1939 to
control............................ 82
SECTION 14.5. Company released from Indenture
requirements if entitled to have
Indenture cancelled................ 83
SECTION 14.6. Date of execution....................... 83
SECTION 14.7. Execution of documents furnished under
the Indenture...................... 83
SECTION 14.8. Officers' Certificates and Opinions of
Counsel to be furnished Trustee.... 83
SECTION 14.9. Presentation of notices and demands..... 84
SECTION 14.10. Successors and assigns bound by
Indenture.......................... 85
SECTION 14.11. Descriptive headings for convenience
only............................... 85
SECTION 14.12. North Carolina law to govern................... 85
SECTION 14.13. Indenture may be executed in
counterparts....................... 85
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INDENTURE dated as of the day of ,
between Vanguard Cellular Systems, Inc., a corporation
organized and existing under the laws of the State of North
Carolina (hereinafter called the "Company"), and , a
banking corporation with its principal offices in ,
as Trustee hereunder (hereinafter called the "Trustee").
WHEREAS, the Company for its lawful corporate purposes
has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of
its debentures, notes or other evidences of indebtedness
(hereinafter called the "Debentures"), to be issued in one
or more series, the amount and terms of each series to be
determined as hereinafter provided.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
THAT, in consideration of the premises and of the
mutual covenants herein contained and of the purchase and
acceptance of the Debentures by the holders thereof, and for
other valuable consideration the receipt whereof is hereby
acknowledged, and intending to be legally bound hereby, it
is hereby agreed between the Company and the Trustee, for
the benefit of those who shall hold the Debentures, as
follows:
ARTICLE I
DEFINITIONS; TRUST INDENTURE ACT CONTROLLING
SECTION 1.1. Definitions. Unless otherwise
specified or the context otherwise requires, the terms
defined in this Article I shall for all purposes of this
Indenture and of any indenture supplemental hereto have the
meanings herein specified, the following definitions to be
equally applicable to both the singular and plural forms of
any of the terms herein defined. All accounting terms not
otherwise defined herein have the meanings assigned to them
in accordance with generally accepted accounting principles
in the United States of America, and 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.
Affiliate
An "Affiliate" shall mean any person directly or
indirectly controlling or controlled by or under direct or
indirect common control with the Company or any other
obligor under this Indenture.
Authenticating Agent
The term "Authenticating Agent" means any Person
authorized by the Trustee pursuant to Section 11.14 to act
on behalf of the
<PAGE>
Trustee to authenticate Debentures of one or more series.
Authorized Newspaper
The term "Authorized Newspaper" shall mean a newspaper
in the English language or in an official language of the
country of publication, customarily printed on each Business
day, whether or not published on Saturdays, Sundays or
holidays, and of general circulation in the place in
connection with which the term is used or in the financial
community of such place. If, because of temporary
suspension of publication or general circulation of any
newspaper or for any other reason, it is impossible or, in
the opinion of the Trustee, impracticable to make any
publication of any notice required by this Indenture in the
manner herein provided, such publication or other notice in
lieu thereof which is made at the written direction of the
Company by the Trustee shall constitute a sufficient
publication of such notice. Where successive publications
are required to be made in Authorized Newspapers, the
successive publications may be made in the same or in
different newspapers in the same place meeting the foregoing
requirements and in each case on any Business day.
Bankruptcy Law
The term "Bankruptcy Law" means Title 11 of the United
States Code, as now constituted or hereafter in effect, or
any other applicable Federal or State bankruptcy, insolvency
or other similar law.
Board; Board of Directors
The term "Board" or "Board of Directors" shall mean the
Board of Directors of the Company or the Executive
Committee, if any, of such Board or any other committee of
such Board duly authorized to act hereunder.
Business day
The term "Business day" shall mean, with respect to any
Debenture, a day that, in the city (or in any of the cities,
if more than one) in which amounts are payable, as specified
in the terms of such Debentures, is not a day upon which
banking institutions are authorized or required by law, or
by executive order issued by a governmental authority or
agency regulating such banking institutions, to close.
Capital Stock
The term "Capital Stock" shall mean stock of any class
of the Company.
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Certified Resolution
The term "Certified Resolution" shall mean 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.
Class A Common Stock
The term "Class A Common Stock" shall mean the Class A
Common Stock, $.01 par value, of the Company.
Class B Common Stock
The term "Class B Common Stock" shall mean the Class B
Common Stock, $.01 par value, of the Company.
Closing Price
The term "Closing Price" on any day when used with
respect to any class of Capital Stock shall mean (i) if the
stock is then listed or admitted to trading on a national
securities exchange in the United States, the last reported
sale price, regular way, for the stock as reported in the
consolidated transaction or other reporting system for
securities listed or traded on such exchange, or (ii) if the
stock is listed on the National Association of Securities
Dealers', Inc. Automated Quotations System National Market
System (the "NASDAQ National Market System"), the last
reported sale price, regular way, for the stock, as reported
on such list, or (iii) if the stock is not so admitted for
trading on any national securities exchange or the NASDAQ
National Market System, the average of the last reported
closing bid and asked prices reported by the National
Association of Securities Dealers', Inc. Automated
Quotations System as furnished by any member in good
standing of the National Association of Securities Dealers',
Inc., selected from time to time by the Company for that
purpose or as quoted by the National Quotation Bureau
Incorporated. In the event that no such quotation is
available for any day, the Board of Directors shall be
entitled to determine the current market price on the basis
of such quotations as it considers appropriate.
Code
The term "the Code" means the Internal Revenue Code of
1986, as amended.
Company
The term "Company" shall mean Vanguard Cellular
Systems, Inc., a North Carolina corporation, and, subject to
the provisions of Article X, shall include its successors
and assigns.
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<PAGE>
Company Order
The term "Company Order" means a written order signed
in the name of the Company by its Chairman of the Board,
President, any Vice Chairman of the Board or any Vice
President, and by its Treasurer, any Assistant Treasurer,
Secretary or any Assistant Secretary and delivered to the
Trustee.
Debenture
The term "Debenture" shall mean one of the debentures,
notes or other evidences of indebtedness that are issued
from time to time in one or more series under this Indenture
and, more particularly, any Debenture authenticated and
delivered under this Indenture.
Debentureholder; holder of Debentures
The term "Debentureholder" or "holder of Debentures" or
other similar term shall mean any person who shall at the
time be the registered holder of any Debenture or Debentures
as shown by the register or registers kept by the Company or
its agent for that purpose in accordance with the terms of
this Indenture.
Depositary
The term "Depositary" has the meaning specified in
Section 2.13.
Event of Default
The term "Event of Default" shall mean an event listed
in Section 7.1, continued for the period of time, if any,
and after the required notices, if any, therein designated.
Global Debenture
The term "Global Debenture" has the meaning specified
in Section 2.13.
Indenture
The term "Indenture" shall mean this instrument as
originally executed or, if amended or supplemented as herein
provided, as so amended or supplemented and, unless the
context otherwise indicates, shall include the form and
terms of each particular series of Debentures established as
contemplated hereunder.
Officers' Certificate
The term "Officers' Certificate" shall mean a
certificate signed by the Chairman of the Board, President,
any Vice Chairman
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<PAGE>
of the Board or any Vice President
and by the Treasurer or any Assistant Treasurer or the
Secretary or any Assistant Secretary of the Company, in
their capacities as such officers of the Company and
delivered to the Trustee. Each such certificate shall
include the statements provided for in Section 14.8, if and
to the extent required by the provisions thereof.
Opinion of Counsel
The term "Opinion of Counsel" shall mean an opinion in
writing signed by Schell Bray Aycock Abel & Livingston
L.L.P. or other legal counsel (who may be an employee of the
Company) acceptable in form and substance to the Trustee and
delivered to the Trustee. Such opinion shall include the
statements provided for in Section 14.8, if and to the
extent required by the provisions thereof.
Original issue discount
The term "original issue discount" with respect to any
debt security, including an Original Issue Discount
Debenture, has the same meaning as set forth in Section 1273
of the Code, or any successor provision, and the applicable
Treasury Regulations thereunder.
Original Issue Discount Debenture
The term "Original Issue Discount Debenture" means any
Debenture which provides for an amount less than the
principal amount thereof to be due and payable upon
acceleration of the maturity thereof pursuant to Section
7.1.
Outstanding
The term "Outstanding", when used with respect to the
Debentures, shall, subject to Section 14.3, mean, as of the
date of determination, all Debentures theretofore
authenticated and delivered under this Indenture, except:
(a) Debentures for the payment or redemption of which cash
(or other form of payment if permitted by the terms of such
Debentures) in the necessary amount shall have been
deposited in trust with the Trustee or any paying agent
(other than the Company) provided that, if such Debentures
are to be redeemed prior to the maturity thereof, notice of
such redemption shall have been duly given or provision
satisfactory to the Trustee shall have been made for giving
such notice; (b) Debentures converted into Capital Stock in
accordance with Article XIII hereof, if the terms of such
Debentures provide for convertibility pursuant to Section
2.2; (c) Debentures paid or in lieu of or in substitution
for which other Debentures shall have been authenticated and
delivered pursuant to the terms of Section 2.9, unless proof
satisfactory to the Trustee is presented that any such
Debentures are held by persons in whose hands such
Debentures are valid, binding and legal obligations;
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<PAGE>
and (d) Debentures which have been cancelled by the Trustee
or delivered to the Trustee for cancellation.
Paying Agent
The term "Paying Agent" shall mean any person
authorized by the Company to pay the principal of, premium,
if any, and interest on any Debentures.
Person
The term "Person" shall mean an individual, a
corporation, a partnership, an association, a joint-stock
company, a trust, any unincorporated organization, or a
government or political subdivision thereof.
Principal
The term "principal" of a debt security, including any
Debenture, on any day and for any purpose means the amount
(including, without limitation, in the case of an Original
Issue Discount Debenture, any accrued original issue
discount, but excluding interest) that is payable with
respect to such debt security as of such date and for such
purpose (including, without limitation, in connection with
any sinking fund, upon any redemption at the option of the
Company upon any purchase or exchange at the option of the
Company or the holder of such debt security and upon any
acceleration of the maturity of such debt security).
Principal amount
The term "principal amount" of a debt security,
including any Debenture, means the principal amount as set
forth on the face of such debt security.
Responsible Officer
The term "Responsible Officer", when used with respect
to the Trustee, shall mean any officer of the Trustee
assigned by the Trustee to administer its corporate trust
matters.
Securities Exchange Act
The term "Securities Exchange Act" shall mean the
Securities Exchange Act of 1934, as amended.
Senior Indebtedness
The term "Senior Indebtedness" shall mean: (a) the
principal of and premium, if any, and interest on (i) all
indebtedness for money borrowed by the Company (other than
the Debentures), whether outstanding on the date of this
Indenture or hereafter
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<PAGE>
created or incurred, (ii) all indebtedness for money
borrowed by another person in which the Company has an
equity interest or has the right to purchase an equity
interest, and guaranteed directly or indirectly by the
Company (whether such guarantee is outstanding on the date
of this Indenture or hereafter created or incurred), and
(iii) all indebtedness constituting purchase money
indebtedness for the payment of which the Company is
directly or contingently liable, whether outstanding on the
date of this Indenture or hereafter created or incurred; (b)
any obligation to purchase or guarantee indebtedness of, to
supply funds to or to invest in, another person in which the
Company has an equity interest or has the right to purchase
an equity interest (whether such obligation is outstanding
on the date of this Indenture or is hereafter created or
incurred); (c) any obligation of the Company to any person
in respect of surety or similar bonds issued by such person
in connection with entering into, renewing or extending any
cellular telephone license granted by a governmental
authority or any construction in respect of any cellular
telephone system by the Company or any other person in which
the Company has an equity interest or has the right to
purchase an equity interest; and (d) all renewals,
extensions or refundings of any such obligations,
indebtedness and guarantees; provided, however, that if, by
the terms of the instrument creating or evidencing any
obligation, indebtedness or guarantee referred to in clauses
(a), (b), (c) and (d) above, it is expressly provided that
such obligation, indebtedness or guarantee is subordinate to
the Debentures or to all other indebtedness of the Company
or is not superior in right of payment or performance to the
Debentures, such obligation, indebtedness or guarantee shall
not be included as Senior Indebtedness; and, provided,
however, further, that Senior Indebtedness shall not include
(which shall be subordinate in right of payment to the prior
payment in full of the Debenture) or any obligation,
indebtedness or guarantee which is created or evidenced by
an instrument the terms of which expressly provide that such
obligation, indebtedness or guarantee is subordinate to
senior indebtedness and senior indebtedness is defined in
such instrument in substantially the same manner as Senior
Indebtedness is defined in the indenture for the , unless
the definition of senior indebtedness expressly provides
that such obligations, indebtedness or guarantee is not
subordinate to the Debentures, or is superior in right of
payment or performance to the Debentures. As used in the
preceding sentence the term "purchase money indebtedness"
shall mean indebtedness evidenced by a note, debenture, bond
or other instrument or any other written obligation to pay
money (whether or not secured by any lien or other security
interest) issued or assumed as all or a part of the
consideration for the acquisition of property, assets, or
securities whether by purchase, merger, consolidation, or
otherwise.
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<PAGE>
Trustee; principal office
The term "Trustee" shall mean the trustee or trustees
hereunder for the time being, whether original or successor.
"Trustee" as used with respect to the Debentures of any
series shall mean the Trustee with respect to Debentures of
such series. The term "principal office" of the Trustee
shall mean the principal office of the Trustee at which, at
any particular time, the corporate trust business of the
Trustee shall be administered, which office as of the date
hereof is .
U.S. Government Obligations
The term "U.S. Government Obligations" means direct
obligations of, or obligations entitled to the full faith
and credit of, the United States of America.
SECTION 1.2. Trust Indenture Act definitions
controlling. All terms used in this Indenture which are
defined in the Trust Indenture Act of 1939, as amended, or
which are by reference therein defined in the Securities Act
of 1933 (except as herein otherwise expressly provided or
unless the context otherwise requires) shall have the
meanings assigned to such terms in such Trust Indenture Act
and such Securities Act as they were respectively in force
at the date of this Indenture, except as otherwise provided
in Section 12.3.
ARTICLE II
FORM, ISSUE AND REGISTRATION OF DEBENTURES
SECTION 2.1. Forms generally and dating. The
Debentures of each series shall be in the form or forms
(including temporary or permanent global form) established
from time to time by or pursuant to a resolution of the
Board of Directors or in one or more indentures supplemental
hereto which shall set forth the information required by
Section 2.2. The Debentures and the Trustee's certificate
of authentication shall have such appropriate insertions,
omissions, substitutions and other variations as are
required or permitted by this Indenture or by a resolution
of the Board of Directors and may have such notations,
legends or endorsements as the Company may deem appropriate
and as are not inconsistent with the provisions of this
Indenture or as may be required by law, stock exchange rule
or usage. The Company shall approve and provide the form of
the Debentures and any notation, legend or endorsement on
them. If the form of Debentures of any series is
established by action taken pursuant to a resolution of the
Board of Directors, 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 2.5 for the authentication and delivery
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<PAGE>
of such Debentures.
Each Debenture shall be dated the date of its
authentication. The form of the Trustee's certificate of
authentication to be borne by the Debentures shall be
substantially as follows:
(FORM OF TRUSTEE'S CERTIFICATE)
This is one of the Debentures of the series referred to
on the reverse hereof.
as Trustee
By:
Authorized Officer
SECTION 2.2. Amount unlimited; Issuable in series.
The aggregate principal amount of the Debentures which
may be authenticated and delivered under this Indenture is
unlimited.
The Debentures may be issued in one or more series.
There shall be established in or pursuant to one or more
resolutions of the Board of Directors, or established in or
pursuant to one or more indentures supplemental hereto,
prior to the issuance of the Debentures of any series:
(1) the title of the Debentures of the series
(which shall distinguish Debentures of the series from
all other Debentures);
(2) any limit upon the aggregate principal
amount of the Debentures of the series which may be
authenticated and delivered under this Indenture
(except for the Debentures authenticated and delivered
upon registration of transfer of, or in exchange for,
or in lieu of, other Debentures of the series pursuant
to Section 2.6, 2.8, 2.9, 2.10, 2.11, 5.2 or 12.5) and
except for any Debentures which pursuant to Section 2.4
are deemed not to have been authenticated and delivered
hereunder;
(3) the date or dates (and whether fixed or
extendable) on which the principal of the Debentures of
the series is payable or the method of determination
thereof;
(4) the rate or rates at which the Debentures
of the series shall bear interest, if any, the method
of calculating such rates, the date or dates from which
such interest shall accrue or the manner of determining
such dates, the interest
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<PAGE>
payment dates on which such interest shall be payable
and the record dates for the determination of
Debentureholders to whom interest is payable;
(5) the place or places where the principal of
and premium, if any, and interest on the Debentures, if
any, of the series shall be payable;
(6) if other than 100% of their principal
amount, the percentage of the principal amount at which
the Debentures will be issued;
(7) any provisions relating to the issuance of
the Debentures of such series at an original issue
discount;
(8) the price or prices at which, the period or
periods within which and the terms and conditions upon
which the Debentures of the series may be redeemed, in
whole or in part, at the option of the Company,
pursuant to any sinking fund or otherwise (including,
without limitation, the form or method of payment
thereof if other than in cash);
(9) the obligation, if any, of the Company to
redeem, purchase or repay the Debentures of the series
pursuant to any mandatory redemption, sinking fund or
analogous provisions or at the option of a
Debentureholder thereof and the price or prices at
which and the period or periods within which and the
terms and conditions upon which the Debentures of the
series shall be redeemed, purchased or repaid, in whole
or in part, pursuant to such obligation (including,
without limitation, the form or method of payment
thereof if other than in cash), and any provisions for
the remarketing of such Debentures;
(10) if other than denominations of $1,000 and
any integral multiple thereof, the denominations in
which the Debentures of the series shall be issuable;
(11) if other than the principal amount thereof,
the portion of the principal amount of the Debentures
of the series which shall be payable upon declaration
of acceleration of the maturity thereof pursuant to
Section 7.1 or provable in bankruptcy pursuant to
Section 7.2, or, if applicable, which is convertible in
accordance with Article XIII;
(12) any Events of Default with respect to the
Debentures of a particular series, in lieu of or in
addition to those set forth herein and the remedies
therefor;
(13) the obligation, if any, of the Company to
permit the conversion or exchange of the Debentures of
such series and, if any, the securities or rights into
which the
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Debenture of that series are convertible or
exchangeable (which may include other debentures,
Capital Stock or other securities or rights of the
Company (including rights to receive payment in cash or
securities based on the value, rate or price of one or
more specified commodities, currencies or indices) or
exchangeable for securities of other issuers or a
combination of the foregoing) and the terms and
conditions upon which such conversion or exchange shall
be effected (including, without limitation, the initial
conversion price or rate, the conversion period and any
other provision in addition to or in lieu of those set
forth in this Indenture relative to such obligation);
(14) any trustees, authenticating or paying
agents, transfer agents or registrars or any other
agents with respect to the Debentures of such series;
(15) the currency or currencies, including
composite currencies, in which the Debentures of the
series shall be denominated if other than the currency
of the United States of America, and, if so, whether
the Debentures of the series may be satisfied and
discharged other than as provided in Article VI;
(16) if other than the coin or currency in which
the Debentures of that series are denominated, the coin
or currency in which payment of the principal of,
premium, if any, or interest on the Debentures of such
series shall be payable;
(17) if the principal of, premium, if any, or
interest on the Debentures of such series are to be
payable, at the election of the Company or a
Debentureholder thereof, in a coin or currency other
than that in which the Debentures are denominated, the
period or periods within which, and the terms and
conditions upon which, such election may be made;
(18) if the amount of payments of principal of,
premium, if any, and interest on the Debentures of the
series may be determined with reference to an index,
the manner in which such amounts shall be determined;
(19) whether and under what circumstances the
Company will pay additional amounts on the Debentures
of the series held by a person who is not a United
States of America person in respect of any tax,
assessment or governmental charge withheld or deducted
and, if so, whether the Company will have the option to
redeem such Debentures rather than pay such additional
amounts;
(20) if receipt of certain certificates or other
documents or satisfaction of other conditions will be
necessary for any purpose, including, without
limitation, as
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<PAGE>
a condition to the issuance of the Debentures of such
series in definitive form (whether upon original issue
or upon exchange of a temporary Debenture of such
series), the form and terms of such certificates,
documents or conditions;
(21) any other affirmative or negative covenants
with respect to the Debentures of such series;
(22) whether the Debentures of such series shall
be issued in whole or in part in the form of one or
more Global Debentures and in such case (i) the
Depositary for such Global Debenture or Debentures,
which Depositary must be a clearing agency registered
under the Securities Exchange Act, (ii) the
circumstances under which any such Global Debenture may
be exchanged for Debentures registered in the name of,
and under which any transfer of such Global Debenture
may be registered in the name of, any Person other than
such Depositary or its nominee, if other than as set
forth in Section 2.13 and (iii) any other provisions
regarding such Global Debentures which provisions may
be in addition to or in lieu of, in whole or in part,
the provisions of Section 2.13; and
(23) any other terms of a particular series and
any other provisions expressing or referring to the
terms and conditions upon which the Debentures of such
series are to be issued under the Indenture, which
terms and provisions are not in conflict with the
provisions of this Indenture; provided, however, that
the addition to or subtraction from or variation of
Articles IV, V, VI, VII, and X (and Section 1.1,
insofar as it relates to the definition of certain
terms as used in such Articles) with regard to the
Debentures of a particular series shall not be deemed
to constitute a conflict with the provisions of those
Articles.
All Debentures of any one series shall be substantially
identical except as to denomination and except as may
otherwise be provided in or pursuant to such resolution of
the Board of Directors or in any such indenture supplemental
hereto. Not all Debentures of any one series need be issued
at the same time, and, unless otherwise so provided, a
series may be reopened for issuances of additional
Debentures of such series.
If any of the terms of the Debentures of a series are
established by action taken pursuant to a resolution of the
Board of Directors, a copy of any appropriate record of such
action shall be certified by the Secretary or an Assistant
Secretary of the Company and delivered to the Trustee with
an Officers' Certificate setting forth the terms of the
Debentures of such series. With respect to Debentures of a
series which are not to be issued at one time, such
resolution of the Board of Directors or action may provide
general terms or parameters for Debentures of such series
and provide either that the specific terms of
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<PAGE>
particular Debentures of such series shall be specified in a
Company Order or that such terms shall be determined by the
Company or its agents in accordance with a Company Order as
contemplated by the proviso clause of Section 2.5.
SECTION 2.3. Denominations. The Debentures of
each series shall be registered Debentures without coupons,
in such denominations as shall be specified as contemplated
by Section 2.2. In the absence of any such provisions with
respect to the Debentures of any series, the Debentures of
such series shall be issuable in denominations of $1,000 or
of any integral multiple of $1,000.
SECTION 2.4. Execution of Debentures;
Authentication. The Debentures shall be executed on behalf
of the Company by its President or one of its Vice Chairmen
or Vice Presidents, whose signatures may be manual or
facsimile, and its corporate seal shall be thereunto affixed
(or a facsimile thereof shall be engraved, printed, or
otherwise reproduced thereon) and attested by the manual or
facsimile signature of its Secretary or one of its Assistant
Secretaries. In case any officer of the Company who shall
have signed any of the Debentures shall cease to be such
officer before the Debentures so signed and attested shall
actually have been authenticated and delivered by the
Trustee or the Authenticating Agent or disposed of by the
Company, such Debentures nevertheless may be authenticated,
issued and delivered or disposed of with the same force and
effect as though the person or persons who signed or
attested such Debentures had not ceased to be such officer
of the Company; and any such Debenture may be signed and
attested on behalf of the Company by such persons, as at the
actual date of the execution of such Debenture, shall be the
proper officers of the Company, although at the date of such
Debenture or the date of execution of this Indenture any
such person was not such officer.
No Debenture of any series shall be entitled to the
benefits hereof or shall be or become valid or obligatory
for any purpose unless there shall appear on the Debenture a
certificate of authentication, substantially in the form
hereinbefore recited, manually executed by the Trustee for
such series or an Authenticating Agent; and such certificate
on any Debenture issued by the Company shall be conclusive
evidence that it has been duly authenticated and delivered
hereunder.
Notwithstanding the foregoing, if any Debenture shall
have been duly authenticated and delivered hereunder but
never issued and sold by the Company, and the Company shall
deliver such Debenture to the Trustee for cancellation as
provided in Section 2.11 together with a written statement
(which need not be accompanied by an Opinion of Counsel)
stating that such Debenture has not been issued and sold by
the Company, for all purposes of this Indenture such
Debenture shall be deemed not to have been authenticated and
delivered hereunder and shall not be entitled
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to the benefits of this Indenture.
If the form or forms or terms of the Debentures of any
series have been established in or pursuant to one or more
resolutions of the Board of Directors or indentures
supplemental hereto as permitted by Sections 2.1 and 2.2, in
authenticating such Debentures, and accepting the additional
responsibilities under this Indenture in relation to such
Debentures, the Trustee and the Authenticating Agent shall
be entitled to receive, and (subject to Section 11.2) shall
be fully protected in relying upon, a copy of such
resolution or resolutions delivered to the Trustee and the
Authenticating Agent and certified by the Secretary or
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 an Opinion of Counsel
stating:
(1) if the form or forms of such Debentures
have been established by or pursuant to a resolution of
the Board of Directors or indenture supplemental
hereto, that such form or forms have been established
in conformity with the provisions of this Indenture;
(2) if the terms of such Debentures have been
established by or pursuant to a resolution of the Board
of Directors or indenture supplemental hereto, that
such terms have been established in conformity with the
provisions of this Indenture; and
(3) that such Debentures, when authenticated
and delivered by the Trustee or an Authenticating Agent
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
conveyance, reorganization and other laws of general
applicability relating to or affecting the enforcement
of creditors' rights and to general equity principles
(or such other similar matters as in the opinion of
such counsel shall not materially adversely affect such
enforceability).
provided, however, that, with respect to Debentures of a
series which are not to be issued at one time, the Trustee
and the Authenticating Agent shall be entitled to receive
such Opinion of Counsel only once at or prior to the time of
the first authentication of Debentures of such series and
that the opinions described in clauses (2) and (3) above may
state, respectively:
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(a) that, when the terms of such Debentures
shall have been established pursuant to a Company Order
or pursuant to such procedures as may be specified from
time to time by a Company Order, all as contemplated by
and in accordance with a resolution of the Board of
Directors or an Officers' Certificate pursuant to a
resolution of the Board of Directors or indenture
supplemental hereto, as the case may be, such terms
will have been established in conformity with the
provisions of this Indenture; and
(b) that such Debentures, when (i) executed by
the Company, (ii) completed, authenticated and
delivered by the Trustee or the Authenticating Agent in
accordance with this Indenture, (iii) issued and
delivered by the Company, and (iv) paid for, all as
contemplated by and in accordance with the aforesaid
Company Order or specified procedures, as the case may
be, will constitute valid and legally binding
obligations of the Company, enforceable in accordance
with their terms, subject to bankruptcy, insolvency,
fraudulent conveyance, reorganization and other laws of
general applicability relating to or affecting the
enforcement of creditors' rights and to general
equitable principles (or such other similar matters as
in the opinion of such counsel shall not materially
adversely affect such enforceability).
Notwithstanding the provisions of Sections 2.1, 2.2,
14.8 and this Section, if all the Debentures of a series are
not to be originally issued at one time, the resolution of
the Board of Directors or indenture supplemental hereto, the
certified copy of the record of action taken pursuant to
such resolution or supplemental indenture, the Officers'
Certificate, the Company Order and any other documents
otherwise required pursuant to such Sections need not be
delivered at or prior to the time of authentication of each
Debenture of such series if such documents are delivered at
or prior to the authentication upon original issuance of the
first Debenture of such series to be issued; provided,
however, that any subsequent request by the Company to the
Trustee or the Authenticating Agent to authenticate
Debentures of such series shall constitute a representation
and warranty by the Company that, as of the date of such
request, the statements made in the Officers' Certificate
delivered pursuant to Section 14.8 at or prior to
authentication of the first such Debenture shall be true and
correct on the date thereof as if made on and as of the date
hereof.
The Trustee or the Authenticating Agent shall not be
required to authenticate such Debentures if the issue of
such Debentures pursuant to this Indenture will adversely
affect the Trustee's or the Authenticating Agent's own
rights, duties or immunities under the Debentures and this
Indenture or otherwise in a manner which is not reasonably
acceptable to the Trustee or the Authenticating Agent.
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With respect to Debentures of a series which are not
all issued at one time, the Trustee and the Authenticating
Agent may conclusively rely, as to the authorization by the
Company of any such Debentures, the form and terms thereof
and the legality, validity, binding effect and
enforceability thereof, upon the Opinion of Counsel,
Officers' Certificate and other documents delivered pursuant
to Sections 2.1, 2.2, 14.8 and this Section, as applicable,
at or prior to the time of the first authentication of
Debentures of such series unless and until such opinion,
certificate or other documents have been superseded or
revoked in a writing delivered to the Trustee. In
connection with the authentication and delivery of
Debentures of a series which are not all issued at one time,
the Trustee and the Authenticating Agent shall be entitled
to assume that the Company's instructions to authenticate
and deliver such Debentures do not violate any rules,
regulations or orders of any governmental agency or
commission having jurisdiction over the Company.
SECTION 2.5. Issue of Debentures. The Trustee and
the Authenticating Agent, forthwith upon the execution and
delivery of this Indenture and from time to time thereafter,
upon the execution and delivery to it of Debentures of any
series by the Company as herein provided, and without
further action on the part of the Company, shall
authenticate such Debentures up to a maximum amount, if any,
designated for such series pursuant to Section 2.2 and
deliver them to or upon the receipt of a Company Order;
provided, however, that if not all the Debentures of a
series are to be issued at one time and if the resolution of
the Board of Directors or indenture supplemental hereto
establishing such series as contemplated by Sections 2.1 and
2.2 shall so permit, such Company Order may set forth
procedures acceptable to the Trustee for the issuance of
such Debentures and for determining the form or forms or
terms of particular Debentures of such series including, but
not limited to, interest rate, if any, maturity date, date
of issuance and date from which interest, if any, shall
accrue.
SECTION 2.6. Transfer of Debentures. The transfer
of any Debenture of any series may be registered by the
registered owner thereof, in person or by his attorney duly
authorized in writing, at the office or agency of the
Company to be maintained by it as provided in Section 4.2,
by delivering such Debenture for cancellation, accompanied
by delivery of a duly executed instrument of transfer, in a
form approved by the Company and satisfactory to the
Trustee, and thereupon the Company shall execute in the name
of the transferee or transferees, and the Trustee or the
Authenticating Agent shall authenticate and deliver, a new
Debenture or Debentures of the same series and of like form
for the same aggregate principal amount.
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SECTION 2.7. Persons deemed owners of Debentures.
Prior to due presentation of any Debenture for registration
of transfer, the person in whose name a Debenture of any
series shall be registered, on books kept for such purpose
in accordance with Section 4.2, shall be deemed the absolute
owner thereof for all purposes of this Indenture, whether or
not such Debenture is overdue, and neither the Company, the
Trustee nor any Paying Agent or conversion agent nor any
Debenture registrar shall be affected by notice to the
contrary. Subject to the provisions of Section 2.12, payment
of or on account of the principal, premium, if any, and
interest shall be made only to or upon the order in writing
of such registered owner thereof, but such registration may
be changed as above provided. All such payments shall be
valid and effectual to satisfy and discharge the liability
upon such Debenture to the extent of the sum or sums so
paid.
SECTION 2.8. Provisions for Debentures in
temporary form. Until Debentures of any series in
definitive form are ready for delivery, the Company may
execute and, upon its request in writing, the Trustee or the
Authenticating Agent shall authenticate and deliver, in lieu
thereof and subject to the same conditions, one or more
printed or lithographed Debentures in temporary form,
substantially of the tenor of Debentures of the same series,
without a recital of specific redemption prices and with
such other appropriate omissions, variations and insertions,
all as may be determined by the Board of Directors. Until
exchanged for Debentures of the same series in definitive
form such Debentures in temporary form shall be entitled to
the benefits of this Indenture. The Company shall, without
unreasonable delay after the issue of Debentures in
temporary form, prepare, execute and deliver definitive
Debentures of the same series to the Trustee, and upon the
presentation and surrender of Debentures in temporary form,
the Trustee or the Authenticating Agent shall authenticate
and deliver, in exchange therefor, Debentures of the same
series in definitive form for the same aggregate principal
amount as the Debentures in temporary form surrendered.
Such exchange shall be made by the Company at its own
expense and without any charge therefor.
SECTION 2.9. Mutilated, destroyed, lost or stolen
Debentures. Upon receipt by the Company, the Trustee and
the Authenticating Agent of evidence satisfactory to them
that any Debenture of any series has been mutilated,
destroyed, lost or stolen, and upon receipt of indemnity
(and in case of a destroyed, lost or stolen Debenture, proof
of ownership) satisfactory to them, the Company shall, in
the case of a mutilated Debenture, and may in the case of a
lost, stolen or destroyed Debenture, execute, and thereupon
the Trustee or the Authenticating Agent shall authenticate
and deliver, a new Debenture of the same series of like
tenor bearing a serial number not contemporaneously
outstanding (bearing such notation, if any, as may be
required by the rules of any stock exchange upon which the
Debentures of the same series are listed or are to
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be listed), in exchange and substitution for, and upon
surrender and cancellation of, the mutilated Debenture, or
in lieu of and in substitution for the Debenture so
destroyed, lost or stolen; or, if any mutilated, destroyed,
lost or stolen Debenture of any series shall have matured or
be about to mature, instead of issuing a new Debenture, the
Company, upon written notice to the Trustee or the
Authenticating Agent, may pay the same without surrender of
the destroyed, lost or stolen Debenture. The Company may
require payment of the expenses which may be incurred by the
Company or any agent thereof and the charges and expenses of
the Trustee and the Authenticating Agent in the premises.
Any Debenture issued under the provisions of this Section
2.9 in lieu of any Debenture alleged to have been destroyed,
lost or stolen, shall constitute an additional contractual
obligation of the Company, whether or not the Debenture
alleged to have been destroyed, lost or stolen shall be
found at any time, and shall be equally and proportionately
entitled to the benefits of this Indenture with all other
Debentures of the same series issued under this Indenture.
All Debentures shall be held and owned upon the express
condition that the foregoing provisions are exclusive with
respect to the replacement or payment of mutilated,
destroyed, lost or stolen Debentures, and shall preclude, to
the extent lawful, any and all other rights or remedies,
notwithstanding any law or statute existing or hereafter
enacted to the contrary with respect to the replacement or
payment of negotiable instruments or other securities
without their surrender.
SECTION 2.10. Exchanges of Debentures. Debentures of
any series may, upon surrender thereof as hereinafter
provided in this Section 2.10, be exchanged for one or more
Debentures of the same series of the same aggregate
principal amount, in authorized denominations. The
Debentures to be exchanged shall be surrendered at the
office or agency of the Company to be maintained by it as
provided in Section 4.2, accompanied by duly executed
instruments of transfer in a form acceptable to the Company
and the Trustee, and the Company shall execute and the
Trustee or the Authenticating Agent shall authenticate and
deliver, in exchange therefor, the Debenture or Debentures
of the same series, bearing numbers not contemporaneously
outstanding, which the Debentureholder making the exchange
shall be entitled to receive. Every exchange of Debentures
of any series shall be effected in such manner as may be
prescribed by the Company with the approval of the Trustee,
and as may be necessary to comply with the regulations of
any stock exchange upon which Debentures of such series are
listed or are to be listed or to conform to usage in respect
thereof.
Upon every exchange or registration of transfer of
Debentures, no service charge shall be made but the Company
may require the payment of any taxes or other governmental
charges required to be paid with respect to such exchange or
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registration, as a condition precedent to the exercise of
the privilege of such exchange or registration.
All Debentures executed, authenticated and delivered in
exchange or upon registration of transfer shall be the valid
obligations of the Company, evidencing the same debt as the
Debentures surrendered, and shall be entitled to the
benefits of this Indenture to the same extent as the
Debentures in exchange for which they were authenticated and
delivered.
The Company shall not be required to make exchanges or
registrations of transfer under any provision of this
Article II of: (a) the Debentures of any series for the
period of 15 days next preceding the date of any designation
of Debentures of such series to be redeemed, as provided in
Article V, or (b) any Debenture or portion thereof called or
to be called for redemption.
SECTION 2.11. Cancellation of Surrendered
Debentures. All Debentures of any series surrendered for
the purpose of payment, exchange, conversion or cancellation
(including Debentures authenticated which the Company has
not issued and sold) shall, if surrendered to the Company
or any Paying Agent or conversion agent, be delivered to the
Trustee and cancelled by it, or, if surrendered to the
Trustee, shall be cancelled by it, and no Debentures shall
be issued in lieu thereof except as expressly permitted by
any of the provisions of this Indenture or as otherwise
provided in the resolution of the Board of Directors or
indenture supplemental hereto establishing such series as
contemplated by Section 2.2. All Debentures of any series
surrendered for the purpose of redemption or credit against
any sinking fund shall similarly be delivered to the Trustee
for cancellation, and no Debentures shall be issued in lieu
thereof except Debentures of the same series in the case of
redemption of a Debenture in part only. If the Company
shall acquire any of the Debentures, such acquisition shall
not operate as a redemption or satisfaction of the
indebtedness represented by such Debentures unless and until
the same are delivered to the Trustee for cancellation.
Unless otherwise directed in writing by the Company, the
Trustee shall destroy all cancelled Debentures and furnish
to the Company a certificate evidencing such destruction.
SECTION 2.12. Payment of interest; Defaulted
interest. Except as provided in Section 13.4, interest
(except defaulted interest) on the Debentures of any series
which is payable on any interest payment date shall be paid
to the persons who are Debentureholders of such series at
the close of business on the record date specified for that
purpose as contemplated by Section 2.2. At the option of
the Company, payment of interest on any Debenture may be
made by check mailed to the holder's registered address.
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If the Company defaults in a payment of interest on the
Debentures of any series, it shall pay the defaulted
interest to the persons who are Debentureholders of such
series at the close of business on a subsequent special
record date. The Company shall fix the record date (which
shall be not less than five Business days prior to the date
of payment of such defaulted interest) and payment date. At
least 15 days before the record date, the Company shall mail
to each Debentureholder of such series a notice that states
the record date, the payment date and the amount of
defaulted interest to be paid. The Company shall notify the
Trustee in writing of the amount of defaulted interest
proposed to be paid on each Debenture of such series and the
date of the proposed payment, and at the same time the
Company shall deposit with the Trustee or any paying agent
for such series an amount of money in immediately available
funds by 10:00 a.m. New York time on the payment date equal
to the aggregate amount proposed to be paid in respect of
such defaulted interest or shall make arrangements
satisfactory to any Paying Agent for such series for such
deposit prior to the date of the proposed payment. The
Company may pay defaulted interest in any other lawful
manner not inconsistent with the requirements of any
securities exchange on which the Debenture may be listed,
and upon 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 payment shall
be deemed practicable by the Trustee.
SECTION 2.13. Global Debentures; Depositary. For
the purposes of this Section, the term "Agent Member" means
a member of, or participant in, a Depositary; the term
"Depositary" means, with respect to Debentures issuable or
issued in whole or in part in the form of one or more Global
Debentures, the entity designated as Depositary by the
Company pursuant to Section 2.2, and, if at any time there
is more than one such person, "Depositary" as used with
respect to the Debentures shall mean the respective
Depositary with respect to particular series of Debentures;
and the term "Global Debenture" means a global certificate
evidencing all or part of the series of Debentures as shall
be specified herein, issued to the Depositary for the series
or such portion of the series, and registered in the name of
such Depositary or its nominee. The Global Debenture may
provide that it shall represent the aggregate amount of
Outstanding Debentures from time to time endorsed thereon
which may from time to time be reduced to reflect exchanges.
Any endorsement to reflect the amount, or any increase or
decrease in the amount, of Outstanding Debentures shall be
made by the Trustee.
Notwithstanding Section 2.10, except as otherwise
specified as contemplated by Section 2.2., hereof, any
Global Debenture shall be exchangeable only as provided in
this paragraph. A Global Debenture shall be exchangeable
pursuant to this Section 2.13 if (i) the Depositary notifies
the Company that it is
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unwilling or unable to continue as Depositary for such
Global Debenture or if at any time the Depositary ceases to
be a clearing agency registered under the Securities
Exchange Act, (ii) the Company in its sole discretion
determines that all Global Debentures of any series then
outstanding under the Indenture shall be exchangeable for
definitive Debentures of such series in registered form or
(iii) an Event of Default with respect to the Debentures of
the series represented by such Global Debenture has occurred
and is continuing. Any Global Debenture of such series
exchangeable pursuant to the preceding sentence shall be
exchangeable for definitive Debentures of such series in
registered form, bearing interest (if any) at the same rate
or pursuant to the same formula, having the same date of
issuance, redemption, conversion (if any) and other
provisions, and of differing denominations aggregating a
like amount. Such definitive Debentures of such series
shall be registered in the names of the owners of the
beneficial interests in such Global Debentures of such
series as such names are from time to time provided by the
relevant participants in the Depositary holding such Global
Debentures (as such participants are identified from time to
time by such Depositary).
No Global Debenture may be transferred except as a
whole by a nominee of the Depositary to the Depositary or
another nominee of the Depositary or by the Depositary or
any such nominee or a successor of the Depositary or a
nominee of such successor. Except as provided above, owners
solely of beneficial interests in a Global Debenture shall
not be entitled to receive physical delivery of Debentures
of such series in definitive form and will not be considered
the Debentureholders thereof for any purpose under this
Indenture.
Any Global Debenture that is exchangeable pursuant to
the preceding paragraph shall be exchangeable for Debentures
of such series in authorized denominations and registered in
such names as the Depositary that is the Debentureholder of
such Global Debentures of such series shall direct.
In the event that a Global Debenture is surrendered for
redemption in part pursuant to Section 5.2 or 5.5, the
Company shall execute, and the Trustee or the Authenticating
Agent shall authenticate and delivery to the Depositary for
such Global Debenture, without service charge, a new Global
Debenture in a denomination and tenor equal to and in
exchange for the unredeemed portion of the principal for the
Global Debenture so surrendered.
The Agent Members shall have no rights under this
Indenture with respect to any Global Debenture held on their
behalf by a Depositary, and such Depositary may be treated
by the Company, the Trustee, and any agent of the Company or
the Trustee as the owner of such Global Debenture for all
purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent the
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Company, the Trustee, or any agent of the Company or the
Trustee, from giving effect to any written certification,
proxy or other authorization furnished by a Depositary or
impair, as between a Depositary and its Agent Members, the
operation of customary practices governing the exercise of
the rights of a holder of a Debenture of any series,
including without limitation the granting of proxies or
other authorization of participants to give or take any
request, demand, authorization, direction, notice, consent,
waiver or other action which a Debentureholder is entitled
to give or take under the Indenture.
The Trustee shall not be required to authenticate
Global Debentures until it has received documentation
satisfactory to it.
ARTICLE III
SUBORDINATION OF DEBENTURES
SECTION 3.1. Debentures subordinated to Senior
Indebtedness. The Company covenants and agrees, and each
holder of Debentures by his acceptance thereof, whether upon
original issue or upon registration of transfer or
assignment, likewise covenants and agrees, that the payment
of the principal of, premium, if any, and interest on each
and all of the Debentures is hereby expressly subordinated,
to the extent and in the manner hereinafter set forth, in
right of payment to the prior payment in full of all Senior
Indebtedness.
SECTION 3.2. Payment over of proceeds of
Debentures on dissolution, etc. Upon any payment or
distribution of assets of the Company of any kind or
character, whether in cash, property or securities, upon any
dissolution or winding up or total or partial liquidation or
reorganization of the Company, whether voluntary or
involuntary, in bankruptcy, insolvency or receivership, or
upon an assignment for the benefit of creditors or any other
marshalling of the assets and liabilities of the Company or
otherwise,
(a) all principal of, premium, if any, and
interest then due upon all Senior Indebtedness shall
first be paid in full, or payment thereof provided for
in money or money's worth, before the holders of the
Debentures or the Trustee on their behalf shall be
entitled to receive any assets (other than shares of
stock of the Company as reorganized or readjusted, or
securities of the Company or any other corporation
provided for by a plan of reorganization or
readjustment, junior to, or the payment of which is
subordinated at least to the extent provided in this
Article III to the payment of all Senior Indebtedness
which may at the time be outstanding or to any
securities issued in respect thereof under any such
plan of reorganization or readjustment) in respect of
the Debentures (for principal, premium, if any, or
interest) or of this Indenture;
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(b) any payment or distribution of assets of
the Company of any kind or character, whether in cash,
property or securities (other than shares of stock of
the Company as reorganized or readjusted, or securities
of the Company or any other corporation provided for by
a plan of reorganization of readjustment, junior to, or
the payment of which is subordinated at least to the
extent provided in this Article III to the payment of,
all Senior Indebtedness which may at the time be
outstanding or to any securities issued in respect
thereof under any such plan of reorganization or
readjustment), to which the holders of the Debentures
or the Trustee on their behalf would be entitled,
except for the provisions of this Article III, shall be
made by the Company or by any receiver, trustee in
bankruptcy, liquidating trustee, agent or other person
making such payment or distribution, directly to the
holders of Senior Indebtedness or their representatives
to the extent necessary to pay all Senior Indebtedness
in full after giving effect to any concurrent payment
or distribution to or for the holders of Senior
Indebtedness; and
(c) in the event that, notwithstanding the
foregoing, the Trustee or the holder of any Debenture
shall have received any payment or distribution of
assets of the Company of any kind or character, whether
in cash, property or securities (other than shares of
stock of the Company as reorganized or readjusted, or
securities of the Company or any other corporation
provided for by a plan of reorganization or
readjustment, junior to, or the payment of which is
subordinated at least to the extent provided in this
Article III to the payment of, all Senior Indebtedness
which may at the time be outstanding or to any
securities issued in respect thereof under any such
plan of reorganization or readjustment), before all
Senior Indebtedness is paid in full and if such fact
shall have been made known to the Trustee or such
Debentureholder, then and in such event such payment or
distribution of assets of the Company shall be paid
over or delivered forthwith to the receiver, trustee in
bankruptcy, liquidating trustee, agent or other person
making payment or distribution of assets of the Company
for application to the payment of all Senior
Indebtedness remaining unpaid to the extent necessary
to pay all Senior Indebtedness in full, in money or
money's worth, after giving effect to any concurrent
payment or distribution to or for the holders of Senior
Indebtedness.
The consolidation or merger of the Company with or into
another corporation, or any consolidation or merger of any
other corporation with or into the Company, or the
liquidation or dissolution of the Company following the
sale, transfer or lease of substantially all of the property
and assets of the Company to another corporation shall not
be deemed a dissolution, winding-up
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or total or partial liquidation or reorganization of the
Company or an assignment or other marshalling of the assets
and liabilities of the Company for purposes of this Section
3.2 so long as such other corporation shall, as a part of
any such consolidation, merger, sale, conveyance or lease
comply with the conditions stated in Article X.
Subject to the payment in full, in money or money's
worth, of all Senior Indebtedness, the rights of the holders
of the Debentures shall be subrogated to the rights of the
holders of Senior Indebtedness to receive payments or
distributions of assets of the Company applicable to Senior
Indebtedness until the Debentures shall be paid in full, and
no such payments or distributions to the Debentureholders of
cash, properties or securities otherwise distributable to
holders of Senior Indebtedness shall, as between the
Company, its creditors, other than the holders of Senior
Indebtedness, and the holders of the Debentures, be deemed
to be a payment by the Company to or on account of the
Debentures, it being understood that the provisions of this
Article III are and are intended solely for the purpose of
defining the relative rights of the holders of the
Debentures, on the one hand, and the holders of Senior
Indebtedness, on the other hand. Nothing contained in this
Article III or elsewhere in this Indenture or in the
Debentures is intended to or shall alter or impair, as
between the Company and the holders of Debentures, the
obligation of the Company, which is unconditional and
absolute, to pay to the holders of the Debentures the
principal of, premium, if any, and interest on the
Debentures as and when the same shall become due and payable
in accordance with their terms, or is intended to or shall
affect (except to the extent specifically provided by this
paragraph) the relative rights of the holders of the
Debentures and creditors of the Company, other than the
holders of Senior Indebtedness, nor shall anything herein or
therein prevent the Trustee or the holder of any Debenture
from exercising all remedies otherwise permitted by
applicable law upon an Event of Default under this
Indenture, subject to the rights, if any, under this Article
III, of the holders of Senior Indebtedness in respect of
assets of the Company of any kind or character, whether
cash, property or securities, received upon the exercise of
any such remedy.
The Company shall give prompt written notice to a
Responsible Officer of the Trustee of any dissolution,
winding up, liquidation, or reorganization of the Company
within the meaning of this Section 3.2. The Trustee shall
be entitled to assume that no such event has occurred unless
the Company has given such written notice. Upon any payment
or distribution of assets of the Company referred to in this
Article III, the Trustee and the holders of the Debentures
shall be entitled to rely upon any order or decree of a
court of competent jurisdiction in which such dissolution,
winding up, liquidation or reorganization proceedings are
pending, and upon a certificate of the receiver,
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trustee in bankruptcy, liquidating trustee, agent or other
person making any such payment or distribution, delivered to
the Trustee or to the holders of the Debentures, for the
purpose of ascertaining the persons entitled to participate
in such distribution, the holders of Senior Indebtedness and
other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this
Article III.
In the event that the Trustee determines, in good
faith, that further evidence is required with respect to the
right of any person as a holder of Senior Indebtedness to
participate in any payment or distribution pursuant to this
Section 3.2, the Trustee may request such person or
representative thereof to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior
Indebtedness held by such person, the extent to which such
person is entitled to participate in such payment or
distribution, and other facts pertinent to the rights of
such person under this Section 3.2. If such evidence is not
furnished, the Trustee may defer any payment to such person
or such representative pending judicial determination as to
the right of such person to receive such payment.
No payment on account of the principal of, premium, if
any, or interest on the Debentures shall be made, if, at the
time of such payment or immediately after giving effect
thereto, there shall exist a default in the payment of the
principal of, premium, if any, or interest on any Senior
Indebtedness (whether at expressed maturity, acceleration
thereof or otherwise), unless and until such default shall
have been cured or waived or shall have ceased to exist;
provided, however, that, notwithstanding the foregoing, the
following shall be permitted: payments made in Capital Stock
or in warrants, rights or options to purchase or acquire
Capital Stock, payments made on account of any sinking fund
and made in Debentures owned by the Company or any
subsidiary prior to the time such default shall have
occurred and payments made through the exchange of other
debt obligations of the Company for such Debentures in
accordance with the terms of such Debentures, provided that
such debt obligations are subordinated to Senior
Indebtedness at least to the extent that the Debentures for
which they are exchanged are so subordinated pursuant to
this Article III.
If any Event of Default described in Section 7.1 occurs
(under the circumstances when the provisions of the first
paragraph of this Section 3.2 shall not be applicable) and
as a result the Debentures then Outstanding of any series
are declared due and payable, and such declaration has not
been rescinded or annulled, all principal and premium, if
any, of all Senior Indebtedness then due, or thereafter
declared to be due, pursuant to the terms of said Senior
Indebtedness, within 90 days from notice of said Event of
Default given by the Company to holders of Senior
Indebtedness, and all interest then due upon Senior
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Indebtedness, shall first be paid in full before any payment
is made on account of the principal, premium, if any, or
interest on any Debenture.
Nothing in this Section 3.2 shall apply to claims of,
or payments to, the Trustee pursuant to Section 11.2.
SECTION 3.3. Debentures may be paid prior to
dissolution, etc. Nothing contained in this Article III or
elsewhere in this Indenture, or in any of the Debentures,
shall prevent (a) the Company, at any time except under the
conditions described in Section 3.2 hereof or during the
pendency of any dissolution or winding up or total or
partial liquidation or reorganization proceedings therein
referred to, from making payments at any time of principal
of, premium, if any, or interest on the Debentures or from
depositing with the Trustee or any Paying Agent moneys for
such payments, (b) the application by the Trustee or any
Paying Agent of any moneys deposited with it under this
Indenture to the payment of or on account of the principal
of, premium, if any, or interest on the Debentures to the
Debentureholders entitled thereto, provided that such
payment was not, to the actual knowledge of the Trustee or
any Paying Agent, prohibited by the provisions of Section
3.2 on the date such moneys were so deposited, or (c) the
retention by the holders of Debentures of moneys so applied
and paid to them on account of the principal of, premium, if
any, or interest on the Debentures, whether or not at the
time of application described in clause (b) or payment
described in this clause (c), payment of the principal of,
premium, if any, or interest on the Debentures would then be
precluded pursuant to Section 3.2.
Notwithstanding the provisions of Section 3.1 or any
other provision of this Indenture, the Trustee and any
Paying Agent shall not be charged with knowledge of the
existence of any Senior Indebtedness, or of the occurrence
of any default with respect to Senior Indebtedness of the
character described in Section 3.2, or of any other facts
which would prohibit the making of any payment of moneys to
or by the Trustee or such payment agent, unless and until a
Responsible Officer of the Trustee and the Paying Agent
shall have received written notice thereof at its principal
office from the Company or from a person the Trustee and the
Paying Agent reasonably believes to be a holder of such
Senior Indebtedness stating that facts exist prohibiting the
making of such payment or specifying such facts, and, prior
to the receipt of any such written notice by a Responsible
Officer of the Trustee, the Trustee or the Paying Agent
shall be entitled in all respects to assume that no such
facts exist; provided, that, if two Business days prior to
the date upon which by the terms hereof any such moneys may
become payable for any purpose (including, without
limitation, the payment of the principal of, premium, if
any, or interest on any Debenture) the Trustee or such
Paying Agent shall not have received with respect to such
moneys the notice provided for in
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this Section 3.3, then, anything herein contained to the
contrary notwithstanding, the Trustee and such Paying Agent
shall have full power and authority to receive such moneys
and are directed to apply the same to the purpose for which
they were received, and shall not be affected by any notice
to the contrary which may be received by it after such date.
SECTION 3.4. Rights of holders of Senior
Indebtedness not to be impaired, etc. No right of any
present or future holder of any Senior Indebtedness of the
Company to enforce subordination as herein provided shall at
any time in any way be prejudiced or impaired by any act or
failure to act on the part of the Company or by any act or
failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms, provisions and
covenants of this Indenture, regardless of any knowledge
thereof any such holder may have or be otherwise charged
with.
The provisions of this Article III are intended to be
for the benefit of, and shall be enforceable directly by,
the holders of Senior Indebtedness. Neither the Trustee nor
any Paying Agent shall be deemed to owe any fiduciary duty
to the holders of Senior Indebtedness and shall not be
liable to any such holder if any of them shall mistakenly
pay over or distribute to the holders of the Debentures, the
Company or any other person, money or assets to which the
holders of Senior Indebtedness shall be entitled by virtue
of this Article III or otherwise. With respect to the
holders of Senior Indebtedness, the Trustee undertakes to
perform and observe only such covenants and obligations as
are specifically set forth in this Article III and no
implied covenants and obligations with respect to such
holders of Senior Indebtedness should be read into this
Indenture against the Trustee.
SECTION 3.5. Authorization to Trustee to take
action to effectuate subordination. Each holder of a
Debenture of any series by his acceptance thereof authorizes
the Trustee and the Paying Agent on his behalf to take such
action as may be necessary or appropriate to effectuate as
between the Debentureholders of such series and the holders
of Senior Debentures the subordination provided in this
Article III and appoints the Trustee his attorney-in-fact
for any and all such purposes.
SECTION 3.6. Trustee's rights as holder of Senior
Indebtedness. The Trustee shall be entitled to all the
rights set forth in this Article III with respect to any
Senior Indebtedness at any time held by it, to the same
extent as any other holder of Senior Indebtedness, and
nothing in Section 11.9 or elsewhere in this Indenture shall
be construed to deprive the Trustee of any of its rights as
such holder.
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SECTION 3.7. Trustee's disclaimer. The Trustee
makes no representations as to the validity or adequacy of
this Indenture or the Debentures, it shall not be
accountable for the Company's use of proceeds from the
Debentures, and it shall not be responsible for any
statement in any Debentures other than its authentication.
SECTION 3.8. Application by Trustee of monies or
U.S. Government Obligations deposited with it. Money or
U.S. Government Obligations deposited in trust with the
Trustee pursuant to and in accordance with Section 6.1 shall
be for the sole benefit of Debentureholders and, to the
extent allocated for the payment of Debentures, shall not be
subject to the subordination provisions of this Article III,
if the same are deposited in trust prior to the happening of
any event specified in Section 3.2. Otherwise, any deposit
of moneys or U.S. Government Obligations by the Company with
the Trustee or any Paying Agent (whether or not in trust)
for the payment of the principal of, premium, if any, or
interest on any Debentures shall be subject to the
provisions of Sections 3.1 and 3.2 except that, if prior to
the date on which by the terms of this Indenture any such
monies may become payable for any purpose (including,
without limitation, the payment of the principal of,
premium, if any, or interest on any Debenture) the Trustee
shall not have received with respect to such moneys the
notice provided for in Section 3.3, then the Trustee or the
Paying Agent shall have full power and authority to receive
such moneys and U.S. Government Obligations and to apply the
same to the purpose for which they were received, and shall
not be affected by any notice to the contrary which may be
received by it on or after such date. This Section 3.8
shall be construed solely for the benefit of the Trustee and
Paying Agent and, as to the first sentence hereof, the
Debentureholders, and shall not otherwise affect the rights
of holders of Senior Indebtedness.
SECTION 3.9. Trustee Compensation not prejudiced.
Nothing in this Article III shall apply to claims of or
payment to the Trustee pursuant to Section 11.2.
ARTICLE IV
COVENANTS OF THE COMPANY
The Company covenants and agrees as follows:
SECTION 4.1 Payment of Principal and interest. The
Company will for the benefit of each series of Debentures
duly and punctually pay or cause to be paid the principal
of, premium, if any, and interest on the Debentures of such
series at the times
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and place and in the manner specified in this Indenture and
in the Debentures of such series. At the option of the
Company, interest on the Debentures shall be payable without
presentation of such Debentures by a check to the registered
holder.
SECTION 4.2 Maintenance of office or agency. So long
as any of the Debentures of any series remain unpaid, the
Company will at all times keep an office or agency in where
Debentures of such series may be presented for registration
of transfer and exchange as in this Indenture provided,
where notices and demands with respect to the Debentures and
this Indenture may be served and where the Debentures may be
presented for payment or, for Debentures of each series that
is convertible, for conversion. The principal office of the
Trustee shall be the office or agency for all of the
aforesaid purposes, unless the Company shall maintain some
other office or agency with respect to the Debentures of any
series for such purposes and shall give the Trustee written
notice of the location thereof. In case the Company shall
fail to maintain such office or agency, presentations may be
made and notices and demands may be served at the principal
office of the Trustee.
The Company shall keep, at said office or agency, a
register or registers in which, subject to such reasonable
regulations as it may prescribe, the Company shall register
or cause to be registered Debentures of each series and
shall register or cause to be registered the transfer or
exchange of Debentures of each series as in Article II
provided. Such register or registers shall be in written
form in the English language or any other form capable of
being converted into written form within a reasonable time.
At all reasonable times, such register or registers shall be
open for inspection by the Trustee.
SECTION 4.3 Corporate existence. So long as any of
the Debentures remain unpaid, the Company will at all times
(except as otherwise provided or permitted elsewhere in this
Indenture) do or cause to be done all things necessary to
preserve and keep in full force and effect its corporate
existence.
SECTION 4.4 Restrictions on mergers, sales and
consolidations. So long as any of the Debentures remain
unpaid, the Company will not consolidate or merge with or
sell, convey or lease all or substantially all of its
property to any other corporation except as permitted in
Article X hereof.
SECTION 4.5 Further assurances. From time to time
whenever requested by the Trustee, the Company will execute
and deliver such further instruments and assurances and do
such further acts as may be reasonably necessary or proper
to carry out more effectually the purposes of this Indenture
or to secure the rights and remedies hereunder of the
holders of the Debentures of any series.
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SECTION 4.6 File certain reports and information with
the Trustee and the Securities and Exchange Commission -
transmit to Debentureholders summaries of certain documents
filed with the Trustee - furnish list of Debentureholders to
the Trustee. The Company will:
(a) file with the Trustee, within 15 days after
the Company files the same with the Securities and
Exchange Commission, copies of the annual reports and
of the information, documents and other reports which
the Company may be required to file with the Securities
and Exchange Commission pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934
(or copies of such portions thereof as may be
prescribed by the Securities and Exchange Commission);
or, if the Company is not required to file with the
Securities and Exchange Commission information,
documents or reports pursuant to either Section 13 or
Section 15(d) of the Securities Exchange Act of 1934,
then the Company will file with the Trustee and will
file with the Securities and Exchange Commission, in
accordance with rules and regulations prescribed by the
Securities and Exchange Commission, such of the
supplementary and periodic information, documents and
reports required pursuant to Section 13 of the
Securities Exchange Act of 1934 in respect of a
security listed and registered on a national securities
exchange as may be prescribed in such rules and
regulations;
(b) file with the Trustee and the Securities and
Exchange Commission, in accordance with the rules and
regulations prescribed from time to time by the
Securities and Exchange Commission, such additional
information, documents and reports with respect to
compliance by the Company with the conditions and
covenants provided for in this Indenture as may be
required by such rules and regulations;
(c) transmit to the Debentureholders, in the
manner and to the extent provided in subdivision (c) of
Section 11.10, such summaries of any information,
documents and reports required to be filed with the
Trustee pursuant to the provisions of subdivisions (a)
and (b) of this Section 4.6 as may be required by the
rules and regulations of the Securities and Exchange
Commission; and
(d) furnish or cause to be furnished to the
Trustee, not more than 15 days after each record date
(but in no event less frequently than every six months)
for the payment of interest with respect to Debentures
of any series, and at such other times as the Trustee
may request in writing, within 30 days after receipt by
the Company of any such request, a list in such form as
the Trustee may reasonably require containing all
information in the possession or control of the Company
or of any paying agent, other than the
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Trustee, as to the names and addresses of the holders
of Debentures of such series obtained since the date as
of which the next previous list, if any, was furnished;
provided, that so long as the Trustee is Debenture
registrar for such series, no such list need be
furnished. Any such list may be dated as of a date not
more than 15 days prior to the time such information is
furnished or caused to be furnished, and need not
include information received after such date (excluding
from any such list names and addresses received by the
Trustee in its capacity as Debenture registrar).
SECTION 4.7 File statement by officers annually with
the Trustee. Within 120 days after the close of the fiscal
year ending and within 120 days after
the close of each fiscal year thereafter, the Company will
file with the Trustee a brief certificate from the principal
executive officer, principal financial officer or principal
accounting officer as to his or her knowledge of the
Company's compliance with all conditions and covenants under
this Indenture. For purposes of this paragraph, such
compliance shall be determined without regard to any period
of grace or requirement of notice provided under this
Indenture.
At the time such Officers' Certificate is filed, the
Company will also file with the Trustee a letter or
statement of the independent accountants who shall have
certified the financial statements of the Company for its
preceding fiscal year in connection with the annual report
of the Company to its shareholders for such year to the
effect that, in making the examination necessary for
certification of such financial statements, they have
obtained no knowledge of any default by the Company in the
performance or fulfillment of any covenant, agreement or
condition contained in this Indenture, which default remains
uncured at the date of such letter or statement, or, if they
shall have obtained knowledge of any such uncured default,
specifying in such letter or statement such default or
defaults and the nature and status thereof, it being
understood that such accountants shall not be liable
directly or indirectly for failure to obtain knowledge of
any such default or defaults, and that nothing contained in
this Section 4.7 shall be construed to require such
accountants to make any investigation beyond the scope
required in connection with such examination.
SECTION 4.8 Duties of Paying Agent. The Company will
cause each Paying Agent for the Debentures of any series
other than the Trustee to execute and deliver to the Trustee
an instrument in which such agent shall agree with the
Trustee:
(a) that it will hold all sums held by it as
such agent for the payment of the principal of,
premium, if any, or interest on the Debentures of such
series (whether such sums have been paid to it by the
Company or by any other obligor on the Debentures of
such series) in trust for the benefit of
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the holders of the Debentures of such series;
(b) that it will give the Trustee written notice
of any failure by the Company (or by any other obligor
on the Debentures of such series) to make any payment
of the principal of, premium, if any, or interest on
the Debentures of such series when the same shall be
due and payable; and
(c) that it will, at any time during the
continuance of any Event of Default with respect to
such series, upon the written request of the Trustee,
forthwith pay to the Trustee all sums so held in trust
by such Paying Agent.
If the Company acts as its own paying Agent for the
Debentures of any series, it will, on or before each due
date of the principal of, premium, if any, or interest on
the Debentures of such series, set aside and segregate and
hold in trust for the benefit of the holders of the
Debentures of such series a sum sufficient to pay such
principal, premium, if any, or interest and will notify the
Trustee of such action or any failure to take such action.
Whenever the Company shall have one or more Paying
Agents for any series of Debentures, it will, on or before
each due date of the principal of, premium, if any, or
interest on any Debentures of such series, deposit with the
Paying Agent or Agents for the Debentures of such series a
sum, by 10:00 a.m. New York time in immediately available
funds on the payment date, sufficient to pay the principal,
premium, if any, or interest so becoming due with respect to
the Debentures of such series, and (unless such paying agent
is the Trustee) the Company will promptly notify the Trustee
in writing of any failure so to act.
The Company may at any time, for the purpose of
obtaining the satisfaction and discharge of this Indenture
with respect to the Debentures of one or more series or for
any other purpose, pay, or by Company order direct any
Paying Agent for such series to pay, to the Trustee all sums
held in trust by the Company or such Paying Agent, such sums
to be held by the Trustee upon the same trusts as those upon
which such sums were held by the Company or such Paying
Agent; and, upon such payment by any Paying Agent to the
Trustee, such Paying Agent shall be released from all
further liability with respect to such payment.
Anything in this Section 4.8 to the contrary
notwithstanding, the agreement to hold sums in trust as
provided in this Section 4.8 shall be subject to the
provisions of Section 6.3.
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ARTICLE V
REDEMPTION OF DEBENTURES; SINKING FUND
SECTION 5.1 Applicability of Article. Debentures of
any series which are redeemable before their stated maturity
at the election of the Company or through the operation of
any sinking fund for the retirement of Debentures of such
series shall be redeemable in accordance with their terms
established pursuant to Section 2.2 and (except as otherwise
established pursuant to Section 2.2 for Debentures of such
series) in accordance with this Article.
SECTION 5.2 Notice of redemption to be given to
Trustee - deposit of cash (or other form of payment) with
Trustee - selection by Trustee of Debentures to be redeemed.
Not less than 30 days (or such lesser number of days as the
Trustee shall approve) nor more than 60 days (or such
greater number of days as the Trustee shall approve) prior
to the date fixed by the Company for the redemption at the
option of the Company of any Debentures of any series which
are subject to redemption or portions thereof, the Company
shall give written notice, by delivering a Company Order to
the Trustee, stating the aggregate principal amount of
Debentures of such series which the Company elects to redeem
and the date and place fixed for redemption, that the
Company, in the case of any redemption of Debentures subject
to any restrictions on such redemption provided in the terms
of Debentures of such series established pursuant to Section
2.2 or elsewhere in this Indenture, is in compliance with
such restrictions. On or before 10:00 a.m. New York time of
the date fixed for redemption, the Company shall deposit
with the Trustee or the Paying Agent money in immediately
available funds on such redemption date (or other form of
payment if permitted by the terms of such Debentures) an
amount sufficient to redeem on the date fixed for redemption
all the Debentures of such series or portions thereof to be
redeemed, other than any Debentures of such series called
for redemption on such date which have been converted prior
to the date of such deposit, at the appropriate redemption
price, together with any accrued interest to the date fixed
for redemption. If less than all the Debentures then
Outstanding of such series are to be redeemed, the Trustee
shall select, substantially pro rata or by lot, in such
manner as it shall deem appropriate and fair, in its sole
discretion, the numbers of the Debentures to be redeemed as
a whole or in part, and shall thereafter promptly notify the
Company in writing of the numbers of the Debentures to be
redeemed; provided, however, that Debentures of such series
registered in the name of the Company shall be excluded from
any such selection for redemption until all Debentures of
such series not so registered shall have been previously
selected for redemption. For the purpose of such selection
in case of redemption of less than all of the Debentures of
any series, the Trustee and the Company shall have the
option to treat as Outstanding Debentures any Debentures of
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such series which are surrendered for conversion after the
fifteenth day immediately preceding the mailing of the
notice of such redemption, and need not treat as Outstanding
Debentures any Debentures authenticated and delivered during
such period in exchange for the unconverted portion of any
Debentures converted in part during such period. In case
any Debenture shall be redeemed in part only, the notice of
redemption shall specify the principal amount thereof to be
redeemed and shall state that, upon surrender thereof for
redemption, a new Debenture or new Debentures of the same
series of an aggregate principal amount equal to the
unredeemed portion of such Debenture will be issued in lieu
thereof; and in such case the Company shall execute and the
Trustee or the Authenticating Agent shall authenticate and
deliver such new Debenture or Debentures of such series to
or upon the written order of the Debentureholder, at the
expense of the Company. Provisions of this Indenture that
apply to Debentures called for redemption also apply to
portions of Debentures called for redemption.
Upon or after the receipt of such notice, the Trustee,
in the name of the Company and as its agent, shall mail by
first-class mail, postage prepaid, to each registered holder
of a Debenture to be redeemed in whole or in part at his
last address appearing on the registration books of the
Company, a notice of redemption. Such notice of redemption
shall identify the Debentures to be so redeemed in whole or
in part and whether such Debentures are to be redeemed in
whole or in part and shall state: (i) the date fixed for
redemption; (ii) the redemption price at which Debentures
are to be redeemed and method of payment, if other than in
cash; (iii) if applicable, the current conversion price or
rate; (iv) if applicable, that the right of the
Debentureholder to convert Debentures called for redemption
shall terminate at the close of business on the date fixed
for redemption (or such other day as may be specified as
contemplated by Section 2.2 for Debentures of any series);
(v) if applicable, that Debentureholders who want to convert
Debentures called for redemption must satisfy the
requirements for conversion contained in such Debentures;
(vi) that, subject to Section 13.4, interest, if any,
accrued to the date fixed for redemption will be paid as
specified in said notice and that on and after said date
interest thereon shall cease to accrue; (vii) the provision
of the Debenture or this Indenture under which the
redemption is being made; and (viii) that the Company so
elects to redeem such Debentures or portions thereof at the
place or places specified in such notice. Such notice shall
be mailed not later than the tenth, and not earlier than the
sixtieth, day before the date fixed for redemption. Any
notice which is mailed in the manner herein provided shall
be conclusively presumed to have been duly given, whether or
not the holder receives such notice; and failure duly to
give such notice by mail, or any defect in such notice, to
the holder of any Debenture designated for redemption as a
whole or in part shall not affect the validity of the
proceedings for the redemption of any other Debenture.
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The Company shall pay to the Trustee the cost of
mailing notices of redemption and any other necessary
expenses incurred by the Trustee in connection therewith.
SECTION 5.3. Debentures called for redemption to
become due - rights of holders of redeemed Debentures -
return of funds on conversion. The notice of election to
redeem having been mailed as hereinbefore provided, the
Debentures or portions thereof called for redemption shall
become due and payable on the redemption date at the
applicable redemption price, together with interest accrued
to the date fixed for redemption, at the place or places
specified in such notice, and if cash (or other form of
payment if permitted by the terms of such Debentures) in the
amount necessary to redeem such Debentures or portions
thereof has been deposited with the Trustee, interest on
such Debentures or portions thereof shall cease to accrue
from and after the date fixed for redemption (unless the
Company shall default in the payment of the redemption
price, plus accrued interest, if any) and the right to
convert such Debentures or portions thereof, if the terms of
such Debentures provide for conversion pursuant to Section
2.2, shall terminate at the close of business on the date
fixed for redemption or such other day as may be specified
as contemplated by Section 2.2 for Debentures of such
series. The respective registered holders of Debentures or
portions thereof so called for redemption shall be entitled
to receive payment of the applicable redemption price,
together with interest accrued to the date fixed for
redemption on or after the date fixed for redemption (unless
the Company shall default in the payment of the redemption
price, plus accrued interest, if any), upon presentation and
surrender at the place or places of payment specified in
such notice. Notwithstanding the foregoing, subject to
Section 13.4, if the record date for payment or interest is
on or prior to the redemption date, such interest shall be
payable to the persons who are holders of such Debentures on
such record date according to the terms of such Debentures
and Section 2.12.
If any Debenture called for redemption pursuant to
Section 5.1 is converted pursuant to Article XIII, any
monies deposited with the Trustee for the purpose of paying
or redeeming any such Debenture shall be promptly paid to
the Company.
SECTION 5.4 Credits against sinking fund. Against any
one or more sinking fund payments to be made pursuant to the
terms of the Debentures of any series providing for a
sinking fund, the Company may elect, by delivery of an
Officers' Certificate to the Trustee, at least 45 days prior
to the sinking fund payment date (or such shorter period as
may be acceptable to the Trustee or is otherwise specified
as contemplated by Section 2.2 for Debentures of any
series), to take credit for any Debentures of such series or
portions thereof acquired or redeemed by the Company,
pursuant to the terms of such Debentures or through the
application of permitted optional sinking fund payments
pursuant to the terms of
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such Debentures, which have not previously been used by the
Company for the purposes permitted in this Section 5.4 and
for any Debentures which have been converted pursuant to the
terms of such Debentures. Such Debentures shall be received
and credited for such purpose by the Trustee at the
redemption price specified in such Debentures for redemption
through operation of the sinking fund and the amount of such
sinking fund payment shall be reduced accordingly. Upon any
such election the Company shall receive credit against such
sinking fund payments required to be made in the order in
which they are to be made. Any Debenture for which credit is
elected to be taken which shall not theretofore have been
delivered to the Trustee for cancellation shall at the time
of such election be delivered to the Trustee for
cancellation by the Trustee.
SECTION 5.5 Redemption through sinking fund. Each
sinking fund payment made under the terms of the Debentures
of any series established pursuant to Section 2.2 shall be
applied to the redemption of Debentures of such series on
the date for redemption specified in the Debentures of such
series next succeeding such sinking fund payment date;
provided, however, if at any time the amount of cash to be
paid into the sinking fund for such series on the next
succeeding sinking fund payment date, together with any
unused balance of any preceding sinking fund payment or
payments for such series, shall not exceed in the aggregate
$10,000, the Trustee, unless requested by the Company, shall
not give notice of the redemption of Debentures of such
series through the operation of the sinking fund on the
succeeding date for redemption specified in the Debentures
of such series. At least 45 days (or such lesser number of
days as the Trustee shall approve) prior to the date on
which a sinking fund payment with respect to the Debentures
of any series is due, the Company shall give written notice
to the Trustee of the principal amount of Debentures of such
series registered in the name of the Company (which shall be
excluded from such redemption) and the Trustee shall select,
substantially pro rata or by lot, in such manner as it shall
deem appropriate and fair, the principal amount of
Debentures of such series to be redeemed in accordance with
the terms of the Debentures of such series after allowance
for any credit elected under Section 5.4 and shall, in the
name and at the expense of the Company and as its agent,
give notice of such redemption, all in the manner provided
for in Section 5.2, except that such notice shall state that
the Debentures of such series are being redeemed for the
sinking fund. The notice of redemption having been mailed
as hereinbefore provided, the Debentures or portions thereof
called for redemption shall become due and payable on the
next succeeding date for redemption specified in the
Debentures of such series at the sinking fund redemption
price thereof, all in the manner and with the effect
provided for in Section 5.3.
Any sinking fund payment not so required to be applied
to the redemption of Debentures of any series on the date
for redemption
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specified in the Debentures of such series next succeeding
any sinking fund payment date may, at the direction of the
Company as evidenced by a Company Order, be applied by the
Trustee prior to the forty-fifth day preceding the next
following sinking fund payment date for such series, in such
manner and from time to time, in such amount as the Company
may direct the Trustee in writing, so far as such moneys
shall be adequate, to the purchase for the sinking fund of
Debentures of such series or portions thereof, in the open
market, from the Company or otherwise, at prices (exclusive
of accrued interest and brokerage commissions) not in excess
of the sinking fund redemption price for such series. The
Company agrees to pay to the Trustee, upon request, accrued
interest and brokerage commissions paid by the Trustee with
respect to any Debentures of such series so purchased by the
Trustee and such accrued interest and brokerage commissions
shall not be charged against the sinking fund for such
series.
Any unused balance of sinking fund moneys with respect
to Debentures of any series remaining in the hands of the
Trustee on the forty-fifth day preceding the sinking fund
payment date for such series in any year shall be added to
any sinking fund payment for such series to be made in cash
in such year, and together with such payment, if any, shall
be applied to the redemption or purchase of Debentures of
such series in accordance with the provisions of this
Section 5.5, provided that any sinking fund moneys so
remaining in the hands of the Trustee after the date
specified in the Debentures of such series and not utilized
in the purchase of Debentures of such series as provided in
this Section 5.5 shall be applied by the Trustee to the
payment of Debentures at maturity.
SECTION 5.6 Debentures no longer Outstanding after
notice to Trustee and deposit of cash. If the Company,
having given notice to the Trustee as provided in Section
5.1 or 5.2, shall have deposited with the Trustee or the
Paying Agent, for the benefit of the holders of any
Debentures of any series or portions thereof called for
redemption in whole or in part cash or other form of payment
if permitted by the terms of such Debentures (which amount
shall be immediately due and payable to the holders of such
Debentures or portions thereof) in the amount necessary so
to redeem all such Debentures or portions thereof on the
date fixed for redemption and provision satisfactory to the
Trustee shall have been made for the giving of notice of
such redemption, such Debentures, or portions thereof, shall
thereupon, for all purposes of this Indenture, be deemed to
be no longer Outstanding, and the holders thereof shall be
entitled to no rights thereunder or hereunder, except the
right to receive payment of the applicable redemption price,
together with interest accrued to the date fixed for
redemption, on or after the date fixed for redemption of
such Debentures or portions thereof and the right to convert
such Debentures or portions thereof, if the terms of such
Debentures provide for convertibility pursuant to Section
2.2, at or prior to the close
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of business on the date fixed for redemption.
SECTION 5.7. Conversion arrangement on call for
redemption. In connection with any redemption of
Debentures, the Company may arrange for the purchase and
conversion of any Debentures called for redemption by an
agreement with one or more investment bankers or other
purchasers to purchase such Debentures by paying to the
Trustee or the Paying Agent in trust for the
Debentureholders, on or before 10:00 a.m., New York time, on
the redemption date, an amount no less than the redemption
price, together with interest, if any, accrued to the
redemption date of such Debentures, in immediately available
funds. Notwithstanding anything to the contrary contained in
this Article V, the obligation of the Company to pay the
redemption price of such Debentures, including all accrued
interest, if any, shall be deemed to be satisfied and
discharged to the extent such amount is so paid by such
purchasers. If such an agreement is entered into, any
Debentures not duly surrendered for conversion by the
holders thereof may, at the option of the Company, be
deemed, to the fullest extent permitted by law, acquired by
such purchasers from such holders and (notwithstanding
anything to the contrary contained in Article XIII)
surrendered by such purchasers for conversion, all as of
immediately prior to the close of business on the last day
on which Debentures of such series called for redemption may
be converted in accordance with this Indenture and the terms
of such Debentures, subject to payment of the above amount
aforesaid. The Trustee or the Paying Agent shall hold and
pay to the Debentureholders whose Debentures are selected
for redemption any such amount paid to it in the same manner
as it would moneys deposited with it by the Company for the
redemption of Debentures. Without the Trustee's and the
Paying Agent's prior written consent, no arrangement between
the Company and such purchasers for the purchase and
conversion of any Debentures shall increase or otherwise
affect any of the powers, duties, responsibilities or
obligations of the Trustee as set forth in this Indenture,
and the Company agrees to indemnify the Trustee from, and
hold it harmless against, any loss, liability or expense
arising out of or in connection with any such arrangement
for the purchase and conversion of any Debentures between
the Company and such purchasers, including the costs and
expenses incurred by the Trustee and the Paying Agent in the
defense of any claim or liability arising out of or in
connection with the exercise or performance of any of its
powers, duties, responsibilities or obligations under this
Indenture.
ARTICLE VI
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 6.1 Satisfaction and discharge of Indenture
with respect to Debentures of any series. If (a) the
Company shall deliver to the Trustee for cancellation all
Debentures of any series theretofore authenticated (other
than any such Debentures
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which shall have been destroyed, lost or stolen and in lieu
of or in substitution for which other such Debentures shall
have been authenticated and delivered or Debentures for
whose payment money (or other form of payment if permitted
by the terms of such Debentures) has theretofore been held
in trust and thereafter repaid to the Company, as provided
in Section 6.3) and not theretofore cancelled, or (b) the
Company shall irrevocably deposit (subject to Section 6.3)
with the Trustee or Paying Agent as trust funds the entire
amount in cash or U.S. Government Obligations sufficient to
pay at maturity or upon redemption all of the Debentures of
such series (other than any Debentures which shall have been
destroyed, lost or stolen and in lieu of or in substitution
for which other Debentures shall have been authenticated and
delivered or Debentures for whose payment money (or other
form of payment if permitted by the terms of such
Debentures) has theretofore been held in trust and
thereafter repaid to the Company, as provided in Section
6.3) not theretofore paid, surrendered or delivered to the
Trustee for cancellation, including the principal, premium,
if any, and interest due or to become due to such date of
maturity or redemption date, as the case may be, and if in
either case the Company shall also pay or cause to be paid
all other sums payable hereunder by the Company and the
Company shall deliver to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that in
the opinion of the signers all conditions precedent to the
satisfaction and discharge of this Indenture with respect to
the Debentures of such series have been complied with (and,
in the event that such deposit shall be made more than one
year prior to the maturity of the Debentures of such series,
such Opinion of Counsel shall also state that such deposit
will not result in an obligation of the Company, the Trustee
or the trust fund created by such deposit to register as an
investment company under the Investment Company Act of 1940,
as amended) and a certificate (upon which the Trustee may
rely) of a firm of independent public accountants of
recognized national standing selected by the Board of
Directors (who may be the regular accountants employed by
the Company) stating that the cash, if any, and U.S.
Government Obligations, if any, deposited as set forth above
are sufficient to pay at maturity or upon redemption all of
the Debentures of such series as set forth above, then,
except with respect to the remaining rights of conversion of
any Debentures the terms of which provide for conversion
(which shall continue in full force and effect pursuant to
the terms set forth in Article XIII to the extent provided
for in such terms) or to rights of exchange or registration
of transfer or of the Company's right of optional redemption
of any Debentures of such series, this Indenture shall cease
to be of further effect with respect to the Debentures of
such series, and the Trustee, on demand of and at the cost
and expense of the Company, shall execute proper instruments
acknowledging satisfaction of and discharging this Indenture
with respect to the Debentures of such series.
Notwithstanding the satisfaction and discharge of this
Indenture with respect to the Debentures of such series, the
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obligations of the Company to the Trustee under Section 11.2
shall survive, and if moneys or U.S. Government Obligations
shall have been irrevocably deposited with the Trustee or
Paying Agent pursuant to clause (b) of this Section, the
obligations of the Trustee under Section 6.2 and the first
paragraph of Section 6.3 shall survive.
In order to have money available on a payment date to
pay the principal of, premium, if any, or interest, if any,
on the Debentures, the U.S. Government Obligations shall be
payable as to principal or interest on or before such
payment date in such amounts as will provide the necessary
money. Such U.S. Government Obligations shall not be
callable at the issuer's option.
SECTION 6.2 Deposits for payment or redemption of
Debentures to be held in trust. Subject to the provisions
of Article III and the provisions hereinafter contained in
this Article VI, any moneys or U.S. Government Obligations
(or other form of payments if permitted by the terms of such
Debenture) which at any time shall be deposited by the
Company, or on its behalf with the Trustee or the Paying
Agent, for the purpose of paying or redeeming any of the
Debentures of any series shall be held in trust and applied
by the Trustee to the payment to the holders of the
particular Debentures for the payment or redemption of which
such moneys (or other form of payments if permitted by the
terms of such Debenture) have been deposited, of all sums
due and to become due thereon for principal, premium, if
any, and interest, upon presentation and surrender of such
Debentures at the office or agency of the Company maintained
as provided in this Indenture. Neither the Company nor the
Trustee (except as provided in Section 11.2) nor any Paying
Agent shall be required to pay interest on any moneys so
deposited.
SECTION 6.3 Repayment of moneys. Any moneys or U.S.
Government Obligations deposited with the Trustee or any
Paying Agent remaining unclaimed by the holders of
Debentures for two years after the date upon which the
principal of or interest on such Debentures shall have
become due and payable, shall (unless otherwise required by
mandatory provisions of applicable escheat or abandoned or
unclaimed property law) be repaid to the Company by the
Trustee or Paying Agent and such holders shall (unless
otherwise required by mandatory provisions of applicable
escheat or abandoned or unclaimed property law) thereafter
be entitled to look to the Company only for payment thereof;
provided, however, that, before being required to make any
such payment to the Company, the Trustee or Paying Agent
may, at the expense and written direction of the Company,
cause to be published once, in an Authorized Newspaper, a
notice that such moneys remain unclaimed and that, after the
date set forth in said notice, the balance of such moneys
then unclaimed will be returned to the Company.
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Upon the satisfaction and discharge of this Indenture,
all moneys then held by any Paying Agent other than the
Trustee hereunder shall, upon demand of the Company, be
repaid to it and thereupon such paying agent shall be
released from all further liability with respect to such
moneys.
The Trustee or any Paying Agent shall deliver or pay to
the Company from time to time upon a request in writing by
the Company any moneys or U.S. Government Obligations (or
the principal or interest on such U.S. Government
Obligations) held by it as provided in Section 6.1 which, in
the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification
thereof to the Trustee, are then in excess of the amount
thereof which then would have been required to be deposited
for the purpose for which such money or U.S. Government
Obligations were deposited or received.
ARTICLE VII
REMEDIES UPON DEFAULT
SECTION 7.1. Events of Default defined-acceleration of
maturity upon default-waiver of default after acceleration.
The following events are hereby defined for all purposes of
this Indenture (except where the term is otherwise defined
for specific purposes) as Events of Default with respect to
Debentures of a particular series, unless it is either
inapplicable to a particular series or is specifically
deleted or modified as contemplated by Section 2.2 for the
Debentures of such series, in addition to any other events
as may be defined as Events of Default pursuant to Section
2.2 for the Debentures of such series:
(a) Failure of the Company to pay or provide for
payment of the principal of or premium, if any, on any
of the Debentures of such series, when and as the same
shall become due and payable, whether at maturity
thereof, by call for redemption, through any mandatory
sinking fund, by redemption at the option of the holder
of any Debenture pursuant to the terms of such
Debenture, by declaration of acceleration or otherwise,
whether or not such payment is prohibited by the
provisions of Article III; or
(b) Failure of the Company to pay or provide for
payment of any installment of interest on any of the
Debentures of such series, when and as the same shall
become due and payable, whether or not such payment is
prohibited by the provisions of Article III, which
failure shall have continued for a period of 30 days;
or
(c) Failure of the Company to perform or observe
any other of the covenants or agreements on the part of
the Company in this Indenture or in the Debentures of
such series
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(other than a covenant or agreement which has expressly
been included in this Indenture solely for the benefit
of Debentures of any series other than that series or
is expressly made inapplicable to the Debentures of
such series pursuant to by Section 2.2), which failure
shall have continued for a period of 90 days after
written notice by certified or registered mail given to
the Company by the Trustee hereunder or to the Company
and to the Trustee from the holders of not less than
25% of the aggregate principal amount of Debentures
then Outstanding of such series under this Indenture
specifying such Event of Default or failure and
requesting that it be remedied and stating that such
notice is a notice of an event which, if continued for
90 days after such written notice, will become an Event
of Default; or
(d) The institution by the Company of
proceedings to be adjudicated a bankrupt or insolvent,
or the consent by it to the institution of bankruptcy
or insolvency proceedings against it, or the filing by
it of a petition or answer or consent seeking relief
under any Bankruptcy Law or the consent by it to the
institution of proceedings thereunder or the filing of
any such petition or to the appointment of a receiver,
liquidator, assignee, trustee, custodian, sequestrator
(or other similar official) of the Company or of any
substantial part of its property, or the making by the
Company of an assignment for the benefit of creditors,
or the admission by the Company in writing of its
inability to pay its debts generally as they become
due; or
(e) The entry of a decree or order by a court
having jurisdiction for relief in respect of the
Company, or 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
Bankruptcy Law or appointing a 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 unstayed and in effect for a period of 180
consecutive days; or
(f) An event of default, as defined in any
indenture or instrument evidencing or under which the
Company has at the date of this Indenture or shall
hereafter have outstanding any Senior Indebtedness,
shall have happened and shall be continuing and such
indebtedness shall have been accelerated so that the
same shall be or become due and payable prior to the
date on which the same would otherwise become due and
payable, and such acceleration shall not be contested
in good faith by the Company, and such acceleration
shall not be rescinded or annulled within 30 Business
days after written
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notice thereof given by certified or registered mail to
the Company from the Trustee or to the Company and the
Trustee from the holders of not less than 25% in
aggregate principal amount of the Debentures then
Outstanding of such series hereunder specifying such
event of default and requesting that it be remedied and
stating that such notice is a notice of an Event of
Default; provided, however, that if such event of
default under such indenture or instrument shall be
remedied or cured by the Company or be waived by the
holders of such indebtedness in any manner authorized
by such indenture or instrument or shall otherwise
cease to exist, then the Event of Default hereunder by
reason thereof shall be deemed likewise to have been
thereupon remedied, cured or waived without further
action upon the part of either the Trustee or any of
the Debentureholders.
If one or more Events of Default shall happen and be
continuing with respect to Debentures then outstanding of
any series, then, and in each and every such case, either
the Trustee, by notice in writing to the Company, or the
holders of not less than 25% in aggregate principal amount
of the Debentures then Outstanding of such series, by notice
in writing to the Company and to the Trustee, may declare
the principal amount (or, if the Debentures of such series
are Original Issue Discount Debentures, such portion of the
principal amount as may be specified in the terms of the
Debentures of such series) of all Debentures of such series
and/or such other amount or amounts as the Debentures or
supplemental indenture with respect to such series may
provide, if not already due and payable, to be immediately
due and payable; and upon any such declaration all
Debentures of such series shall become and be immediately
due and payable, anything in this Indenture or in any of the
Debentures of such series contained to the contrary
notwithstanding; provided, however, that payment of
principal of (and/or such other specified amount), premium,
if any, and interest on the Debentures of such series shall
remain subordinated to the extent provided in Article III.
This provision, however, is subject to the condition that
if, at any time after the principal of (and/or such other
specified amount on) the Debentures of such series shall so
become due and payable, and before any judgment or decree
for the payment of the moneys due shall have been obtained
or entered as hereinafter provided, the Company shall pay or
shall deposit with the Trustee a sum sufficient to pay all
matured installments of interest upon all the Debentures of
such series and the principal of (and/or such other
specified amount) and premium, if any, on any and all
Debentures of such series which shall have become due
otherwise than by acceleration, with interest on such
principal (and/or such other specified amount) and premium,
if any, and (to the extent that payment of such interest is
enforceable under applicable law) on any overdue installment
of interest, at the rate specified in the Debentures of such
series (or, if no such rate is specified, at the rate borne
by the Debentures of such series), to the date of such
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payment or deposit, and the reasonable compensation and
expenses of the Trustee, and any and all defaults under this
Indenture with respect to the Debentures or such series,
other than the nonpayment of principal of (and/or such other
specified amount) or premium, if any, and accrued interest
on Debentures of such series which shall have become due by
acceleration, shall have been remedied, then and in every
such case the Trustee shall, upon written request or consent
of the holders of a majority in aggregate principal amount
of the Debentures then Outstanding of such series delivered
to the Company and to the Trustee, waive such default and
its consequences and rescind or annul such declaration and
its consequences, but no such waiver, rescission or
annulment shall extend to or affect any subsequent default,
or impair any right consequent thereon.
For all purposes under this Indenture, if the portion
of the principal amount as may be specified in the terms of
any Original Issue Discount Debentures shall have been
accelerated and declared due and payable pursuant to the
provisions hereof, then, from and after such declaration,
unless such declaration has been rescinded and annulled,
payment of such portion of the principal amount thereof,
together with interest, if any, thereon and all other
amounts owing thereunder, shall constitute payment in full
of such Original Issue Discount Debentures.
SECTION 7.2 Covenant of Company to pay to Trustee
whole amount due on default in payment of Principal or
interest-Trustee may recover judgment for whole amount
due-application of moneys received by the Trustee. In case
the Company shall commit an Event of Default with respect to
the Debentures of any series described in Section 7.1(a) or
(b), then upon demand of the Trustee, the Company shall pay
to the Trustee, for the benefit of the holders of the
Debentures then Outstanding of such series, the whole amount
which then shall have become due on all such Debentures of
such series for principal, premium, if any, and interest,
with interest on the overdue principal and premium, if any,
and (to the extent that payment of such interest is
enforceable under applicable law) upon overdue installments
of interest, at the rate specified in the Debentures of such
series (or, if no such rate is specified, at the rate borne
by the Debentures of such series), and in addition thereto,
such additional amount as shall be sufficient to cover the
costs and expenses of collection, including the reasonable
compensation, expenses, liabilities, disbursements and
advances of the Trustee, any predecessor Trustee, their
agents and counsel. In case the Company shall pay the same
in accordance with the provisions of this Section 7.2 and,
prior to such payment neither the Trustee nor the holders of
the Debentures then Outstanding of such series shall have
taken any steps to begin enforcing their rights under this
Indenture and so long as no additional Event of Default with
respect to the Debentures of such series shall have
occurred, from and after such payment, the Event of Default
giving rise to the demand by the Trustee pursuant to this
Section 7.2 shall be
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deemed to be no longer continuing and shall be deemed to
have thereupon been remedied, cured or waived without
further action upon the part of either the Trustee or any of
the Debentureholders. In case the Company shall fail to pay
the same forthwith upon such demand, the Trustee, in its own
name and as trustee of an express trust, may institute any
judicial proceedings at law or in equity for the collection
of the sums so due and unpaid and may prosecute such
proceedings to judgment or final decree, and may enforce the
same against the Company or any other obligor upon the
Debentures of such series and collect the moneys adjudged or
decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon the
Debentures of such series, wherever situated. The right of
the Trustee to recover such judgment shall not be affected
by the exercise of any other right, power or remedy for the
enforcement of the provisions of this Indenture.
In case of the pendency of any receivership,
insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial
proceeding relative to the Company or any other obligor upon
the Debentures or the property of the Company or of such
other obligor or their creditors, the Trustee (irrespective
of whether the principal of any Debentures shall then be due
and payable as therein expressed or by declaration of
acceleration or otherwise and irrespective of whether the
Trustee shall have made any demand on the Company for the
payment of overdue principal or interest) shall be entitled
and empowered to file and prove a claim for the whole amount
of principal, premium, if any, and interest owing and unpaid
in respect of the Debentures of any series for which it
serves as Trustee and to file such other papers or documents
as may be necessary or advisable in order to have the claims
of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the
Trustee, any predecessor Trustee, their agents and counsel)
and of the Debentureholders of such series allowed in such
judicial proceeding, and to receive payment of or on account
of such claims and to distribute the same after the
deduction of its charges and expenses; and any receiver,
assignee, trustee, liquidator, sequestrator (or other
similar official) in any judicial proceeding is hereby
irrevocably authorized and instructed by each of the
Debentureholders of such series to make such payments to the
Trustee, and, in the event that the Trustee shall consent to
the making of such payments directly to the Debentureholders
of such series, to pay to the Trustee any amount due it or
any predecessor Trustee, for compensation and expenses,
including counsel fees incurred up to the date of such
distribution. Nothing contained in this Indenture shall be
deemed to give to the Trustee any right to accept or consent
to any plan or reorganization, arrangement, adjustment or
composition affecting the Debentureholders or the rights of
any Debentureholder, or to authorize the Trustee to vote in
respect of the claim of any Debentureholder in any such
proceeding.
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Subject to the provisions of Article III, any moneys or
property received by the Trustee under this Section 7.2
shall be applied in the following order, at the date or
dates fixed by the Trustee and, in case of the distribution
of such moneys or property on account or principal, premium,
if any, or interest, upon presentation of the several
Debentures of the series in respect of which such moneys
were received, and stamping thereon the payment, if only
partially paid, and upon surrender thereof if fully paid:
First: To the payment of costs and expenses of
collections, and reasonable compensation to the
Trustee, its agents, attorneys and counsel, and all
advances made and expenses and liabilities incurred by
the Trustee, except as a result of its negligence or
bad faith and all other amounts owing to the Trustee or
any predecessor Trustee pursuant to Section 11.2
hereof;
Second: In case the principal of the Outstanding
Debentures in respect of which such moneys were
received shall not have become due and be unpaid, to
the payment of interest on such Debentures, in the
order of the maturity of the installments of such
interest, with interest (so far as may be lawful) upon
the overdue installments of interest at the rate
specified in such Debentures (or, if no such rate is
specified, at the rate borne by the Debentures of such
series), such payments to be made ratably to the
persons entitled thereto;
Third: In case the principal of the Outstanding
Debentures in respect of which such moneys were
received and/or such other amount or amounts as the
Debentures or supplemental indenture with respect to
such series shall provide, shall have become due, by
declaration or otherwise, to the payment of the whole
amount then owing and unpaid upon such Debentures for
principal (and/or such other specified amount),
premium, if any, and interest, with interest on the
overdue principal (and/or such other specified amount),
premium, if any, and (so far as may be lawful) upon
overdue installments of interest, at the rate specified
in such Debentures (or, if no such rate is specified,
at the rate borne by the Debentures of such series),
and in case such moneys shall be insufficient to pay in
full the whole amount so due and unpaid upon such
Debentures, then to the payment of such principal
(and/or such other specified amount), premium, if any,
and interest, with interest on the overdue principal
(and/or such other specified amount), premium, if any,
and (so far as may be lawful) upon overdue installments
of interest, at the rate specified in such Debentures
(or, if no such rate is specified, at the rate borne by
the Debentures of such series), without preference or
priority of principal (and/or such other specified
amount) and premium,
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if any, over interest, or of interest over principal
(and/or specified amount) and premium, if any, or of
any installment of interest over any other installment
of interest, or of any such Debenture over any other
such Debenture, ratably to the aggregate of such
principal (and/or such other specified amount),
premium, if any, and accrued and unpaid interest;
Fourth: To the payment of the remainder, if any,
to the Company, its successors or assigns, or to
whomever may be so lawfully entitled to receive the
same, or as a court of competent jurisdiction may
direct.
SECTION 7.3 Trustee may enforce rights of action
without possession of Debentures. All rights of action
under this Indenture or any of the Debentures Outstanding of
any series hereunder enforceable by the Trustee may be
enforced by the Trustee without the possession of any of the
Debentures or the production thereof at the trial or other
proceedings relative thereto, and any such suit or
proceeding instituted by the Trustee shall be brought for
the ratable benefit of the holders of the Debentures with
respect to which the rights are being exercised, subject to
the provisions of this Indenture.
SECTION 7.4 Delays or omissions not to impair any
rights or powers accruing upon default. No delay or
omission of the Trustee or of the Debentureholders to
exercise any rights or powers accruing upon any default
which shall not have been remedied shall impair any such
right or power, or shall be construed to be a waiver of any
such default or acquiescence therein; and every power and
remedy given by this Article VII to the Trustee and the
holders of the Debentures of any series may be exercised
from time to time and as often as may be deemed expedient by
the Trustee or by the holders of the Debentures of such
series.
SECTION 7.5 In Event of Default Trustee may protect
and enforce its rights by appropriate proceedings-holders of
majority in aggregate Principal amount of Debentures of a
series may waive default. If any one or more Events of
Default shall happen and be continuing, the Trustee may, in
its discretion, proceed to protect and enforce the rights
vested in it by this Indenture by such appropriate judicial
proceedings as the Trustee, being advised by its counsel,
shall deem most effectual to protect and enforce any of said
rights, either by suit in equity or by action at law or by
proceeding in bankruptcy or otherwise, whether for the
specific performance of any covenant or agreement contained
in this Indenture or in aid of the exercise of any power
granted in this Indenture, or to enforce any other legal or
equitable right vested in the Trustee by this Indenture or
by law.
Provided the Debentures of any series shall not then be
due and payable by reason of a declaration pursuant to
Section 7.1 hereof, the holders of a majority in aggregate
principal amount
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of the Debentures of such series then Outstanding may on
behalf of the holders of all of the Debentures of such
series waive by written notice any past default hereunder
and its consequences, except a default in the payment of
interest on or principal and premium, if any, of any of the
Debentures of such series. In the case of any such waiver,
the Company, the Trustee and the holders of the Debentures
of such series shall be restored to their former positions
and rights hereunder, respectively; but no such waiver shall
extend to any subsequent or other default or impair any
right consequent thereon.
SECTION 7.6 Holders of majority in aggregate Principal
amount of Debentures of any series may direct exercise of
remedies. The holders of a majority in aggregate principal
amount of the Debentures then Outstanding of any series
shall have the right, by an instrument in writing executed
and delivered to the Trustee, to direct the time, method and
place of conducting any proceedings for any remedy available
to the Trustee, or of exercising any power or trust
conferred upon the Trustee under this Indenture, with
respect to the Debentures of such series; provided, however,
that subject to the provisions of Section 11.1 of this
Indenture, the Trustee shall have the right to decline to
follow any such direction if the Trustee, being advised by
counsel, determines that the action or proceedings so
directed may not lawfully be taken or if the Trustee in good
faith shall, by Responsible Officers, determine that the
action or proceedings so directed would involve the Trustee
in personal liability, or would be unduly prejudicial to the
holders of the Debentures of such series not joining in such
direction, and the Trustee may take any other action deemed
proper by the Trustee which is not inconsistent with such
direction.
SECTION 7.7 Limitation on suits by Debentureholders.
No holder of any Debenture of any series shall have the
right to institute any suit, action or proceeding, in equity
or at law, for the execution of any trust or power hereof,
or for the enforcement of any other remedy under or upon
this Indenture or the Debentures of such series, unless the
holders of a majority in aggregate principal amount of the
Debentures then Outstanding of such series shall have made
written request upon the Trustee and shall have afforded to
it a reasonable opportunity either to proceed to exercise
the powers hereinbefore granted or to institute such suit,
action or proceeding in its own name, as Trustee hereunder,
and shall have offered to the Trustee reasonable indemnity
against the costs, expenses and liabilities to be incurred
therein or thereby, and the Trustee shall have refused or
neglected to comply with such request for 60 days after its
receipt of such request and no direction inconsistent with
such request shall have been given to the Trustee pursuant
to Section 7.6; it being understood and intended that no one
or more holders of Debentures of any series shall have any
right under this Indenture or under the Debentures, by his
or their action, to enforce any right hereunder except in
the manner
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herein provided, and that all proceedings hereunder, at law
or in equity, shall be instituted, had and maintained in the
manner herein provided and for the ratable benefit of all
holders of the Debentures of such series. Subject to the
provisions of Article III, notwithstanding any provision of
this Indenture to the contrary, the right, which is absolute
and unconditional, of any Debentureholder to receive the
payment of the principal of, premium, if any, and interest
on his Debentures at and after the respective due dates
(including maturity by call for redemption, through any
sinking fund, declaration unless annulled pursuant to
Section 7.1 hereof, or otherwise), of such principal,
premium, if any, or interest, or the right, which is also
absolute and unconditional, of any Debentureholder to
require conversion of his Debentures pursuant to Article
XIII hereof if the terms of such Debentures provide for
convertibility pursuant to Section 2.2, or the right to
institute suit for the enforcement of any such payment at or
after such due dates or of such right to convert, shall not
be impaired or affected without the consent of such holder,
and the obligation of the Company, which is also absolute
and unconditional, to pay the principal of, premium, if any,
and interest on each of the Debentures to the respective
holders thereof at the times and places in the Debentures
expressed shall not be impaired or affected.
Notwithstanding anything to the contrary contained in
this Section 7.7, the parties to this Indenture and the
Debentureholders agree as follows:
Any court may in its discretion require, in any suit
for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action
taken, suffered or omitted by it as Trustee, the filing by
any party litigant in such suit of an undertaking to pay the
costs of such suit, and such court may in its discretion
assess reasonable costs, including reasonable attorneys'
fees, against any party litigant in such suit, having due
regard to the merits and good faith of the claims or
defenses made by such party litigant; provided, however,
that the provisions of this paragraph shall not apply to any
suit instituted, directly or through an agent or agents, by
the Trustee, to any suit instituted by any Debentureholder
of any series, or group of Debentureholders of any series,
holding in the aggregate more than 10% in aggregate
principal amount of the Debentures then Outstanding of such
series or to any suit instituted by any Debentureholder of
any series for the enforcement of the payment of the
principal of, premium, if any, or interest on, any Debenture
of such series at or after the respective due dates of such
principal, premium, if any, or interest expressed in his
Debenture of such series.
SECTION 7.8. No Debentures owned or held by, for the
account of or for the benefit of the Company to be deemed
Outstanding for purpose of payment or distribution. No
Debentures owned or held by, for the account of or for the
benefit of the Company or any
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Affiliate (other than Debentures pledged in good faith which
would be deemed Outstanding under the provisions of Section
14.3) shall be deemed Outstanding for the purpose of any
payment or distribution provided for in this Article VII.
SECTION 7.9. Company and Trustee restored to former
position on discontinuance or abandonment of proceedings.
If the Trustee shall have proceeded to enforce any right
under this Indenture with respect to the Debentures of any
series, and such proceedings shall have been discontinued or
abandoned because of waiver, or for any other reason, or
shall have been determined adversely to the Trustee, then,
and in any such case, the Company, the Trustee and the
Debentureholders of such series shall each be restored to
their former positions and rights hereunder, and all rights,
remedies and powers of the Trustee shall continue as though
no such proceeding had been taken.
ARTICLE VIII
EVIDENCE OF ACTION BY DEBENTUREHOLDERS
SECTION 8.1. Evidence of action by Debentureholders.
Any demand, request, consent, proxy or other instrument
which this Indenture may require or permit to be signed and
executed by the Debentureholders of any series may be in any
number of concurrent instruments of similar tenor, and may
be signed or executed by such Debentureholders in person or
by an attorney duly authorized in writing. Proof of the
execution of any such demand, request, consent, proxy or
other instrument, or of a writing appointing any such
attorney, shall be sufficient for any purpose of this
Indenture if made in the following manner: the fact and date
of the execution by any person of such demand, request,
consent, proxy or other instrument or writing may be proved
by the certificate of any notary public, or other officer
authorized to take acknowledgments of deeds to be recorded
in any state or country, that the person signing such
request or other instrument or writing acknowledged to him
the execution thereof, or by an affidavit of a witness of
such execution. Where such execution is by an officer of a
corporation or association or a member of a partnership on
behalf of such corporation, association or partnership, or
by a trustee or other fiduciary, such certificate or
affidavit shall also constitute sufficient proof of his
authority. The Trustee may nevertheless in its discretion
accept such other proof or require further proof of any
matter referred to in this Section 8.1 as it shall deem
reasonable. The ownership of Debentures shall be proved by
the registry books or by a certificate of the registrar
thereof.
The Trustee shall not be bound to recognize any person
as a Debentureholder of any series unless and until his
title to the Debentures of such series held by him is proved
in the manner in this Article VIII provided.
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Any demand, request, direction, waiver, consent, vote
or other action of the holder of any Debenture shall be
conclusive and shall bind all future holders of the same
Debenture and of any Debenture issued in exchange or
substitution therefor irrespective of whether or not any
notation in regard thereto is made upon such Debenture. Any
such holder, however, may revoke the consent as to his
Debenture or portion thereof. Such revocation shall be
effective only if the Trustee receives the notice of
revocation before the date the amendment, supplement, waiver
or other action becomes effective. An amendment,
supplement, waiver or other action shall become effective on
receipt by the Trustee of written consents from the
Debentureholders of the requisite percentage in aggregate
principal amount of the Outstanding Debentures of the
relevant series. After an amendment, supplement, waiver or
other action becomes effective, it shall bind every
Debentureholder of each series of Debentures so affected.
The Company or the Trustee, as applicable, may set a
date for the purpose of determining the Debentureholders
entitled to consent, vote or take any other action referred
to in this Section 8.1, which date shall be not less than 10
days nor more than 60 days prior to the taking of the
consent, vote or other action.
ARTICLE IX
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
SECTION 9.1. Immunity of incorporators, stockholders,
officers, directors and employees. No recourse shall be had
for the payment of the principal of, premium, if any, or
interest on any Debenture or for any claim based thereon or
otherwise in any manner in respect thereof, or in respect of
this Indenture, to or against any subsidiary, incorporator,
stockholder, officer, director or employee, as such, past,
present or future, of the Company or any subsidiary,
incorporator, stockholder, officer, director or employee, as
such, past, present or future, of any predecessor or
successor corporation, either directly or through the
Company or such predecessor or successor corporation,
whether by virtue of any constitutional provision or statute
or rule of law, or by the enforcement of any assessment or
penalty, or in any other manner, all such liability being
expressly waived and released by the acceptance of any
Debenture and as part of the consideration for the issue
thereof.
ARTICLE X
MERGER, CONSOLIDATION, SALE OR LEASE
SECTION 10.1. Documents required to be filed with the
Trustee upon consolidation, merger, sale, transfer or lease -
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execution or supplemental indentures - acts of successor
corporation. Nothing in this Indenture or in the Debentures
shall prevent any consolidation or merger of the Company
with or into any other corporation, or any consolidation or
merger of any other corporation with or into the Company, or
any sale, transfer or lease of all or substantially all of
the property and assets of the Company to any other
corporation lawfully entitled to acquire the same; provided,
however, and the Company hereby covenants and agrees, that
any such consolidation, merger, sale, transfer or lease
shall be upon the condition that (a) the due and punctual
payment of the principal of, premium, if any, and interest
on all the Debentures according to their tenor, and the due
and punctual performance and observance of all the terms,
covenants and conditions of this Indenture to be kept or
performed by the Company shall, by an indenture supplemental
hereto complying with the provisions of Section 12.1,
executed and delivered to the Trustee, be expressly assumed
by the corporation (other than the Company) formed by or
resulting from any such consolidation or merger, or which
shall have received the transfer or lease of all or
substantially all of the property and assets of the Company,
just as fully and effectually as if such successor
corporation had been an original party hereto; and (b) the
Company or such successor corporation, as the case may be,
shall not, immediately after such consolidation, merger,
sale, transfer or lease be in default in the performance of
any such covenant or condition. Thereafter, unless otherwise
specified pursuant to Section 2.2 for the Debentures of any
series, all obligations of the predecessor corporation under
the Debentures of such series shall terminate. In the event
of any such sale, transfer or lease, the predecessor Company
may be dissolved, wound up and liquidated at any time
thereafter.
Every such successor corporation, upon executing an
indenture supplemental hereto as provided in this Section
10.1 in form satisfactory to the Trustee, shall succeed to
and be substituted for the Company with the same effect as
if it had been named herein as the Company; and any order,
certificate or resolution of the Board or officers of the
Company provided for in this Indenture may be made by like
officials of such successor corporation. Such successor
corporation may thereupon cause to be signed, either in its
own name or in the name of the Company, with such suitable
reference, if any, to such consolidation, merger, sale,
transfer or lease as may be required by the Trustee, any or
all of the Debentures which shall not theretofore have been
signed by the Company and authenticated by the Trustee or
any Authenticating Agent; and upon the written order of such
successor corporation in lieu of the Company, signed by the
President or any Vice President and Treasurer or any
Assistant Treasurer of such successor corporation, and
subject to all the terms, conditions and restrictions herein
prescribed with respect to the authentication and delivery
of the Debentures, the Trustee or any Authenticating Agent
shall authenticate and deliver any and all Debentures which
shall have been previously signed by the
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proper officers of the Company and delivered to the Trustee
or any Authenticating Agent for authentication and any of
such Debentures which such successor corporation shall
thereafter, in accordance with the provisions of this
Indenture, cause to be signed and delivered to the Trustee
or any Authenticating Agent for such purpose. All
Debentures of any series so authenticated and delivered
shall in all respects have the same rank as the Debentures
of such series theretofore or thereafter authenticated and
delivered in accordance with the terms of this Indenture.
SECTION 10.2. Trustee may rely upon Opinion of
Counsel. The Trustee may receive and shall, subject to the
provisions of Section 11.1 of this Indenture, be fully
protected in relying upon an Officers' Certificate and
Opinion of Counsel as conclusive evidence that any
supplemental indenture executed under the foregoing Section
10.1 complies with the foregoing conditions and provisions
of this Article X.
ARTICLE XI
CONCERNING THE TRUSTEE
SECTION 11.1. Acceptance of Trust - responsibilities
of Trustee. (a) The Trustee, prior to the occurrence of an
Event of Default and after the curing or waiving of all
Events of Default which may have occurred, undertakes to
perform such duties and only such duties as are specifically
set forth in this Indenture or in the Trust Indenture Act of
1939, and no implied covenants or conditions shall be read
into this Indenture against the Trustee. In case an Event
of Default with respect to the Debentures of a particular
series has occurred (but only during the continuance
thereof), the Trustee shall exercise with respect to the
Debentures of such series such of the rights and powers
vested in it by this Indenture, and use the same degree of
care and skill in their exercise, as a prudent man would
exercise or use under the circumstances in the conduct of
his own affairs.
The Trustee, upon receipt of all resolutions,
certificates, statements, opinions, reports, documents,
orders or other instruments furnished to the Trustee
pursuant to any provision of this Indenture, shall examine
them to determine whether they conform to the requirements
of this Indenture.
(b) No provision of this Indenture shall be construed
to relieve the Trustee from liability for its own negligent
action, its own negligent failure to act, or its own willful
misconduct, except that
(i) prior to the occurrence of an Event of
Default with respect to the Debentures of any series
hereunder and after the curing or waiving of all Events
of Default with respect to the Debentures of such
series which may have occurred, the
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Trustee shall not be liable with respect to the
Debentures of such series except for the performance of
such duties as are specifically set forth in this
Indenture, and no implied covenants or obligations
shall be read into this Indenture against the Trustee,
but the duties and obligations of the Trustee with
respect to the Debentures of such series, prior to the
occurrence of an Event of Default with respect to the
Debentures of such series and after the curing or
waiving of all Events of Default with respect to the
Debentures of such series which may have occurred,
shall be determined solely by the express provisions of
this Indenture;
(ii) Subject to the limitations contained in
subsection (a) of this Section 11.1, prior to the
occurrence of an Event of Default with respect to the
Debentures of any series hereunder and after the curing
or waiving of all events of Default with respect to the
Debentures of such series which may have occurred, and
in the absence of bad faith on the part of the Trustee,
the Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions
expressed herein, upon certificates or opinions
conforming to the requirements of this Indenture;
(iii) the Trustee shall not be personally liable
for any error of judgment made in good faith by a
Responsible Officer or Officers of the Trustee unless
it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts; and
(iv) the Trustee shall not be personally liable
with respect to any action taken, suffered or omitted
to be taken by it in good faith in accordance with the
direction of the holders of not less than a majority in
aggregate principal amount of the Debentures then
Outstanding of any series relating to the time, method
and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or
power conferred upon the Trustee, under this Indenture
with respect to the Debentures of such series.
(c) Subject to the limitations contained in
subsections (a) and (b) of this Section 11.1, the recitals
contained herein and in the Debentures (except in the
Trustee's certificate of authentication) shall be taken as
the statements of the Company, and the Trustee assumes no
responsibility for the correctness of the same. The Trustee
makes no representations as to the validity or sufficiency
of this Indenture or of the Debentures except that the
Trustee represents that it is duly authorized to execute and
deliver this Indenture and to perform its obligations
hereunder.
(d) Subject to the limitations contained in
subsections (a) and (b) of this Section 11.1:
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(i) the Trustee may rely and shall be protected
in acting or refraining from acting upon any
resolution, certificate, opinion, notice, consent,
request, order, appraisal, report, bond or other paper
or document believed by it to be genuine and to have
been signed or presented by the proper party or
parties;
(ii) the Trustee may consult with counsel and the
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 accordance with such
advice or Opinion of Counsel;
(iii) whenever in the administration of the
trusts of this Indenture, prior to an Event of Default
hereunder and after the curing or waiving of all Events
of Default which may have occurred, the Trustee shall
deem it necessary or desirable that a matter be proved
or established prior to taking, suffering or omitting
any action hereunder, such matter (unless other
evidence in respect thereof be herein specifically
prescribed) may be deemed to be conclusively proved and
established by an Officers' Certificate delivered to
the Trustee, and such certificate shall be full warrant
to the Trustee for any action taken, suffered or
omitted by it under the provisions of this Indenture
upon the faith thereof;
(iv) the Trustee shall be under no obligation to
exercise any of the trusts or powers hereof at the
request, order or direction of any of the
Debentureholders, pursuant to the provisions of this
Indenture, unless such Debentureholders shall have
offered to the Trustee reasonable indemnity against all
the costs, expenses and liabilities which might be
incurred therein;
(v) the Trustee shall not be liable for any
action taken or omitted to be taken by it in good faith
and believed by it to be authorized or within the
discretion or power conferred upon it by this
Indenture;
(vi) prior to the occurrence of an Event of
Default with respect to the Debentures of any series
hereunder and after the curing or waiving of all Events
of Default with respect to the Debentures of such
series which may have occurred, the Trustee shall not
be bound to make any investigation into the facts or
matters stated in any resolution, certificate, opinion,
notice, consent, request, order, appraisal, report,
bond or other document or instrument concerning such
series, unless requested in writing to do so by the
holders of not less than a majority in aggregate
principal amount of the Debentures then Outstanding of
such series; provided, however, that if the payment
within a reasonable time to the
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Trustee of the costs, expenses or liabilities likely to
be incurred by it in the making of such investigation
is, in the opinion of the Trustee (subject to the
limitations contained in subsections (a) and (b) of
this Section 11.1), not reasonably assured to the
Trustee by the security afforded to it by the terms of
this Indenture, the Trustee may require reasonable
indemnity against such expense or liability as a
condition to so proceeding; and provided, further, that
nothing in this subdivision (d)(vi) shall require the
Trustee to give the Debentureholders any notice other
than that required by Section 11.3 hereof. The
reasonable expense of every such investigation shall be
paid by the Company or, if paid by the Trustee, shall
be repaid by the Company upon demand;
(vii) the Trustee may execute any of the trusts
or powers hereunder or perform any duties hereunder
either directly or by or through agents or attorneys
and the Trustee shall not be responsible for any
misconduct or negligence on the part of any agent or
attorney appointed with due care by it hereunder; and
(viii) none of the provisions of this Indenture
shall require the Trustee to expend or risk its own
funds or otherwise incur any personal financial
liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or
powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate
indemnity against such risk or liability is not
reasonably assured to it.
SECTION 11.2. Trustee to be entitled to compensation -
Trustee not to be accountable for application of proceeds -
moneys held by Trustee to be trust funds. The Company
covenants and agrees to pay to the Trustee from time to
time, and the Trustee shall be entitled to reasonable
compensation (which shall not be limited by any provision of
law in regard to the compensation of a trustee of an express
trust) for services rendered by it in the execution of the
trusts hereby created, and shall also be entitled to payment
of reasonable expenses and disbursements actually made or
incurred hereunder, including the reasonable fees and
expenses of counsel, accountants and of all persons not
regularly in its employ, and all taxes which may have been
assessed against the Trustee as such on any funds on deposit
with the Trustee. The Company also agrees to indemnify each
of the Trustee and any predecessor Trustee for and hold it
harmless against loss, liability or expense incurred arising
out of or in connection with the acceptance or
administration of this trust or performance of its duties
hereunder, including the cost and expenses of defending
itself against any claim of liability in the premises,
except to the extent that such loss, liability or expense is
incurred due to the negligence or bad faith of the Trustee
or predecessor Trustee. If any property other than cash
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shall at any time be subject to a lien in favor of the
Debentureholders, the Trustee, if and to the extent
authorized by a receivership or bankruptcy court of
competent jurisdiction or by the supplemental instrument
subjecting such property to such lien, shall be entitled to
make advances for the purpose of preserving such property or
of discharging tax liens or other prior liens or
encumbrances thereon. The obligations of the Company under
this Section 11.2 to compensate the Trustee and to
indemnify, pay or reimburse the Trustee or any predecessor
Trustee for expenses, disbursements and advances shall
constitute additional indebtedness hereunder and shall
survive the satisfaction and discharge or any other
termination pursuant to any Bankruptcy Law hereof. Such
additional indebtedness shall be secured by a lien prior to
that of the Debentures of all series with respect to which
the Trustee acts as Trustee upon all property and funds held
or collected by the Trustee as such, except funds held in
trust for the benefit of the holders of particular
Debentures.
The Trustee shall not be accountable for the use or
application by the Company of any Debentures authenticated
and delivered hereunder or of the proceeds of such
Debentures, or for the use or application of any moneys paid
over by the Trustee in accordance with any provision of this
Indenture, or for the use or application of any moneys
received by any paying agent.
All moneys received by the Trustee in trust under or
pursuant to any provision of this Indenture shall constitute
trust funds for the purposes for which they were paid or
were held, but need not be segregated in any manner from any
other moneys and may be deposited by the Trustee, under such
conditions as may be prescribed by law, in its general
banking department, and the Trustee shall not be liable for
any interest thereon, except as otherwise agreed with the
Company.
The parties hereto, and the Debentureholders by their
acceptance of their Debentures, hereby agree, that when the
Trustee incurs expenses and renders services after an Event
of Default occurs, such expenses and the compensation for
such services are intended by the holders of the Debentures
and Company to constitute expenses of administration under
any Bankruptcy Law.
SECTION 11.3. Trustee to give Debentureholders notice
of default. The Trustee shall give to the Debentureholders
of any series notice of the happening of all defaults with
respect to the Debentures of such series known to it, within
90 days after the occurrence thereof unless such defaults
shall have been cured before the giving of such notice;
provided, however, that, except in the case of a default
resulting from the failure to make any payment of principal
of, premium, if any, or interest on the Debentures of any
series, or in the payment of any mandatory sinking fund
installment with respect to the Debentures of such
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series, the Trustee may withhold the giving of such notice
if and so long as the board of directors, the executive
committee or a trust committee of directors and/or
Responsible Officers of the Trustee in good faith determine
that the withholding of such notice is in the interest of
the Debentureholders of such series. For the purpose of
this Section 11.3, the term "default" means any event which
is, or after notice or lapse of time or both would become,
an Event of Default. Such notice shall be given to the
Debentureholders of such series in the manner and to the
extent provided in subsection (c) of Section 11.10.
SECTION 11.4. Trustee acquiring conflicting interest
must eliminate it or resign. Reference is made to Section
310(b) of the Trust Indenture Act of 1934, as amended,
and with respect to the Debentures of each series, the Trustee
shall comply therewith. To the extent permitted under
Section 310(b)(1) thereof, the Trustee shall not be deemed
to have a conflicting interest by virtue of being a
trustee under this Indenture with respect to Debentures
of more than one series.
SECTION 11.5. Eligibility of Trustee. There shall at
all times be a corporate Trustee under this Indenture which
shall be a bank or trust company organized and doing
business under the laws of the United States or of any State
or the District of Columbia and having a combined capital
and surplus of not less than $50,000,000 which is authorized
under the laws of its jurisdiction of incorporation to
exercise corporate trust powers and is subject to
supervision or examination by Federal, State or District of
Columbia authority and which has an office or agency in
. If the Trustee publishes reports of conditions at least
annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, the combined
capital of the Trustee shall be deemed to be its combined
capital and surplus as set forth in its most recent report
of condition so published. If the Trustee shall at any time
cease to meet the foregoing standards of eligibility, then
such Trustee shall resign immediately in the manner and with
the effect specified in Section 11.6.
SECTION 11.6. Resignation or removal of Trustee.
(a) Subject to the limitations contained in subsection
(d) of this Section 11.6, the Trustee may resign and be
discharged from the trust hereby created with respect to the
Debentures of one or more series by giving notice thereof to
the Company and by giving notice thereof to the
Debentureholders of such series, in the manner and to the
extent provided in subsection (c) of Section 11.10. Upon
receiving such notice of resignation, the Company shall
promptly appoint a successor trustee or trustees (it being
understood that any such successor trustee may be appointed
with respect to the Debentures of one or more or all of such
series with respect to which the resigning trustee has
resigned and that at any time there shall be only one
trustee with respect to the Debentures of any particular
series) by written instrument, in duplicate, executed by
order of the Board of Directors, one copy
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of which instrument shall be delivered to the resigning
trustee and one copy to the successor trustee. If no
successor trustee shall have been so appointed and have
accepted appointment within 60 days after the mailing of
such notice of resignation, the resigning trustee may
petition any court of competent jurisdiction for the
appointment of a successor trustee, or any Debentureholder
of such series who has been a bona fide holder of a
Debenture or Debentures of such series for at least six
months may on behalf of himself and all others similarly
situated, petition any such court for the appointment of a
successor trustee. Such court may thereupon, after such
notice, if any, as it may deem proper and prescribe, appoint
a successor trustee.
(b) In case at any time any of the following
shall occur-
(1) the Trustee shall fail to comply with the
provisions of Section 11.4 with respect to the
Debentures of any series after written request therefor
by the Company or by any Debentureholder of such series
who has been a bona fide holder of a Debenture or
Debentures of such series for at least six months; or
(2) the Trustee shall cease to be eligible in
accordance with the provisions of Section 11.5 with
respect to the Debentures of any series and shall fail
to resign after written request therefor by the Company
or by any such Debentureholder; 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
then, in such case, the Company may remove the Trustee with
respect to all Debentures of such series and appoint a duly
qualified successor trustee by written instrument, in
duplicate, executed by order of the Board of Directors of
the Company, one copy of which instrument shall be delivered
to the Trustee so removed and one copy to the successor
trustee so appointed, or, subject to the provisions of
Section 7.7, any Debentureholder who has been a bona fide
holder of a Debenture or Debentures of such series for at
least six months may, on behalf of himself and all others
similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee with respect to
all Debentures of such series and the appointment of a
successor trustee. Such court may thereupon after such
notice, if any, as it may deem proper and prescribe, remove
the Trustee and appoint a duly qualified successor trustee
with respect to the Debentures of such series.
(c) The holders of a majority in aggregate principal
amount of the Debentures then Outstanding of any series may
at any time
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remove the Trustee and appoint a duly qualified successor
trustee with respect to such series by delivery to the
Trustee so removed, to the successor trustee and to the
Company of the evidence provided for in Section 8.1 of the
action in that regard taken by Debentureholders.
(d) Any resignation or removal of the Trustee and any
appointment of a duly qualified successor trustee pursuant
to any of the provisions of this Section shall become
effective upon acceptance of appointment by the successor
trustee as provided in Section 11.7.
SECTION 11.7. Acceptance by successor Trustee.
(a) In case of the appointment hereunder of a
successor trustee with respect to all Debentures, every duly
qualified successor trustee so appointed under any of the
methods herein provided shall execute, acknowledge and
deliver to its predecessor trustee and to the Company an
instrument in writing accepting such appointment hereunder
and thereupon such successor trustee, without any further
act, deed or conveyance, shall become fully vested with the
rights, powers, trusts, duties and obligations of its
predecessor in the trust hereunder with like effect as if
originally named as Trustee herein. The predecessor trustee
shall, nevertheless, at the written request of the successor
trustee, pay over to the successor trustee all moneys at the
time held by it herein; and the Company and the predecessor
trustee upon payment or provision therefor of any amounts
then due the predecessor trustee pursuant to the provisions
of Section 11.2, shall execute and deliver such instruments
and do such other things as may reasonably be required for
more fully and certainly vesting and confirming in the
successor trustee all such rights, powers, trusts, duties
and obligations. The Company shall promptly give notice of
the appointment of such successor trustee to the
Debentureholders in the manner and to the extent provided in
subsection (c) of Section 11.10.
(b) In the case of the appointment hereunder of a
successor trustee with respect to the Debentures of one or
more (but not all) series, the Company, the predecessor
trustee and each successor trustee with respect to the
Debentures of such series shall execute and deliver an
indenture supplemental hereto wherein each successor trustee
shall accept such appointment and which (i) 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
predecessor trustee with respect to the Debentures of such
series to which the appointment of such successor trustee
relates, (ii) if the predecessor trustee is not retiring
with respect to all Debentures of such series, shall contain
such provisions as shall be deemed necessary or desirable to
confirm that all the rights, powers, trusts and duties of
the predecessor
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trustee with respect to the Debentures of such series as to
which the predecessor trustee is not retiring shall continue
to be vested in the predecessor trustee, and (iii) 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 predecessor 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
predecessor trustee with respect to the Debentures of such
series to which the appointment of such successor trustee
relates; but, on request of the Company or any successor
trustee, such predecessor trustee upon payment of its
charges shall duly assign, transfer and deliver to such
successor trustee all property and money held by such
predecessor trustee hereunder with respect to the Debentures
of such 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 this subsection (b) of this Section.
SECTION 11.8. Successor to Trustee by merger or
consolidation, etc. Any corporation or national banking
association into which the Trustee may be merged, or with
which it may be consolidated, or to which the Trustee
transfers all or substantially all of its corporate trust
assets, or any corporation or national banking association
resulting from any merger or consolidation or conversion to
which the Trustee shall be a party, shall be the successor
trustee under this Indenture without the execution or filing
of any instruments or any further act on the part of any of
the parties hereto.
In case at the time such successor trustee shall
succeed to the trusts created by this Indenture any of the
Debentures shall have been authenticated but not delivered,
any such successor trustee may adopt the certificate of
authentication of its predecessor trustee, and deliver such
Debentures so authenticated; and in case at that time any of
the Debentures shall not have been authenticated, any
successor trustee may authenticate such Debentures either in
the name of any predecessor hereunder or in the name of the
successor trustee; and in all such cases such certificates
shall have the full force which it is anywhere in the
Debentures or in this Indenture provided that the
certificate of authentication of the Trustee shall have;
provided, however, that the right to adopt the
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certificate of authentication of any predecessor trustee or
authenticate Debentures in the name of any predecessor
trustee shall apply only to its successor or successors by
merger, conversion or consolidation.
SECTION 11.9. Limitations on right of Trustee as a
creditor to obtain payment of certain claims. Reference is
made to Section 311 of the Trust Indenture Act of 1939, as
amended, for purposes of which the following terms shall
have the following meanings:
(i) the term "cash transaction" shall mean any
transaction in which full payment for goods or
securities sold is made within seven days after
delivery of the goods or securities in currency or in
checks or other orders drawn upon banks or bankers and
payable upon demand; and
(ii) the term "self-liquidating paper" shall mean
any draft, bill of exchange, acceptance or obligation
which is made, drawn, negotiated or incurred by the
Company for the purpose of financing the purchase,
processing, manufacturing, shipment, storage or sale of
goods, wares or merchandise and which is secured by
documents evidencing title to, possession of, or a lien
upon, the goods, wares or merchandise or the
receivables or proceeds arising from the sale of the
goods, wares or merchandise previously constituting the
security, provided the security is received by the
Trustee simultaneously with the creation of the
creditor relationship with the Company arising from the
making, drawing, negotiating or incurring of the draft,
bill of exchange, acceptance or obligation.
SECTION 11.10. Trustee to make annual report to
Debentureholders - Trustee to make other reports to
Debentureholders - Debentureholders to whom reports to be
transmitted.
(a) The Trustee shall, so long as any Debentures are
Outstanding of any series with respect to which it acts as
Trustee, transmit to the Debentureholders of such series,
within 60 days after of each year beginning
with the year , a brief report as of such
that complies with Section 313(a) of the Trust Indenture Act
of 1939, as amended, to the extent any such report is
required pursuant to such Section.
(b) The Trustee shall, so long as any Debentures of any
series with respect to which it acts as Trustee shall be
Outstanding, also transmit to the Debentureholders of such
series, as hereinafter provided, within the times
hereinafter specified, a brief report with respect to the
character and amount of any advances (and if the Trustee
elects so to state the circumstances surrounding the making
thereof) made by the
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Trustee, as such, since the date of the last report
transmitted pursuant to the provisions of subsection (a) of
this Section 11.10 (or if no such report has been so
transmitted, since the date of the execution of this
Indenture), for the reimbursement of which it claims or may
claim a lien or charge prior to that of the Debentures of
such series, on property or funds held or collected by the
Trustee, as such, and which it has not previously reported
pursuant to this subsection (b), if such advances remaining
unpaid at any time aggregate more than 10% of the principal
amount of the Debentures of such series then Outstanding,
such report to be so transmitted within 90 days after such
time.
(c) All reports required by this Section 11.10, and all
other reports or notices which are required by any other
provision of this Indenture to be transmitted in accordance
with the provisions of this Section 11.10, shall be
transmitted by mail; (i) to all registered holders of
Debentures of such series, as the names and addresses of
such holders appear upon the Debenture register; (ii) to
such holders of Debentures of such series as have, within
the two years preceding such transmission, filed their names
and addresses with the Trustee for that purpose; and (iii)
except in the case of reports pursuant to subsection (b) of
this Section 11.10, to all holders of Debentures of such
series whose names and addresses have been furnished to or
received by the Trustee pursuant to Section 4.6(d).
(d) The Trustee shall, at the time of the transmission
to the Debentureholders of any report or notice pursuant to
this Section 11.10, file a copy thereof with the Securities
and Exchange Commission. The Company will notify the
Trustee if and when the Debentures of any series become
listed on any stock exchange and the Trustee will thereafter
file a copy of any such report or notice with such stock
exchange.
SECTION 11.11. Preservation of information by Trustee
- Trustee to give certain information to Debentureholders
upon application. The Trustee shall preserve, in as current
a form as is reasonably practicable, all information
furnished it pursuant to subsection (d) of Section 4.6
hereof or received by it as Debenture registrar hereunder.
The Trustee may destroy such information upon receipt of new
information updating information previously furnished.
Within five Business days after receipt by the Trustee
of a written application by any three or more
Debentureholders stating that the applicants desire to
communicate with other Debentureholders with respect to
their rights under this Indenture or under the Debentures,
and accompanied by a copy of the form of proxy or other
communication which such applicants propose to transmit, and
by reasonable proof that each such applicant has owned a
Debenture or Debentures for a period of at least six months
preceding such application, the Trustee shall,
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at its election, either (a) afford to such applicants access
to all information so furnished to or received by the
Trustee and not destroyed pursuant to the provisions of this
Section 11.11, or (b) inform such applicants as to the
approximate number of Debentureholders according to the most
recent information so furnished to or received by the
Trustee, and as to the approximate cost of mailing to the
Debentureholders the form of proxy or other communication,
if any, specified in such application. If the Trustee shall
elect not to afford to such applicants access to such
information, the Trustee shall, upon the written request of
such applicants, mail to all Debentureholders whose names
and addresses are contained in the then current information
filed with the Trustee as aforesaid copies of the form of
proxy or other communication which is specified in such
request, with reasonable promptness after a tender to the
Trustee of the material to be mailed and the payment, or
provision for the payment, of the reasonable expenses of
such mailing, unless within five business days after such
tender, the Trustee shall mail to such applicants, and file
with the Securities and Exchange Commission, together with a
copy of the material to be mailed, a written statement to
the effect that, in the opinion of the Trustee, such mailing
would be contrary to the best interests of the
Debentureholders or would be in violation of applicable law.
Such written statement shall specify the basis of such
opinion. If the Securities and Exchange Commission, after
granting opportunity for a hearing upon the objections
specified in said written statement and on notice to the
Trustee, shall enter an order refusing to sustain any of
such objections, or, if, after the entry of an order
sustaining one or more of such objections, the Securities
and Exchange Commission shall find, after notice and
opportunity for a hearing, that all objections sustained
have been met and shall enter an order so declaring, the
Trustee shall mail copies of such material to all such
Debentureholders with reasonable promptness after such
determination and the renewal of the aforesaid tender;
otherwise the Trustee shall be relieved of any obligation or
duty to such applicants respecting their application.
Neither the Company, the Trustee nor any person acting
as Debenture registrar or paying agent shall be liable or
accountable to the Company or to any Debentureholder by
reason of the disclosure of any such information as to the
names and addresses of Debentureholders in accordance with
the provisions of this Section 11.11, regardless of the
source from which such information was derived, nor by
reason of the mailing of any material pursuant to a request
made under this Section 11.11.
SECTION 11.12. Trustee may hold Debentures and
otherwise deal with Company. The Trustee, the Debenture
registrar, any paying agent or any other agent of the
Company in its individual or any other capacity may buy,
own, hold and sell any of the Debentures or any other
evidences of indebtedness or other
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securities, whether heretofore or hereafter created or
issued, of the Company or any subsidiary or Affiliate with
the same rights it would have it if were not Trustee,
Debenture registrar, paying agent or such other agent; and
subject to the provisions of this Article XI, the Trustee
may engage or be interested in any financial or other
transaction with the Company or any subsidiary or Affiliate,
including without limitation, secured and unsecured loans to
the Company or any subsidiary or Affiliate; and may maintain
any and all other general banking and business relations
with the Company and any subsidiary or Affiliate with like
effect and in the same manner and to the same extent as if
the Trustee were not a party to this Indenture; and no
implied covenant shall be read into this Indenture against
the Trustee in respect of any such matters.
SECTION 11.13. Trustee may comply with any rule,
regulation or order of the Securities and Exchange
Commission. The Trustee may comply in good faith with any
rule, regulation or order of the Securities and Exchange
Commission made pursuant to the terms and provisions of the
Trust Indenture Act of 1939 and shall be fully protected in
so doing notwithstanding that such rule, regulation or order
may thereafter be amended or rescinded or determined by
judicial or other authority to be invalid for any reason,
but nothing herein contained shall require the Trustee to
take any action or omit to take any action in accordance
with such rule, regulation or order, except as is in this
Indenture otherwise required.
SECTION 11.14. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents
with respect to one or more series of Debentures which shall
be authorized to act on behalf of the Trustee to
authenticate Debentures of such series upon exchange,
registration of transfer or partial redemption or partial
conversion thereof or pursuant to Section 2.9, and if the
Trustee is required to appoint one or more Authenticating
Agents with respect to any series of Debentures, to
authenticate Debentures of such series and to take such
other actions as are specified in Sections 2.4, 2.8, 2.11,
5.2 and 13.3 and Debentures 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. Whenever reference is made in this
Indenture to the authentication and delivery of Debentures
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
(except in respect to an original issue). 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
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not less than $1,000,000 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 11.14, 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 11.14, such Authenticating Agent
shall resign immediately in the manner and with the effect
specified in this Section 11.14.
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 such Authenticating Agent,
shall continue to be an Authenticating Agent, provided such
corporation shall be otherwise eligible under this Section
11.14, without the execution or filing of any paper or any
further act on the part of the Trustee or such
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 or 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 11.14, the Trustee may appoint a
successor Authenticating Agent which shall be acceptable to
the Company and shall provide notice to the holders of the
Debentures of the series as to which the Authenticating
Agent will serve as provided in Section 14.9. 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 11.14.
The Trustee agrees to pay 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 11.2.
If an appointment with respect to one or more series is
made pursuant to this Section 11.14, the Debentures of such
series may have endorsed thereon, in addition to the
Trustee's certificate of authentication, as alternative
certificate of authentication in the following form:
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This is one of the Debentures of the series designated
therein referred to in the within-mentioned Indenture.
, As Trustee
By
As Authenticating Agent
By
Authorized Officer
If all of the Debentures of a series may not be
originally issued at one time, and if the Trustee does not
have an office capable of authenticating Debentures upon
original issuance located where the Company wishes to have
Debentures of such series authenticated upon original
issuance, the Trustee, if so requested by the Company in
writing (which writing need not comply with Section 14.8 and
need not be accompanied by an Opinion of Counsel), shall
appoint in accordance with this Section 11.14 an
Authenticating Agent having an office in a place designated
by the Company with respect to such series of Debentures.
ARTICLE XII
SUPPLEMENTAL INDENTURES
SECTION 12.1. Company and Trustee may enter into
supplemental indenture for special purposes. Without the
consent of any of the Debentureholders, the Company, when
authorized by resolution of its Board of Directors, and the
Trustee from time to time and at any time, subject to the
conditions and restrictions in this Indenture contained, may
enter into an indenture or indentures supplemental hereto in
form satisfactory to the Trustee, which thereafter shall
form a part hereof, for any one or more of the following
purposes:
(a) to add to the covenants and agreements of the
Company in this Indenture contained, other covenants
and agreements thereafter to be observed for the
benefit of the Holders of all or any series of
Debentures (and if such covenants and agreements are to
be for the benefit of less than all series of
Debentures, stating that such covenants and agreements
are expressly being included solely for the benefit of
such series) or to surrender any right or power herein
reserved to or conferred upon the Company; or
(b) to cure any ambiguity or to cure, correct or
supplement any defect or inconsistent provision
contained in this Indenture or in any supplemental
indenture; or
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(c) to make sure provisions in regard to matters
or questions arising under this Indenture which may be
necessary or desirable, or otherwise change this
Indenture in any manner, which shall not adversely
affect the interests of the Debentureholders of any
series; or
(d) to evidence the succession of another
corporation to the Company, or successive successions,
and the assumption by the successor corporation of the
covenants, agreements and obligations of the Company
pursuant to Article X and to provide for the adjustment
of conversion rights pursuant to Section 13.7; or
(e) to establish the form or terms of the
Debentures of any series as permitted by Sections 2.1
and 2.2; or
(f) to change or eliminate any of the provisions
of this Indenture, provided that, except as otherwise
contemplated by Section 2.2(23), any such change or
elimination shall become effective only when there is
no Debenture outstanding of any series created prior
thereto which is entitled to the benefit of such
provision; or
(g) to add or change any of the provisions of
this Indenture to such extent as shall be necessary to
permit or facilitate the issuance of Debentures in
bearer form, registrable or not registrable as to
principal, and with or without interest coupons, or to
provide for uncertificated Debentures in addition to
certificated Debentures (so long as any
"registration-required obligation" within the meaning
of Section 163(f)(2) of the Code is in registered form
for purposes of the Code); or
(h) to amend or supplement any provision
contained herein, which was required to be contained
herein in order for this Indenture to be qualified
under the Trust Indenture Act of 1939, if the Trust
Indenture Act of 1939 or regulations thereunder change
what is so required to be included in qualified
indentures, in any manner not inconsistent with what
then may be required for such qualification; or
(i) to add any additional Events of Default (and
if such Events of Default are to be applicable to less
than all series of Securities, stating that such Events
of Default are expressly being included solely to be
applicable to such series); or
(j) to convey, transfer, assign, mortgage or
pledge to the Trustee as security for the Debentures of
one or more series any property or assets; or
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(k) to add to or change any of the provisions of
this Indenture as contemplated in Section 11.7(b)
and the Company hereby covenants that it will fully perform
all the requirements of any such supplemental indenture
which may be in effect from time to time. Nothing in this
Article XII contained shall affect or limit the right or
obligation of the Company to execute and deliver to the
Trustee any instrument of further assurance or other
instrument which elsewhere in this Indenture it is provided
shall be delivered to the Trustee.
The Trustee shall join with the Company in the
execution of any such supplemental indenture, make any
further appropriate agreements and stipulations which may be
therein contained and accept the conveyance, transfer,
assignment, mortgage or pledge of any property thereunder,
but the Trustee shall not be obligated to enter into any
such supplemental indenture which adversely affects the
Trustee's own rights, duties or immunities under this
Indenture or otherwise.
Any supplemental indenture authorized by the provisions
of this Section 12.1 may be executed by the Company and the
Trustee without the consent of the holders of any of the
Debentures at the time Outstanding, notwithstanding any of
the provisions of Section 12.2.
SECTION 12.2. Modification of Indenture with consent
of Debentureholders. With the consent (evidenced as provided
in Section 8.1) of the holders of not less than 66 2/3% in
aggregate principal amount of the Debentures at the time
Outstanding of each series affected by such supplement, the
Company, when authorized by a resolution of its Board of
Directors, and the Trustee may from time to time and at any
time enter into an indenture or indentures supplemental
hereto for the purpose of adding any provision to or
changing in any manner or eliminating any of the provisions
of this Indenture or of any supplemental indenture or of
modifying in any manner the rights of the holders of such
series of the Debentures; provided, however, that no such
supplemental indenture shall (i) extend the time or times of
payment of the principal of, premium, if any, or the
interest on, any Debenture, or reduce the principal amount
of, premium, if any, or the rate of interest on, any
Debenture (and/or such other amount or amounts as any
Debentures or supplemental indentures with respect thereto
may provide to be due and payable upon declaration of
acceleration of the maturity thereof pursuant to Section
7.1) or change the currency of payment of principal of,
premium, if any, or interest on, any Debenture or reduce any
amount payable on redemption thereof or alter or impair the
right to convert the same at the rate and upon the terms
provided in the Indenture or alter or impair the right to
require redemption at the option of the holder, without the
consent of the holder of
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each Debenture so affected, or (ii) reduce the percentage of
Debentures of any series, the vote or consent of the holders
of which is required for such modifications and alterations,
without the consent of the holders of all Debentures then
Outstanding of such series under the Indenture.
Notwithstanding the foregoing, no consent of the
Debentureholders shall be necessary to permit the execution
of supplemental indentures pursuant to Section 13.7.
Upon the request of the Company, accompanied by a copy
of a resolution of its Board of Directors certified by the
Secretary or an Assistant Secretary of the Company
authorizing the execution of any such supplemental
indenture, and upon the filing with the Trustee of evidence
of the consent of Debentureholders as aforesaid, the Trustee
shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture
affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise, in which case the Trustee may,
in its discretion, but shall not be obligated, to enter into
such supplemental indenture.
It shall not be necessary for the consent of the
Debentureholders under this Section 12.2 to approve the
particular form of any proposed supplemental indenture, but
it shall be sufficient if such consent shall approve the
substance thereof.
A supplemental indenture which changes or eliminates
any provision of this Indenture which has expressly been
included solely for the benefit of one or more particular
series of Debentures, or which modifies the rights of the
holders of Debentures of such series with respect to such
provision, shall be deemed not to affect the rights under
this Indenture of the holders of Debentures of any other
series.
SECTION 12.3. Effect of supplemental indentures. Upon
the execution of any supplemental indenture pursuant to the
provisions of this Article XII, this Indenture shall be and
be deemed to be modified and amended in accordance therewith
and the respective rights, limitations of rights,
obligations, duties and immunities under this Indenture of
the Trustee, the Company and the holders of Debentures shall
thereafter be determined, exercised and enforced hereunder
subject in all respects to such modifications and
amendments, and all the terms and conditions of any such
supplemental indenture shall be and be deemed to be part of
the terms and conditions of this Indenture for any and all
purposes.
The Trustee, subject to the provisions of Section 11.1
may receive an Opinion of Counsel as conclusive evidence
that any such supplemental indenture complies with the
provisions of this Article XII.
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SECTION 12.4. Supplemental indentures to conform to
Trust Indenture Act. Any supplemental indenture executed and
delivered pursuant to the provisions of this Article XII
shall conform in all respects to the requirements of the
Trust Indenture Act of 1939, as amended, as then in effect.
SECTION 12.5. Notation on or exchange of Debentures.
If an amendment, supplement or waiver changes the terms of a
Debenture of any series, the Trustee may require the Holder
of the Debenture to deliver it to the Trustee. The Trustee
may place an appropriate notation on the Debenture about the
changed terms and return it to the Holder. Alternatively,
if the Company or the Trustee so determines, the Company in
exchange for the Debenture of any series shall issue and the
Trustee shall authenticate a new Debenture of such series
that reflects the changed terms.
ARTICLE XIII
CONVERSION OF DEBENTURES
SECTION 13.1. Applicability of Article. Debentures
of any series which are convertible into Capital Stock at
the option of the Debentureholder shall be convertible in
accordance with their terms and (unless otherwise specified
as contemplated by Section 2.2. for Debentures of any
series) in accordance with this Article. Each reference in
this Article XIII to "a Debenture" or "the Debentures"
refers to the Debentures of the particular series that is
convertible into Capital Stock. Each reference in this
Article to "Capital Stock" into which Debentures of any
series are convertible refers to the class of Capital Stock
into which the Debentures of such series are convertible in
accordance with their terms (as specified as contemplated by
Section 2.2). If more than one series of Debentures with
conversion privileges are outstanding at any time, the
provisions of this Article XIII shall be applied separately
to each such series.
SECTION 13.2. Right of Debentureholders to convert
Debentures. Subject to and upon compliance with the terms
of the Debentures and the provisions of Section 5.7 and this
Article XIII, at the option of the holder thereof, any
Debenture of any series of any authorized denomination, or
any portion of the principal amount thereof which is $1,000
or any integral multiple of $1,000, may, at any time during
the period specified in the Debentures of such series, or in
case such Debenture or portion thereof shall have been
called for redemption, then in respect of such Debenture or
portion thereof until and including, but not after (unless
the Company shall default in payment due upon the redemption
thereof) the close of business on the date fixed for
redemption except that in the case of redemption at the
option of the Debentureholder, if specified in the terms of
such Debentures, such right shall terminate upon receipt of
written notice of the exercise of such option, be converted
into duly
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authorized, validly issued, fully paid and nonassessable
shares of the class of Capital Stock, or combination
thereof, as specified in such Debenture, at the conversion
rate for each $1,000 principal amount of Debentures (such
initial conversion rate reflecting an initial conversion
price specified in such Debenture) in effect on the
conversion date, or, in case an adjustment in the conversion
rate has taken place pursuant to the provisions of Section
13.5, then at the applicable conversion rate as so adjusted,
upon surrender of the Debenture or Debentures, the principal
amount of which is so to be converted, to the Company at any
time during usual business hours at the office or agency to
be maintained by it in accordance with the provisions of
Section 4.2, accompanied by a written notice of election to
convert as provided in Section 13.3 and, if so required by
the Company and the Trustee, by a written instrument or
instruments of transfer in form satisfactory to the Company
and the Trustee duly executed by the registered holder or
his attorney duly authorized in writing. All Debentures
surrendered for conversion shall, if surrendered to the
Company or any conversion agent, be delivered to the Trustee
for cancellation and cancelled by it, or shall, if
surrendered to the Trustee, be cancelled by it, as provided
in Section 2.11.
The initial conversion price or conversion rate in
respect of a series of Debentures shall be specified on the
Debentures of such series. The conversion price or
conversion rate will be subject to adjustment on the terms
set forth in Section 13.5 or such other or different terms,
if any, as may be specified by Section 2.2 for Debentures of
such series. Provisions of this Indenture that apply to
conversion of all of a Debenture also apply to conversion of
a portion of it.
SECTION 13.3. Issuance of shares of Capital Stock
on conversion. As promptly as practicable after the
surrender, as herein provided, of any Debenture or
Debentures for conversion, the Company shall deliver or
cause to be delivered at its said office or agency to or
upon the written order of the holder of the Debenture or
Debentures so surrendered a certificate or certificates
representing the number of duly authorized, validly issued,
fully paid and nonassessable shares of Capital Stock into
which such Debenture or Debentures may be converted in
accordance with the terms thereof and the provisions of this
Article XIII. Prior to delivery of such certificate or
certificates, the Company shall require a written notice at
its said office or agency from the holder of the Debenture
or Debentures so surrendered stating that the holder
irrevocably elects to convert such Debenture or Debentures,
or, if less than the entire principal amount thereof is to
be converted, stating the portion thereof to be converted.
Such notice shall also state the name or names (with address
and social security or other taxpayer identification number)
in which said certificate or certificates are to be issued.
Such conversion shall be deemed to have been made at the
time that such Debenture or Debentures shall have
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been surrendered for conversion and such notice shall have
been received by the Company or the Trustee, the rights of
the holder of such Debenture or Debentures as a
Debentureholder shall cease at such time, the person or
persons entitled to receive the shares of Capital Stock upon
conversion of such Debenture or Debentures shall be treated
for all purposes as having become the record holder or
holders of such shares of Capital Stock at such time and
such conversion shall be at the conversion rate in effect at
such time. In the case of any Debenture of any series which
is converted in part only, upon such conversion, the Company
shall execute and the Trustee or any Authenticating Agent
shall authenticate and deliver to the holder thereof, as
requested by such holder, a new Debenture or Debentures of
such series of authorized denominations in aggregate
principal amount equal to the unconverted portion of such
Debenture.
If the last day on which a Debenture may be converted
is not a Business day in a place where a conversion agent is
located, the Debenture may be surrendered to that conversion
agent on the next succeeding day that is a Business day.
The Company will not be required to deliver
certificates for shares of Capital Stock upon conversion
while its stock transfer books are closed for a meeting of
shareholders or for the payment of dividends or for any
other purpose, but certificates for shares of Capital Stock
shall be delivered as soon as the stock transfer books shall
again be opened.
SECTION 13.4. No payment or adjustment for interest
or dividends. Unless otherwise specified as contemplated by
Section 2.2 for Debentures of such series, Debentures
surrendered for conversion during the period from the close
of business on any regular record date (or special record
date for payment of defaulted interest) next preceding any
interest payment date to the opening of business on such
interest payment date (except Debentures called for
redemption on a redemption date within such period) when
surrendered for conversion must be accompanied by payment of
an amount equal to the interest thereon which the registered
holder is to receive on such interest payment date. Payment
of interest shall be made as of such interest payment date
or such date, as the case may be, to the holder of record of
the Debentures as of such regular, or special record date,
as applicable. Except where Debentures surrendered for
conversion must be accompanied by payment as described
above, no interest on converted Debentures will be payable
by the Company on any interest payment date subsequent to
the date of conversion. No other payment or adjustment for
interest or dividends is to be made upon conversion.
Notwithstanding the foregoing, upon conversion of any
Debentures with original issue discount, the fixed number of
shares of Capital Stock into which such Debenture is
convertible delivered by the Company to the holder thereof
shall be applied, first, to pay the accrued original issue
discount attributable to the period from the date of
issuance to
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the date of conversion of such Debenture, and, second, to
pay the balance of the principal amount of such Debenture.
SECTION 13.5. Adjustment of conversion rate.
Unless otherwise specified as contemplated by Section 2.2
for Debentures of such series, the conversion rate for
Debentures in effect at any time shall be subject to
adjustment as follows:
(a) In case the Company shall (i) declare a
dividend or make a distribution on the class of Capital
Stock into which Debentures of such series are
convertible in shares of its Capital Stock, (ii)
subdivide the outstanding shares of the class of
Capital Stock into which Debentures of such series are
convertible into a greater number of shares, (iii)
combine the outstanding shares of the class of Capital
Stock into which Debentures of such series are
convertible into a smaller number of shares, or (iv)
issue by reclassification of the shares of the class of
Capital Stock into which Debentures of such series are
convertible (including any such reclassification in
connection with a consolidation or merger in which the
Company is the continuing corporation) any shares, the
conversion rate for the Debentures of such series in
effect at the time of the record date for such dividend
or distribution, or the effective date of such
subdivision, combination or reclassification, shall be
proportionately adjusted so that the holder of any
Debenture of such series surrendered for conversion
after such time shall be entitled to receive the number
and kind of shares which he would have owned or have
been entitled to receive had such Debenture been
converted immediately prior to such time. Similar
adjustments shall be made whenever any event listed
above shall occur.
(b) In case the Company shall fix a record date
for the issuance of rights or warrants to all holders
of the class of Capital Stock into which Debentures of
such series are convertible entitling them (for a
period expiring within 45 days after such record date)
to subscribe for or purchase shares of such class of
Capital Stock (or securities convertible into shares of
such class of Capital Stock ) at a price per share (or,
in the case of a right or warrant to purchase
securities convertible into such class of Capital
Stock, having a conversion price per share, after
adding thereto the exercise price, computed on the
basis of the maximum number of shares of such class of
Capital Stock issuable upon conversion of such
convertible securities, per share of such class of
Capital Stock, so issuable) less than the current
market price per share of such class of Capital Stock
(as defined in subsection (d) below) on the date on
which such issuance was declared or otherwise announced
by the Company (the "Determination Date"), the number
of shares of such class of Capital Stock into which
each $1,000 principal amount of Debentures shall be
convertible after such record date shall be determined
by multiplying the
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number of shares of such class of Capital Stock into
which such principal amount of Debentures was
convertible immediately prior to such record date by a
fraction, of which the numerator shall be the number of
shares of such class of Capital Stock outstanding on
the Determination Date plus the number of additional
shares of such class of Capital Stock offered for
subscription or purchase (or in the case of a right or
warrant to purchase securities convertible into such
class of Capital Stock, the aggregate number of
additional shares of such class of Capital Stock into
which the convertible securities so offered are
initially convertible), and of which the denominator
shall be the number of shares of such class of Capital
Stock outstanding on the Determination Date plus the
number of shares of such class of Capital Stock
obtained by dividing the aggregate offering price of
the total number of shares so offered (or, in the case
of a right or warrant to purchase securities
convertible into such class of Capital Stock, the
aggregate initial conversion price of the convertible
securities so offered, after adding thereto the
aggregate exercise price of such rights or warrants
computed on the basis of the maximum number of shares
of such class of Capital Stock issuable upon conversion
of such convertible securities) by such current market
price. Shares of such class of Capital Stock of the
Company owned by or held for the account of the Company
shall not be deemed outstanding for the purpose of any
such computation. Such adjustment shall be made
successively whenever such a record date is fixed; and
to the extent that shares of such class of Capital
Stock are not delivered (or securities convertible into
shares of such class of Capital Stock are not
delivered) after the expiration of such rights or
warrants (or, in the case of rights or warrants to
purchase securities convertible into such class of
Capital Stock once exercised, the expiration of the
conversion right of such securities) the conversion
rate shall be readjusted to the conversion rate which
would then be in effect had the adjustments made upon
the issuance of such rights or warrants (or securities
convertible into shares) been made upon the basis of
delivery of only the number of shares actually
delivered. In the event that such rights or warrants
are not so issued, the conversion rate shall again be
adjusted to be the conversion rate which would then be
in effect if such record date had not been fixed.
(c) In case the Company shall fix a record date
for the making of a distribution to all holders of the
class of Capital Stock into which Debentures of such
series are convertible (including any such distribution
made in connection with a consolidation or merger in
which the Company is the continuing corporation) of
evidences of its indebtedness or assets (excluding any
cash dividends paid from retained earnings and
dividends payable in Capital Stock for which adjustment
is made pursuant to subsection (a)
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above) or subscription rights or warrants (excluding
subscription rights or warrants to purchase the class
of Capital Stock into which Debentures of such series
are convertible), the number of shares of such class of
Capital Stock into which each $1,000 principal amount
of Debentures of such series shall be convertible after
such record date shall be determined by multiplying the
number of shares of such class of Capital Stock into
which such principal amount of Debentures was
convertible immediately prior to such record date by a
fraction, of which the numerator shall be the fair
market value of the assets of the Company, after
deducting therefrom all liabilities of the Company and
all preferences (including accrued but unpaid
dividends) in respect of classes of Capital Stock
having a preference with respect to the assets of the
Company over such class of Capital Stock (all as
determined by the Board of Directors, whose
determination shall be conclusive, and described in a
certificate signed by any Vice Chairmen of the Board,
Vice President or Assistant Vice President and
Treasurer of the Company, filed with the Trustee and
each conversion agent) on such record date, and of
which the denominator shall be such fair market value
after deducting therefrom such liabilities and
preferences, less the fair market value (as determined
by the Board of Directors, whose determination shall be
conclusive, and described in a statement filed with the
Trustee and each conversion agent) of the assets or
evidences of indebtedness, so distributed or of such
subscription rights or warrants applicable, so
distributed. Such adjustment shall be made
successively whenever such a record date is fixed; and
in the event that such distribution is not so made, the
conversion rate shall again be adjusted to the
conversion rate which would then be in effect if such
record date had not been fixed.
(d) For the purpose of any computation under
subsection (b) above and Section 13.6, the current
market price per share of the Capital Stock on any date
as of which such price is to be computed shall mean the
average of the Closing Prices for the 30 consecutive
Business days commencing 45 Business days before such
date.
(e) No adjustment in the conversion rate shall
be required unless such adjustment would require a
cumulative increase or decrease of at least 1% in such
rate; provided, however, that any adjustments which by
reason of this subsection (e) are not required to be
made shall be carried forward and taken into account in
any subsequent adjustment, and provided, further, that
adjustments shall be required and made in accordance
with the provisions of this Article XIII (other than
this subsection (e)) not later than such time as may be
required in order to preserve the tax-free nature of a
distribution for United States income tax purposes to
the holders of Debentures or the class of Capital Stock
into
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which such Debentures are convertible. All
calculations under this Article XIII shall be made to
the nearest cent or to the nearest one-thousandth of a
share, as the case may be. Anything in this Section
13.5 to the contrary notwithstanding, the Company shall
be entitled to make such adjustments in the conversion
rate, in addition to those required by this Section
13.5, as it in its discretion shall determine to be
advisable in order that any stock dividend, subdivision
of shares, distribution of rights to purchase stock or
securities, or distribution of securities convertible
into or exchangeable for stock hereafter made by the
Company to its shareholders shall not be taxable for
United States income tax purposes.
(f) Whenever the conversion rate is adjusted,
as herein provided, the Company shall promptly file
with the Trustee and with the office or agency
maintained by the Company for the conversion of
Debentures of such series pursuant to Section 4.2, a
certificate of a firm of independent public accountants
of recognized national standing selected by the Board
of Directors (who may be the regular accountants
employed by the Company) setting forth the conversion
rate after such adjustment and setting forth a brief
statement of the facts requiring such adjustment and a
computation thereof. Such certificate shall be
conclusive evidence of the correctness of such
adjustment. Neither the Trustee nor any conversion
agent shall be under any duty or responsibility with
respect to any such certificate or any facts or
computations set forth therein, except to exhibit said
certificate from time to time to any Debentureholder of
such series desiring to inspect the same. The Company
shall promptly cause a notice setting forth the
adjusted conversion rate to be mailed to the holders of
Debentures of such series, as their names and addresses
appear upon the registration books of the Company.
(g) In the event that at any time, as a result
of shares of any other class of Capital Stock becoming
issuable in exchange or substitution for or in lieu of
shares of the class of Capital Stock into which such
Debentures are convertible or as a result of an
adjustment made pursuant to subsection (a) above, the
holder of any Debenture of such series thereafter
surrendered for conversion shall become entitled to
receive any shares of the Company other than shares of
the class of Capital Stock into which the Debentures of
such series are convertible, thereafter the number of
such other shares so receivable upon conversion of any
Debenture shall be subject to adjustment from time to
time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the class
of Capital Stock into which the Debentures of such
series are convertible contained in subsections (a) to
(f), inclusive, above, and the provisions of this
Article XIII with respect
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to the class of Capital Stock into which the Debentures
of such series are convertible shall apply on like
terms to any such other shares.
(h) The conversion rate with respect to any
Debentures with original issue discount, the terms of
which provide for convertibility, shall not be adjusted
during the term of such Original Issue Discount
Debentures for accrued original issue discount.
(i) In the event that the Debentures of any
series are convertible into more than one class of
Capital Stock, the provisions of this Section 13.5
shall apply separately to events affecting each such
class.
SECTION 13.6. No fractional shares to be issued.
No fractional shares of Capital Stock shall be issued upon
conversions of Debentures. If more than one Debenture of
any series shall be surrendered for conversion at one time
by the same holder, the number of full shares which shall be
issuable upon conversion thereof shall be computed on the
basis of the aggregate principal amount of the Debentures of
such series (or specified portions thereof to the extent
permitted hereby) so surrendered. Instead of a fraction of
a share of Capital Stock which would otherwise be issuable
upon conversion of any Debenture or Debentures (or specified
portions thereof), the Company shall pay a cash adjustment
in respect of such fraction of a share in an amount equal to
the same fractional interest of the current market price (as
defined in Section 13.5) per share of Capital Stock on the
Business day next preceding the day of conversion.
SECTION 13.7. Preservation of conversion rights upon
consolidation, merger, sale or conveyance. In case of any
consolidation of the Company with, or merger of the Company
into, any other corporation (other than a consolidation or
merger in which the Company is the continuing corporation),
or in the case of any sale or transfer of all or
substantially all of the assets of the Company, the
corporation formed by such consolidation or the corporation
into which the Company shall have been merged or the
corporation which shall have acquired such assets, as the
case may be, shall execute and deliver to the Trustee, a
supplemental indenture, subject to the provisions of Article
X and XII as they relate to supplemental indentures,
providing that the holder of each Debenture then Outstanding
of a series which was convertible into Capital Stock shall
have the right thereafter to convert such Debenture into the
kind and amount of shares of stock and other securities and
property, including cash, receivable upon such
consolidation, merger, sale or transfer by a holder of the
number of shares of Capital Stock of the Company into which
such Debentures might have been converted immediately prior
to such consolidation, merger, sale or transfer. Such
supplemental indenture shall conform to the
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provisions of the Trust Indenture Act of 1939 as then in
effect and shall provide for adjustments which shall be as
nearly equivalent as may be practicable to the adjustments
provided for in this Article XIII. Neither the Trustee nor
any conversion agent shall be under any responsibility to
determine the correctness of any provision contained in any
such supplemental indenture relating either to the kind or
amount of shares of stock or other securities or property
receivable by Debentureholders upon the conversion of their
Debentures after any such consolidation, merger, sale or
transfer, or to any adjustment to be made with respect
thereto and, subject to the provisions of Section 11.1, may
accept as conclusive evidence of the correctness of any such
provisions, and shall be protected in relying upon, an
Opinion of Counsel with respect thereto. If in the case of
any such consolidation, merger, sale or transfer, the stock
or other securities and property receivable by a holder of
the Debentures includes stock or other securities and
property of a corporation other than the successor or
purchasing corporation, then such supplemental indenture
shall also be executed by such other corporation and shall
contain such additional provisions to protect the interests
of the holders of the Debentures as the Board of Directors
shall reasonably consider necessary. The above provisions
of this Section 13.7 shall similarly apply to successive
consolidations, mergers, sales or transfers.
SECTION 13.8. Notice to Debentureholders of a series
prior to taking certain types of action. With respect to
the Debentures of any series, in case:
(a) the Company shall authorize the issuance to
all holders of the class of Capital Stock into which
Debentures of such series are convertible of rights or
warrants to subscribe for or purchase shares of its
Capital Stock or of any other right;
(b) the Company shall authorize the distribution
to all holders of the class of Capital Stock into which
Debentures of such series are convertible of evidences
of its indebtedness or assets (except for the
exclusions with respect to certain dividends set forth
in Section 13.5(c);
(c) of any subdivision, combination or
reclassification of the class of Capital Stock into
which Debentures of such series are convertible or of
any consolidation or merger to which the Company is a
party and for which approval by the shareholders of the
Company is required, or of the sale or transfer of all
or substantially all of the assets of the Company; or
(d) of the voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then the Company shall cause to be filed with the Trustee
and at
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the office or agency maintained for the purpose of
conversion of Debentures of such series pursuant to Section
4.2, and shall cause to be mailed to the holders of
Debentures of such series, at their last addresses as they
shall appear upon the registration books of the Company, at
least ten days prior to the applicable record date
hereinafter specified, a notice stating (i) the date as of
which the holders of such class of Capital Stock to be
entitled to receive any such rights, warrants or
distribution are to be determined, or (ii) the date on which
any such subdivision, combination, reclassification,
consolidation, merger, sale, transfer, dissolution,
liquidation, winding up or other action is expected to
become effective, and the date as of which it is expected
that holders of record of such class of Capital Stock shall
be entitled to exchange their Capital Stock of such class
for securities or other property, if any, deliverable upon
such subdivision, combination, reclassification,
consolidation, merger, sale, transfer, dissolution,
liquidation, winding up or other action. The failure to give
the notice required by this Section 13.8 or any defect
therein shall not affect the legality or validity of any
distribution, right, warrant, subdivision, combination,
reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation, winding up or other action, or the
vote upon any of the foregoing. Such notice shall also be
published by and at the expense of the Company not later
than the aforesaid filing date at least once in an
Authorized Newspaper.
SECTION 13.9. Covenant to reserve shares for issuance
on conversion of Debentures. The Company covenants that at
all times it will reserve and keep available out of each
class of its authorized Capital Stock, free from preemptive
rights, solely for the purpose of issue upon conversion of
Debentures of any series as herein provided, such number of
shares of Capital Stock of such class as shall then be
issuable upon the conversion of all Outstanding Debentures
of such series. The Company covenants that all shares of
Capital Stock which shall be so issuable shall, when issued
or delivered, be duly and validly issued shares of the class
of authorized Capital Stock into which Debentures of such
series are convertible, and shall be fully paid and
nonassessable, free of all liens and charges and not subject
to preemptive rights and that, upon conversion, the
appropriate capital stock accounts of the Company will be
duly credited.
SECTION 13.10. Compliance with governmental
requirements. The Company covenants that if any shares of
Capital Stock required to be reserved for purposes of
conversion of Debentures hereunder require registration or
listing with or approval of any governmental authority under
any Federal or State law, pursuant to the Securities Act of
1933, as amended, or the Securities Exchange Act, or any
national or regional securities exchange on which such
Capital Stock is listed at the time of delivery of any
shares of such Capital Stock, before such shares may be
issued
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upon conversion, the Company will use its best efforts to
cause such shares to be duly registered, listed or approved,
as the case may be.
SECTION 13.11. Payment of taxes upon certificates for
shares issued upon conversion. The issuance of certificates
for shares of Capital Stock upon the conversion of
Debentures shall be made without charge to the converting
Debentureholders for any tax (including, without limitation,
all documentary and stamp taxes) in respect of the issuance
and delivery of such certificates, and such certificates
shall be issued in the respective names of, or in such names
as may be directed by, the holders of the Debentures
converted; provided, however, that the Company shall not be
required to pay any tax which may be payable in respect of
any transfer involved in the issuance and delivery of any
such certificate in a name other than that of the holder of
the Debenture converted, and the Company shall not be
required to issue or deliver such certificates unless or
until the person or persons requesting the issuance thereof
shall have paid to the Company the amount of such tax or
shall have established to the satisfaction of the Company
that such tax has been paid.
SECTION 13.12. Trustee's duties with respect to
conversion provisions. The Trustee and any conversion agent
shall not at any time be under any duty or responsibility to
any Debentureholder to determine whether any facts exist
which may require any adjustment of the conversion rate, or
with respect to the nature or extent of any such adjustment
when made, or with respect to the method employed, or herein
or in any supplemental indenture provided to be employed, in
making the same. Neither the Trustee nor any conversion
agent shall be accountable with respect to the registration
under securities laws, listing, validity or value (or the
kind or amount) of any shares of Capital Stock, or of any
other securities or property, which may at any time be
issued or delivered upon the conversion of any Debenture;
and neither the Trustee nor any conversion agent makes any
representation with respect thereto. Neither the Trustee
nor any conversion agent shall be responsible for any
failure of the Company to make any cash payment or to issue,
transfer or deliver any shares of stock or stock
certificates or other securities or property upon the
surrender of any Debenture for the purpose of conversion;
and the Trustee, subject to the provisions of Section 11.1,
and any conversion agent shall not be responsible for any
failure of the Company to comply with any of the covenants
of the Company contained in this Article XIII.
ARTICLE XIV
MISCELLANEOUS PROVISIONS
SECTION 14.1. Rights under Indenture limited to the
parties and holders of Debentures. Except as provided in
Article III, nothing in this Indenture or the Debentures,
express or implied,
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is intended or shall be construed to confer upon, or to give
to, any person or corporation, other than the parties
hereto, their successors and assigns, and the holders of the
Debentures, any right, remedy or claim under or by reason of
this Indenture or any provision hereof; and the provisions
of this Indenture are for the exclusive benefit of the
parties hereto, their successors and assigns, and the
holders of the Debentures.
SECTION 14.2. Certificate of independent accountants
conclusive. Unless otherwise specifically provided, the
certificate or opinion of Arthur Andersen & Co., or of any
other independent firm of public accountants of recognized
standing selected by the Board of Directors and acceptable
to the Trustee in the exercise of reasonable care (which
firm may be regular independent accountants to the Company),
shall be conclusive evidence of the correctness of any
computation made under the provisions of this Indenture, and
wherever reference is made in this Indenture to "generally
accepted accounting principles" the certificate or opinion
of such a firm shall be conclusive evidence thereof. The
Company shall furnish to the Trustee upon its request a copy
of any such certificate or opinion.
SECTION 14.3. Treatment of Debentures owned or held by
the Company in determining required percentages. For all
purposes of this Indenture, in determining whether the
holders of a required percentage or proportion of the
principal amount of Debentures of one or more series have
concurred in any request, waiver, vote, direction or
consent, Debentures owned or held by or for the account or
for the benefit of the Company or any other obligor under
this Indenture or any Affiliate shall be disregarded and
deemed not Outstanding, except that, for the purposes of
determining whether the Trustee shall be protected in
relying on any such request, waiver, direction or consent,
only Debentures which the Trustee knows to be so owned or
held shall be so disregarded. Debentures so owned which
have been pledged in good faith to secure an obligation may
be regarded as Outstanding for all such purposes, if the
Trustee receives an Officers' Certificate stating that said
Debentures have been so pledged, that the pledgee is
entitled to vote with respect to such Debentures and that
the pledgee is not the Company or any other obligor on the
Debentures, an Affiliate of the Company or an Affiliate of
such other obligor. In case of a dispute as to such right,
any decision by the Trustee taken upon the advice of counsel
shall be conclusive, and, subject to the provisions of
Section 11.1 of this Indenture, shall afford full protection
to the Trustee.
SECTION 14.4. Remaining provisions not affected by
invalidity of any other provisions-required provisions of
Trust Indenture Act of 1939 to control. In case anyone or
more of the provisions contained in this Indenture or in the
Debentures of any series shall for any reason be held to be
invalid, illegal or unenforceable in any respect, such
invalidity, illegality or
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unenforceability shall not affect any other provision of
this Indenture, but this Indenture shall be construed as if
such invalid, illegal or unenforceable provisions had never
been contained herein.
If any provision of this Indenture limits, qualifies or
conflicts with any other provision of this Indenture which
is required to be included in an indenture qualified under
the Trust Indenture Act of 1939, as amended, such provision
which is so required to be included shall control.
SECTION 14.5. Company released from Indenture
requirements if entitled to have Indenture cancelled.
Whenever by the terms of this Indenture the Company shall be
required to do or not to do anything so long as any of the
Debentures shall be Outstanding of any series, the Company
shall, notwithstanding any such provision, not be required
to comply with such provision with respect to such series if
it shall be entitled to have this Indenture satisfied and
discharged pursuant to the provisions hereof, even though in
either case the holders of any of the Debentures of such
series shall have failed to present and surrender such
Debentures for payment pursuant to the terms of this
Indenture.
SECTION 14.6. Date of execution. Although this
Indenture, for convenience and for the purpose of reference,
is dated as of the date first above written, the actual date
of execution by the Company and by the Trustee is as
indicated by their respective acknowledgements hereto
annexed.
SECTION 14.7. Execution of documents furnished under
the Indenture. Unless otherwise expressly provided, any
order, notice, request, demand, certificate or statement of
the Company required or permitted to be made or given under
any provision hereof shall be sufficiently executed if
signed by its Chairman of the Board, President, any Vice
Chairman of the Board or any Vice President, and by its
Treasurer, any Assistant Treasurer, Secretary or any
Assistant Secretary.
SECTION 14.8. Officers' Certificates and Opinions of
Counsel to be furnished Trustee. Upon any application,
demand or request by the Company to the Trustee to take any
action under any of the provisions of this Indenture, the
Company shall furnish to the Trustee an Officers'
Certificate stating that all conditions precedent, if any,
provided for in this Indenture relating to the proposed
action have been complied with, and an Opinion of Counsel
stating that in the opinion of such counsel all such
conditions precedent have been complied with and that such
action is in compliance with applicable law.
Each certificate or opinion with respect to compliance
with a condition or covenant provided for in this Indenture
shall include (a) a statement that the person making such
certificate
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or opinion has read such covenant or condition; (b) a brief
statement as to the nature and scope of the examination or
investigation upon which the statements or opinions
contained in such certificate or opinion are based; (c) a
statement that, in the opinion of such person, he has made
such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such
covenant or condition has been complied with; and (d) a
statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.
Any certificate, statement 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 that the certificate
or opinion or representations with respect to the matters
upon which his certificate, statement or opinion may be
based as aforesaid are erroneous, or in the exercise of
reasonable care should know that the same are erroneous.
Any certificate, statement or opinion of counsel may be
based, insofar as it relates to factual matters, information
with respect to which is in the possession of the Company,
upon the certificate, statement or opinion of or
representations by an officer or officers of the Company,
unless such counsel knows that the certificate, statement or
opinion or representations with respect to the matters upon
which his certificate, statement or opinion may be based as
aforesaid are erroneous, or in the exercise of reasonable
care should know that the same are erroneous.
Any certificate, statement or opinion of an officer of
the Company or of counsel may be based, insofar as it
relates to accounting matters, upon a certificate or opinion
of or representations by an accountant or firm of
accountants in the employ of the Company, unless such
officer or counsel, as the case may be, knows that the
certificate or opinion or representations with respect to
the accounting matters upon which his certificate, statement
or opinion may be based as aforesaid are erroneous, or in
the exercise of reasonable care should know that the same
are erroneous. Any certificate or opinion of any
independent firm of public accountants filed with the
Trustee shall contain a statement that such firm is
independent.
SECTION 14.9. Presentation of notices and demands.
All notices to or demands upon the Trustee shall be in
writing and may be served or presented at the principal
office of the Trustee. Any notice to or demand upon the
Company shall be deemed to have been sufficiently given or
served by the Trustee or the Debentureholders, for all
purposes, by being mailed by first class mail addressed to
the Company, attention of the President, at 2002 Pisgah
Church Road, Suite 300, Greensboro, North Carolina 27455,
and to Schell Bray Aycock Abel & Livingston, 230 North Elm
Street, Suite 1500, Greensboro, North Carolina 27401,
Attention: Kenneth N. Shelton, Esq., or at such
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other address or to such other counsel, as may be filed in
writing by the Company with the Trustee.
Except as otherwise expressly provided herein, where
this Indenture provides for notice to holders of Debentures
of any event, such notice shall be sufficiently given to
holders of Debentures if in writing and mailed, first-class
postage prepaid, to each holder of a Debenture affected by
such event, at the address of such holder as it appears in
the Debenture register, not later than the latest date, and
not earlier than the earliest date, prescribed for the
giving of such notice.
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 to holders of Debentures
by mail, then such notification as shall be made with the
approval of the Trustee shall constitute a sufficient
notification for every purpose hereunder. In any case where
notice to holders of Debentures is given by mail, neither
the failure to mail such notice, nor any defect in any
notice so mailed, to any particular holder of a Debenture
shall affect the sufficiency of such notice with respect to
other holders of Debentures.
SECTION 14.10. Successors and assigns bound by
Indenture. All the covenants, promises and agreements in
this Indenture contained by or on behalf of the Company, or
by or on behalf of the Trustee, shall bind and inure to the
benefit of their respective successors and assigns, whether
so expressed or not.
SECTION 14.11 Descriptive headings for convenience
only. The descriptive headings of the several Articles of
this Indenture are inserted for convenience only and shall
not control or affect the meaning or construction of any of
the provisions hereof.
SECTION 14.12. North Carolina law to govern. This
Indenture and each Debenture shall be deemed to be a
contract made under the laws of the State of North Carolina,
and for all purposes shall be construed in accordance with
the laws of said jurisdiction, except that the rights,
obligations, duties, immunities and limitations of rights of
the Trustee shall be construed in accordance with the laws
of the State of .
SECTION 14.13. Indenture may be executed in
counterparts. This Indenture may be simultaneously executed
in any number of counterparts, each of which when so
executed and delivered shall be an original, but such
counterparts shall together constitute but one and the same
instrument. , as Trustee, hereby accepts the trusts in this
Indenture declared and provided upon the terms and
conditions hereinbefore set forth.
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IN WITNESS WHEREOF, VANGUARD CELLULAR SYSTEMS, INC. has
caused this Indenture to be signed in its corporate name,
and , as Trustee, has caused this
Indenture to be signed in its corporate name, all as of the
day and year first above written.
VANGUARD CELLULAR SYSTEMS, INC.
By:
(CORPORATE SEAL) Title:
ATTEST:
Secretary
By:
(CORPORATE SEAL) Title:
ATTEST:
Secretary
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NORTH CAROLINA
COUNTY OF GUILFORD ss.
On this day of , before me
personally came , to me known, who, being by me
duly sworn, did depose and say the he resides at ;
that he is the of Vanguard Cellular Systems, Inc., a North
Carolina corporation, the corporation described in and which
executed the above instrument; that he knows the corporate
seal of said corporation; that the seal affixed to the said
instrument is such corporate seal; that it was so affixed by
authority of the Board of Directors of said corporation; and
that he signed his name thereto by like authority.
(NOTORIAL SEAL)
STATE OF
COUNTY OF ss.
On this day of , before me
personally came , to me known, who, being
by me duly sworn, did depose and say that he resides at
; that he is a of
, the banking corporation described in and which executed
the above instrument; that he knows the seal of said banking
corporation; that the seal affixed to the said instrument is
such seal; that it was so affixed by authority of the Board
of Directors of said banking corporation; and that he signed
his name thereto by like authority.
(NOTORIAL SEAL)
Exhibit 4(c)(3)
VANGUARD CELLULAR SYSTEMS, INC.
AND
, Trustee
INDENTURE
Dated as of
Subordinated Debentures
<PAGE>
VANGUARD CELLULAR SYSTEMS, INC.
Reconciliation and Tie between Indenture
and
Trust Indenture Act of 1939
Trust Indenture Indenture
Act Section Section
310 (a)(1).................................11.5
(a)(2).................................11.5
(a)(3).................................Not applicable
(a)(4).................................Not applicable
(b)....................................11.4, 11.5
311 (a)....................................11.9
(b)....................................11.9
312 (a)....................................4.6(d),11.1
(b)....................................11.11
(c)....................................11.11
313 (a)....................................11.10(a)
(b)(1).................................Not applicable
(b)(2).................................11.10(b)
(c)....................................11.10(c)
(d)....................................11.10(c)
314 (a)(1).................................4.6(a)
(a)(2).................................4.6(b)
(a)(3).................................4.6(c)
(b)....................................Not applicable
(c)....................................14.8
(d)....................................Not applicable
(e)....................................14.8
315 (a)....................................11.1(a),(b)
(b)....................................11.3
(c)....................................11.1(a)
(d)....................................11.1(a),11.1(b),13.3
(e)....................................7.7
316 (a)(1)(A)..............................7.6,13.3
(a)(1)(B)..............................7.1,7.5,13.3
(a)(2).................................Not required
(b)....................................7.7
317 (a)....................................7.2
(b)....................................4.8
318 (a)....................................14.4
NOTE: This reconciliation and tie shall not, for any purpose,
be deemed to be part of the Indenture.
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VANGUARD CELLULAR SYSTEMS, INC.
INDENTURE
TABLE OF CONTENTS*
Page
Parties.................................................... 1
Recitals................................................... 1
Consideration.............................................. 1
ARTICLE I
DEFINITIONS; TRUST INDENTURE ACT CONTROLLING
SECTION 1.1 Definitions.............................. 1
Affiliate.......................... 1
Authenticating Agent............... 1
Authorized Newspaper............... 2
Bankruptcy Law..................... 2
Board; Board of Directors.......... 2
Business day....................... 2
Capital Stock...................... 2
Certified Resolution............... 3
Class A Common Stock............... 3
Class B Common Stock............... 3
Closing Price...................... 3
Code............................... 3
Company............................ 3
Company order...................... 4
Debenture.......................... 4
Debentureholder, holder of
Debentures.................... 4
Depositary......................... 4
Event of Default................... 4
Global Debenture................... 4
Indenture.......................... 4
Officers' Certificate.............. 4
Opinion of Counsel................. 5
Original issue discount............ 5
Original Issue Discount Debenture.. 5
Outstanding........................ 5
Paying Agent....................... 6
Person............................. 6
Principal.......................... 6
Principal amount................... 6
*This table of contents shall not, for any purpose, be deemed to
be part of the Indenture.
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Page
Responsible Officer................ 6
Securities Exchange Act............ 6
Senior Indebtedness................ 6
Trustee; principal office.......... 7
U.S. Government Obligations........ 8
SECTION 1.2. Trust Indenture Act definitions
controlling........................ 8
ARTICLE II
FORM, ISSUE AND REGISTRATION OF DEBENTURES
SECTION 2.1. Forms generally and dating.............. 8
SECTION 2.2. Amount unlimited; Issuable in series.... 9
SECTION 2.3. Denominations........................... 12
SECTION 2.4. Execution of Debentures; Authentication. 13
SECTION 2.5. Issue of Debentures..................... 16
SECTION 2.6. Transfer of Debentures.................. 16
SECTION 2.7. Persons deemed owners of Debentures..... 16
SECTION 2.8. Provisions for Debentures in temporary
form.............................. 16
SECTION 2.9. Mutilated, destroyed, lost or stolen
Debentures........................ 17
SECTION 2.10. Exchanges of Debentures................. 18
SECTION 2.11. Cancellation of surrendered Debentures.. 19
SECTION 2.12. Payment of interest; Defaulted interest. 19
SECTION 2.13. Global Debentures; Depositary........... 20
ARTICLE III
SUBORDINATION OF DEBENTURES
Page
SECTION 3.1. Debentures subordinated to Senior
Indebtedness....................... 22
SECTION 3.2. Payment over of proceeds of Debentures
on dissolution, etc................ 22
SECTION 3.3. Debentures may be paid over prior to
dissolution, etc................... 25
SECTION 3.4. Rights of holders of Senior Indebtedness
not to be impaired, etc............ 26
SECTION 3.5. Authorization to Trustee to take action
to effectuate subordination........ 27
SECTION 3.6. Trustee's rights as holder of Senior
Indebtedness....................... 27
SECTION 3.7. Trustee's disclaimer.................... 27
SECTION 3.8. Application by Trustee of monies or
U.S. Governmental Obligations
deposited with it.................. 27
SECTION 3.9. Trustee compensation not prejudiced..... 28
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ARTICLE IV
COVENANTS OF THE COMPANY
Page
SECTION 4.1. Payment of Principal and interest....... 28
SECTION 4.2. Maintenance of office or agency......... 28
SECTION 4.3. Corporate existence..................... 29
SECTION 4.4. Restrictions on mergers, sales and
consolidations.................... 29
SECTION 4.5. Further assurances...................... 29
SECTION 4.6. File certain reports and information
with the Trustee and the Securities
and Exchange Commission - transmit
to Debentureholders summaries of
certain documents filed with the
Trustee - furnish list of
Debentureholders to the Trustee... 29
SECTION 4.7. File statement by officers annually
with the Trustee.................. 30
SECTION 4.8. Duties of Paying Agent.................. 31
ARTICLE V
REDEMPTION OF DEBENTURES; SINKING FUND
Page
SECTION 5.1. Applicability of Article................ 32
SECTION 5.2. Notice of redemption to be given to
Trustee - deposit of cash (or
other form of payment) with
Trustee - selection by Trustee
of Debentures to be redeemed....... 32
SECTION 5.3. Debentures called for redemption to
become due - rights of holders
of redeemed Debentures - return
of funds on conversion............. 34
SECTION 5.4. Credit against sinking fund............. 35
SECTION 5.5. Redemption through sinking fund......... 35
SECTION 5.6. Debentures no longer Outstanding after
notice to Trustee and deposit
of cash............................ 37
SECTION 5.7. Conversion arrangement on call for
redemption......................... 37
ARTICLE VI
SATISFACTION AND DISCHARGE OF INDENTURE
Page
SECTION 6.1. Satisfaction and discharge of Indenture
with respect to Debentures of
any series......................... 38
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<PAGE>
Page
SECTION 6.2. Deposits for payment or redemption of
Debentures to be held in trust.... 39
SECTION 6.3. Repayment of moneys..................... 40
ARTICLE VII
REMEDIES OF DEFAULT
Page
SECTION 7.1. Events of Default defined - acceleration
of maturity upon default - waiver
of default after acceleration...... 40
SECTION 7.2. Covenant of Company to pay to Trustee
whole amount due on default in
payment of Principal or interest -
Trustee may recover judgment for
whole amount due - application
of moneys received by Trustee...... 44
SECTION 7.3. Trustee may enforce rights of action
without possession of Debentures... 47
SECTION 7.4. Delays or omissions not to impair any
rights or powers accruing upon
default............................ 47
SECTION 7.5. In Event of Default Trustee may protect
and enforce its rights by
appropriate proceedings - holders
of majority in aggregate Principal
amount of Debentures of a series
may waive default.................. 47
SECTION 7.6. Holders of majority in aggregate
Principal amount of Debentures of
any series may direct exercise of
remedies........................... 47
SECTION 7.7. Limitation on suits by Debentureholders. 48
SECTION 7.8. No Debentures owned or held by, for the
account of or for the benefit of
the Company to be deemed
Outstanding for purpose of
payment of distribution............ 49
SECTION 7.9. Company and Trustee restored to
former position on discontinuance
or abandonment of proceedings...... 49
ARTICLE VIII
EVIDENCE OF ACTION BY DEBENTUREHOLDERS
Page
SECTION 8.1. Evidence of action by Debentureholders.. 49
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<PAGE>
ARTICLE IX
IMMUNITY OF INCORPORATORS,
STOCKHOLDERS, OFFICERS AND DIRECTORS
Page
SECTION 9.1. Immunity of incorporators, stockholder,
officers, directors and employees.. 51
ARTICLE X
MERGER, CONSOLIDATION, SALE OR LEASE
Page
SECTION 10.1. Documents required to be filed with the
Trustee upon consolidation, merger,
sale, transfer or lease - execution
of supplemental indentures - acts
of successor corporation........... 51
SECTION 10.2. Trustee may rely upon Opinion of
Counsel............................ 52
ARTICLE XI
CONCERNING THE TRUSTEE
Page
SECTION 11.1. Acceptance of Trust - responsibilities
of Trustee........................ 52
SECTION 11.2. Trustee to be entitled to compensation -
Trustee not to be accountable for
application of proceeds - moneys
held by Trustee to be trust funds. 56
SECTION 11.3. Trustee to give Debentureholders notice
of default........................ 57
SECTION 11.4. Trustee acquiring conflicting interest
must eliminate it or resign....... 57
SECTION 11.5. Eligibility of Trustee.................. 57
SECTION 11.6. Resignation or removal of Trustee....... 58
SECTION 11.7. Acceptance by successor Trustee......... 59
SECTION 11.8. Successor to Trustee by merger or
consolidation, etc................ 61
SECTION 11.9. Limitations on right of Trustee as a
creditor to obtain payment of
certain claims.................... 61
SECTION 11.10 Trustee to make annual report to
Debentureholders - Trustee to
make other reports to
Debentureholders - Debentureholders
to whom reports to be transmitted. 62
SECTION 11.11. Preservation of information by Trustee -
Trustee to give certain information
to Debentureholders upon
application....................... 63
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<PAGE>
Page
SECTION 11.12. Trustee may hold Debentures and
otherwise deal with Company....... 64
SECTION 11.13. Trustee may comply with any rule,
regulation or order of the
Securities and Exchange
Commission........................ 64
SECTION 11.14 Appointment of Authenticating Agent..... 65
ARTICLE XII
SUPPLEMENTAL INDENTURES
Page
SECTION 12.1. Company and Trustee may enter into
supplemental indenture for
special purposes................... 67
SECTION 12.2. Modification of Indenture with consent
of Debentureholders................ 69
SECTION 12.3. Effect of supplemental indentures....... 70
SECTION 12.4. Supplemental indentures to conform to
Trust Indenture Act................ 70
SECTION 12.5. Notation on or exchange of Debentures... 70
ARTICLE XIII
CONVERSION OF DEBENTURES
Page
SECTION 13.1. Applicability of Article................ 70
SECTION 13.2. Right of Debentureholders to convert
Debentures......................... 71
SECTION 13.3. Issuance of shares of Capital Stock on
conversion......................... 72
SECTION 13.4. No payment or adjustment for interest
or dividends....................... 72
SECTION 13.5. Adjustment of conversion rate........... 73
SECTION 13.6. No fractional shares to be issued....... 77
SECTION 13.7. Preservation of conversion rights upon
consolidation, merger, sale or
conveyance......................... 78
SECTION 13.8. Notice to Debentureholders of a series
prior to taking certain types
of action.......................... 78
SECTION 13.9. Covenant to reserve shares for
issuance on conversion of
Debentures......................... 79
SECTION 13.10. Compliance with governmental
requirements....................... 80
SECTION 13.11. Payment of taxes upon certificates for
shares issued upon conversion...... 80
SECTION 13.12. Trustee's duties with respect to
conversion provisions.............. 80
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CONTENTS - (Continued)
Page
ARTICLE XIV
MISCELLANEOUS PROVISIONS
SECTION 14.1. Rights under Indenture limited to the
parties and holders of Debentures.. 81
SECTION 14.2. Certificate of independent accountants
conclusive......................... 81
SECTION 14.3. Treatment of Debentures owned or held
by the Company in determining
required percentages............... 81
SECTION 14.4. Remaining provisions not affected by
invalidity of any other
provisions - required provisions of
Trust Indenture Act of 1939 to
control............................ 82
SECTION 14.5. Company released from Indenture
requirements if entitled to have
Indenture cancelled................ 82
SECTION 14.6. Date of execution........................ 82
SECTION 14.7. Execution of documents furnished under
the Indenture...................... 83
SECTION 14.8. Officers' Certificates and Opinions of
Counsel to be furnished Trustee.... 83
SECTION 14.9. Presentation of notices and demands...... 84
SECTION 14.10. Successors and assigns bound by
Indenture.......................... 84
SECTION 14.11. Descriptive headings for convenience
only............................... 84
SECTION 14.12. North Carolina law to govern................... 85
SECTION 14.13. Indenture may be executed in
counterparts....................... 85
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<PAGE>
INDENTURE dated as of the day of ,
between Vanguard Cellular Systems, Inc., a corporation
organized and existing under the laws of the State of North
Carolina (hereinafter called the "Company"), and , a
banking corporation with its principal offices in ,
as Trustee hereunder (hereinafter called the "Trustee").
WHEREAS, the Company for its lawful corporate purposes
has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of
its debentures, notes or other evidences of indebtedness
(hereinafter called the "Debentures"), to be issued in one
or more series, the amount and terms of each series to be
determined as hereinafter provided.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
THAT, in consideration of the premises and of the
mutual covenants herein contained and of the purchase and
acceptance of the Debentures by the holders thereof, and for
other valuable consideration the receipt whereof is hereby
acknowledged, and intending to be legally bound hereby, it
is hereby agreed between the Company and the Trustee, for
the benefit of those who shall hold the Debentures, as
follows:
ARTICLE I
DEFINITIONS; TRUST INDENTURE ACT CONTROLLING
SECTION 1.1. Definitions. Unless otherwise
specified or the context otherwise requires, the terms
defined in this Article I shall for all purposes of this
Indenture and of any indenture supplemental hereto have the
meanings herein specified, the following definitions to be
equally applicable to both the singular and plural forms of
any of the terms herein defined. All accounting terms not
otherwise defined herein have the meanings assigned to them
in accordance with generally accepted accounting principles
in the United States of America, and 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.
Affiliate
An "Affiliate" shall mean any person directly or
indirectly controlling or controlled by or under direct or
indirect common control with the Company or any other
obligor under this Indenture.
Authenticating Agent
The term "Authenticating Agent" means any Person
authorized by the Trustee pursuant to Section 11.14 to act
on behalf of the
<PAGE>
Trustee to authenticate Debentures of one or more series.
Authorized Newspaper
The term "Authorized Newspaper" shall mean a newspaper
in the English language or in an official language of the
country of publication, customarily printed on each Business
day, whether or not published on Saturdays, Sundays or
holidays, and of general circulation in the place in
connection with which the term is used or in the financial
community of such place. If, because of temporary
suspension of publication or general circulation of any
newspaper or for any other reason, it is impossible or, in
the opinion of the Trustee, impracticable to make any
publication of any notice required by this Indenture in the
manner herein provided, such publication or other notice in
lieu thereof which is made at the written direction of the
Company by the Trustee shall constitute a sufficient
publication of such notice. Where successive publications
are required to be made in Authorized Newspapers, the
successive publications may be made in the same or in
different newspapers in the same place meeting the foregoing
requirements and in each case on any Business day.
Bankruptcy Law
The term "Bankruptcy Law" means Title 11 of the United
States Code, as now constituted or hereafter in effect, or
any other applicable Federal or State bankruptcy, insolvency
or other similar law.
Board; Board of Directors
The term "Board" or "Board of Directors" shall mean the
Board of Directors of the Company or the Executive
Committee, if any, of such Board or any other committee of
such Board duly authorized to act hereunder.
Business day
The term "Business day" shall mean, with respect to any
Debenture, a day that, in the city (or in any of the cities,
if more than one) in which amounts are payable, as specified
in the terms of such Debentures, is not a day upon which
banking institutions are authorized or required by law, or
by executive order issued by a governmental authority or
agency regulating such banking institutions, to close.
Capital Stock
The term "Capital Stock" shall mean stock of any class
of the Company.
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Certified Resolution
The term "Certified Resolution" shall mean 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.
Class A Common Stock
The term "Class A Common Stock" shall mean the Class A
Common Stock, $.01 par value, of the Company.
Class B Common Stock
The term "Class B Common Stock" shall mean the Class B
Common Stock, $.01 par value, of the Company.
Closing Price
The term "Closing Price" on any day when used with
respect to any class of Capital Stock shall mean (i) if the
stock is then listed or admitted to trading on a national
securities exchange in the United States, the last reported
sale price, regular way, for the stock as reported in the
consolidated transaction or other reporting system for
securities listed or traded on such exchange, or (ii) if the
stock is listed on the National Association of Securities
Dealers', Inc. Automated Quotations System National Market
System (the "NASDAQ National Market System"), the last
reported sale price, regular way, for the stock, as reported
on such list, or (iii) if the stock is not so admitted for
trading on any national securities exchange or the NASDAQ
National Market System, the average of the last reported
closing bid and asked prices reported by the National
Association of Securities Dealers', Inc. Automated
Quotations System as furnished by any member in good
standing of the National Association of Securities Dealers',
Inc., selected from time to time by the Company for that
purpose or as quoted by the National Quotation Bureau
Incorporated. In the event that no such quotation is
available for any day, the Board of Directors shall be
entitled to determine the current market price on the basis
of such quotations as it considers appropriate.
Code
The term "the Code" means the Internal Revenue Code of
1986, as amended.
Company
The term "Company" shall mean Vanguard Cellular
Systems, Inc., a North Carolina corporation, and, subject to
the provisions of Article X, shall include its successors
and assigns.
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Company Order
The term "Company Order" means a written order signed
in the name of the Company by its Chairman of the Board,
President, any Vice Chairman of the Board or any Vice
President, and by its Treasurer, any Assistant Treasurer,
Secretary or any Assistant Secretary and delivered to the
Trustee.
Debenture
The term "Debenture" shall mean one of the debentures,
notes or other evidences of indebtedness that are issued
from time to time in one or more series under this Indenture
and, more particularly, any Debenture authenticated and
delivered under this Indenture.
Debentureholder; holder of Debentures
The term "Debentureholder" or "holder of Debentures" or
other similar term shall mean any person who shall at the
time be the registered holder of any Debenture or Debentures
as shown by the register or registers kept by the Company or
its agent for that purpose in accordance with the terms of
this Indenture.
Depositary
The term "Depositary" has the meaning specified in
Section 2.13.
Event of Default
The term "Event of Default" shall mean an event listed
in Section 7.1, continued for the period of time, if any,
and after the required notices, if any, therein designated.
Global Debenture
The term "Global Debenture" has the meaning specified
in Section 2.13.
Indenture
The term "Indenture" shall mean this instrument as
originally executed or, if amended or supplemented as herein
provided, as so amended or supplemented and, unless the
context otherwise indicates, shall include the form and
terms of each particular series of Debentures established as
contemplated hereunder.
Officers' Certificate
The term "Officers' Certificate" shall mean a
certificate signed by the Chairman of the Board, President,
any Vice Chairman
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of the Board or any Vice President and by the Treasurer or
any Assistant Treasurer or the Secretary or any Assistant
Secretary of the Company, in their capacities as such
officers of the Company and delivered to the Trustee. Each
such certificate shall include the statements provided for
in Section 14.8, if and to the extent required by the
provisions thereof.
Opinion of Counsel
The term "Opinion of Counsel" shall mean an opinion in
writing signed by Schell Bray Aycock Abel & Livingston
L.L.P. or other legal counsel (who may be an employee of the
Company) acceptable in form and substance to the Trustee and
delivered to the Trustee. Such opinion shall include the
statements provided for in Section 14.8, if and to the
extent required by the provisions thereof.
Original issue discount
The term "original issue discount" with respect to any
debt security, including an Original Issue Discount
Debenture, has the same meaning as set forth in Section 1273
of the Code, or any successor provision, and the applicable
Treasury Regulations thereunder.
Original Issue Discount Debenture
The term "Original Issue Discount Debenture" means any
Debenture which provides for an amount less than the
principal amount thereof to be due and payable upon
acceleration of the maturity thereof pursuant to Section
7.1.
Outstanding
The term "Outstanding", when used with respect to the
Debentures, shall, subject to Section 14.3, mean, as of the
date of determination, all Debentures theretofore
authenticated and delivered under this Indenture, except:
(a) Debentures for the payment or redemption of which cash
(or other form of payment if permitted by the terms of such
Debentures) in the necessary amount shall have been
deposited in trust with the Trustee or any paying agent
(other than the Company) provided that, if such Debentures
are to be redeemed prior to the maturity thereof, notice of
such redemption shall have been duly given or provision
satisfactory to the Trustee shall have been made for giving
such notice; (b) Debentures converted into Capital Stock in
accordance with Article XIII hereof, if the terms of such
Debentures provide for convertibility pursuant to Section
2.2; (c) Debentures paid or in lieu of or in substitution
for which other Debentures shall have been authenticated and
delivered pursuant to the terms of Section 2.9, unless proof
satisfactory to the Trustee is presented that any such
Debentures are held by persons in whose hands such
Debentures are valid, binding and legal obligations;
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and (d) Debentures which have been cancelled by the Trustee
or delivered to the Trustee for cancellation.
Paying Agent
The term "Paying Agent" shall mean any person
authorized by the Company to pay the principal of, premium,
if any, and interest on any Debentures.
Person
The term "Person" shall mean an individual, a
corporation, a partnership, an association, a joint-stock
company, a trust, any unincorporated organization, or a
government or political subdivision thereof.
Principal
The term "principal" of a debt security, including any
Debenture, on any day and for any purpose means the amount
(including, without limitation, in the case of an Original
Issue Discount Debenture, any accrued original issue
discount, but excluding interest) that is payable with
respect to such debt security as of such date and for such
purpose (including, without limitation, in connection with
any sinking fund, upon any redemption at the option of the
Company upon any purchase or exchange at the option of the
Company or the holder of such debt security and upon any
acceleration of the maturity of such debt security).
Principal amount
The term "principal amount" of a debt security,
including any Debenture, means the principal amount as set
forth on the face of such debt security.
Responsible Officer
The term "Responsible Officer", when used with respect
to the Trustee, shall mean any officer of the Trustee
assigned by the Trustee to administer its corporate trust
matters.
Securities Exchange Act
The term "Securities Exchange Act" shall mean the
Securities Exchange Act of 1934, as amended.
Senior Indebtedness
The term "Senior Indebtedness" shall mean: (a) the
principal of and premium, if any, and interest on (i) all
indebtedness for money borrowed by the Company (other than
the Debentures), whether outstanding on the date of this
Indenture or hereafter
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created or incurred, (ii) all indebtedness for money
borrowed by another person in which the Company has an
equity interest or has the right to purchase an equity
interest, and guaranteed directly or indirectly by the
Company (whether such guarantee is outstanding on the date
of this Indenture or hereafter created or incurred), and
(iii) all indebtedness constituting purchase money
indebtedness for the payment of which the Company is
directly or contingently liable, whether outstanding on the
date of this Indenture or hereafter created or incurred; (b)
any obligation to purchase or guarantee indebtedness of, to
supply funds to or to invest in, another person in which the
Company has an equity interest or has the right to purchase
an equity interest (whether such obligation is outstanding
on the date of this Indenture or is hereafter created or
incurred); (c) any obligation of the Company to any person
in respect of surety or similar bonds issued by such person
in connection with entering into, renewing or extending any
cellular telephone license granted by a governmental
authority or any construction in respect of any cellular
telephone system by the Company or any other person in which
the Company has an equity interest or has the right to
purchase an equity interest; and (d) all renewals,
extensions or refundings of any such obligations,
indebtedness and guarantees; provided, however, that if, by
the terms of the instrument creating or evidencing any
obligation, indebtedness or guarantee referred to in clauses
(a), (b), (c) and (d) above, it is expressly provided that
such obligation, indebtedness or guarantee is subordinate to
the Debentures or to all other indebtedness of the Company
or is not superior in right of payment or performance to the
Debentures, such obligation, indebtedness or guarantee shall
not be included as Senior Indebtedness. As used in the
preceding sentence the term "purchase money indebtedness"
shall mean indebtedness evidenced by a note, debenture, bond
or other instrument or any other written obligation to pay
money (whether or not secured by any lien or other security
interest) issued or assumed as all or a part of the
consideration for the acquisition of property, assets, or
securities whether by purchase, merger, consolidation, or
otherwise.
Trustee; principal office
The term "Trustee" shall mean the trustee or trustees
hereunder for the time being, whether original or successor.
"Trustee" as used with respect to the Debentures of any
series shall mean the Trustee with respect to Debentures of
such series. The term "principal office" of the Trustee
shall mean the principal office of the Trustee at which, at
any particular time, the corporate trust business of the
Trustee shall be administered, which office as of the date
hereof is .
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U.S. Government Obligations
The term "U.S. Government Obligations" means direct
obligations of, or obligations entitled to the full faith
and credit of, the United States of America.
SECTION 1.2. Trust Indenture Act definitions
controlling. All terms used in this Indenture which are
defined in the Trust Indenture Act of 1939, as amended, or
which are by reference therein defined in the Securities Act
of 1933 (except as herein otherwise expressly provided or
unless the context otherwise requires) shall have the
meanings assigned to such terms in such Trust Indenture Act
and such Securities Act as they were respectively in force
at the date of this Indenture, except as otherwise provided
in Section 12.3.
ARTICLE II
FORM, ISSUE AND REGISTRATION OF DEBENTURES
SECTION 2.1. Forms generally and dating. The
Debentures of each series shall be in the form or forms
(including temporary or permanent global form) established
from time to time by or pursuant to a resolution of the
Board of Directors or in one or more indentures supplemental
hereto which shall set forth the information required by
Section 2.2. The Debentures and the Trustee's certificate
of authentication shall have such appropriate insertions,
omissions, substitutions and other variations as are
required or permitted by this Indenture or by a resolution
of the Board of Directors and may have such notations,
legends or endorsements as the Company may deem appropriate
and as are not inconsistent with the provisions of this
Indenture or as may be required by law, stock exchange rule
or usage. The Company shall approve and provide the form of
the Debentures and any notation, legend or endorsement on
them. If the form of Debentures of any series is
established by action taken pursuant to a resolution of the
Board of Directors, 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 2.5 for the authentication and delivery of such
Debentures.
Each Debenture shall be dated the date of its
authentication. The form of the Trustee's certificate of
authentication to be borne by the Debentures shall be
substantially as follows:
(FORM OF TRUSTEE'S CERTIFICATE)
This is one of the Debentures of the series referred to
on the reverse hereof.
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as Trustee
By:
Authorized Officer
SECTION 2.2. Amount unlimited; Issuable in series.
The aggregate principal amount of the Debentures which
may be authenticated and delivered under this Indenture is
unlimited.
The Debentures may be issued in one or more series.
There shall be established in or pursuant to one or more
resolutions of the Board of Directors, or established in or
pursuant to one or more indentures supplemental hereto,
prior to the issuance of the Debentures of any series:
(1) the title of the Debentures of the series
(which shall distinguish Debentures of the series from
all other Debentures);
(2) any limit upon the aggregate principal
amount of the Debentures of the series which may be
authenticated and delivered under this Indenture
(except for the Debentures authenticated and delivered
upon registration of transfer of, or in exchange for,
or in lieu of, other Debentures of the series pursuant
to Section 2.6, 2.8, 2.9, 2.10, 2.11, 5.2 or 12.5) and
except for any Debentures which pursuant to Section 2.4
are deemed not to have been authenticated and delivered
hereunder;
(3) the date or dates (and whether fixed or
extendable) on which the principal of the Debentures of
the series is payable or the method of determination
thereof;
(4) the rate or rates at which the Debentures
of the series shall bear interest, if any, the method
of calculating such rates, the date or dates from which
such interest shall accrue or the manner of determining
such dates, the interest payment dates on which such
interest shall be payable and the record dates for the
determination of Debentureholders to whom interest is
payable;
(5) the place or places where the principal of
and premium, if any, and interest on the Debentures, if
any, of the series shall be payable;
(6) if other than 100% of their principal
amount, the percentage of the principal amount at which
the Debentures will be issued;
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(7) any provisions relating to the issuance of
the Debentures of such series at an original issue
discount;
(8) the price or prices at which, the period or
periods within which and the terms and conditions upon
which the Debentures of the series may be redeemed, in
whole or in part, at the option of the Company,
pursuant to any sinking fund or otherwise (including,
without limitation, the form or method of payment
thereof if other than in cash);
(9) the obligation, if any, of the Company to
redeem, purchase or repay the Debentures of the series
pursuant to any mandatory redemption, sinking fund or
analogous provisions or at the option of a
Debentureholder thereof and the price or prices at
which and the period or periods within which and the
terms and conditions upon which the Debentures of the
series shall be redeemed, purchased or repaid, in whole
or in part, pursuant to such obligation (including,
without limitation, the form or method of payment
thereof if other than in cash), and any provisions for
the remarketing of such Debentures;
(10) if other than denominations of $1,000 and
any integral multiple thereof, the denominations in
which the Debentures of the series shall be issuable;
(11) if other than the principal amount thereof,
the portion of the principal amount of the Debentures
of the series which shall be payable upon declaration
of acceleration of the maturity thereof pursuant to
Section 7.1 or provable in bankruptcy pursuant to
Section 7.2, or, if applicable, which is convertible in
accordance with Article XIII;
(12) any Events of Default with respect to the
Debentures of a particular series, in lieu of or in
addition to those set forth herein and the remedies
therefor;
(13) the obligation, if any, of the Company to
permit the conversion or exchange of the Debentures of
such series and, if any, the securities or rights into
which the Debenture of that series are convertible or
exchangeable (which may include other debentures,
Capital Stock or other securities or rights of the
Company (including rights to receive payment in cash or
securities based on the value, rate or price of one or
more specified commodities, currencies or indices) or
exchangeable for securities of other issuers or a
combination of the foregoing) and the terms and
conditions upon which such conversion or exchange shall
be effected (including, without limitation, the initial
conversion price or rate, the conversion period and any
other provision in addition to or in lieu of those set
forth in this Indenture relative to such obligation);
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(14) any trustees, authenticating or paying
agents, transfer agents or registrars or any other
agents with respect to the Debentures of such series;
(15) the currency or currencies, including
composite currencies, in which the Debentures of the
series shall be denominated if other than the currency
of the United States of America, and, if so, whether
the Debentures of the series may be satisfied and
discharged other than as provided in Article VI;
(16) if other than the coin or currency in which
the Debentures of that series are denominated, the coin
or currency in which payment of the principal of,
premium, if any, or interest on the Debentures of such
series shall be payable;
(17) if the principal of, premium, if any, or
interest on the Debentures of such series are to be
payable, at the election of the Company or a
Debentureholder thereof, in a coin or currency other
than that in which the Debentures are denominated, the
period or periods within which, and the terms and
conditions upon which, such election may be made;
(18) if the amount of payments of principal of,
premium, if any, and interest on the Debentures of the
series may be determined with reference to an index,
the manner in which such amounts shall be determined;
(19) whether and under what circumstances the
Company will pay additional amounts on the Debentures
of the series held by a person who is not a United
States of America person in respect of any tax,
assessment or governmental charge withheld or deducted
and, if so, whether the Company will have the option to
redeem such Debentures rather than pay such additional
amounts;
(20) if receipt of certain certificates or other
documents or satisfaction of other conditions will be
necessary for any purpose, including, without
limitation, as a condition to the issuance of the
Debentures of such series in definitive form (whether
upon original issue or upon exchange of a temporary
Debenture of such series), the form and terms of such
certificates, documents or conditions;
(21) any other affirmative or negative covenants
with respect to the Debentures of such series;
(22) whether the Debentures of such series shall
be issued in whole or in part in the form of one or
more Global Debentures and in such case (i) the
Depositary for such Global Debenture or Debentures,
which Depositary must be a
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clearing agency registered under the Securities
Exchange Act, (ii) the circumstances under which any
such Global Debenture may be exchanged for Debentures
registered in the name of, and under which any transfer
of such Global Debenture may be registered in the name
of, any Person other than such Depositary or its
nominee, if other than as set forth in Section 2.13 and
(iii) any other provisions regarding such Global
Debentures which provisions may be in addition to or in
lieu of, in whole or in part, the provisions of Section
2.13; and
(23) any other terms of a particular series and
any other provisions expressing or referring to the
terms and conditions upon which the Debentures of such
series are to be issued under the Indenture, which
terms and provisions are not in conflict with the
provisions of this Indenture; provided, however, that
the addition to or subtraction from or variation of
Articles IV, V, VI, VII, and X (and Section 1.1,
insofar as it relates to the definition of certain
terms as used in such Articles) with regard to the
Debentures of a particular series shall not be deemed
to constitute a conflict with the provisions of those
Articles.
All Debentures of any one series shall be substantially
identical except as to denomination and except as may
otherwise be provided in or pursuant to such resolution of
the Board of Directors or in any such indenture supplemental
hereto. Not all Debentures of any one series need be issued
at the same time, and, unless otherwise so provided, a
series may be reopened for issuances of additional
Debentures of such series.
If any of the terms of the Debentures of a series are
established by action taken pursuant to a resolution of the
Board of Directors, a copy of any appropriate record of such
action shall be certified by the Secretary or an Assistant
Secretary of the Company and delivered to the Trustee with
an Officers' Certificate setting forth the terms of the
Debentures of such series. With respect to Debentures of a
series which are not to be issued at one time, such
resolution of the Board of Directors or action may provide
general terms or parameters for Debentures of such series
and provide either that the specific terms of particular
Debentures of such series shall be specified in a Company
Order or that such terms shall be determined by the Company
or its agents in accordance with a Company Order as
contemplated by the proviso clause of Section 2.5.
SECTION 2.3. Denominations. The Debentures of
each series shall be registered Debentures without coupons,
in such denominations as shall be specified as contemplated
by Section 2.2. In the absence of any such provisions with
respect to the Debentures of any series, the Debentures of
such series shall be issuable in denominations of $1,000 or
of any integral multiple of $1,000.
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SECTION 2.4. Execution of Debentures;
Authentication. The Debentures shall be executed on behalf
of the Company by its President or one of its Vice Chairmen
or Vice Presidents, whose signatures may be manual or
facsimile, and its corporate seal shall be thereunto affixed
(or a facsimile thereof shall be engraved, printed, or
otherwise reproduced thereon) and attested by the manual or
facsimile signature of its Secretary or one of its Assistant
Secretaries. In case any officer of the Company who shall
have signed any of the Debentures shall cease to be such
officer before the Debentures so signed and attested shall
actually have been authenticated and delivered by the
Trustee or the Authenticating Agent or disposed of by the
Company, such Debentures nevertheless may be authenticated,
issued and delivered or disposed of with the same force and
effect as though the person or persons who signed or
attested such Debentures had not ceased to be such officer
of the Company; and any such Debenture may be signed and
attested on behalf of the Company by such persons, as at the
actual date of the execution of such Debenture, shall be the
proper officers of the Company, although at the date of such
Debenture or the date of execution of this Indenture any
such person was not such officer.
No Debenture of any series shall be entitled to the
benefits hereof or shall be or become valid or obligatory
for any purpose unless there shall appear on the Debenture a
certificate of authentication, substantially in the form
hereinbefore recited, manually executed by the Trustee for
such series or an Authenticating Agent; and such certificate
on any Debenture issued by the Company shall be conclusive
evidence that it has been duly authenticated and delivered
hereunder.
Notwithstanding the foregoing, if any Debenture shall
have been duly authenticated and delivered hereunder but
never issued and sold by the Company, and the Company shall
deliver such Debenture to the Trustee for cancellation as
provided in Section 2.11 together with a written statement
(which need not be accompanied by an Opinion of Counsel)
stating that such Debenture has not been issued and sold by
the Company, for all purposes of this Indenture such
Debenture shall be deemed not to have been authenticated and
delivered hereunder and shall not be entitled to the
benefits of this Indenture.
If the form or forms or terms of the Debentures of any
series have been established in or pursuant to one or more
resolutions of the Board of Directors or indentures
supplemental hereto as permitted by Sections 2.1 and 2.2, in
authenticating such Debentures, and accepting the additional
responsibilities under this Indenture in relation to such
Debentures, the Trustee and the Authenticating Agent shall
be entitled to receive, and (subject to Section 11.2) shall
be fully protected in relying upon, a copy of such
resolution or resolutions delivered to the Trustee and the
Authenticating Agent and certified by the
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Secretary or 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 an
Opinion of Counsel stating:
(1) if the form or forms of such Debentures
have been established by or pursuant to a resolution of
the Board of Directors or indenture supplemental
hereto, that such form or forms have been established
in conformity with the provisions of this Indenture;
(2) if the terms of such Debentures have been
established by or pursuant to a resolution of the Board
of Directors or indenture supplemental hereto, that
such terms have been established in conformity with the
provisions of this Indenture; and
(3) that such Debentures, when authenticated
and delivered by the Trustee or an Authenticating Agent
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
conveyance, reorganization and other laws of general
applicability relating to or affecting the enforcement
of creditors' rights and to general equity principles
(or such other similar matters as in the opinion of
such counsel shall not materially adversely affect such
enforceability).
provided, however, that, with respect to Debentures of a
series which are not to be issued at one time, the Trustee
and the Authenticating Agent shall be entitled to receive
such Opinion of Counsel only once at or prior to the time of
the first authentication of Debentures of such series and
that the opinions described in clauses (2) and (3) above may
state, respectively:
(a) that, when the terms of such Debentures
shall have been established pursuant to a Company Order
or pursuant to such procedures as may be specified from
time to time by a Company Order, all as contemplated by
and in accordance with a resolution of the Board of
Directors or an Officers' Certificate pursuant to a
resolution of the Board of Directors or indenture
supplemental hereto, as the case may be, such terms
will have been established in conformity with the
provisions of this Indenture; and
(b) that such Debentures, when (i) executed by
the Company, (ii) completed, authenticated and
delivered by the Trustee or the Authenticating Agent in
accordance with this Indenture, (iii) issued and
delivered by the Company, and (iv) paid for, all as
contemplated by and in accordance with the aforesaid
Company Order or specified procedures, as the
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case may be, will constitute valid and legally binding
obligations of the Company, enforceable in accordance
with their terms, subject to bankruptcy, insolvency,
fraudulent conveyance, reorganization and other laws of
general applicability relating to or affecting the
enforcement of creditors' rights and to general
equitable principles (or such other similar matters as
in the opinion of such counsel shall not materially
adversely affect such enforceability).
Notwithstanding the provisions of Sections 2.1, 2.2,
14.8 and this Section, if all the Debentures of a series are
not to be originally issued at one time, the resolution of
the Board of Directors or indenture supplemental hereto, the
certified copy of the record of action taken pursuant to
such resolution or supplemental indenture, the Officers'
Certificate, the Company Order and any other documents
otherwise required pursuant to such Sections need not be
delivered at or prior to the time of authentication of each
Debenture of such series if such documents are delivered at
or prior to the authentication upon original issuance of the
first Debenture of such series to be issued; provided,
however, that any subsequent request by the Company to the
Trustee or the Authenticating Agent to authenticate
Debentures of such series shall constitute a representation
and warranty by the Company that, as of the date of such
request, the statements made in the Officers' Certificate
delivered pursuant to Section 14.8 at or prior to
authentication of the first such Debenture shall be true and
correct on the date thereof as if made on and as of the date
hereof.
The Trustee or the Authenticating Agent shall not be
required to authenticate such Debentures if the issue of
such Debentures pursuant to this Indenture will adversely
affect the Trustee's or the Authenticating Agent's own
rights, duties or immunities under the Debentures and this
Indenture or otherwise in a manner which is not reasonably
acceptable to the Trustee or the Authenticating Agent.
With respect to Debentures of a series which are not
all issued at one time, the Trustee and the Authenticating
Agent may conclusively rely, as to the authorization by the
Company of any such Debentures, the form and terms thereof
and the legality, validity, binding effect and
enforceability thereof, upon the Opinion of Counsel,
Officers' Certificate and other documents delivered pursuant
to Sections 2.1, 2.2, 14.8 and this Section, as applicable,
at or prior to the time of the first authentication of
Debentures of such series unless and until such opinion,
certificate or other documents have been superseded or
revoked in a writing delivered to the Trustee. In
connection with the authentication and delivery of
Debentures of a series which are not all issued at one time,
the Trustee and the Authenticating Agent shall be entitled
to assume that the Company's instructions to authenticate
and deliver such Debentures do not violate any rules,
regulations or orders of any
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governmental agency or commission having jurisdiction over
the Company.
SECTION 2.5. Issue of Debentures. The Trustee and
the Authenticating Agent, forthwith upon the execution and
delivery of this Indenture and from time to time thereafter,
upon the execution and delivery to it of Debentures of any
series by the Company as herein provided, and without
further action on the part of the Company, shall
authenticate such Debentures up to a maximum amount, if any,
designated for such series pursuant to Section 2.2 and
deliver them to or upon the receipt of a Company Order;
provided, however, that if not all the Debentures of a
series are to be issued at one time and if the resolution of
the Board of Directors or indenture supplemental hereto
establishing such series as contemplated by Sections 2.1 and
2.2 shall so permit, such Company Order may set forth
procedures acceptable to the Trustee for the issuance of
such Debentures and for determining the form or forms or
terms of particular Debentures of such series including, but
not limited to, interest rate, if any, maturity date, date
of issuance and date from which interest, if any, shall
accrue.
SECTION 2.6. Transfer of Debentures. The transfer
of any Debenture of any series may be registered by the
registered owner thereof, in person or by his attorney duly
authorized in writing, at the office or agency of the
Company to be maintained by it as provided in Section 4.2,
by delivering such Debenture for cancellation, accompanied
by delivery of a duly executed instrument of transfer, in a
form approved by the Company and satisfactory to the
Trustee, and thereupon the Company shall execute in the name
of the transferee or transferees, and the Trustee or the
Authenticating Agent shall authenticate and deliver, a new
Debenture or Debentures of the same series and of like form
for the same aggregate principal amount.
SECTION 2.7. Persons deemed owners of Debentures.
Prior to due presentation of any Debenture for registration
of transfer, the person in whose name a Debenture of any
series shall be registered, on books kept for such purpose
in accordance with Section 4.2, shall be deemed the absolute
owner thereof for all purposes of this Indenture, whether or
not such Debenture is overdue, and neither the Company, the
Trustee nor any Paying Agent or conversion agent nor any
Debenture registrar shall be affected by notice to the
contrary. Subject to the provisions of Section 2.12, payment
of or on account of the principal, premium, if any, and
interest shall be made only to or upon the order in writing
of such registered owner thereof, but such registration may
be changed as above provided. All such payments shall be
valid and effectual to satisfy and discharge the liability
upon such Debenture to the extent of the sum or sums so
paid.
SECTION 2.8. Provisions for Debentures in
temporary form. Until Debentures of any series in
definitive form are ready for
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delivery, the Company may execute and, upon its request in
writing, the Trustee or the Authenticating Agent shall
authenticate and deliver, in lieu thereof and subject to the
same conditions, one or more printed or lithographed
Debentures in temporary form, substantially of the tenor of
Debentures of the same series, without a recital of specific
redemption prices and with such other appropriate omissions,
variations and insertions, all as may be determined by the
Board of Directors. Until exchanged for Debentures of the
same series in definitive form such Debentures in temporary
form shall be entitled to the benefits of this Indenture.
The Company shall, without unreasonable delay after the
issue of Debentures in temporary form, prepare, execute and
deliver definitive Debentures of the same series to the
Trustee, and upon the presentation and surrender of
Debentures in temporary form, the Trustee or the
Authenticating Agent shall authenticate and deliver, in
exchange therefor, Debentures of the same series in
definitive form for the same aggregate principal amount as
the Debentures in temporary form surrendered. Such exchange
shall be made by the Company at its own expense and without
any charge therefor.
SECTION 2.9. Mutilated, destroyed, lost or stolen
Debentures. Upon receipt by the Company, the Trustee and
the Authenticating Agent of evidence satisfactory to them
that any Debenture of any series has been mutilated,
destroyed, lost or stolen, and upon receipt of indemnity
(and in case of a destroyed, lost or stolen Debenture, proof
of ownership) satisfactory to them, the Company shall, in
the case of a mutilated Debenture, and may in the case of a
lost, stolen or destroyed Debenture, execute, and thereupon
the Trustee or the Authenticating Agent shall authenticate
and deliver, a new Debenture of the same series of like
tenor bearing a serial number not contemporaneously
outstanding (bearing such notation, if any, as may be
required by the rules of any stock exchange upon which the
Debentures of the same series are listed or are to be
listed), in exchange and substitution for, and upon
surrender and cancellation of, the mutilated Debenture, or
in lieu of and in substitution for the Debenture so
destroyed, lost or stolen; or, if any mutilated, destroyed,
lost or stolen Debenture of any series shall have matured or
be about to mature, instead of issuing a new Debenture, the
Company, upon written notice to the Trustee or the
Authenticating Agent, may pay the same without surrender of
the destroyed, lost or stolen Debenture. The Company may
require payment of the expenses which may be incurred by the
Company or any agent thereof and the charges and expenses of
the Trustee and the Authenticating Agent in the premises.
Any Debenture issued under the provisions of this Section
2.9 in lieu of any Debenture alleged to have been destroyed,
lost or stolen, shall constitute an additional contractual
obligation of the Company, whether or not the Debenture
alleged to have been destroyed, lost or stolen shall be
found at any time, and shall be equally and proportionately
entitled to the benefits of this Indenture with all other
Debentures of the same series issued under this Indenture.
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All Debentures shall be held and owned upon the express
condition that the foregoing provisions are exclusive with
respect to the replacement or payment of mutilated,
destroyed, lost or stolen Debentures, and shall preclude, to
the extent lawful, any and all other rights or remedies,
notwithstanding any law or statute existing or hereafter
enacted to the contrary with respect to the replacement or
payment of negotiable instruments or other securities
without their surrender.
SECTION 2.10. Exchanges of Debentures. Debentures of
any series may, upon surrender thereof as hereinafter
provided in this Section 2.10, be exchanged for one or more
Debentures of the same series of the same aggregate
principal amount, in authorized denominations. The
Debentures to be exchanged shall be surrendered at the
office or agency of the Company to be maintained by it as
provided in Section 4.2, accompanied by duly executed
instruments of transfer in a form acceptable to the Company
and the Trustee, and the Company shall execute and the
Trustee or the Authenticating Agent shall authenticate and
deliver, in exchange therefor, the Debenture or Debentures
of the same series, bearing numbers not contemporaneously
outstanding, which the Debentureholder making the exchange
shall be entitled to receive. Every exchange of Debentures
of any series shall be effected in such manner as may be
prescribed by the Company with the approval of the Trustee,
and as may be necessary to comply with the regulations of
any stock exchange upon which Debentures of such series are
listed or are to be listed or to conform to usage in respect
thereof.
Upon every exchange or registration of transfer of
Debentures, no service charge shall be made but the Company
may require the payment of any taxes or other governmental
charges required to be paid with respect to such exchange or
registration, as a condition precedent to the exercise of
the privilege of such exchange or registration.
All Debentures executed, authenticated and delivered in
exchange or upon registration of transfer shall be the valid
obligations of the Company, evidencing the same debt as the
Debentures surrendered, and shall be entitled to the
benefits of this Indenture to the same extent as the
Debentures in exchange for which they were authenticated and
delivered.
The Company shall not be required to make exchanges or
registrations of transfer under any provision of this
Article II of: (a) the Debentures of any series for the
period of 15 days next preceding the date of any designation
of Debentures of such series to be redeemed, as provided in
Article V, or (b) any Debenture or portion thereof called or
to be called for redemption.
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SECTION 2.11. Cancellation of Surrendered
Debentures. All Debentures of any series surrendered for
the purpose of payment, exchange, conversion or cancellation
(including Debentures authenticated which the Company has
not issued and sold) shall, if surrendered to the Company
or any Paying Agent or conversion agent, be delivered to the
Trustee and cancelled by it, or, if surrendered to the
Trustee, shall be cancelled by it, and no Debentures shall
be issued in lieu thereof except as expressly permitted by
any of the provisions of this Indenture or as otherwise
provided in the resolution of the Board of Directors or
indenture supplemental hereto establishing such series as
contemplated by Section 2.2. All Debentures of any series
surrendered for the purpose of redemption or credit against
any sinking fund shall similarly be delivered to the Trustee
for cancellation, and no Debentures shall be issued in lieu
thereof except Debentures of the same series in the case of
redemption of a Debenture in part only. If the Company
shall acquire any of the Debentures, such acquisition shall
not operate as a redemption or satisfaction of the
indebtedness represented by such Debentures unless and until
the same are delivered to the Trustee for cancellation.
Unless otherwise directed in writing by the Company, the
Trustee shall destroy all cancelled Debentures and furnish
to the Company a certificate evidencing such destruction.
SECTION 2.12. Payment of interest; Defaulted
interest. Except as provided in Section 13.4, interest
(except defaulted interest) on the Debentures of any series
which is payable on any interest payment date shall be paid
to the persons who are Debentureholders of such series at
the close of business on the record date specified for that
purpose as contemplated by Section 2.2. At the option of
the Company, payment of interest on any Debenture may be
made by check mailed to the holder's registered address.
If the Company defaults in a payment of interest on the
Debentures of any series, it shall pay the defaulted
interest to the persons who are Debentureholders of such
series at the close of business on a subsequent special
record date. The Company shall fix the record date (which
shall be not less than five Business days prior to the date
of payment of such defaulted interest) and payment date. At
least 15 days before the record date, the Company shall mail
to each Debentureholder of such series a notice that states
the record date, the payment date and the amount of
defaulted interest to be paid. The Company shall notify the
Trustee in writing of the amount of defaulted interest
proposed to be paid on each Debenture of such series and the
date of the proposed payment, and at the same time the
Company shall deposit with the Trustee or any paying agent
for such series an amount of money in immediately available
funds by 10:00 a.m. New York time on the payment date equal
to the aggregate amount proposed to be paid in respect of
such defaulted interest or shall make arrangements
satisfactory to any Paying Agent for such
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series for such deposit prior to the date of the proposed
payment. The Company may pay defaulted interest in any
other lawful manner not inconsistent with the requirements
of any securities exchange on which the Debenture may be
listed, and upon 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 payment shall
be deemed practicable by the Trustee.
SECTION 2.13. Global Debentures; Depositary. For
the purposes of this Section, the term "Agent Member" means
a member of, or participant in, a Depositary; the term
"Depositary" means, with respect to Debentures issuable or
issued in whole or in part in the form of one or more Global
Debentures, the entity designated as Depositary by the
Company pursuant to Section 2.2, and, if at any time there
is more than one such person, "Depositary" as used with
respect to the Debentures shall mean the respective
Depositary with respect to particular series of Debentures;
and the term "Global Debenture" means a global certificate
evidencing all or part of the series of Debentures as shall
be specified herein, issued to the Depositary for the series
or such portion of the series, and registered in the name of
such Depositary or its nominee. The Global Debenture may
provide that it shall represent the aggregate amount of
Outstanding Debentures from time to time endorsed thereon
which may from time to time be reduced to reflect exchanges.
Any endorsement to reflect the amount, or any increase or
decrease in the amount, of Outstanding Debentures shall be
made by the Trustee.
Notwithstanding Section 2.10, except as otherwise
specified as contemplated by Section 2.2., hereof, any
Global Debenture shall be exchangeable only as provided in
this paragraph. A Global Debenture shall be exchangeable
pursuant to this Section 2.13 if (i) the Depositary notifies
the Company that it is unwilling or unable to continue as
Depositary for such Global Debenture or if at any time the
Depositary ceases to be a clearing agency registered under
the Securities Exchange Act, (ii) the Company in its sole
discretion determines that all Global Debentures of any
series then outstanding under the Indenture shall be
exchangeable for definitive Debentures of such series in
registered form or (iii) an Event of Default with respect to
the Debentures of the series represented by such Global
Debenture has occurred and is continuing. Any Global
Debenture of such series exchangeable pursuant to the
preceding sentence shall be exchangeable for definitive
Debentures of such series in registered form, bearing
interest (if any) at the same rate or pursuant to the same
formula, having the same date of issuance, redemption,
conversion (if any) and other provisions, and of differing
denominations aggregating a like amount. Such definitive
Debentures of such series shall be registered in the names
of the owners of the beneficial interests in such Global
Debentures of such series as such names are from time to
time
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provided by the relevant participants in the
Depositary holding such Global Debentures (as such
participants are identified from time to time by such
Depositary).
No Global Debenture may be transferred except as a
whole by a nominee of the Depositary to the Depositary or
another nominee of the Depositary or by the Depositary or
any such nominee or a successor of the Depositary or a
nominee of such successor. Except as provided above, owners
solely of beneficial interests in a Global Debenture shall
not be entitled to receive physical delivery of Debentures
of such series in definitive form and will not be considered
the Debentureholders thereof for any purpose under this
Indenture.
Any Global Debenture that is exchangeable pursuant to
the preceding paragraph shall be exchangeable for Debentures
of such series in authorized denominations and registered in
such names as the Depositary that is the Debentureholder of
such Global Debentures of such series shall direct.
In the event that a Global Debenture is surrendered for
redemption in part pursuant to Section 5.2 or 5.5, the
Company shall execute, and the Trustee or the Authenticating
Agent shall authenticate and delivery to the Depositary for
such Global Debenture, without service charge, a new Global
Debenture in a denomination and tenor equal to and in
exchange for the unredeemed portion of the principal for the
Global Debenture so surrendered.
The Agent Members shall have no rights under this
Indenture with respect to any Global Debenture held on their
behalf by a Depositary, and such Depositary may be treated
by the Company, the Trustee, and any agent of the Company or
the Trustee as the owner of such Global Debenture for all
purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent the Company, the Trustee, or any agent
of the Company or the Trustee, from giving effect to any
written certification, proxy or other authorization
furnished by a Depositary or impair, as between a Depositary
and its Agent Members, the operation of customary practices
governing the exercise of the rights of a holder of a
Debenture of any series, including without limitation the
granting of proxies or other authorization of participants
to give or take any request, demand, authorization,
direction, notice, consent, waiver or other action which a
Debentureholder is entitled to give or take under the
Indenture.
The Trustee shall not be required to authenticate
Global Debentures until it has received documentation
satisfactory to it.
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ARTICLE III
SUBORDINATION OF DEBENTURES
SECTION 3.1. Debentures subordinated to Senior
Indebtedness. The Company covenants and agrees, and each
holder of Debentures by his acceptance thereof, whether upon
original issue or upon registration of transfer or
assignment, likewise covenants and agrees, that the payment
of the principal of, premium, if any, and interest on each
and all of the Debentures is hereby expressly subordinated,
to the extent and in the manner hereinafter set forth, in
right of payment to the prior payment in full of all Senior
Indebtedness.
SECTION 3.2. Payment over of proceeds of
Debentures on dissolution, etc. Upon any payment or
distribution of assets of the Company of any kind or
character, whether in cash, property or securities, upon any
dissolution or winding up or total or partial liquidation or
reorganization of the Company, whether voluntary or
involuntary, in bankruptcy, insolvency or receivership, or
upon an assignment for the benefit of creditors or any other
marshalling of the assets and liabilities of the Company or
otherwise,
(a) all principal of, premium, if any, and
interest then due upon all Senior Indebtedness shall
first be paid in full, or payment thereof provided for
in money or money's worth, before the holders of the
Debentures or the Trustee on their behalf shall be
entitled to receive any assets (other than shares of
stock of the Company as reorganized or readjusted, or
securities of the Company or any other corporation
provided for by a plan of reorganization or
readjustment, junior to, or the payment of which is
subordinated at least to the extent provided in this
Article III to the payment of all Senior Indebtedness
which may at the time be outstanding or to any
securities issued in respect thereof under any such
plan of reorganization or readjustment) in respect of
the Debentures (for principal, premium, if any, or
interest) or of this Indenture;
(b) any payment or distribution of assets of
the Company of any kind or character, whether in cash,
property or securities (other than shares of stock of
the Company as reorganized or readjusted, or securities
of the Company or any other corporation provided for by
a plan of reorganization of readjustment, junior to, or
the payment of which is subordinated at least to the
extent provided in this Article III to the payment of,
all Senior Indebtedness which may at the time be
outstanding or to any securities issued in respect
thereof under any such plan of reorganization or
readjustment), to which the holders of the Debentures
or the Trustee on their behalf would be entitled,
except for the provisions of this Article III, shall be
made by the Company
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or by any receiver, trustee in bankruptcy, liquidating
trustee, agent or other person making such payment or
distribution, directly to the holders of Senior
Indebtedness or their representatives to the extent
necessary to pay all Senior Indebtedness in full after
giving effect to any concurrent payment or distribution
to or for the holders of Senior Indebtedness; and
(c) in the event that, notwithstanding the
foregoing, the Trustee or the holder of any Debenture
shall have received any payment or distribution of
assets of the Company of any kind or character, whether
in cash, property or securities (other than shares of
stock of the Company as reorganized or readjusted, or
securities of the Company or any other corporation
provided for by a plan of reorganization or
readjustment, junior to, or the payment of which is
subordinated at least to the extent provided in this
Article III to the payment of, all Senior Indebtedness
which may at the time be outstanding or to any
securities issued in respect thereof under any such
plan of reorganization or readjustment), before all
Senior Indebtedness is paid in full and if such fact
shall have been made known to the Trustee or such
Debentureholder, then and in such event such payment or
distribution of assets of the Company shall be paid
over or delivered forthwith to the receiver, trustee in
bankruptcy, liquidating trustee, agent or other person
making payment or distribution of assets of the Company
for application to the payment of all Senior
Indebtedness remaining unpaid to the extent necessary
to pay all Senior Indebtedness in full, in money or
money's worth, after giving effect to any concurrent
payment or distribution to or for the holders of Senior
Indebtedness.
The consolidation or merger of the Company with or into
another corporation, or any consolidation or merger of any
other corporation with or into the Company, or the
liquidation or dissolution of the Company following the
sale, transfer or lease of substantially all of the property
and assets of the Company to another corporation shall not
be deemed a dissolution, winding-up or total or partial
liquidation or reorganization of the Company or an
assignment or other marshalling of the assets and
liabilities of the Company for purposes of this Section 3.2
so long as such other corporation shall, as a part of any
such consolidation, merger, sale, conveyance or lease comply
with the conditions stated in Article X.
Subject to the payment in full, in money or money's
worth, of all Senior Indebtedness, the rights of the holders
of the Debentures shall be subrogated to the rights of the
holders of Senior Indebtedness to receive payments or
distributions of assets of the Company applicable to Senior
Indebtedness until the Debentures shall be paid in full, and
no such payments or distributions to the Debentureholders of
cash, properties or
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securities otherwise distributable to holders of Senior
Indebtedness shall, as between the Company, its creditors,
other than the holders of Senior Indebtedness, and the
holders of the Debentures, be deemed to be a payment by the
Company to or on account of the Debentures, it being
understood that the provisions of this Article III are and
are intended solely for the purpose of defining the relative
rights of the holders of the Debentures, on the one hand,
and the holders of Senior Indebtedness, on the other hand.
Nothing contained in this Article III or elsewhere in this
Indenture or in the Debentures is intended to or shall alter
or impair, as between the Company and the holders of
Debentures, the obligation of the Company, which is
unconditional and absolute, to pay to the holders of the
Debentures the principal of, premium, if any, and interest
on the Debentures as and when the same shall become due and
payable in accordance with their terms, or is intended to or
shall affect (except to the extent specifically provided by
this paragraph) the relative rights of the holders of the
Debentures and creditors of the Company, other than the
holders of Senior Indebtedness, nor shall anything herein or
therein prevent the Trustee or the holder of any Debenture
from exercising all remedies otherwise permitted by
applicable law upon an Event of Default under this
Indenture, subject to the rights, if any, under this Article
III, of the holders of Senior Indebtedness in respect of
assets of the Company of any kind or character, whether
cash, property or securities, received upon the exercise of
any such remedy.
The Company shall give prompt written notice to a
Responsible Officer of the Trustee of any dissolution,
winding up, liquidation, or reorganization of the Company
within the meaning of this Section 3.2. The Trustee shall
be entitled to assume that no such event has occurred unless
the Company has given such written notice. Upon any payment
or distribution of assets of the Company referred to in this
Article III, the Trustee and the holders of the Debentures
shall be entitled to rely upon any order or decree of a
court of competent jurisdiction in which such dissolution,
winding up, liquidation or reorganization proceedings are
pending, and upon a certificate of the receiver, trustee in
bankruptcy, liquidating trustee, agent or other person
making any such payment or distribution, delivered to the
Trustee or to the holders of the Debentures, for the purpose
of ascertaining the persons entitled to participate in such
distribution, the holders of Senior Indebtedness and other
indebtedness of the Company, the amount thereof or payable
thereon, the amount or amounts paid or distributed thereon
and all other facts pertinent thereto or to this Article
III.
In the event that the Trustee determines, in good
faith, that further evidence is required with respect to the
right of any person as a holder of Senior Indebtedness to
participate in any payment or distribution pursuant to this
Section 3.2, the Trustee may request such person or
representative thereof to furnish
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evidence to the reasonable satisfaction of the Trustee as to
the amount of Senior Indebtedness held by such person, the
extent to which such person is entitled to participate in
such payment or distribution, and other facts pertinent to
the rights of such person under this Section 3.2. If such
evidence is not furnished, the Trustee may defer any payment
to such person or such representative pending judicial
determination as to the right of such person to receive such
payment.
No payment on account of the principal of, premium, if
any, or interest on the Debentures shall be made, if, at the
time of such payment or immediately after giving effect
thereto, there shall exist a default in the payment of the
principal of, premium, if any, or interest on any Senior
Indebtedness (whether at expressed maturity, acceleration
thereof or otherwise), unless and until such default shall
have been cured or waived or shall have ceased to exist;
provided, however, that, notwithstanding the foregoing, the
following shall be permitted: payments made in Capital Stock
or in warrants, rights or options to purchase or acquire
Capital Stock, payments made on account of any sinking fund
and made in Debentures owned by the Company or any
subsidiary prior to the time such default shall have
occurred and payments made through the exchange of other
debt obligations of the Company for such Debentures in
accordance with the terms of such Debentures, provided that
such debt obligations are subordinated to Senior
Indebtedness at least to the extent that the Debentures for
which they are exchanged are so subordinated pursuant to
this Article III.
If any Event of Default described in Section 7.1 occurs
(under the circumstances when the provisions of the first
paragraph of this Section 3.2 shall not be applicable) and
as a result the Debentures then Outstanding of any series
are declared due and payable, and such declaration has not
been rescinded or annulled, all principal and premium, if
any, of all Senior Indebtedness then due, or thereafter
declared to be due, pursuant to the terms of said Senior
Indebtedness, within 90 days from notice of said Event of
Default given by the Company to holders of Senior
Indebtedness, and all interest then due upon Senior
Indebtedness, shall first be paid in full before any payment
is made on account of the principal, premium, if any, or
interest on any Debenture.
Nothing in this Section 3.2 shall apply to claims of,
or payments to, the Trustee pursuant to Section 11.2.
SECTION 3.3. Debentures may be paid prior to
dissolution, etc. Nothing contained in this Article III or
elsewhere in this Indenture, or in any of the Debentures,
shall prevent (a) the Company, at any time except under the
conditions described in Section 3.2 hereof or during the
pendency of any dissolution or winding up or total or
partial liquidation or reorganization proceedings therein
referred to, from making payments at any time
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of principal of, premium, if any, or interest on the
Debentures or from depositing with the Trustee or any Paying
Agent moneys for such payments, (b) the application by the
Trustee or any Paying Agent of any moneys deposited with it
under this Indenture to the payment of or on account of the
principal of, premium, if any, or interest on the Debentures
to the Debentureholders entitled thereto, provided that such
payment was not, to the actual knowledge of the Trustee or
any Paying Agent, prohibited by the provisions of Section
3.2 on the date such moneys were so deposited, or (c) the
retention by the holders of Debentures of moneys so applied
and paid to them on account of the principal of, premium, if
any, or interest on the Debentures, whether or not at the
time of application described in clause (b) or payment
described in this clause (c), payment of the principal of,
premium, if any, or interest on the Debentures would then be
precluded pursuant to Section 3.2.
Notwithstanding the provisions of Section 3.1 or any
other provision of this Indenture, the Trustee and any
Paying Agent shall not be charged with knowledge of the
existence of any Senior Indebtedness, or of the occurrence
of any default with respect to Senior Indebtedness of the
character described in Section 3.2, or of any other facts
which would prohibit the making of any payment of moneys to
or by the Trustee or such payment agent, unless and until a
Responsible Officer of the Trustee and the Paying Agent
shall have received written notice thereof at its principal
office from the Company or from a person the Trustee and the
Paying Agent reasonably believes to be a holder of such
Senior Indebtedness stating that facts exist prohibiting the
making of such payment or specifying such facts, and, prior
to the receipt of any such written notice by a Responsible
Officer of the Trustee, the Trustee or the Paying Agent
shall be entitled in all respects to assume that no such
facts exist; provided, that, if two Business days prior to
the date upon which by the terms hereof any such moneys may
become payable for any purpose (including, without
limitation, the payment of the principal of, premium, if
any, or interest on any Debenture) the Trustee or such
Paying Agent shall not have received with respect to such
moneys the notice provided for in this Section 3.3, then,
anything herein contained to the contrary notwithstanding,
the Trustee and such Paying Agent shall have full power and
authority to receive such moneys and are directed to apply
the same to the purpose for which they were received, and
shall not be affected by any notice to the contrary which
may be received by it after such date.
SECTION 3.4. Rights of holders of Senior
Indebtedness not to be impaired, etc. No right of any
present or future holder of any Senior Indebtedness of the
Company to enforce subordination as herein provided shall at
any time in any way be prejudiced or impaired by any act or
failure to act on the part of the Company or by any act or
failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms,
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provisions and covenants of this Indenture, regardless of
any knowledge thereof any such holder may have or be
otherwise charged with.
The provisions of this Article III are intended to be
for the benefit of, and shall be enforceable directly by,
the holders of Senior Indebtedness. Neither the Trustee nor
any Paying Agent shall be deemed to owe any fiduciary duty
to the holders of Senior Indebtedness and shall not be
liable to any such holder if any of them shall mistakenly
pay over or distribute to the holders of the Debentures, the
Company or any other person, money or assets to which the
holders of Senior Indebtedness shall be entitled by virtue
of this Article III or otherwise. With respect to the
holders of Senior Indebtedness, the Trustee undertakes to
perform and observe only such covenants and obligations as
are specifically set forth in this Article III and no
implied covenants and obligations with respect to such
holders of Senior Indebtedness should be read into this
Indenture against the Trustee.
SECTION 3.5. Authorization to Trustee to take
action to effectuate subordination. Each holder of a
Debenture of any series by his acceptance thereof authorizes
the Trustee and the Paying Agent on his behalf to take such
action as may be necessary or appropriate to effectuate as
between the Debentureholders of such series and the holders
of Senior Debentures the subordination provided in this
Article III and appoints the Trustee his attorney-in-fact
for any and all such purposes.
SECTION 3.6. Trustee's rights as holder of Senior
Indebtedness. The Trustee shall be entitled to all the
rights set forth in this Article III with respect to any
Senior Indebtedness at any time held by it, to the same
extent as any other holder of Senior Indebtedness, and
nothing in Section 11.9 or elsewhere in this Indenture shall
be construed to deprive the Trustee of any of its rights as
such holder.
SECTION 3.7. Trustee's disclaimer. The Trustee
makes no representations as to the validity or adequacy of
this Indenture or the Debentures, it shall not be
accountable for the Company's use of proceeds from the
Debentures, and it shall not be responsible for any
statement in any Debentures other than its authentication.
SECTION 3.8. Application by Trustee of monies or
U.S. Government Obligations deposited with it. Money or
U.S. Government Obligations deposited in trust with the
Trustee pursuant to and in accordance with Section 6.1 shall
be for the sole benefit of Debentureholders and, to the
extent allocated for the payment of Debentures, shall not be
subject to the subordination provisions of this Article III,
if the same are deposited in trust prior to the happening of
any event specified
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in Section 3.2. Otherwise, any deposit of moneys or U.S.
Government Obligations by the Company with the Trustee or
any Paying Agent (whether or not in trust) for the payment
of the principal of, premium, if any, or interest on any
Debentures shall be subject to the provisions of Sections
3.1 and 3.2 except that, if prior to the date on which by
the terms of this Indenture any such monies may become
payable for any purpose (including, without limitation, the
payment of the principal of, premium, if any, or interest on
any Debenture) the Trustee shall not have received with
respect to such moneys the notice provided for in Section
3.3, then the Trustee or the Paying Agent shall have full
power and authority to receive such moneys and U.S.
Government Obligations and to apply the same to the purpose
for which they were received, and shall not be affected by
any notice to the contrary which may be received by it on or
after such date. This Section 3.8 shall be construed solely
for the benefit of the Trustee and Paying Agent and, as to
the first sentence hereof, the Debentureholders, and shall
not otherwise affect the rights of holders of Senior
Indebtedness.
SECTION 3.9. Trustee Compensation not prejudiced.
Nothing in this Article III shall apply to claims of or
payment to the Trustee pursuant to Section 11.2.
ARTICLE IV
COVENANTS OF THE COMPANY
The Company covenants and agrees as follows:
SECTION 4.1 Payment of Principal and interest. The
Company will for the benefit of each series of Debentures
duly and punctually pay or cause to be paid the principal
of, premium, if any, and interest on the Debentures of such
series at the times and place and in the manner specified in
this Indenture and in the Debentures of such series. At the
option of the Company, interest on the Debentures shall be
payable without presentation of such Debentures by a check
to the registered holder.
SECTION 4.2 Maintenance of office or agency. So long
as any of the Debentures of any series remain unpaid, the
Company will at all times keep an office or agency in where
Debentures of such series may be presented for registration
of transfer and exchange as in this Indenture provided,
where notices and demands with respect to the Debentures and
this Indenture may be served and where the Debentures may be
presented for payment or, for Debentures of each series that
is convertible, for conversion. The principal office of the
Trustee shall be the office or agency for all of the
aforesaid purposes, unless the Company shall maintain some
other office or agency with respect to the Debentures of any
series for such purposes and shall give the Trustee written
notice of the location thereof. In case the Company shall
fail to maintain such office
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or agency, presentations may be made and notices and demands
may be served at the principal office of the Trustee.
The Company shall keep, at said office or agency, a
register or registers in which, subject to such reasonable
regulations as it may prescribe, the Company shall register
or cause to be registered Debentures of each series and
shall register or cause to be registered the transfer or
exchange of Debentures of each series as in Article II
provided. Such register or registers shall be in written
form in the English language or any other form capable of
being converted into written form within a reasonable time.
At all reasonable times, such register or registers shall be
open for inspection by the Trustee.
SECTION 4.3 Corporate existence. So long as any of
the Debentures remain unpaid, the Company will at all times
(except as otherwise provided or permitted elsewhere in this
Indenture) do or cause to be done all things necessary to
preserve and keep in full force and effect its corporate
existence.
SECTION 4.4 Restrictions on mergers, sales and
consolidations. So long as any of the Debentures remain
unpaid, the Company will not consolidate or merge with or
sell, convey or lease all or substantially all of its
property to any other corporation except as permitted in
Article X hereof.
SECTION 4.5 Further assurances. From time to time
whenever requested by the Trustee, the Company will execute
and deliver such further instruments and assurances and do
such further acts as may be reasonably necessary or proper
to carry out more effectually the purposes of this Indenture
or to secure the rights and remedies hereunder of the
holders of the Debentures of any series.
SECTION 4.6 File certain reports and information with
the Trustee and the Securities and Exchange Commission -
transmit to Debentureholders summaries of certain documents
filed with the Trustee - furnish list of Debentureholders to
the Trustee. The Company will:
(a) file with the Trustee, within 15 days after
the Company files the same with the Securities and
Exchange Commission, copies of the annual reports and
of the information, documents and other reports which
the Company may be required to file with the Securities
and Exchange Commission pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934
(or copies of such portions thereof as may be
prescribed by the Securities and Exchange Commission);
or, if the Company is not required to file with the
Securities and Exchange Commission information,
documents or reports pursuant to either Section 13 or
Section 15(d) of the Securities Exchange Act of 1934,
then the Company will file with the Trustee and will
file with the Securities and
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Exchange Commission, in accordance with rules and
regulations prescribed by the Securities and Exchange
Commission, such of the supplementary and periodic
information, documents and reports required pursuant to
Section 13 of the Securities Exchange Act of 1934 in
respect of a security listed and registered on a
national securities exchange as may be prescribed in
such rules and regulations;
(b) file with the Trustee and the Securities and
Exchange Commission, in accordance with the rules and
regulations prescribed from time to time by the
Securities and Exchange Commission, such additional
information, documents and reports with respect to
compliance by the Company with the conditions and
covenants provided for in this Indenture as may be
required by such rules and regulations;
(c) transmit to the Debentureholders, in the
manner and to the extent provided in subdivision (c) of
Section 11.10, such summaries of any information,
documents and reports required to be filed with the
Trustee pursuant to the provisions of subdivisions (a)
and (b) of this Section 4.6 as may be required by the
rules and regulations of the Securities and Exchange
Commission; and
(d) furnish or cause to be furnished to the
Trustee, not more than 15 days after each record date
(but in no event less frequently than every six months)
for the payment of interest with respect to Debentures
of any series, and at such other times as the Trustee
may request in writing, within 30 days after receipt by
the Company of any such request, a list in such form as
the Trustee may reasonably require containing all
information in the possession or control of the Company
or of any paying agent, other than the Trustee, as to
the names and addresses of the holders of Debentures of
such series obtained since the date as of which the
next previous list, if any, was furnished; provided,
that so long as the Trustee is Debenture registrar for
such series, no such list need be furnished. Any such
list may be dated as of a date not more than 15 days
prior to the time such information is furnished or
caused to be furnished, and need not include
information received after such date (excluding from
any such list names and addresses received by the
Trustee in its capacity as Debenture registrar).
SECTION 4.7 File statement by officers annually with
the Trustee. Within 120 days after the close of the fiscal
year ending and within 120 days after
the close of each fiscal year thereafter, the Company will
file with the Trustee a brief certificate from the principal
executive officer, principal financial officer or principal
accounting officer as to his or her knowledge of the
Company's compliance with all conditions and covenants under
this Indenture. For purposes of
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this paragraph, such compliance shall be determined without
regard to any period of grace or requirement of notice
provided under this Indenture.
At the time such Officers' Certificate is filed, the
Company will also file with the Trustee a letter or
statement of the independent accountants who shall have
certified the financial statements of the Company for its
preceding fiscal year in connection with the annual report
of the Company to its shareholders for such year to the
effect that, in making the examination necessary for
certification of such financial statements, they have
obtained no knowledge of any default by the Company in the
performance or fulfillment of any covenant, agreement or
condition contained in this Indenture, which default remains
uncured at the date of such letter or statement, or, if they
shall have obtained knowledge of any such uncured default,
specifying in such letter or statement such default or
defaults and the nature and status thereof, it being
understood that such accountants shall not be liable
directly or indirectly for failure to obtain knowledge of
any such default or defaults, and that nothing contained in
this Section 4.7 shall be construed to require such
accountants to make any investigation beyond the scope
required in connection with such examination.
SECTION 4.8 Duties of Paying Agent. The Company will
cause each Paying Agent for the Debentures of any series
other than the Trustee to execute and deliver to the Trustee
an instrument in which such agent shall agree with the
Trustee:
(a) that it will hold all sums held by it as
such agent for the payment of the principal of,
premium, if any, or interest on the Debentures of such
series (whether such sums have been paid to it by the
Company or by any other obligor on the Debentures of
such series) in trust for the benefit of the holders of
the Debentures of such series;
(b) that it will give the Trustee written notice
of any failure by the Company (or by any other obligor
on the Debentures of such series) to make any payment
of the principal of, premium, if any, or interest on
the Debentures of such series when the same shall be
due and payable; and
(c) that it will, at any time during the
continuance of any Event of Default with respect to
such series, upon the written request of the Trustee,
forthwith pay to the Trustee all sums so held in trust
by such Paying Agent.
If the Company acts as its own paying Agent for the
Debentures of any series, it will, on or before each due
date of the principal of, premium, if any, or interest on
the Debentures of such series, set aside and segregate and
hold in trust for the benefit of the holders of the
Debentures of such series a sum sufficient to pay such
principal, premium, if any, or interest and will
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notify the Trustee of such action or any failure to take
such action.
Whenever the Company shall have one or more Paying
Agents for any series of Debentures, it will, on or before
each due date of the principal of, premium, if any, or
interest on any Debentures of such series, deposit with the
Paying Agent or Agents for the Debentures of such series a
sum, by 10:00 a.m. New York time in immediately available
funds on the payment date, sufficient to pay the principal,
premium, if any, or interest so becoming due with respect to
the Debentures of such series, and (unless such paying agent
is the Trustee) the Company will promptly notify the Trustee
in writing of any failure so to act.
The Company may at any time, for the purpose of
obtaining the satisfaction and discharge of this Indenture
with respect to the Debentures of one or more series or for
any other purpose, pay, or by Company order direct any
Paying Agent for such series to pay, to the Trustee all sums
held in trust by the Company or such Paying Agent, such sums
to be held by the Trustee upon the same trusts as those upon
which such sums were held by the Company or such Paying
Agent; and, upon such payment by any Paying Agent to the
Trustee, such Paying Agent shall be released from all
further liability with respect to such payment.
Anything in this Section 4.8 to the contrary
notwithstanding, the agreement to hold sums in trust as
provided in this Section 4.8 shall be subject to the
provisions of Section 6.3.
ARTICLE V
REDEMPTION OF DEBENTURES; SINKING FUND
SECTION 5.1 Applicability of Article. Debentures of
any series which are redeemable before their stated maturity
at the election of the Company or through the operation of
any sinking fund for the retirement of Debentures of such
series shall be redeemable in accordance with their terms
established pursuant to Section 2.2 and (except as otherwise
established pursuant to Section 2.2 for Debentures of such
series) in accordance with this Article.
SECTION 5.2 Notice of redemption to be given to
Trustee - deposit of cash (or other form of payment) with
Trustee - selection by Trustee of Debentures to be redeemed.
Not less than 30 days (or such lesser number of days as the
Trustee shall approve) nor more than 60 days (or such
greater number of days as the Trustee shall approve) prior
to the date fixed by the Company for the redemption at the
option of the Company of any Debentures of any series which
are subject to redemption or portions thereof, the Company
shall give written notice, by delivering a Company Order to
the Trustee, stating the aggregate principal amount of
Debentures of such series which the Company elects to
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redeem and the date and place fixed for redemption, that the
Company, in the case of any redemption of Debentures subject
to any restrictions on such redemption provided in the terms
of Debentures of such series established pursuant to Section
2.2 or elsewhere in this Indenture, is in compliance with
such restrictions. On or before 10:00 a.m. New York time of
the date fixed for redemption, the Company shall deposit
with the Trustee or the Paying Agent money in immediately
available funds on such redemption date (or other form of
payment if permitted by the terms of such Debentures) an
amount sufficient to redeem on the date fixed for redemption
all the Debentures of such series or portions thereof to be
redeemed, other than any Debentures of such series called
for redemption on such date which have been converted prior
to the date of such deposit, at the appropriate redemption
price, together with any accrued interest to the date fixed
for redemption. If less than all the Debentures then
Outstanding of such series are to be redeemed, the Trustee
shall select, substantially pro rata or by lot, in such
manner as it shall deem appropriate and fair, in its sole
discretion, the numbers of the Debentures to be redeemed as
a whole or in part, and shall thereafter promptly notify the
Company in writing of the numbers of the Debentures to be
redeemed; provided, however, that Debentures of such series
registered in the name of the Company shall be excluded from
any such selection for redemption until all Debentures of
such series not so registered shall have been previously
selected for redemption. For the purpose of such selection
in case of redemption of less than all of the Debentures of
any series, the Trustee and the Company shall have the
option to treat as Outstanding Debentures any Debentures of
such series which are surrendered for conversion after the
fifteenth day immediately preceding the mailing of the
notice of such redemption, and need not treat as Outstanding
Debentures any Debentures authenticated and delivered during
such period in exchange for the unconverted portion of any
Debentures converted in part during such period. In case
any Debenture shall be redeemed in part only, the notice
of redemption shall specify the principal amount thereof to
be redeemed and shall state that, upon surrender thereof for
redemption, a new Debenture or new Debentures of the same
series of an aggregate principal amount equal to the
unredeemed portion of such Debenture will be issued in lieu
thereof; and in such case the Company shall execute and the
Trustee or the Authenticating Agent shall authenticate and
deliver such new Debenture or Debentures of such series to
or upon the written order of the Debentureholder, at the
expense of the Company. Provisions of this Indenture that
apply to Debentures called for redemption also apply to
portions of Debentures called for redemption.
Upon or after the receipt of such notice, the Trustee,
in the name of the Company and as its agent, shall mail by
first-class mail, postage prepaid, to each registered holder
of a Debenture to be redeemed in whole or in part at his
last address appearing on the registration books of the
Company, a notice of
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redemption. Such notice of redemption shall identify the
Debentures to be so redeemed in whole or in part and whether
such Debentures are to be redeemed in whole or in part and
shall state: (i) the date fixed for redemption; (ii) the
redemption price at which Debentures are to be redeemed and
method of payment, if other than in cash; (iii) if
applicable, the current conversion price or rate; (iv) if
applicable, that the right of the Debentureholder to convert
Debentures called for redemption shall terminate at the
close of business on the date fixed for redemption (or such
other day as may be specified as contemplated by Section 2.2
for Debentures of any series); (v) if applicable, that
Debentureholders who want to convert Debentures called for
redemption must satisfy the requirements for conversion
contained in such Debentures; (vi) that, subject to Section
13.4, interest, if any, accrued to the date fixed for
redemption will be paid as specified in said notice and that
on and after said date interest thereon shall cease to
accrue; (vii) the provision of the Debenture or this
Indenture under which the redemption is being made; and
(viii) that the Company so elects to redeem such Debentures
or portions thereof at the place or places specified in such
notice. Such notice shall be mailed not later than the
tenth, and not earlier than the sixtieth, day before the
date fixed for redemption. Any notice which is mailed in
the manner herein provided shall be conclusively presumed to
have been duly given, whether or not the holder receives
such notice; and failure duly to give such notice by mail,
or any defect in such notice, to the holder of any Debenture
designated for redemption as a whole or in part shall not
affect the validity of the proceedings for the redemption of
any other Debenture.
The Company shall pay to the Trustee the cost of
mailing notices of redemption and any other necessary
expenses incurred by the Trustee in connection therewith.
SECTION 5.3. Debentures called for redemption to
become due - rights of holders of redeemed Debentures -
return of funds on conversion. The notice of
election to redeem having been mailed as hereinbefore
provided, the Debentures or portions thereof called for
redemption shall become due and payable on the redemption
date at the applicable redemption price, together with
interest accrued to the date fixed for redemption, at the
place or places specified in such notice, and if cash (or
other form of payment if permitted by the terms of such
Debentures) in the amount necessary to redeem such
Debentures or portions thereof has been deposited with the
Trustee, interest on such Debentures or portions thereof
shall cease to accrue from and after the date fixed for
redemption (unless the Company shall default in the payment
of the redemption price, plus accrued interest, if any) and
the right to convert such Debentures or portions thereof, if
the terms of such Debentures provide for conversion pursuant
to Section 2.2, shall terminate at the close of business on
the date fixed for redemption or such other day as may be
specified as contemplated by Section 2.2 for Debentures of
such series. The
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respective registered holders of Debentures or portions
thereof so called for redemption shall be entitled to
receive payment of the applicable redemption price, together
with interest accrued to the date fixed for redemption on or
after the date fixed for redemption (unless the Company
shall default in the payment of the redemption price, plus
accrued interest, if any), upon presentation and surrender
at the place or places of payment specified in such notice.
Notwithstanding the foregoing, subject to Section 13.4, if
the record date for payment or interest is on or prior to
the redemption date, such interest shall be payable to the
persons who are holders of such Debentures on such record
date according to the terms of such Debentures and Section
2.12.
If any Debenture called for redemption pursuant to
Section 5.1 is converted pursuant to Article XIII, any
monies deposited with the Trustee for the purpose of paying
or redeeming any such Debenture shall be promptly paid to
the Company.
SECTION 5.4 Credits against sinking fund. Against any
one or more sinking fund payments to be made pursuant to the
terms of the Debentures of any series providing for a
sinking fund, the Company may elect, by delivery of an
Officers' Certificate to the Trustee, at least 45 days prior
to the sinking fund payment date (or such shorter period as
may be acceptable to the Trustee or is otherwise specified
as contemplated by Section 2.2 for Debentures of any
series), to take credit for any Debentures of such series or
portions thereof acquired or redeemed by the Company,
pursuant to the terms of such Debentures or through the
application of permitted optional sinking fund payments
pursuant to the terms of such Debentures, which have not
previously been used by the Company for the purposes
permitted in this Section 5.4 and for any Debentures which
have been converted pursuant to the terms of such
Debentures. Such Debentures shall be received and credited
for such purpose by the Trustee at the redemption price
specified in such Debentures for redemption through
operation of the sinking fund and the amount of such sinking
fund payment shall be reduced accordingly. Upon any such
election the Company shall receive credit against such
sinking fund payments required to be made in the order in
which they are to be made. Any Debenture for which credit is
elected to be taken which shall not theretofore have been
delivered to the Trustee for cancellation shall at the time
of such election be delivered to the Trustee for
cancellation by the Trustee.
SECTION 5.5 Redemption through sinking fund. Each
sinking fund payment made under the terms of the Debentures
of any series established pursuant to Section 2.2 shall be
applied to the redemption of Debentures of such series on
the date for redemption specified in the Debentures of such
series next succeeding such sinking fund payment date;
provided, however, if at any time the amount of cash to be
paid into the sinking fund for such series on the next
succeeding sinking fund payment date, together with any
unused balance of any preceding sinking fund
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payment or payments for such series, shall not exceed in the
aggregate $10,000, the Trustee, unless requested by the
Company, shall not give notice of the redemption of
Debentures of such series through the operation of the
sinking fund on the succeeding date for redemption specified
in the Debentures of such series. At least 45 days (or such
lesser number of days as the Trustee shall approve) prior to
the date on which a sinking fund payment with respect to the
Debentures of any series is due, the Company shall give
written notice to the Trustee of the principal amount of
Debentures of such series registered in the name of the
Company (which shall be excluded from such redemption) and
the Trustee shall select, substantially pro rata or by lot,
in such manner as it shall deem appropriate and fair, the
principal amount of Debentures of such series to be redeemed
in accordance with the terms of the Debentures of such
series after allowance for any credit elected under Section
5.4 and shall, in the name and at the expense of the Company
and as its agent, give notice of such redemption, all in the
manner provided for in Section 5.2, except that such notice
shall state that the Debentures of such series are being
redeemed for the sinking fund. The notice of redemption
having been mailed as hereinbefore provided, the Debentures
or portions thereof called for redemption shall become due
and payable on the next succeeding date for redemption
specified in the Debentures of such series at the sinking
fund redemption price thereof, all in the manner and with
the effect provided for in Section 5.3.
Any sinking fund payment not so required to be applied
to the redemption of Debentures of any series on the date
for redemption specified in the Debentures of such series
next succeeding any sinking fund payment date may, at the
direction of the Company as evidenced by a Company Order, be
applied by the Trustee prior to the forty-fifth day
preceding the next following sinking fund payment date for
such series, in such manner and from time to time, in such
amount as the Company may direct the Trustee in writing, so
far as such moneys shall be adequate, to the purchase for
the sinking fund of Debentures of such series or portions
thereof, in the open market, from the Company or otherwise,
at prices (exclusive of accrued interest and brokerage
commissions) not in
excess of the sinking fund redemption price for such series.
The Company agrees to pay to the Trustee, upon request,
accrued interest and brokerage commissions paid by the
Trustee with respect to any Debentures of such series so
purchased by the Trustee and such accrued interest and
brokerage commissions shall not be charged against the
sinking fund for such series.
Any unused balance of sinking fund moneys with respect
to Debentures of any series remaining in the hands of the
Trustee on the forty-fifth day preceding the sinking fund
payment date for such series in any year shall be added to
any sinking fund payment for such series to be made in cash
in such year, and together with such payment, if any, shall
be applied to the redemption or purchase of Debentures of
such series in accordance
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with the provisions of this Section 5.5, provided that any
sinking fund moneys so remaining in the hands of the Trustee
after the date specified in the Debentures of such series
and not utilized in the purchase of Debentures of such
series as provided in this Section 5.5 shall be applied by
the Trustee to the payment of Debentures at maturity.
SECTION 5.6 Debentures no longer Outstanding after
notice to Trustee and deposit of cash. If the Company,
having given notice to the Trustee as provided in Section
5.1 or 5.2, shall have deposited with the Trustee or the
Paying Agent, for the benefit of the holders of any
Debentures of any series or portions thereof called for
redemption in whole or in part cash or other form of payment
if permitted by the terms of such Debentures (which amount
shall be immediately due and payable to the holders of such
Debentures or portions thereof) in the amount necessary so
to redeem all such Debentures or portions thereof on the
date fixed for redemption and provision satisfactory to the
Trustee shall have been made for the giving of notice of
such redemption, such Debentures, or portions thereof, shall
thereupon, for all purposes of this Indenture, be deemed to
be no longer Outstanding, and the holders thereof shall be
entitled to no rights thereunder or hereunder, except the
right to receive payment of the applicable redemption price,
together with interest accrued to the date fixed for
redemption, on or after the date fixed for redemption of
such Debentures or portions thereof and the right to convert
such Debentures or portions thereof, if the terms of such
Debentures provide for convertibility pursuant to Section
2.2, at or prior to the close of business on the date fixed
for redemption.
SECTION 5.7. Conversion arrangement on call for
redemption. In connection with any redemption of
Debentures, the Company may arrange for the purchase and
conversion of any Debentures called for redemption by an
agreement with one or more investment bankers or other
purchasers to purchase such Debentures by paying to the
Trustee or the Paying Agent in trust for the
Debentureholders, on or before 10:00 a.m., New York time, on
the redemption date, an amount no less than the redemption
price, together with interest, if any, accrued to the
redemption date of such Debentures, in immediately available
funds. Notwithstanding anything to the contrary contained in
this Article V, the obligation of the Company to pay the
redemption price of such Debentures, including all accrued
interest, if any, shall be deemed to be satisfied and
discharged to the extent such amount is so paid by such
purchasers. If such an agreement is entered into, any
Debentures not duly surrendered for conversion by the
holders thereof may, at the option of the Company, be
deemed, to the fullest extent permitted by law, acquired by
such purchasers from such holders and (notwithstanding
anything to the contrary contained in Article XIII)
surrendered by such purchasers for conversion, all as of
immediately prior to the close of business on the last day
on which Debentures of such series called for
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redemption may be converted in accordance with this
Indenture and the terms of such Debentures, subject to
payment of the above amount aforesaid. The Trustee or the
Paying Agent shall hold and pay to the Debentureholders
whose Debentures are selected for redemption any such amount
paid to it in the same manner as it would moneys deposited
with it by the Company for the redemption of Debentures.
Without the Trustee's and the Paying Agent's prior written
consent, no arrangement between the Company and such
purchasers for the purchase and conversion of any Debentures
shall increase or otherwise affect any of the powers,
duties, responsibilities or obligations of the Trustee as
set forth in this Indenture, and the Company agrees to
indemnify the Trustee from, and hold it harmless against,
any loss, liability or expense arising out of or in
connection with any such arrangement for the purchase and
conversion of any Debentures between the Company and such
purchasers, including the costs and expenses incurred by the
Trustee and the Paying Agent in the defense of any claim or
liability arising out of or in connection with the exercise
or performance of any of its powers, duties,
responsibilities or obligations under this Indenture.
ARTICLE VI
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 6.1 Satisfaction and discharge of Indenture
with respect to Debentures of any series. If (a) the
Company shall deliver to the Trustee for cancellation all
Debentures of any series theretofore authenticated (other
than any such Debentures which shall have been destroyed,
lost or stolen and in lieu of or in substitution for which
other such Debentures shall have been authenticated and
delivered or Debentures for whose payment money (or other
form of payment if permitted by the terms of such
Debentures) has theretofore been held in trust and
thereafter repaid to the Company, as provided in Section
6.3) and not theretofore cancelled, or (b) the Company shall
irrevocably deposit (subject to Section 6.3) with the
Trustee or Paying Agent as trust funds the entire amount in
cash or U.S. Government Obligations sufficient to pay at
maturity or upon redemption all of the Debentures of such
series (other than any Debentures which shall have been
destroyed, lost or stolen and in lieu of or in substitution
for which other Debentures shall have been authenticated and
delivered or Debentures for whose payment money (or other
form of payment if permitted by the terms of such
Debentures) has theretofore been held in trust and
thereafter repaid to the Company, as provided in Section
6.3) not theretofore paid, surrendered or delivered to the
Trustee for cancellation, including the principal, premium,
if any, and interest due or to become due to such date of
maturity or redemption date, as the case may be, and if in
either case the Company shall also pay or cause to be paid
all other sums payable hereunder by the Company and the
Company shall deliver to the Trustee an Officers'
Certificate and an Opinion of Counsel, each
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stating that in the opinion of the signers all conditions
precedent to the satisfaction and discharge of this
Indenture with respect to the Debentures of such series have
been complied with (and, in the event that such deposit
shall be made more than one year prior to the maturity of
the Debentures of such series, such Opinion of Counsel shall
also state that such deposit will not result in an
obligation of the Company, the Trustee or the trust fund
created by such deposit to register as an investment company
under the Investment Company Act of 1940, as amended) and a
certificate (upon which the Trustee may rely) of a firm of
independent public accountants of recognized national
standing selected by the Board of Directors (who may be the
regular accountants employed by the Company) stating that
the cash, if any, and U.S. Government Obligations, if any,
deposited as set forth above are sufficient to pay at
maturity or upon redemption all of the Debentures of such
series as set forth above, then, except with respect to the
remaining rights of conversion of any Debentures the terms
of which provide for conversion (which shall continue in
full force and effect pursuant to the terms set forth in
Article XIII to the extent provided for in such terms) or to
rights of exchange or registration of transfer or of the
Company's right of optional redemption of any Debentures of
such series, this Indenture shall cease to be of further
effect with respect to the Debentures of such series, and
the Trustee, on demand of and at the cost and expense of the
Company, shall execute proper instruments acknowledging
satisfaction of and discharging this Indenture with respect
to the Debentures of such series. Notwithstanding the
satisfaction and discharge of this Indenture with respect to
the Debentures of such series, the obligations of the
Company to the Trustee under Section 11.2 shall survive, and
if moneys or U.S. Government Obligations shall have been
irrevocably deposited with the Trustee or Paying Agent
pursuant to clause (b) of this Section, the obligations of
the Trustee under Section 6.2 and the first paragraph of
Section 6.3 shall survive.
In order to have money available on a payment date to
pay the principal of, premium, if any, or interest, if any,
on the Debentures, the U.S. Government Obligations shall be
payable as to principal or interest on or before such
payment date in such amounts as will provide the necessary
money. Such U.S. Government Obligations shall not be
callable at the issuer's option.
SECTION 6.2 Deposits for payment or redemption of
Debentures to be held in trust. Subject to the provisions
of Article III and the provisions hereinafter contained in
this Article VI, any moneys or U.S. Government Obligations
(or other form of payments if permitted by the terms of such
Debenture) which at any time shall be deposited by the
Company, or on its behalf with the Trustee or the Paying
Agent, for the purpose of paying or redeeming any of the
Debentures of any series shall be held in trust and applied
by the Trustee to the payment to the holders of
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the particular Debentures for the payment or redemption of
which such moneys (or other form of payments if permitted by
the terms of such Debenture) have been deposited, of all
sums due and to become due thereon for principal, premium,
if any, and interest, upon presentation and surrender of
such Debentures at the office or agency of the Company
maintained as provided in this Indenture. Neither the
Company nor the Trustee (except as provided in Section 11.2)
nor any Paying Agent shall be required to pay interest on
any moneys so deposited.
SECTION 6.3 Repayment of moneys. Any moneys or U.S.
Government Obligations deposited with the Trustee or any
Paying Agent remaining unclaimed by the holders of
Debentures for two years after the date upon which the
principal of or interest on such Debentures shall have
become due and payable, shall (unless otherwise required by
mandatory provisions of applicable escheat or abandoned or
unclaimed property law) be repaid to the Company by the
Trustee or Paying Agent and such holders shall (unless
otherwise required by mandatory provisions of applicable
escheat or abandoned or unclaimed property law) thereafter
be entitled to look to the Company only for payment thereof;
provided, however, that, before being required to make any
such payment to the Company, the Trustee or Paying Agent
may, at the expense and written direction of the Company,
cause to be published once, in an Authorized Newspaper, a
notice that such moneys remain unclaimed and that, after the
date set forth in said notice, the balance of such moneys
then unclaimed will be returned to the Company.
Upon the satisfaction and discharge of this Indenture,
all moneys then held by any Paying Agent other than the
Trustee hereunder shall, upon demand of the Company, be
repaid to it and thereupon such paying agent shall be
released from all further liability with respect to such
moneys.
The Trustee or any Paying Agent shall deliver or pay to
the Company from time to time upon a request in writing by
the Company any moneys or U.S. Government Obligations (or
the principal or interest on such U.S. Government
Obligations) held by it as provided in Section 6.1 which, in
the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification
thereof to the Trustee, are then in excess of the amount
thereof which then would have been required to be deposited
for the purpose for which such money or U.S. Government
Obligations were deposited or received.
ARTICLE VII
REMEDIES UPON DEFAULT
SECTION 7.1. Events of Default defined-acceleration of
maturity upon default-waiver of default after acceleration.
The following events are hereby defined for all purposes of
this
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Indenture (except where the term is otherwise defined for
specific purposes) as Events of Default with respect to
Debentures of a particular series, unless it is either
inapplicable to a particular series or is specifically
deleted or modified as contemplated by Section 2.2 for the
Debentures of such series, in addition to any other events
as may be defined as Events of Default pursuant to Section
2.2 for the Debentures of such series:
(a) Failure of the Company to pay or provide for
payment of the principal of or premium, if any, on any
of the Debentures of such series, when and as the same
shall become due and payable, whether at maturity
thereof, by call for redemption, through any mandatory
sinking fund, by redemption at the option of the holder
of any Debenture pursuant to the terms of such
Debenture, by declaration of acceleration or otherwise,
whether or not such payment is prohibited by the
provisions of Article III; or
(b) Failure of the Company to pay or provide for
payment of any installment of interest on any of the
Debentures of such series, when and as the same shall
become due and payable, whether or not such payment is
prohibited by the provisions of Article III, which
failure shall have continued for a period of 30 days;
or
(c) Failure of the Company to perform or observe
any other of the covenants or agreements on the part of
the Company in this Indenture or in the Debentures of
such series (other than a covenant or agreement which
has expressly been included in this Indenture solely
for the benefit of Debentures of any series other than
that series or is expressly made inapplicable to the
Debentures of such series pursuant to by Section 2.2),
which failure shall have continued for a period of 90
days after written notice by certified or registered
mail given to the Company by the Trustee hereunder or
to the Company and to the Trustee from the holders of
not less than 25% of the aggregate principal amount of
Debentures then Outstanding of such series under this
Indenture specifying such Event of Default or failure
and requesting that it be remedied and stating that
such notice is a notice of an event which, if continued
for 90 days after such written notice, will become an
Event of Default; or
(d) The institution by the Company of
proceedings to be adjudicated a bankrupt or insolvent,
or the consent by it to the institution of bankruptcy
or insolvency proceedings against it, or the filing by
it of a petition or answer or consent seeking relief
under any Bankruptcy Law or the consent by it to the
institution of proceedings thereunder or the filing of
any such petition or to the appointment of a receiver,
liquidator, assignee, trustee, custodian,
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sequestrator (or other similar official) of the Company
or of any substantial part of its property, or the
making by the Company of an assignment for the benefit
of creditors, or the admission by the Company in
writing of its inability to pay its debts generally as
they become due; or
(e) The entry of a decree or order by a court
having jurisdiction for relief in respect of the
Company, or 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
Bankruptcy Law or appointing a 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 unstayed and in effect for a period of 180
consecutive days; or
(f) An event of default, as defined in any
indenture or instrument evidencing or under which the
Company has at the date of this Indenture or shall
hereafter have outstanding any Senior Indebtedness,
shall have happened and shall be continuing and such
indebtedness shall have been accelerated so that the
same shall be or become due and payable prior to the
date on which the same would otherwise become due and
payable, and such acceleration shall not be contested
in good faith by the Company, and such acceleration
shall not be rescinded or annulled within 30 Business
days after written notice thereof given by certified or
registered mail to the Company from the Trustee or to
the Company and the Trustee from the holders of not
less than 25% in aggregate principal amount of the
Debentures then Outstanding of such series hereunder
specifying such event of default and requesting that it
be remedied and stating that such notice is a notice of
an Event of Default; provided, however, that if such
event of default under such indenture or instrument
shall be remedied or cured by the Company or be waived
by the holders of such indebtedness in any manner
authorized by such indenture or instrument or shall
otherwise cease to exist, then the Event of Default
hereunder by reason thereof shall be deemed likewise to
have been thereupon remedied, cured or waived without
further action upon the part of either the Trustee or
any of the Debentureholders.
If one or more Events of Default shall happen and be
continuing with respect to Debentures then outstanding of
any series, then, and in each and every such case, either
the Trustee, by notice in writing to the Company, or the
holders of not less than 25% in aggregate principal amount
of the Debentures then Outstanding of such series, by notice
in writing to the Company and to the Trustee, may declare
the principal amount (or, if the Debentures of such series
are Original Issue Discount
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Debentures, such portion of the principal amount as may be
specified in the terms of the Debentures of such series) of
all Debentures of such series and/or such other amount or
amounts as the Debentures or supplemental indenture with
respect to such series may provide, if not already due and
payable, to be immediately due and payable; and upon any
such declaration all Debentures of such series shall become
and be immediately due and payable, anything in this
Indenture or in any of the Debentures of such series
contained to the contrary notwithstanding; provided,
however, that payment of principal of (and/or such other
specified amount), premium, if any, and interest on the
Debentures of such series shall remain subordinated to the
extent provided in Article III. This provision, however, is
subject to the condition that if, at any time after the
principal of (and/or such other specified amount on) the
Debentures of such series shall so become due and payable,
and before any judgment or decree for the payment of the
moneys due shall have been obtained or entered as
hereinafter provided, the Company shall pay or shall deposit
with the Trustee a sum sufficient to pay all matured
installments of interest upon all the Debentures of such
series and the principal of (and/or such other specified
amount) and premium, if any, on any and all Debentures of
such series which shall have become due otherwise than by
acceleration, with interest on such principal (and/or such
other specified amount) and premium, if any, and (to the
extent that payment of such interest is enforceable under
applicable law) on any overdue installment of interest, at
the rate specified in the Debentures of such series (or, if
no such rate is specified, at the rate borne by the
Debentures of such series), to the date of such payment or
deposit, and the reasonable compensation and expenses of the
Trustee, and any and all defaults under this Indenture with
respect to the Debentures or such series, other than the
nonpayment of principal of (and/or such other specified
amount) or premium, if any, and accrued interest on
Debentures of such series which shall have become due by
acceleration, shall have been remedied, then and in every
such case the Trustee shall, upon written request or consent
of the holders of a majority in aggregate principal amount
of the Debentures then Outstanding of such series delivered
to the Company and to the Trustee, waive such default and
its consequences and rescind or annul such declaration and
its consequences, but no such waiver, rescission or
annulment shall extend to or affect any subsequent default,
or impair any right consequent thereon.
For all purposes under this Indenture, if the portion
of the principal amount as may be specified in the terms of
any Original Issue Discount Debentures shall have been
accelerated and declared due and payable pursuant to the
provisions hereof, then, from and after such declaration,
unless such declaration has been rescinded and annulled,
payment of such portion of the principal amount thereof,
together with interest, if any, thereon and all other
amounts owing thereunder, shall constitute payment in full
of such Original Issue Discount Debentures.
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SECTION 7.2 Covenant of Company to pay to Trustee
whole amount due on default in payment of Principal or
interest-Trustee may recover judgment for whole amount
due-application of moneys received by the Trustee. In case
the Company shall commit an Event of Default with respect to
the Debentures of any series described in Section 7.1(a) or
(b), then upon demand of the Trustee, the Company shall pay
to the Trustee, for the benefit of the holders of the
Debentures then Outstanding of such series, the whole amount
which then shall have become due on all such Debentures of
such series for principal, premium, if any, and interest,
with interest on the overdue principal and premium, if any,
and (to the extent that payment of such interest is
enforceable under applicable law) upon overdue installments
of interest, at the rate specified in the Debentures of such
series (or, if no such rate is specified, at the rate borne
by the Debentures of such series), and in addition thereto,
such additional amount as shall be sufficient to cover the
costs and expenses of collection, including the reasonable
compensation, expenses, liabilities, disbursements and
advances of the Trustee, any predecessor Trustee, their
agents and counsel. In case the Company shall pay the same
in accordance with the provisions of this Section 7.2 and,
prior to such payment neither the Trustee nor the holders of
the Debentures then Outstanding of such series shall have
taken any steps to begin enforcing their rights under this
Indenture and so long as no additional Event of Default with
respect to the Debentures of such series shall have
occurred, from and after such payment, the Event of Default
giving rise to the demand by the Trustee pursuant to this
Section 7.2 shall be deemed to be no longer continuing and
shall be deemed to have thereupon been remedied, cured or
waived without further action upon the part of either the
Trustee or any of the Debentureholders. In case the Company
shall fail to pay the same forthwith upon such demand, the
Trustee, in its own name and as trustee of an express trust,
may institute any judicial proceedings at law or in equity
for the collection of the sums so due and unpaid and may
prosecute such proceedings to judgment or final decree, and
may enforce the same against the Company or any other
obligor upon the Debentures of such series and collect the
moneys adjudged or decreed to be payable in the manner
provided by law out of the property of the Company or any
other obligor upon the Debentures of such series, wherever
situated. The right of the Trustee to recover such judgment
shall not be affected by the exercise of any other right,
power or remedy for the enforcement of the provisions of
this Indenture.
In case of the pendency of any receivership,
insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial
proceeding relative to the Company or any other obligor upon
the Debentures or the property of the Company or of such
other obligor or their creditors, the Trustee (irrespective
of whether the principal of any Debentures shall then be due
and payable as therein expressed or by declaration of
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acceleration or otherwise and irrespective of whether the
Trustee shall have made any demand on the Company for the
payment of overdue principal or interest) shall be entitled
and empowered to file and prove a claim for the whole amount
of principal, premium, if any, and interest owing and unpaid
in respect of the Debentures of any series for which it
serves as Trustee and to file such other papers or documents
as may be necessary or advisable in order to have the claims
of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the
Trustee, any predecessor Trustee, their agents and counsel)
and of the Debentureholders of such series allowed in such
judicial proceeding, and to receive payment of or on account
of such claims and to distribute the same after the
deduction of its charges and expenses; and any receiver,
assignee, trustee, liquidator, sequestrator (or other
similar official) in any judicial proceeding is hereby
irrevocably authorized and instructed by each of the
Debentureholders of such series to make such payments to the
Trustee, and, in the event that the Trustee shall consent to
the making of such payments directly to the Debentureholders
of such series, to pay to the Trustee any amount due it or
any predecessor Trustee, for compensation and expenses,
including counsel fees incurred up to the date of such
distribution. Nothing contained in this Indenture shall be
deemed to give to the Trustee any right to accept or consent
to any plan or reorganization, arrangement, adjustment or
composition affecting the Debentureholders or the rights of
any Debentureholder, or to authorize the Trustee to vote in
respect of the claim of any Debentureholder in any such
proceeding.
Subject to the provisions of Article III, any moneys or
property received by the Trustee under this Section 7.2
shall be applied in the following order, at the date or
dates fixed by the Trustee and, in case of the distribution
of such moneys or property on account or principal, premium,
if any, or interest, upon presentation of the several
Debentures of the series in respect of which such moneys
were received, and stamping thereon the payment, if only
partially paid, and upon surrender thereof if fully paid:
First: To the payment of costs and expenses of
collections, and reasonable compensation to the
Trustee, its agents, attorneys and counsel, and all
advances made and expenses and liabilities incurred by
the Trustee, except as a result of its negligence or
bad faith and all other amounts owing to the Trustee or
any predecessor Trustee pursuant to Section 11.2
hereof;
Second: In case the principal of the
Outstanding Debentures in respect of which such moneys
were received shall not have become due and be unpaid,
to the payment of interest on such Debentures, in the
order of the maturity of the installments of such
interest, with interest (so far as
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may be lawful) upon the overdue installments of
interest at the rate specified in such Debentures (or,
if no such rate is specified, at the rate borne by the
Debentures of such series), such payments to be made
ratably to the persons entitled thereto;
Third: In case the principal of the Outstanding
Debentures in respect of which such moneys were
received and/or such other amount or amounts as the
Debentures or supplemental indenture with respect to
such series shall provide, shall have become due, by
declaration or otherwise, to the payment of the whole
amount then owing and unpaid upon such Debentures for
principal (and/or such other specified amount),
premium, if any, and interest, with interest on the
overdue principal (and/or such other specified amount),
premium, if any, and (so far as may be lawful) upon
overdue installments of interest, at the rate specified
in such Debentures (or, if no such rate is specified,
at the rate borne by the Debentures of such series),
and in case such moneys shall be insufficient to pay in
full the whole amount so due and unpaid upon such
Debentures, then to the payment of such principal
(and/or such other specified amount), premium, if any,
and interest, with interest on the overdue principal
(and/or such other specified amount), premium, if any,
and (so far as may be lawful) upon overdue installments
of interest, at the rate specified in such Debentures
(or, if no such rate is specified, at the rate borne by
the Debentures of such series), without preference or
priority of principal (and/or such other specified
amount) and premium, if any, over interest, or of
interest over principal (and/or specified amount) and
premium, if any, or of any installment of interest over
any other installment of interest, or of any such
Debenture over any other such Debenture, ratably to the
aggregate of such principal (and/or such other
specified amount), premium, if any, and accrued and
unpaid interest;
Fourth: To the payment of the remainder, if any,
to the Company, its successors or assigns, or to
whomever may be so lawfully entitled to receive the
same, or as a court of competent jurisdiction may
direct.
SECTION 7.3 Trustee may enforce rights of action
without possession of Debentures. All rights of action
under this Indenture or any of the Debentures Outstanding of
any series hereunder enforceable by the Trustee may be
enforced by the Trustee without the possession of any of the
Debentures or the production thereof at the trial or other
proceedings relative thereto, and any such suit or
proceeding instituted by the Trustee shall be brought for
the ratable benefit of the holders of the Debentures with
respect to which the rights are being exercised, subject to
the provisions of this Indenture.
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SECTION 7.4 Delays or omissions not to impair any
rights or powers accruing upon default. No delay or
omission of the Trustee or of the Debentureholders to
exercise any rights or powers accruing upon any default
which shall not have been remedied shall impair any such
right or power, or shall be construed to be a waiver of any
such default or acquiescence therein; and every power and
remedy given by this Article VII to the Trustee and the
holders of the Debentures of any series may be exercised
from time to time and as often as may be deemed expedient by
the Trustee or by the holders of the Debentures of such
series.
SECTION 7.5 In Event of Default Trustee may protect
and enforce its rights by appropriate proceedings-holders of
majority in aggregate Principal amount of Debentures of a
series may waive default. If any one or more Events of
Default shall happen and be continuing, the Trustee may, in
its discretion, proceed to protect and enforce the rights
vested in it by this Indenture by such appropriate judicial
proceedings as the Trustee, being advised by its counsel,
shall deem most effectual to protect and enforce any of said
rights, either by suit in equity or by action at law or by
proceeding in bankruptcy or otherwise, whether for the
specific performance of any covenant or agreement contained
in this Indenture or in aid of the exercise of any power
granted in this Indenture, or to enforce any other legal or
equitable right vested in the Trustee by this Indenture or
by law.
Provided the Debentures of any series shall not then be
due and payable by reason of a declaration pursuant to
Section 7.1 hereof, the holders of a majority in aggregate
principal amount of the Debentures of such series then
Outstanding may on behalf of the holders of all of the
Debentures of such series waive by written notice any past
default hereunder and its consequences, except a default in
the payment of interest on or principal and premium, if any,
of any of the Debentures of such series. In the case of any
such waiver, the Company, the Trustee and the holders of the
Debentures of such series shall be restored to their former
positions and rights hereunder, respectively; but no such
waiver shall extend to any subsequent or other default or
impair any right consequent thereon.
SECTION 7.6 Holders of majority in aggregate Principal
amount of Debentures of any series may direct exercise of
remedies. The holders of a majority in aggregate principal
amount of the Debentures then Outstanding of any series
shall have the right, by an instrument in writing executed
and delivered to the Trustee, to direct the time, method and
place of conducting any proceedings for any remedy available
to the Trustee, or of exercising any power or trust
conferred upon the Trustee under this Indenture, with
respect to the Debentures of such series; provided, however,
that subject to the provisions of Section 11.1 of this
Indenture, the Trustee shall have the right to decline to
follow any such direction if the Trustee, being
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advised by counsel, determines that the action or
proceedings so directed may not lawfully be taken or if the
Trustee in good faith shall, by Responsible Officers,
determine that the action or proceedings so directed would
involve the Trustee in personal liability, or would be
unduly prejudicial to the holders of the Debentures of such
series not joining in such direction, and the Trustee may
take any other action deemed proper by the Trustee which is
not inconsistent with such direction.
SECTION 7.7 Limitation on suits by Debentureholders.
No holder of any Debenture of any series shall have the
right to institute any suit, action or proceeding, in equity
or at law, for the execution of any trust or power hereof,
or for the enforcement of any other remedy under or upon
this Indenture or the Debentures of such series, unless the
holders of a majority in aggregate principal amount of the
Debentures then Outstanding of such series shall have made
written request upon the Trustee and shall have afforded to
it a reasonable opportunity either to proceed to exercise
the powers hereinbefore granted or to institute such suit,
action or proceeding in its own name, as Trustee hereunder,
and shall have offered to the Trustee reasonable indemnity
against the costs, expenses and liabilities to be incurred
therein or thereby, and the Trustee shall have refused or
neglected to comply with such request for 60 days after its
receipt of such request and no direction inconsistent with
such request shall have been given to the Trustee pursuant
to Section 7.6; it being understood and intended that no one
or more holders of Debentures of any series shall have any
right under this Indenture or under the Debentures, by his
or their action, to enforce any right hereunder except in
the manner herein provided, and that all proceedings
hereunder, at law or in equity, shall be instituted, had and
maintained in the manner herein provided and for the ratable
benefit of all holders of the Debentures of such series.
Subject to the provisions of Article III, notwithstanding
any provision of this Indenture to the contrary, the right,
which is absolute and unconditional, of any Debentureholder
to receive the payment of the principal of, premium, if any,
and interest on his Debentures at and after the respective
due dates (including maturity by call for redemption,
through any sinking fund, declaration unless annulled
pursuant to Section 7.1 hereof, or otherwise), of such
principal, premium, if any, or interest, or the right, which
is also absolute and unconditional, of any Debentureholder
to require conversion of his Debentures pursuant to Article
XIII hereof if the terms of such Debentures provide for
convertibility pursuant to Section 2.2, or the right to
institute suit for the enforcement of any such payment at or
after such due dates or of such right to convert, shall not
be impaired or affected without the consent of such holder,
and the obligation of the Company, which is also absolute
and unconditional, to pay the principal of, premium, if any,
and interest on each of the Debentures to the respective
holders thereof at the times and places in the Debentures
expressed shall not be impaired or affected.
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Notwithstanding anything to the contrary contained in
this Section 7.7, the parties to this Indenture and the
Debentureholders agree as follows:
Any court may in its discretion require, in any suit
for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action
taken, suffered or omitted by it as Trustee, the filing by
any party litigant in such suit of an undertaking to pay the
costs of such suit, and such court may in its discretion
assess reasonable costs, including reasonable attorneys'
fees, against any party litigant in such suit, having due
regard to the merits and good faith of the claims or
defenses made by such party litigant; provided, however,
that the provisions of this paragraph shall not apply to any
suit instituted, directly or through an agent or agents, by
the Trustee, to any suit instituted by any Debentureholder
of any series, or group of Debentureholders of any series,
holding in the aggregate more than 10% in aggregate
principal amount of the Debentures then Outstanding of such
series or to any suit instituted by any Debentureholder of
any series for the enforcement of the payment of the
principal of, premium, if any, or interest on, any Debenture
of such series at or after the respective due dates of such
principal, premium, if any, or interest expressed in his
Debenture of such series.
SECTION 7.8. No Debentures owned or held by, for the
account of or for the benefit of the Company to be deemed
Outstanding for purpose of payment or distribution. No
Debentures owned or held by, for the account of or for the
benefit of the Company or any Affiliate (other than
Debentures pledged in good faith which would be deemed
Outstanding under the provisions of Section 14.3) shall be
deemed Outstanding for the purpose of any payment or
distribution provided for in this Article VII.
SECTION 7.9. Company and Trustee restored to former
position on discontinuance or abandonment of proceedings.
If the Trustee shall have proceeded to enforce any right
under this Indenture with respect to the Debentures of any
series, and such proceedings shall have been discontinued or
abandoned because of waiver, or for any other reason, or
shall have been determined adversely to the Trustee, then,
and in any such case, the Company, the Trustee and the
Debentureholders of such series shall each be restored to
their former positions and rights hereunder, and all rights,
remedies and powers of the Trustee shall continue as though
no such proceeding had been taken.
ARTICLE VIII
EVIDENCE OF ACTION BY DEBENTUREHOLDERS
SECTION 8.1. Evidence of action by Debentureholders.
Any demand, request, consent, proxy or other instrument
which this
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Indenture may require or permit to be signed and executed by
the Debentureholders of any series may be in any number of
concurrent instruments of similar tenor, and may be signed
or executed by such Debentureholders in person or by an
attorney duly authorized in writing. Proof of the execution
of any such demand, request, consent, proxy or other
instrument, or of a writing appointing any such attorney,
shall be sufficient for any purpose of this Indenture if
made in the following manner: the fact and date of the
execution by any person of such demand, request, consent,
proxy or other instrument or writing may be proved by the
certificate of any notary public, or other officer
authorized to take acknowledgments of deeds to be recorded
in any state or country, that the person signing such
request or other instrument or writing acknowledged to him
the execution thereof, or by an affidavit of a witness of
such execution. Where such execution is by an officer of a
corporation or association or a member of a partnership on
behalf of such corporation, association or partnership, or
by a trustee or other fiduciary, such certificate or
affidavit shall also constitute sufficient proof of his
authority. The Trustee may nevertheless in its discretion
accept such other proof or require further proof of any
matter referred to in this Section 8.1 as it shall deem
reasonable. The ownership of Debentures shall be proved by
the registry books or by a certificate of the registrar
thereof.
The Trustee shall not be bound to recognize any person
as a Debentureholder of any series unless and until his
title to the Debentures of such series held by him is proved
in the manner in this Article VIII provided.
Any demand, request, direction, waiver, consent, vote
or other action of the holder of any Debenture shall be
conclusive and shall bind all future holders of the same
Debenture and of any Debenture issued in exchange or
substitution therefor irrespective of whether or not any
notation in regard thereto is made upon such Debenture. Any
such holder, however, may revoke the consent as to his
Debenture or portion thereof. Such revocation shall be
effective only if the Trustee receives the notice of
revocation before the date the amendment, supplement, waiver
or other action becomes effective. An amendment,
supplement, waiver or other action shall become effective on
receipt by the Trustee of written consents from the
Debentureholders of the requisite percentage in aggregate
principal amount of the Outstanding Debentures of the
relevant series. After an amendment, supplement, waiver or
other action becomes effective, it shall bind every
Debentureholder of each series of Debentures so affected.
The Company or the Trustee, as applicable, may set a
date for the purpose of determining the Debentureholders
entitled to consent, vote or take any other action referred
to in this Section 8.1, which date shall be not less than 10
days nor more than 60 days prior to the taking of the
consent, vote or other action.
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ARTICLE IX
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
SECTION 9.1. Immunity of incorporators, stockholders,
officers, directors and employees. No recourse shall be had
for the payment of the principal of, premium, if any, or
interest on any Debenture or for any claim based thereon or
otherwise in any manner in respect thereof, or in respect of
this Indenture, to or against any subsidiary, incorporator,
stockholder, officer, director or employee, as such, past,
present or future, of the Company or any subsidiary,
incorporator, stockholder, officer, director or employee, as
such, past, present or future, of any predecessor or
successor corporation, either directly or through the
Company or such predecessor or successor corporation,
whether by virtue of any constitutional provision or statute
or rule of law, or by the enforcement of any assessment or
penalty, or in any other manner, all such liability being
expressly waived and released by the acceptance of any
Debenture and as part of the consideration for the issue
thereof.
ARTICLE X
MERGER, CONSOLIDATION, SALE OR LEASE
SECTION 10.1. Documents required to be filed with the
Trustee upon consolidation, merger, sale, transfer or lease
- execution or supplemental indentures - acts of successor
corporation. Nothing in this Indenture or in the Debentures
shall prevent any consolidation or merger of the Company
with or into any other corporation, or any consolidation or
merger of any other corporation with or into the Company, or
any sale, transfer or lease of all or substantially all of
the property and assets of the Company to any other
corporation lawfully entitled to acquire the same; provided,
however, and the Company hereby covenants and agrees, that
any such consolidation, merger, sale, transfer or lease
shall be upon the condition that (a) the due and punctual
payment of the principal of, premium, if any, and interest
on all the Debentures according to their tenor, and the due
and punctual performance and observance of all the terms,
covenants and conditions of this Indenture to be kept or
performed by the Company shall, by an indenture supplemental
hereto complying with the provisions of Section 12.1,
executed and delivered to the Trustee, be expressly assumed
by the corporation (other than the Company) formed by or
resulting from any such consolidation or merger, or which
shall have received the transfer or lease of all or
substantially all of the property and assets of the Company,
just as fully and effectually as if such successor
corporation had been an original party hereto; and (b) the
Company or such successor corporation, as the case may be,
shall not, immediately after such consolidation, merger,
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sale, transfer or lease be in default in the performance of
any such covenant or condition. Thereafter, unless otherwise
specified pursuant to Section 2.2 for the Debentures of any
series, all obligations of the predecessor corporation under
the Debentures of such series shall terminate. In the event
of any such sale, transfer or lease, the predecessor Company
may be dissolved, wound up and liquidated at any time
thereafter.
Every such successor corporation, upon executing an
indenture supplemental hereto as provided in this Section
10.1 in form satisfactory to the Trustee, shall succeed to
and be substituted for the Company with the same effect as
if it had been named herein as the Company; and any order,
certificate or resolution of the Board or officers of the
Company provided for in this Indenture may be made by like
officials of such successor corporation. Such successor
corporation may thereupon cause to be signed, either in its
own name or in the name of the Company, with such suitable
reference, if any, to such consolidation, merger, sale,
transfer or lease as may be required by the Trustee, any or
all of the Debentures which shall not theretofore have been
signed by the Company and authenticated by the Trustee or
any Authenticating Agent; and upon the written order of such
successor corporation in lieu of the Company, signed by the
President or any Vice President and Treasurer or any
Assistant Treasurer of such successor corporation, and
subject to all the terms, conditions and restrictions herein
prescribed with respect to the authentication and delivery
of the Debentures, the Trustee or any Authenticating Agent
shall authenticate and deliver any and all Debentures which
shall have been previously signed by the proper officers of
the Company and delivered to the Trustee or any
Authenticating Agent for authentication and any of such
Debentures which such successor corporation shall
thereafter, in accordance with the provisions of this
Indenture, cause to be signed and delivered to the Trustee
or any Authenticating Agent for such purpose. All
Debentures of any series so authenticated and delivered
shall in all respects have the same rank as the Debentures
of such series theretofore or thereafter authenticated and
delivered in accordance with the terms of this Indenture.
SECTION 10.2. Trustee may rely upon Opinion of
Counsel. The Trustee may receive and shall, subject to the
provisions of Section 11.1 of this Indenture, be fully
protected in relying upon an Officers' Certificate and
Opinion of Counsel as conclusive evidence that any
supplemental indenture executed under the foregoing Section
10.1 complies with the foregoing conditions and provisions
of this Article X.
ARTICLE XI
CONCERNING THE TRUSTEE
SECTION 11.1. Acceptance of Trust - responsibilities
of Trustee. (a) The Trustee, prior to the occurrence of an
Event of
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Default and after the curing or waiving of all Events of
Default which may have occurred, undertakes to perform such
duties and only such duties as are specifically set forth in
this Indenture or in the Trust Indenture Act of 1939, and no
implied covenants or conditions shall be read into this
Indenture against the Trustee. In case an Event of Default
with respect to the Debentures of a particular series has
occurred (but only during the continuance thereof), the
Trustee shall exercise with respect to the Debentures of
such series such of the rights and powers vested in it by
this Indenture, and use the same degree of care and skill in
their exercise, as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs.
The Trustee, upon receipt of all resolutions,
certificates, statements, opinions, reports, documents,
orders or other instruments furnished to the Trustee
pursuant to any provision of this Indenture, shall examine
them to determine whether they conform to the requirements
of this Indenture.
(b) No provision of this Indenture shall be construed
to relieve the Trustee from liability for its own negligent
action, its own negligent failure to act, or its own willful
misconduct, except that
(i) prior to the occurrence of an Event of
Default with respect to the Debentures of any series
hereunder and after the curing or waiving of all Events
of Default with respect to the Debentures of such
series which may have occurred, the Trustee shall not
be liable with respect to the Debentures of such series
except for the performance of such duties as are
specifically set forth in this Indenture, and no
implied covenants or obligations shall be read into
this Indenture against the Trustee, but the duties and
obligations of the Trustee with respect to the
Debentures of such series, prior to the occurrence of
an Event of Default with respect to the Debentures of
such series and after the curing or waiving of all
Events of Default with respect to the Debentures of
such series which may have occurred, shall be
determined solely by the express provisions of this
Indenture;
(ii) Subject to the limitations contained in
subsection (a) of this Section 11.1, prior to the
occurrence of an Event of Default with respect to the
Debentures of any series hereunder and after the curing
or waiving of all events of Default with respect to the
Debentures of such series which may have occurred, and
in the absence of bad faith on the part of the Trustee,
the Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions
expressed herein, upon certificates or opinions
conforming to the requirements of this Indenture;
(iii) the Trustee shall not be personally liable
for any error of judgment made in good faith by a
Responsible
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Officer or Officers of the Trustee unless
it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts; and
(iv) the Trustee shall not be personally liable
with respect to any action taken, suffered or omitted
to be taken by it in good faith in accordance with the
direction of the holders of not less than a majority in
aggregate principal amount of the Debentures then
Outstanding of any series relating to the time, method
and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or
power conferred upon the Trustee, under this Indenture
with respect to the Debentures of such series.
(c) Subject to the limitations contained in
subsections (a) and (b) of this Section 11.1, the recitals
contained herein and in the Debentures (except in the
Trustee's certificate of authentication) shall be taken as
the statements of the Company, and the Trustee assumes no
responsibility for the correctness of the same. The Trustee
makes no representations as to the validity or sufficiency
of this Indenture or of the Debentures except that the
Trustee represents that it is duly authorized to execute and
deliver this Indenture and to perform its obligations
hereunder.
(d) Subject to the limitations contained in
subsections (a) and (b) of this Section 11.1:
(i) the Trustee may rely and shall be protected
in acting or refraining from acting upon any
resolution, certificate, opinion, notice, consent,
request, order, appraisal, report, bond or other paper
or document believed by it to be genuine and to have
been signed or presented by the proper party or
parties;
(ii) the Trustee may consult with counsel and the
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 accordance with such
advice or Opinion of Counsel;
(iii) whenever in the administration of the
trusts of this Indenture, prior to an Event of Default
hereunder and after the curing or waiving of all Events
of Default which may have occurred, the Trustee shall
deem it necessary or desirable that a matter be proved
or established prior to taking, suffering or omitting
any action hereunder, such matter (unless other
evidence in respect thereof be herein specifically
prescribed) may be deemed to be conclusively proved and
established by an Officers' Certificate delivered to
the Trustee, and such certificate shall be full warrant
to
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the Trustee for any action taken, suffered or omitted
by it under the provisions of this Indenture upon the
faith thereof;
(iv) the Trustee shall be under no obligation to
exercise any of the trusts or powers hereof at the
request, order or direction of any of the
Debentureholders, pursuant to the provisions of this
Indenture, unless such Debentureholders shall have
offered to the Trustee reasonable indemnity against all
the costs, expenses and liabilities which might be
incurred therein;
(v) the Trustee shall not be liable for any
action taken or omitted to be taken by it in good faith
and believed by it to be authorized or within the
discretion or power conferred upon it by this
Indenture;
(vi) prior to the occurrence of an Event of
Default with respect to the Debentures of any series
hereunder and after the curing or waiving of all Events
of Default with respect to the Debentures of such
series which may have occurred, the Trustee shall not
be bound to make any investigation into the facts or
matters stated in any resolution, certificate, opinion,
notice, consent, request, order, appraisal, report,
bond or other document or instrument concerning such
series, unless requested in writing to do so by the
holders of not less than a majority in aggregate
principal amount of the Debentures then Outstanding of
such series; provided, however, that if the payment
within a reasonable time to the Trustee of the costs,
expenses or liabilities likely to be incurred by it in
the making of such investigation is, in the opinion of
the Trustee (subject to the limitations contained in
subsections (a) and (b) of this Section 11.1), not
reasonably assured to the Trustee by the security
afforded to it by the terms of this Indenture, the
Trustee may require reasonable indemnity against such
expense or liability as a condition to so proceeding;
and provided, further, that nothing in this subdivision
(d)(vi) shall require the Trustee to give the
Debentureholders any notice other than that required by
Section 11.3 hereof. The reasonable expense of every
such investigation shall be paid by the Company or, if
paid by the Trustee, shall be repaid by the Company
upon demand;
(vii) the Trustee may execute any of the trusts
or powers hereunder or perform any duties hereunder
either directly or by or through agents or attorneys
and the Trustee shall not be responsible for any
misconduct or negligence on the part of any agent or
attorney appointed with due care by it hereunder; and
(viii) none of the provisions of this Indenture
shall require the Trustee to expend or risk its own
funds or otherwise incur any personal financial
liability in the
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performance of any of its duties hereunder, or
in the exercise of any of its rights or powers, if it
shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it.
SECTION 11.2. Trustee to be entitled to compensation -
Trustee not to be accountable for application of proceeds -
moneys held by Trustee to be trust funds. The Company
covenants and agrees to pay to the Trustee from time to
time, and the Trustee shall be entitled to reasonable
compensation (which shall not be limited by any provision of
law in regard to the compensation of a trustee of an express
trust) for services rendered by it in the execution of the
trusts hereby created, and shall also be entitled to payment
of reasonable expenses and disbursements actually made or
incurred hereunder, including the reasonable fees and
expenses of counsel, accountants and of all persons not
regularly in its employ, and all taxes which may have been
assessed against the Trustee as such on any funds on deposit
with the Trustee. The Company also agrees to indemnify each
of the Trustee and any predecessor Trustee for and hold it
harmless against loss, liability or expense incurred arising
out of or in connection with the acceptance or
administration of this trust or performance of its duties
hereunder, including the cost and expenses of defending
itself against any claim of liability in the premises,
except to the extent that such loss, liability or expense is
incurred due to the negligence or bad faith of the Trustee
or predecessor Trustee. If any property other than cash
shall at any time be subject to a lien in favor of the
Debentureholders, the Trustee, if and to the extent
authorized by a receivership or bankruptcy court of
competent jurisdiction or by the supplemental instrument
subjecting such property to such lien, shall be entitled to
make advances for the purpose of preserving such property or
of discharging tax liens or other prior liens or
encumbrances thereon. The obligations of the Company under
this Section 11.2 to compensate the Trustee and to
indemnify, pay or reimburse the Trustee or any predecessor
Trustee for expenses, disbursements and advances shall
constitute additional indebtedness hereunder and shall
survive the satisfaction and discharge or any other
termination pursuant to any Bankruptcy Law hereof. Such
additional indebtedness shall be secured by a lien prior to
that of the Debentures of all series with respect to which
the Trustee acts as Trustee upon all property and funds held
or collected by the Trustee as such, except funds held in
trust for the benefit of the holders of particular
Debentures.
The Trustee shall not be accountable for the use or
application by the Company of any Debentures authenticated
and delivered hereunder or of the proceeds of such
Debentures, or for the use or application of any moneys paid
over by the Trustee in accordance with any provision of this
Indenture, or for the use or application of any moneys
received by any paying agent.
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All moneys received by the Trustee in trust under or
pursuant to any provision of this Indenture shall constitute
trust funds for the purposes for which they were paid or
were held, but need not be segregated in any manner from any
other moneys and may be deposited by the Trustee, under such
conditions as may be prescribed by law, in its general
banking department, and the Trustee shall not be liable for
any interest thereon, except as otherwise agreed with the
Company.
The parties hereto, and the Debentureholders by their
acceptance of their Debentures, hereby agree, that when the
Trustee incurs expenses and renders services after an Event
of Default occurs, such expenses and the compensation for
such services are intended by the holders of the Debentures
and Company to constitute expenses of administration under
any Bankruptcy Law.
SECTION 11.3. Trustee to give Debentureholders notice
of default. The Trustee shall give to the Debentureholders
of any series notice of the happening of all defaults with
respect to the Debentures of such series known to it, within
90 days after the occurrence thereof unless such defaults
shall have been cured before the giving of such notice;
provided, however, that, except in the case of a default
resulting from the failure to make any payment of principal
of, premium, if any, or interest on the Debentures of any
series, or in the payment of any mandatory sinking fund
installment with respect to the Debentures of such series,
the Trustee may withhold the giving of such notice if and so
long as the board of directors, the executive committee or a
trust committee of directors and/or Responsible Officers of
the Trustee in good faith determine that the withholding of
such notice is in the interest of the Debentureholders of
such series. For the purpose of this Section 11.3, the term
"default" means any event which is, or after notice or lapse
of time or both would become, an Event of Default. Such
notice shall be given to the Debentureholders of such series
in the manner and to the extent provided in subsection (c)
of Section 11.10.
SECTION 11.4. Trustee acquiring conflicting interest
must eliminate it or resign. Reference is made to Section
310(b) of the Trust Indenture Act of 1939, as amended,
and with respect to the Debentures of each series, the Trustee
shall comply therewith. To the extent permitted under
Section 310(b)(1) thereof, the Trustee shall not be deemed
to have a conflicting interest by virtue of being a
trustee under this Indenture with respect to Debentures
of more than one series.
SECTION 11.5. Eligibility of Trustee. There shall at
all times be a corporate Trustee under this Indenture which
shall be a bank or trust company organized and doing
business under the laws of the United States or of any State
or the District of Columbia and having a combined capital
and surplus of not less than $50,000,000 which is authorized
under the laws of its jurisdiction of incorporation to
exercise corporate trust powers
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and is subject to supervision or examination by Federal,
State or District of Columbia authority and which has an
office or agency in . If the Trustee
publishes reports of conditions at least annually, pursuant
to law or to the requirements of the aforesaid supervising
or examining authority, the combined capital of the Trustee
shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so
published. If the Trustee shall at any time cease to meet
the foregoing standards of eligibility, then such Trustee
shall resign immediately in the manner and with the effect
specified in Section 11.6.
SECTION 11.6. Resignation or removal of Trustee.
(a) Subject to the limitations contained in subsection (d) of
this Section 11.6, the Trustee may resign and be discharged from
the trust hereby created with respect to the Debentures of one
or more series by giving notice thereof to the Company and
by giving notice thereof to the Debentureholders of such
series, in the manner and to the extent provided in
subsection (c) of Section 11.10. Upon receiving such notice
of resignation, the Company shall promptly appoint a
successor trustee or trustees (it being understood that any
such successor trustee may be appointed with respect to the
Debentures of one or more or all of such series with respect
to which the resigning trustee has resigned and that at any
time there shall be only one trustee with respect to the
Debentures of any particular series) by written instrument,
in duplicate, executed by order of the Board of Directors,
one copy of which instrument shall be delivered to the
resigning trustee and one copy to the successor trustee. If
no successor trustee shall have been so appointed and have
accepted appointment within 60 days after the mailing of
such notice of resignation, the resigning trustee may
petition any court of competent jurisdiction for the
appointment of a successor trustee, or any Debentureholder
of such series who has been a bona fide holder of a
Debenture or Debentures of such series for at least six
months may on behalf of himself and all others similarly
situated, petition any such court for the appointment of a
successor trustee. Such court may thereupon, after such
notice, if any, as it may deem proper and prescribe, appoint
a successor trustee.
(b) In case at any time any of the following
shall occur-
(1) the Trustee shall fail to comply with the
provisions of Section 11.4 with respect to the
Debentures of any series after written request therefor
by the Company or by any Debentureholder of such series
who has been a bona fide holder of a Debenture or
Debentures of such series for at least six months; or
(2) the Trustee shall cease to be eligible in
accordance with the provisions of Section 11.5 with
respect to the Debentures of any series and shall fail
to resign after
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written request therefor by the Company or by any such
Debentureholder; 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
then, in such case, the Company may remove the Trustee with
respect to all Debentures of such series and appoint a duly
qualified successor trustee by written instrument, in
duplicate, executed by order of the Board of Directors of
the Company, one copy of which instrument shall be delivered
to the Trustee so removed and one copy to the successor
trustee so appointed, or, subject to the provisions of
Section 7.7, any Debentureholder who has been a bona fide
holder of a Debenture or Debentures of such series for at
least six months may, on behalf of himself and all others
similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee with respect to
all Debentures of such series and the appointment of a
successor trustee. Such court may thereupon after such
notice, if any, as it may deem proper and prescribe, remove
the Trustee and appoint a duly qualified successor trustee
with respect to the Debentures of such series.
(c) The holders of a majority in aggregate principal
amount of the Debentures then Outstanding of any series may
at any time remove the Trustee and appoint a duly qualified
successor trustee with respect to such series by delivery to
the Trustee so removed, to the successor trustee and to the
Company of the evidence provided for in Section 8.1 of the
action in that regard taken by Debentureholders.
(d) Any resignation or removal of the Trustee and any
appointment of a duly qualified successor trustee pursuant
to any of the provisions of this Section shall become
effective upon acceptance of appointment by the successor
trustee as provided in Section 11.7.
SECTION 11.7. Acceptance by successor Trustee.
(a) In case of the appointment hereunder of a
successor trustee with respect to all Debentures, every duly
qualified successor trustee so appointed under any of the
methods herein provided shall execute, acknowledge and
deliver to its predecessor trustee and to the Company an
instrument in writing accepting such appointment hereunder
and thereupon such successor trustee, without any further
act, deed or conveyance, shall become fully vested with the
rights, powers, trusts, duties and obligations of its
predecessor in the trust hereunder with like effect as if
originally named as Trustee herein. The predecessor trustee
shall, nevertheless, at the written request of the
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successor trustee, pay over to the successor trustee all
moneys at the time held by it herein; and the Company and
the predecessor trustee upon payment or provision therefor
of any amounts then due the predecessor trustee pursuant to
the provisions of Section 11.2, shall execute and deliver
such instruments and do such other things as may reasonably
be required for more fully and certainly vesting and
confirming in the successor trustee all such rights, powers,
trusts, duties and obligations. The Company shall promptly
give notice of the appointment of such successor trustee to
the Debentureholders in the manner and to the extent
provided in subsection (c) of Section 11.10.
(b) In the case of the appointment hereunder of a
successor trustee with respect to the Debentures of one or
more (but not all) series, the Company, the predecessor
trustee and each successor trustee with respect to the
Debentures of such series shall execute and deliver an
indenture supplemental hereto wherein each successor trustee
shall accept such appointment and which (i) 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
predecessor trustee with respect to the Debentures of such
series to which the appointment of such successor trustee
relates, (ii) if the predecessor trustee is not retiring
with respect to all Debentures of such series, shall contain
such provisions as shall be deemed necessary or desirable to
confirm that all the rights, powers, trusts and duties of
the predecessor trustee with respect to the Debentures of
such series as to which the predecessor trustee is not
retiring shall continue to be vested in the predecessor
trustee, and (iii) 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 predecessor 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 predecessor trustee with respect to
the Debentures of such series to which the appointment of
such successor trustee relates; but, on request of the
Company or any successor trustee, such predecessor trustee
upon payment of its charges shall duly assign, transfer and
deliver to such successor trustee all property and money
held by such predecessor trustee hereunder with respect to
the Debentures of such 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
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certainly vesting in and confirming to such successor
trustee all such rights, powers and trusts referred to in
this subsection (b) of this Section.
SECTION 11.8. Successor to Trustee by merger or
consolidation, etc. Any corporation or national banking
association into which the Trustee may be merged, or with
which it may be consolidated, or to which the Trustee
transfers all or substantially all of its corporate trust
assets, or any corporation or national banking association
resulting from any merger or consolidation or conversion to
which the Trustee shall be a party, shall be the successor
trustee under this Indenture without the execution or filing
of any instruments or any further act on the part of any of
the parties hereto.
In case at the time such successor trustee shall
succeed to the trusts created by this Indenture any of the
Debentures shall have been authenticated but not delivered,
any such successor trustee may adopt the certificate of
authentication of its predecessor trustee, and deliver such
Debentures so authenticated; and in case at that time any of
the Debentures shall not have been authenticated, any
successor trustee may authenticate such Debentures either in
the name of any predecessor hereunder or in the name of the
successor trustee; and in all such cases such certificates
shall have the full force which it is anywhere in the
Debentures or in this Indenture provided that the
certificate of authentication of the Trustee shall have;
provided, however, that the right to adopt the certificate
of authentication of any predecessor trustee or authenticate
Debentures in the name of any predecessor trustee shall
apply only to its successor or successors by merger,
conversion or consolidation.
SECTION 11.9. Limitations on right of Trustee as a
creditor to obtain payment of certain claims. Reference is
made to Section 311 of the Trust Indenture Act of 1939, as
amended, for purposes of which the following terms shall
have the following meanings:
(i) the term "cash transaction" shall mean any
transaction in which full payment for goods or
securities sold is made within seven days after
delivery of the goods or securities in currency or in
checks or other orders drawn upon banks or bankers and
payable upon demand; and
(ii) the term "self-liquidating paper" shall mean
any draft, bill of exchange, acceptance or obligation
which is made, drawn, negotiated or incurred by the
Company for the purpose of financing the purchase,
processing, manufacturing, shipment, storage or sale of
goods, wares or merchandise and which is secured by
documents evidencing title to, possession of, or a lien
upon, the goods, wares or merchandise or the
receivables or proceeds arising from the sale of the
goods,
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wares or merchandise previously constituting the
security, provided the security is received by the
Trustee simultaneously with the creation of the
creditor relationship with the Company arising from
the making, drawing, negotiating or incurring of the
draft, bill of exchange, acceptance or obligation.
SECTION 11.10. Trustee to make annual report to
Debentureholders - Trustee to make other reports to
Debentureholders - Debentureholders to whom reports to be
transmitted.
(a) The Trustee shall, so long as any Debentures are
Outstanding of any series with respect to which it acts as
Trustee, transmit to the Debentureholders of such series,
within 60 days after of each year beginning
with the year , a brief report as of such
that complies with Section 313(a) of the Trust Indenture Act
of 1939, as amended, to the extent any such report is
required pursuant to such Section.
(b) The Trustee shall, so long as any Debentures of any
series with respect to which it acts as Trustee shall be
Outstanding, also transmit to the Debentureholders of such
series, as hereinafter provided, within the times
hereinafter specified, a brief report with respect to the
character and amount of any advances (and if the Trustee
elects so to state the circumstances surrounding the making
thereof) made by the Trustee, as such, since the date of the
last report transmitted pursuant to the provisions of
subsection (a) of this Section 11.10 (or if no such report
has been so transmitted, since the date of the execution of
this Indenture), for the reimbursement of which it claims or
may claim a lien or charge prior to that of the Debentures
of such series, on property or funds held or collected by
the Trustee, as such, and which it has not previously
reported pursuant to this subsection (b), if such advances
remaining unpaid at any time aggregate more than 10% of the
principal amount of the Debentures of such series then
Outstanding, such report to be so transmitted within 90 days
after such time.
(c) All reports required by this Section 11.10, and all
other reports or notices which are required by any other
provision of this Indenture to be transmitted in accordance
with the provisions of this Section 11.10, shall be
transmitted by mail; (i) to all registered holders of
Debentures of such series, as the names and addresses of
such holders appear upon the Debenture register; (ii) to
such holders of Debentures of such series as have, within
the two years preceding such transmission, filed their names
and addresses with the Trustee for that purpose; and (iii)
except in the case of reports pursuant to subsection (b) of
this Section 11.10, to all holders of Debentures of such
series whose names and addresses have been furnished to or
received by the Trustee pursuant to Section 4.6(d).
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(d) The Trustee shall, at the time of the transmission
to the Debentureholders of any report or notice pursuant to
this Section 11.10, file a copy thereof with the Securities
and Exchange Commission. The Company will notify the
Trustee if and when the Debentures of any series become
listed on any stock exchange and the Trustee will thereafter
file a copy of any such report or notice with such stock
exchange.
SECTION 11.11. Preservation of information by Trustee
- Trustee to give certain information to Debentureholders
upon application. The Trustee shall preserve, in as current
a form as is reasonably practicable, all information
furnished it pursuant to subsection (d) of Section 4.6
hereof or received by it as Debenture registrar hereunder.
The Trustee may destroy such information upon receipt of new
information updating information previously furnished.
Within five Business days after receipt by the Trustee
of a written application by any three or more
Debentureholders stating that the applicants desire to
communicate with other Debentureholders with respect to
their rights under this Indenture or under the Debentures,
and accompanied by a copy of the form of proxy or other
communication which such applicants propose to transmit, and
by reasonable proof that each such applicant has owned a
Debenture or Debentures for a period of at least six months
preceding such application, the Trustee shall, at its
election, either (a) afford to such applicants access to all
information so furnished to or received by the Trustee and
not destroyed pursuant to the provisions of this Section
11.11, or (b) inform such applicants as to the approximate
number of Debentureholders according to the most recent
information so furnished to or received by the Trustee, and
as to the approximate cost of mailing to the
Debentureholders the form of proxy or other communication,
if any, specified in such application. If the Trustee shall
elect not to afford to such applicants access to such
information, the Trustee shall, upon the written request of
such applicants, mail to all Debentureholders whose names
and addresses are contained in the then current information
filed with the Trustee as aforesaid copies of the form of
proxy or other communication which is specified in such
request, with reasonable promptness after a tender to the
Trustee of the material to be mailed and the payment, or
provision for the payment, of the reasonable expenses of
such mailing, unless within five business days after such
tender, the Trustee shall mail to such applicants, and file
with the Securities and Exchange Commission, together with a
copy of the material to be mailed, a written statement to
the effect that, in the opinion of the Trustee, such mailing
would be contrary to the best interests of the
Debentureholders or would be in violation of applicable law.
Such written statement shall specify the basis of such
opinion. If the Securities and Exchange Commission, after
granting opportunity for a hearing
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upon the objections specified in said written statement and
on notice to the Trustee, shall enter an order refusing to
sustain any of such objections, or, if, after the entry of
an order sustaining one or more of such objections, the
Securities and Exchange Commission shall find, after notice
and opportunity for a hearing, that all objections sustained
have been met and shall enter an order so declaring, the
Trustee shall mail copies of such material to all such
Debentureholders with reasonable promptness after such
determination and the renewal of the aforesaid tender;
otherwise the Trustee shall be relieved of any obligation or
duty to such applicants respecting their application.
Neither the Company, the Trustee nor any person acting
as Debenture registrar or paying agent shall be liable or
accountable to the Company or to any Debentureholder by
reason of the disclosure of any such information as to the
names and addresses of Debentureholders in accordance with
the provisions of this Section 11.11, regardless of the
source from which such information was derived, nor by
reason of the mailing of any material pursuant to a request
made under this Section 11.11.
SECTION 11.12. Trustee may hold Debentures and
otherwise deal with Company. The Trustee, the Debenture
registrar, any paying agent or any other agent of the
Company in its individual or any other capacity may buy,
own, hold and sell any of the Debentures or any other
evidences of indebtedness or other securities, whether
heretofore or hereafter created or issued, of the Company or
any subsidiary or Affiliate with the same rights it would
have it if were not Trustee, Debenture registrar, paying
agent or such other agent; and subject to the provisions of
this Article XI, the Trustee may engage or be interested in
any financial or other transaction with the Company or any
subsidiary or Affiliate, including without limitation,
secured and unsecured loans to the Company or any subsidiary
or Affiliate; and may maintain any and all other general
banking and business relations with the Company and any
subsidiary or Affiliate with like effect and in the same
manner and to the same extent as if the Trustee were not a
party to this Indenture; and no implied covenant shall be
read into this Indenture against the Trustee in respect of
any such matters.
SECTION 11.13. Trustee may comply with any rule,
regulation or order of the Securities and Exchange
Commission. The Trustee may comply in good faith with any
rule, regulation or order of the Securities and Exchange
Commission made pursuant to the terms and provisions of the
Trust Indenture Act of 1939 and shall be fully protected in
so doing notwithstanding that such rule, regulation or order
may thereafter be amended or rescinded or determined by
judicial or other authority to be invalid for any reason,
but nothing herein contained shall require the Trustee to
take any action or omit to take any action in accordance
with such rule, regulation or order, except as is in this
Indenture otherwise required.
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SECTION 11.14. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents
with respect to one or more series of Debentures which shall
be authorized to act on behalf of the Trustee to
authenticate Debentures of such series upon exchange,
registration of transfer or partial redemption or partial
conversion thereof or pursuant to Section 2.9, and if the
Trustee is required to appoint one or more Authenticating
Agents with respect to any series of Debentures, to
authenticate Debentures of such series and to take such
other actions as are specified in Sections 2.4, 2.8, 2.11,
5.2 and 13.3 and Debentures 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. Whenever reference is made in this
Indenture to the authentication and delivery of Debentures
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
(except in respect to an original issue). 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 $1,000,000 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 11.14, 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 11.14, such
Authenticating Agent shall resign immediately in the manner
and with the effect specified in this Section 11.14.
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 such Authenticating Agent,
shall continue to be an Authenticating Agent, provided such
corporation shall be otherwise eligible under this Section
11.14, without the execution or filing of any paper or any
further act on the part of the Trustee or such
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
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Agent by giving written notice thereof to such
Authenticating Agent and to the Company. Upon receiving
such a notice or 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 11.14, the Trustee may appoint a successor
Authenticating Agent which shall be acceptable to the
Company and shall provide notice to the holders of the
Debentures of the series as to which the Authenticating
Agent will serve as provided in Section 14.9. 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 11.14.
The Trustee agrees to pay 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 11.2.
If an appointment with respect to one or more series is
made pursuant to this Section 11.14, the Debentures of such
series may have endorsed thereon, in addition to the
Trustee's certificate of authentication, as alternative
certificate of authentication in the following form:
This is one of the Debentures of the series designated
therein referred to in the within-mentioned Indenture.
, As Trustee
By
As Authenticating Agent
By
Authorized Officer
If all of the Debentures of a series may not be
originally issued at one time, and if the Trustee does not
have an office capable of authenticating Debentures upon
original issuance located where the Company wishes to have
Debentures of such series authenticated upon original
issuance, the Trustee, if so requested by the Company in
writing (which writing need not comply with Section 14.8 and
need not be accompanied by an Opinion of Counsel), shall
appoint in accordance with this Section 11.14 an
Authenticating Agent having an office in a place designated
by the Company with respect to such series of Debentures.
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ARTICLE XII
SUPPLEMENTAL INDENTURES
SECTION 12.1. Company and Trustee may enter into
supplemental indenture for special purposes. Without the
consent of any of the Debentureholders, the Company, when
authorized by resolution of its Board of Directors, and the
Trustee from time to time and at any time, subject to the
conditions and restrictions in this Indenture contained, may
enter into an indenture or indentures supplemental hereto in
form satisfactory to the Trustee, which thereafter shall
form a part hereof, for any one or more of the following
purposes:
(a) to add to the covenants and agreements of the
Company in this Indenture contained, other covenants
and agreements thereafter to be observed for the
benefit of the Holders of all or any series of
Debentures (and if such covenants and agreements are to
be for the benefit of less than all series of
Debentures, stating that such covenants and agreements
are expressly being included solely for the benefit of
such series) or to surrender any right or power herein
reserved to or conferred upon the Company; or
(b) to cure any ambiguity or to cure, correct or
supplement any defect or inconsistent provision
contained in this Indenture or in any supplemental
indenture; or
(c) to make sure provisions in regard to matters
or questions arising under this Indenture which may be
necessary or desirable, or otherwise change this
Indenture in any manner, which shall not adversely
affect the interests of the Debentureholders of any
series; or
(d) to evidence the succession of another
corporation to the Company, or successive successions,
and the assumption by the successor corporation of the
covenants, agreements and obligations of the Company
pursuant to Article X and to provide for the adjustment
of conversion rights pursuant to Section 13.7; or
(e) to establish the form or terms of the
Debentures of any series as permitted by Sections 2.1
and 2.2; or
(f) to change or eliminate any of the provisions
of this Indenture, provided that, except as otherwise
contemplated by Section 2.2(23), any such change or
elimination shall become effective only when there is
no Debenture outstanding of any series created prior
thereto which is entitled to the benefit of such
provision; or
(g) to add or change any of the provisions of
this Indenture to such extent as shall be necessary to
permit or
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facilitate the issuance of Debentures in bearer form,
registrable or not registrable as to principal, and
with or without interest coupons, or to provide for
uncertificated Debentures in addition to certificated
Debentures (so long as any "registration-required
obligation" within the meaning of Section 163(f)(2) of
the Code is in registered form for purposes of the
Code); or
(h) to amend or supplement any provision
contained herein, which was required to be contained
herein in order for this Indenture to be qualified
under the Trust Indenture Act of 1939, if the Trust
Indenture Act of 1939 or regulations thereunder change
what is so required to be included in qualified
indentures, in any manner not inconsistent with what
then may be required for such qualification; or
(i) to add any additional Events of Default (and
if such Events of Default are to be applicable to less
than all series of Securities, stating that such Events
of Default are expressly being included solely to be
applicable to such series); or
(j) to convey, transfer, assign, mortgage or
pledge to the Trustee as security for the Debentures of
one or more series any property or assets; or
(k) to add to or change any of the provisions of
this Indenture as contemplated in Section 11.7(b)
and the Company hereby covenants that it will fully perform
all the requirements of any such supplemental indenture
which may be in effect from time to time. Nothing in this
Article XII contained shall affect or limit the right or
obligation of the Company to execute and deliver to the
Trustee any instrument of further assurance or other
instrument which elsewhere in this Indenture it is provided
shall be delivered to the Trustee.
The Trustee shall join with the Company in the
execution of any such supplemental indenture, make any
further appropriate agreements and stipulations which may be
therein contained and accept the conveyance, transfer,
assignment, mortgage or pledge of any property thereunder,
but the Trustee shall not be obligated to enter into any
such supplemental indenture which adversely affects the
Trustee's own rights, duties or immunities under this
Indenture or otherwise.
Any supplemental indenture authorized by the provisions
of this Section 12.1 may be executed by the Company and the
Trustee without the consent of the holders of any of the
Debentures at the time Outstanding, notwithstanding any of
the provisions of Section 12.2.
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SECTION 12.2. Modification of Indenture with consent
of Debentureholders. With the consent (evidenced as provided
in Section 8.1) of the holders of not less than 66 2/3% in
aggregate principal amount of the Debentures at the time
Outstanding of each series affected by such supplement, the
Company, when authorized by a resolution of its Board of
Directors, and the Trustee may from time to time and at any
time enter into an indenture or indentures supplemental
hereto for the purpose of adding any provision to or
changing in any manner or eliminating any of the provisions
of this Indenture or of any supplemental indenture or of
modifying in any manner the rights of the holders of such
series of the Debentures; provided, however, that no such
supplemental indenture shall (i) extend the time or times of
payment of the principal of, premium, if any, or the
interest on, any Debenture, or reduce the principal amount
of, premium, if any, or the rate of interest on, any
Debenture (and/or such other amount or amounts as any
Debentures or supplemental indentures with respect thereto
may provide to be due and payable upon declaration of
acceleration of the maturity thereof pursuant to Section
7.1) or change the currency of payment of principal of,
premium, if any, or interest on, any Debenture or reduce any
amount payable on redemption thereof or alter or impair the
right to convert the same at the rate and upon the terms
provided in the Indenture or alter or impair the right to
require redemption at the option of the holder, without the
consent of the holder of each Debenture so affected, or (ii)
reduce the percentage of Debentures of any series, the vote
or consent of the holders of which is required for such
modifications and alterations, without the consent of the
holders of all Debentures then Outstanding of such series
under the Indenture. Notwithstanding the foregoing, no
consent of the Debentureholders shall be necessary to permit
the execution of supplemental indentures pursuant to Section
13.7.
Upon the request of the Company, accompanied by a copy
of a resolution of its Board of Directors certified by the
Secretary or an Assistant Secretary of the Company
authorizing the execution of any such supplemental
indenture, and upon the filing with the Trustee of evidence
of the consent of Debentureholders as aforesaid, the Trustee
shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture
affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise, in which case the Trustee may,
in its discretion, but shall not be obligated, to enter into
such supplemental indenture.
It shall not be necessary for the consent of the
Debentureholders under this Section 12.2 to approve the
particular form of any proposed supplemental indenture, but
it shall be sufficient if such consent shall approve the
substance thereof.
A supplemental indenture which changes or eliminates
any provision of this Indenture which has expressly been
included
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solely for the benefit of one or more particular series of
Debentures, or which modifies the rights of the holders of
Debentures of such series with respect to such provision,
shall be deemed not to affect the rights under this
Indenture of the holders of Debentures of any other series.
SECTION 12.3. Effect of supplemental indentures. Upon
the execution of any supplemental indenture pursuant to the
provisions of this Article XII, this Indenture shall be and
be deemed to be modified and amended in accordance therewith
and the respective rights, limitations of rights,
obligations, duties and immunities under this Indenture of
the Trustee, the Company and the holders of Debentures shall
thereafter be determined, exercised and enforced hereunder
subject in all respects to such modifications and
amendments, and all the terms and conditions of any such
supplemental indenture shall be and be deemed to be part of
the terms and conditions of this Indenture for any and all
purposes.
The Trustee, subject to the provisions of Section 11.1
may receive an Opinion of Counsel as conclusive evidence
that any such supplemental indenture complies with the
provisions of this Article XII.
SECTION 12.4. Supplemental indentures to conform to
Trust Indenture Act. Any supplemental indenture executed and
delivered pursuant to the provisions of this Article XII
shall conform in all respects to the requirements of the
Trust Indenture Act of 1939, as amended, as then in effect.
SECTION 12.5. Notation on or exchange of Debentures.
If an amendment, supplement or waiver changes the terms of a
Debenture of any series, the Trustee may require the Holder
of the Debenture to deliver it to the Trustee. The Trustee
may place an appropriate notation on the Debenture about the
changed terms and return it to the Holder. Alternatively,
if the Company or the Trustee so determines, the Company in
exchange for the Debenture of any series shall issue and the
Trustee shall authenticate a new Debenture of such series
that reflects the changed terms.
ARTICLE XIII
CONVERSION OF DEBENTURES
SECTION 13.1. Applicability of Article. Debentures
of any series which are convertible into Capital Stock at
the option of the Debentureholder shall be convertible in
accordance with their terms and (unless otherwise specified
as contemplated by Section 2.2. for Debentures of any
series) in accordance with this Article. Each reference in
this Article XIII to "a Debenture" or "the Debentures"
refers to the Debentures of the particular series that is
convertible into Capital Stock. Each reference in this
Article to "Capital Stock" into which Debentures of
any
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series are convertible refers to the class of Capital Stock
into which the Debentures of such series are convertible in
accordance with their terms (as specified as contemplated by
Section 2.2). If more than one series of Debentures with
conversion privileges are outstanding at any time, the
provisions of this Article XIII shall be applied separately
to each such series.
SECTION 13.2. Right of Debentureholders to convert
Debentures. Subject to and upon compliance with the terms
of the Debentures and the provisions of Section 5.7 and this
Article XIII, at the option of the holder thereof, any
Debenture of any series of any authorized denomination, or
any portion of the principal amount thereof which is $1,000
or any integral multiple of $1,000, may, at any time during
the period specified in the Debentures of such series, or in
case such Debenture or portion thereof shall have been
called for redemption, then in respect of such Debenture or
portion thereof until and including, but not after (unless
the Company shall default in payment due upon the redemption
thereof) the close of business on the date fixed for
redemption except that in the case of redemption at the
option of the Debentureholder, if specified in the terms of
such Debentures, such right shall terminate upon receipt of
written notice of the exercise of such option, be converted
into duly authorized, validly issued, fully paid and
nonassessable shares of the class of Capital Stock, or
combination thereof, as specified in such Debenture, at the
conversion rate for each $1,000 principal amount of
Debentures (such initial conversion rate reflecting an
initial conversion price specified in such Debenture) in
effect on the conversion date, or, in case an adjustment in
the conversion rate has taken place pursuant to the
provisions of Section 13.5, then at the applicable
conversion rate as so adjusted, upon surrender of the
Debenture or Debentures, the principal amount of which is so
to be converted, to the Company at any time during usual
business hours at the office or agency to be maintained by
it in accordance with the provisions of Section 4.2,
accompanied by a written notice of election to convert as
provided in Section 13.3 and, if so required by the Company
and the Trustee, by a written instrument or instruments of
transfer in form satisfactory to the Company and the Trustee
duly executed by the registered holder or his attorney duly
authorized in writing. All Debentures surrendered for
conversion shall, if surrendered to the Company or any
conversion agent, be delivered to the Trustee for
cancellation and cancelled by it, or shall, if surrendered
to the Trustee, be cancelled by it, as provided in Section
2.11.
The initial conversion price or conversion rate in
respect of a series of Debentures shall be specified on the
Debentures of such series. The conversion price or
conversion rate will be subject to adjustment on the terms
set forth in Section 13.5 or such other or different terms,
if any, as may be specified by Section 2.2 for Debentures of
such series. Provisions of this Indenture that apply to
conversion of all of a Debenture also apply to conversion of
a portion of it.
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SECTION 13.3. Issuance of shares of Capital Stock
on conversion. As promptly as practicable after the
surrender, as herein provided, of any Debenture or
Debentures for conversion, the Company shall deliver or
cause to be delivered at its said office or agency to or
upon the written order of the holder of the Debenture or
Debentures so surrendered a certificate or certificates
representing the number of duly authorized, validly issued,
fully paid and nonassessable shares of Capital Stock into
which such Debenture or Debentures may be converted in
accordance with the terms thereof and the provisions of this
Article XIII. Prior to delivery of such certificate or
certificates, the Company shall require a written notice at
its said office or agency from the holder of the Debenture
or Debentures so surrendered stating that the holder
irrevocably elects to convert such Debenture or Debentures,
or, if less than the entire principal amount thereof is to
be converted, stating the portion thereof to be converted.
Such notice shall also state the name or names (with address
and social security or other taxpayer identification number)
in which said certificate or certificates are to be issued.
Such conversion shall be deemed to have been made at the
time that such Debenture or Debentures shall have been
surrendered for conversion and such notice shall have been
received by the Company or the Trustee, the rights of the
holder of such Debenture or Debentures as a Debentureholder
shall cease at such time, the person or persons entitled to
receive the shares of Capital Stock upon conversion of such
Debenture or Debentures shall be treated for all purposes as
having become the record holder or holders of such shares of
Capital Stock at such time and such conversion shall be at
the conversion rate in effect at such time. In the case of
any Debenture of any series which is converted in part only,
upon such conversion, the Company shall execute and the
Trustee or any Authenticating Agent shall authenticate and
deliver to the holder thereof, as requested by such holder,
a new Debenture or Debentures of such series of authorized
denominations in aggregate principal amount equal to the
unconverted portion of such Debenture.
If the last day on which a Debenture may be converted
is not a Business day in a place where a conversion agent is
located, the Debenture may be surrendered to that conversion
agent on the next succeeding day that is a Business day.
The Company will not be required to deliver
certificates for shares of Capital Stock upon conversion
while its stock transfer books are closed for a meeting of
shareholders or for the payment of dividends or for any
other purpose, but certificates for shares of Capital Stock
shall be delivered as soon as the stock transfer books shall
again be opened.
SECTION 13.4. No payment or adjustment for interest
or dividends. Unless otherwise specified as contemplated by
Section 2.2 for Debentures of such series, Debentures
surrendered for
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conversion during the period from the close of business on
any regular record date (or special record date for payment
of defaulted interest) next preceding any interest payment
date to the opening of business on such interest payment
date (except Debentures called for redemption on a
redemption date within such period) when surrendered for
conversion must be accompanied by payment of an amount equal
to the interest thereon which the registered holder is to
receive on such interest payment date. Payment of interest
shall be made as of such interest payment date or such date,
as the case may be, to the holder of record of the
Debentures as of such regular, or special record date, as
applicable. Except where Debentures surrendered for
conversion must be accompanied by payment as described
above, no interest on converted Debentures will be payable
by the Company on any interest payment date subsequent to
the date of conversion. No other payment or adjustment for
interest or dividends is to be made upon conversion.
Notwithstanding the foregoing, upon conversion of any
Debentures with original issue discount, the fixed number of
shares of Capital Stock into which such Debenture is
convertible delivered by the Company to the holder thereof
shall be applied, first, to pay the accrued original issue
discount attributable to the period from the date of
issuance to the date of conversion of such Debenture, and,
second, to pay the balance of the principal amount of such
Debenture.
SECTION 13.5. Adjustment of conversion rate.
Unless otherwise specified as contemplated by Section 2.2
for Debentures of such series, the conversion rate for
Debentures in effect at any time shall be subject to
adjustment as follows:
(a) In case the Company shall (i) declare a
dividend or make a distribution on the class of Capital
Stock into which Debentures of such series are
convertible in shares of its Capital Stock, (ii)
subdivide the outstanding shares of the class of
Capital Stock into which Debentures of such series are
convertible into a greater number of shares, (iii)
combine the outstanding shares of the class of Capital
Stock into which Debentures of such series are
convertible into a smaller number of shares, or (iv)
issue by reclassification of the shares of the class of
Capital Stock into which Debentures of such series are
convertible (including any such reclassification in
connection with a consolidation or merger in which the
Company is the continuing corporation) any shares, the
conversion rate for the Debentures of such series in
effect at the time of the record date for such dividend
or distribution, or the effective date of such
subdivision, combination or reclassification, shall be
proportionately adjusted so that the holder of any
Debenture of such series surrendered for conversion
after such time shall be entitled to receive the number
and kind of shares which he would have owned or have
been entitled to receive had such Debenture been
converted immediately prior to such time. Similar
adjustments shall be made whenever any event listed
above shall occur.
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(b) In case the Company shall fix a record date
for the issuance of rights or warrants to all holders
of the class of Capital Stock into which Debentures of
such series are convertible entitling them (for a
period expiring within 45 days after such record date)
to subscribe for or purchase shares of such class of
Capital Stock (or securities convertible into shares of
such class of Capital Stock ) at a price per share (or,
in the case of a right or warrant to purchase
securities convertible into such class of Capital
Stock, having a conversion price per share, after
adding thereto the exercise price, computed on the
basis of the maximum number of shares of such class of
Capital Stock issuable upon conversion of such
convertible securities, per share of such class of
Capital Stock, so issuable) less than the current
market price per share of such class of Capital Stock
(as defined in subsection (d) below) on the date on
which such issuance was declared or otherwise announced
by the Company (the "Determination Date"), the number
of shares of such class of Capital Stock into which
each $1,000 principal amount of Debentures shall be
convertible after such record date shall be determined
by multiplying the number of shares of such class of
Capital Stock into which such principal amount of
Debentures was convertible immediately prior to such
record date by a fraction, of which the numerator shall
be the number of shares of such class of Capital Stock
outstanding on the Determination Date plus the number
of additional shares of such class of Capital Stock
offered for subscription or purchase (or in the case of
a right or warrant to purchase securities convertible
into such class of Capital Stock, the aggregate number
of additional shares of such class of Capital Stock
into which the convertible securities so offered are
initially convertible), and of which the denominator
shall be the number of shares of such class of Capital
Stock outstanding on the Determination Date plus the
number of shares of such class of Capital Stock
obtained by dividing the aggregate offering price of
the total number of shares so offered (or, in the case
of a right or warrant to purchase securities
convertible into such class of Capital Stock, the
aggregate initial conversion price of the convertible
securities so offered, after adding thereto the
aggregate exercise price of such rights or warrants
computed on the basis of the maximum number of shares
of such class of Capital Stock issuable upon conversion
of such convertible securities) by such current market
price. Shares of such class of Capital Stock of the
Company owned by or held for the account of the Company
shall not be deemed outstanding for the purpose of any
such computation. Such adjustment shall be made
successively whenever such a record date is fixed; and
to the extent that shares of such class of Capital
Stock are not delivered (or securities convertible into
shares of such class of Capital Stock are not
delivered) after the expiration of such rights or
warrants (or, in the
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case of rights or warrants to purchase securities
convertible into such class of Capital Stock once
exercised, the expiration of the conversion right of
such securities) the conversion rate shall be
readjusted to the conversion rate which would then be
in effect had the adjustments made upon the issuance of
such rights or warrants (or securities convertible into
shares) been made upon the basis of delivery of only
the number of shares actually delivered. In the event
that such rights or warrants are not so issued, the
conversion rate shall again be adjusted to be the
conversion rate which would then be in effect if such
record date had not been fixed.
(c) In case the Company shall fix a record date
for the making of a distribution to all holders of the
class of Capital Stock into which Debentures of such
series are convertible (including any such distribution
made in connection with a consolidation or merger in
which the Company is the continuing corporation) of
evidences of its indebtedness or assets (excluding any
cash dividends paid from retained earnings and
dividends payable in Capital Stock for which adjustment
is made pursuant to subsection (a) above) or
subscription rights or warrants (excluding subscription
rights or warrants to purchase the class of Capital
Stock into which Debentures of such series are
convertible), the number of shares of such class of
Capital Stock into which each $1,000 principal amount
of Debentures of such series shall be convertible after
such record date shall be determined by multiplying the
number of shares of such class of Capital Stock into
which such principal amount of Debentures was
convertible immediately prior to such record date by a
fraction, of which the numerator shall be the fair
market value of the assets of the Company, after
deducting therefrom all liabilities of the Company and
all preferences (including accrued but unpaid
dividends) in respect of classes of Capital Stock
having a preference with respect to the assets of the
Company over such class of Capital Stock (all as
determined by the Board of Directors, whose
determination shall be conclusive, and described in a
certificate signed by any Vice Chairmen of the Board,
Vice President or Assistant Vice President and
Treasurer of the Company, filed with the Trustee and
each conversion agent) on such record date, and of
which the denominator shall be such fair market value
after deducting therefrom such liabilities and
preferences, less the fair market value (as determined
by the Board of Directors, whose determination shall be
conclusive, and described in a statement filed with the
Trustee and each conversion agent) of the assets or
evidences of indebtedness, so distributed or of such
subscription rights or warrants applicable, so
distributed. Such adjustment shall be made
successively whenever such a record date is fixed; and
in the event that such distribution is not so made, the
conversion rate shall again be adjusted to the
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conversion rate which would then be in effect if such
record date had not been fixed.
(d) For the purpose of any computation under
subsection (b) above and Section 13.6, the current
market price per share of the Capital Stock on any date
as of which such price is to be computed shall mean the
average of the Closing Prices for the 30 consecutive
Business days commencing 45 Business days before such
date.
(e) No adjustment in the conversion rate shall
be required unless such adjustment would require a
cumulative increase or decrease of at least 1% in such
rate; provided, however, that any adjustments which by
reason of this subsection (e) are not required to be
made shall be carried forward and taken into account in
any subsequent adjustment, and provided, further, that
adjustments shall be required and made in accordance
with the provisions of this Article XIII (other than
this subsection (e)) not later than such time as may be
required in order to preserve the tax-free nature of a
distribution for United States income tax purposes to
the holders of Debentures or the class of Capital Stock
into which such Debentures are convertible. All
calculations under this Article XIII shall be made to
the nearest cent or to the nearest one-thousandth of a
share, as the case may be. Anything in this Section
13.5 to the contrary notwithstanding, the Company shall
be entitled to make such adjustments in the conversion
rate, in addition to those required by this Section
13.5, as it in its discretion shall determine to be
advisable in order that any stock dividend, subdivision
of shares, distribution of rights to purchase stock or
securities, or distribution of securities convertible
into or exchangeable for stock hereafter made by the
Company to its shareholders shall not be taxable for
United States income tax purposes.
(f) Whenever the conversion rate is adjusted,
as herein provided, the Company shall promptly file
with the Trustee and with the office or agency
maintained by the Company for the conversion of
Debentures of such series pursuant to Section 4.2, a
certificate of a firm of independent public accountants
of recognized national standing selected by the Board
of Directors (who may be the regular accountants
employed by the Company) setting forth the conversion
rate after such adjustment and setting forth a brief
statement of the facts requiring such adjustment and a
computation thereof. Such certificate shall be
conclusive evidence of the correctness of such
adjustment. Neither the Trustee nor any conversion
agent shall be under any duty or responsibility with
respect to any such certificate or any facts or
computations set forth therein, except to exhibit said
certificate from time to time to any Debentureholder of
such series desiring to inspect the same. The Company
shall
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promptly cause a notice setting forth the adjusted
conversion rate to be mailed to the holders of
Debentures of such series, as their names and addresses
appear upon the registration books of the Company.
(g) In the event that at any time, as a result
of shares of any other class of Capital Stock becoming
issuable in exchange or substitution for or in lieu of
shares of the class of Capital Stock into which such
Debentures are convertible or as a result of an
adjustment made pursuant to subsection (a) above, the
holder of any Debenture of such series thereafter
surrendered for conversion shall become entitled to
receive any shares of the Company other than shares of
the class of Capital Stock into which the Debentures of
such series are convertible, thereafter the number of
such other shares so receivable upon conversion of any
Debenture shall be subject to adjustment from time to
time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the class
of Capital Stock into which the Debentures of such
series are convertible contained in subsections (a) to
(f), inclusive, above, and the provisions of this
Article XIII with respect to the class of Capital Stock
into which the Debentures of such series are
convertible shall apply on like terms to any such other
shares.
(h) The conversion rate with respect to any
Debentures with original issue discount, the terms of
which provide for convertibility, shall not be adjusted
during the term of such Original Issue Discount
Debentures for accrued original issue discount.
(i) In the event that the Debentures of any
series are convertible into more than one class of
Capital Stock, the provisions of this Section 13.5
shall apply separately to events affecting each such
class.
SECTION 13.6. No fractional shares to be issued.
No fractional shares of Capital Stock shall be issued upon
conversions of Debentures. If more than one Debenture of
any series shall be surrendered for conversion at one time
by the same holder, the number of full shares which shall be
issuable upon conversion thereof shall be computed on the
basis of the aggregate principal amount of the Debentures of
such series (or specified portions thereof to the extent
permitted hereby) so surrendered. Instead of a fraction of
a share of Capital Stock which would otherwise be issuable
upon conversion of any Debenture or Debentures (or specified
portions thereof), the Company shall pay a cash adjustment
in respect of such fraction of a share in an amount equal to
the same fractional interest of the current market price (as
defined in Section 13.5) per share of Capital Stock on the
Business day next preceding the day of conversion.
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SECTION 13.7. Preservation of conversion rights upon
consolidation, merger, sale or conveyance. In case of any
consolidation of the Company with, or merger of the Company
into, any other corporation (other than a consolidation or
merger in which the Company is the continuing corporation),
or in the case of any sale or transfer of all or
substantially all of the assets of the Company, the
corporation formed by such consolidation or the corporation
into which the Company shall have been merged or the
corporation which shall have acquired such assets, as the
case may be, shall execute and deliver to the Trustee, a
supplemental indenture, subject to the provisions of Article
X and XII as they relate to supplemental indentures,
providing that the holder of each Debenture then Outstanding
of a series which was convertible into Capital Stock shall
have the right thereafter to convert such Debenture into the
kind and amount of shares of stock and other securities and
property, including cash, receivable upon such
consolidation, merger, sale or transfer by a holder of the
number of shares of Capital Stock of the Company into which
such Debentures might have been converted immediately prior
to such consolidation, merger, sale or transfer. Such
supplemental indenture shall conform to the provisions of
the Trust Indenture Act of 1939 as then in effect and shall
provide for adjustments which shall be as nearly equivalent
as may be practicable to the adjustments provided for in
this Article XIII. Neither the Trustee nor any conversion
agent shall be under any responsibility to determine the
correctness of any provision contained in any such
supplemental indenture relating either to the kind or amount
of shares of stock or other securities or property
receivable by Debentureholders upon the conversion of their
Debentures after any such consolidation, merger, sale or
transfer, or to any adjustment to be made with respect
thereto and, subject to the provisions of Section 11.1, may
accept as conclusive evidence of the correctness of any such
provisions, and shall be protected in relying upon, an
Opinion of Counsel with respect thereto. If in the case of
any such consolidation, merger, sale or transfer, the stock
or other securities and property receivable by a holder of
the Debentures includes stock or other securities and
property of a corporation other than the successor or
purchasing corporation, then such supplemental indenture
shall also be executed by such other corporation and shall
contain such additional provisions to protect the interests
of the holders of the Debentures as the Board of Directors
shall reasonably consider necessary. The above provisions
of this Section 13.7 shall similarly apply to successive
consolidations, mergers, sales or transfers.
SECTION 13.8. Notice to Debentureholders of a series
prior to taking certain types of action. With respect to
the Debentures of any series, in case:
(a) the Company shall authorize the issuance to
all holders of the class of Capital Stock into which
Debentures
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of such series are convertible of rights
or warrants to subscribe for or purchase shares of its
Capital Stock or of any other right;
(b) the Company shall authorize the distribution
to all holders of the class of Capital Stock into which
Debentures of such series are convertible of evidences
of its indebtedness or assets (except for the
exclusions with respect to certain dividends set forth
in Section 13.5(c);
(c) of any subdivision, combination or
reclassification of the class of Capital Stock into
which Debentures of such series are convertible or of
any consolidation or merger to which the Company is a
party and for which approval by the shareholders of the
Company is required, or of the sale or transfer of all
or substantially all of the assets of the Company; or
(d) of the voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then the Company shall cause to be filed with the Trustee
and at the office or agency maintained for the purpose of
conversion of Debentures of such series pursuant to Section
4.2, and shall cause to be mailed to the holders of
Debentures of such series, at their last addresses as they
shall appear upon the registration books of the Company, at
least ten days prior to the applicable record date
hereinafter specified, a notice stating (i) the date as of
which the holders of such class of Capital Stock to be
entitled to receive any such rights, warrants or
distribution are to be determined, or (ii) the date on which
any such subdivision, combination, reclassification,
consolidation, merger, sale, transfer, dissolution,
liquidation, winding up or other action is expected to
become effective, and the date as of which it is expected
that holders of record of such class of Capital Stock shall
be entitled to exchange their Capital Stock of such class
for securities or other property, if any, deliverable upon
such subdivision, combination, reclassification,
consolidation, merger, sale, transfer, dissolution,
liquidation, winding up or other action. The failure to give
the notice required by this Section 13.8 or any defect
therein shall not affect the legality or validity of any
distribution, right, warrant, subdivision, combination,
reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation, winding up or other action, or the
vote upon any of the foregoing. Such notice shall also be
published by and at the expense of the Company not later
than the aforesaid filing date at least once in an
Authorized Newspaper.
SECTION 13.9. Covenant to reserve shares for issuance
on conversion of Debentures. The Company covenants that at
all times it will reserve and keep available out of each
class of its authorized Capital Stock, free from preemptive
rights, solely for
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the purpose of issue upon conversion of Debentures of any
series as herein provided, such number of shares of Capital
Stock of such class as shall then be issuable upon the
conversion of all Outstanding Debentures of such series.
The Company covenants that all shares of Capital Stock which
shall be so issuable shall, when issued or delivered, be
duly and validly issued shares of the class of authorized
Capital Stock into which Debentures of such series are
convertible, and shall be fully paid and nonassessable, free
of all liens and charges and not subject to preemptive
rights and that, upon conversion, the appropriate capital
stock accounts of the Company will be duly credited.
SECTION 13.10. Compliance with governmental
requirements. The Company covenants that if any shares of
Capital Stock required to be reserved for purposes of
conversion of Debentures hereunder require registration or
listing with or approval of any governmental authority under
any Federal or State law, pursuant to the Securities Act of
1933, as amended, or the Securities Exchange Act, or any
national or regional securities exchange on which such
Capital Stock is listed at the time of delivery of any
shares of such Capital Stock, before such shares may be
issued upon conversion, the Company will use its best
efforts to cause such shares to be duly registered, listed
or approved, as the case may be.
SECTION 13.11. Payment of taxes upon certificates for
shares issued upon conversion. The issuance of certificates
for shares of Capital Stock upon the conversion of
Debentures shall be made without charge to the converting
Debentureholders for any tax (including, without limitation,
all documentary and stamp taxes) in respect of the issuance
and delivery of such certificates, and such certificates
shall be issued in the respective names of, or in such names
as may be directed by, the holders of the Debentures
converted; provided, however, that the Company shall not be
required to pay any tax which may be payable in respect of
any transfer involved in the issuance and delivery of any
such certificate in a name other than that of the holder of
the Debenture converted, and the Company shall not be
required to issue or deliver such certificates unless or
until the person or persons requesting the issuance thereof
shall have paid to the Company the amount of such tax or
shall have established to the satisfaction of the Company
that such tax has been paid.
SECTION 13.12. Trustee's duties with respect to
conversion provisions. The Trustee and any conversion agent
shall not at any time be under any duty or responsibility to
any Debentureholder to determine whether any facts exist
which may require any adjustment of the conversion rate, or
with respect to the nature or extent of any such adjustment
when made, or with respect to the method employed, or herein
or in any supplemental indenture provided to be employed, in
making the same. Neither the Trustee nor any conversion
agent shall be accountable with
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respect to the registration under securities laws, listing,
validity or value (or the kind or amount) of any shares of
Capital Stock, or of any other securities or property, which
may at any time be issued or delivered upon the conversion
of any Debenture; and neither the Trustee nor any conversion
agent makes any representation with respect thereto.
Neither the Trustee nor any conversion agent shall be
responsible for any failure of the Company to make any cash
payment or to issue, transfer or deliver any shares of stock
or stock certificates or other securities or property upon
the surrender of any Debenture for the purpose of
conversion; and the Trustee, subject to the provisions of
Section 11.1, and any conversion agent shall not be
responsible for any failure of the Company to comply with
any of the covenants of the Company contained in this
Article XIII.
ARTICLE XIV
MISCELLANEOUS PROVISIONS
SECTION 14.1. Rights under Indenture limited to the
parties and holders of Debentures. Except as provided in
Article III, nothing in this Indenture or the Debentures,
express or implied, is intended or shall be construed to
confer upon, or to give to, any person or corporation, other
than the parties hereto, their successors and assigns, and
the holders of the Debentures, any right, remedy or claim
under or by reason of this Indenture or any provision
hereof; and the provisions of this Indenture are for the
exclusive benefit of the parties hereto, their successors
and assigns, and the holders of the Debentures.
SECTION 14.2. Certificate of independent accountants
conclusive. Unless otherwise specifically provided, the
certificate or opinion of Arthur Andersen & Co., or of any
other independent firm of public accountants of recognized
standing selected by the Board of Directors and acceptable
to the Trustee in the exercise of reasonable care (which
firm may be regular independent accountants to the Company),
shall be conclusive evidence of the correctness of any
computation made under the provisions of this Indenture, and
wherever reference is made in this Indenture to "generally
accepted accounting principles" the certificate or opinion
of such a firm shall be conclusive evidence thereof. The
Company shall furnish to the Trustee upon its request a copy
of any such certificate or opinion.
SECTION 14.3. Treatment of Debentures owned or held by
the Company in determining required percentages. For all
purposes of this Indenture, in determining whether the
holders of a required percentage or proportion of the
principal amount of Debentures of one or more series have
concurred in any request, waiver, vote, direction or
consent, Debentures owned or held by or for the account or
for the benefit of the Company or any other obligor under
this Indenture or any Affiliate shall be disregarded and
deemed not Outstanding, except that, for the purposes of
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determining whether the Trustee shall be protected in
relying on any such request, waiver, direction or consent,
only Debentures which the Trustee knows to be so owned or
held shall be so disregarded. Debentures so owned which
have been pledged in good faith to secure an obligation may
be regarded as Outstanding for all such purposes, if the
Trustee receives an Officers' Certificate stating that said
Debentures have been so pledged, that the pledgee is
entitled to vote with respect to such Debentures and that
the pledgee is not the Company or any other obligor on the
Debentures, an Affiliate of the Company or an Affiliate of
such other obligor. In case of a dispute as to such right,
any decision by the Trustee taken upon the advice of counsel
shall be conclusive, and, subject to the provisions of
Section 11.1 of this Indenture, shall afford full protection
to the Trustee.
SECTION 14.4. Remaining provisions not affected by
invalidity of any other provisions-required provisions of
Trust Indenture Act of 1939 to control. In case anyone or
more of the provisions contained in this Indenture or in the
Debentures of any series shall for any reason be held to be
invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect
any other provision of this Indenture, but this Indenture
shall be construed as if such invalid, illegal or
unenforceable provisions had never been contained herein.
If any provision of this Indenture limits, qualifies or
conflicts with any other provision of this Indenture which
is required to be included in an indenture qualified under
the Trust Indenture Act of 1939, as amended, such provision
which is so required to be included shall control.
SECTION 14.5. Company released from Indenture
requirements if entitled to have Indenture cancelled.
Whenever by the terms of this Indenture the Company shall be
required to do or not to do anything so long as any of the
Debentures shall be Outstanding of any series, the Company
shall, notwithstanding any such provision, not be required
to comply with such provision with respect to such series if
it shall be entitled to have this Indenture satisfied and
discharged pursuant to the provisions hereof, even though in
either case the holders of any of the Debentures of such
series shall have failed to present and surrender such
Debentures for payment pursuant to the terms of this
Indenture.
SECTION 14.6. Date of execution. Although this
Indenture, for convenience and for the purpose of reference,
is dated as of the date first above written, the actual date
of execution by the Company and by the Trustee is as
indicated by their respective acknowledgements hereto
annexed.
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SECTION 14.7. Execution of documents furnished under
the Indenture. Unless otherwise expressly provided, any
order, notice, request, demand, certificate or statement of
the Company required or permitted to be made or given under
any provision hereof shall be sufficiently executed if
signed by its Chairman of the Board, President, any Vice
Chairman of the Board or any Vice President, and by its
Treasurer, any Assistant Treasurer, Secretary or any
Assistant Secretary.
SECTION 14.8. Officers' Certificates and Opinions of
Counsel to be furnished Trustee. Upon any application,
demand or request by the Company to the Trustee to take any
action under any of the provisions of this Indenture, the
Company shall furnish to the Trustee an Officers'
Certificate stating that all conditions precedent, if any,
provided for in this Indenture relating to the proposed
action have been complied with, and an Opinion of Counsel
stating that in the opinion of such counsel all such
conditions precedent have been complied with and that such
action is in compliance with applicable law.
Each certificate or opinion with respect to compliance
with a condition or covenant provided for in this Indenture
shall include (a) a statement that the person making such
certificate or opinion has read such covenant or condition;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or
opinions contained in such certificate or opinion are based;
(c) a statement that, in the opinion of such person, he has
made such examination or investigation as is necessary to
enable him to express an informed opinion as to whether or
not such covenant or condition has been complied with; and
(d) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.
Any certificate, statement 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 that the certificate
or opinion or representations with respect to the matters
upon which his certificate, statement or opinion may be
based as aforesaid are erroneous, or in the exercise of
reasonable care should know that the same are erroneous.
Any certificate, statement or opinion of counsel may be
based, insofar as it relates to factual matters, information
with respect to which is in the possession of the Company,
upon the certificate, statement or opinion of or
representations by an officer or officers of the Company,
unless such counsel knows that the certificate, statement or
opinion or representations with respect to the matters upon
which his certificate, statement or opinion may be based as
aforesaid are erroneous, or in the exercise of reasonable
care should know that the same are erroneous.
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Any certificate, statement or opinion of an officer of
the Company or of counsel may be based, insofar as it
relates to accounting matters, upon a certificate or opinion
of or representations by an accountant or firm of
accountants in the employ of the Company, unless such
officer or counsel, as the case may be, knows that the
certificate or opinion or representations with respect to
the accounting matters upon which his certificate, statement
or opinion may be based as aforesaid are erroneous, or in
the exercise of reasonable care should know that the same
are erroneous. Any certificate or opinion of any
independent firm of public accountants filed with the
Trustee shall contain a statement that such firm is
independent.
SECTION 14.9. Presentation of notices and demands.
All notices to or demands upon the Trustee shall be in
writing and may be served or presented at the principal
office of the Trustee. Any notice to or demand upon the
Company shall be deemed to have been sufficiently given or
served by the Trustee or the Debentureholders, for all
purposes, by being mailed by first class mail addressed to
the Company, attention of the President, at 2002 Pisgah
Church Road, Suite 300, Greensboro, North Carolina 27455,
and to Schell Bray Aycock Abel & Livingston, 230 North Elm
Street, Suite 1500, Greensboro, North Carolina 27401,
Attention: Kenneth N. Shelton, Esq., or at such other
address or to such other counsel, as may be filed in writing
by the Company with the Trustee.
Except as otherwise expressly provided herein, where
this Indenture provides for notice to holders of Debentures
of any event, such notice shall be sufficiently given to
holders of Debentures if in writing and mailed, first-class
postage prepaid, to each holder of a Debenture affected by
such event, at the address of such holder as it appears in
the Debenture register, not later than the latest date, and
not earlier than the earliest date, prescribed for the
giving of such notice.
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 to holders of Debentures
by mail, then such notification as shall be made with the
approval of the Trustee shall constitute a sufficient
notification for every purpose hereunder. In any case where
notice to holders of Debentures is given by mail, neither
the failure to mail such notice, nor any defect in any
notice so mailed, to any particular holder of a Debenture
shall affect the sufficiency of such notice with respect to
other holders of Debentures.
SECTION 14.10. Successors and assigns bound by
Indenture. All the covenants, promises and agreements in
this Indenture contained by or on behalf of the Company, or
by or on behalf of the Trustee, shall bind and inure to the
benefit of their respective successors and assigns, whether
so expressed or not.
SECTION 14.11 Descriptive headings for convenience
only. The descriptive headings of the several Articles of
this
-84-
<PAGE>
Indenture are inserted for convenience only and shall
not control or affect the meaning or construction of any of
the provisions hereof.
SECTION 14.12. North Carolina law to govern. This
Indenture and each Debenture shall be deemed to be a
contract made under the laws of the State of North Carolina,
and for all purposes shall be construed in accordance with
the laws of said jurisdiction, except that the rights,
obligations, duties, immunities and limitations of rights of
the Trustee shall be construed in accordance with the laws
of the State of .
SECTION 14.13. Indenture may be executed in
counterparts. This Indenture may be simultaneously executed
in any number of counterparts, each of which when so
executed and delivered shall be an original, but such
counterparts shall together constitute but one and the same
instrument. , as Trustee, hereby
accepts the trusts in this Indenture declared and provided
upon the terms and conditions hereinbefore set forth.
IN WITNESS WHEREOF, VANGUARD CELLULAR SYSTEMS, INC. has
caused this Indenture to be signed in its corporate name,
and , as Trustee, has caused this
Indenture to be signed in its corporate name, all as of the
day and year first above written.
VANGUARD CELLULAR SYSTEMS, INC.
By:
(CORPORATE SEAL) Title:
ATTEST:
Secretary
By:
(CORPORATE SEAL) Title:
ATTEST:
Secretary
-85-
<PAGE>
NORTH CAROLINA
COUNTY OF GUILFORD ss.
On this day of , before me
personally came , to me personally known, who, being by me
duly sworn, did depose and say that he resides at ,
that he is the of Vanguard Cellular Systems, Inc., a North
Carolina corporation, the corporation described in and which
executed the above instrument; that he knows the corporate
seal of said corporation; that the seal affixed to the said
instrument is such corporate seal; that it was so affixed by
authority of the Board of Directors of said corporation; and
that he signed his name thereto by like authority.
(NOTORIAL SEAL)
STATE OF
COUNTY OF ss.
On this day of , before me
personally came , to me known, who, being by me duly sworn,
did depose and say that he resides at ,
that he is a of , the
banking corporation described in and which executed the
above instrument; that he knows the seal of said
banking corporation; that the seal affixed to the said
instrument is such seal; that it was so affixed by authority
of the Board of Directors of said banking corporation; and
that he signed his name thereto by like authority.
(NOTORIAL SEAL)
<PAGE>
July 25, 1995
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, DC 20549
Re: Vanguard Cellular Systems, Inc.
Registration Statement on Form S-3
Gentlemen:
We have represented Vanguard Cellular Systems, Inc. (the
"Corporation"), a North Carolina corporation, in connection with
the Corporation's Registration Statement on Form S-3 (the
"Registration Statement") filed on the date hereof with the
Securities and Exchange Commission (the "Commission") under the
Securities Act of 1933, as amended (the "Act"), for the
registration of the sale by the Corporation from time to time for
an aggregate initial offering price not to exceed $250,000,000 of
its (i) senior debentures ("Senior Debentures"), senior
subordinated debentures ("Senior Subordinated Debentures"), and
subordinated debentures ("Subordinated Debentures") (collectively,
the "Debentures"), (ii) shares of its Preferred Stock, $.01 par
value per share, which may be represented by depositary shares as
described herein (the "Preferred Stock"), (iii) shares of its Class
A Common Stock, $.01 par value per share (the "Class A Common
Stock"), (iv) shares of its Class B Common Stock, par value $.01
per share (the "Class B Common Stock"), or (v) Warrants to purchase
Debentures, Preferred Stock, Class A Common Stock or Class B Common
Stock, or other securities or rights (the "Warrants"). The
Debentures, Preferred Stock, Class A Common Stock, Class B Common
Stock, and Warrants are herein collectively referred to as the
"Securities" and individually as a "Security." Debentures and
Preferred Stock may be convertible and/or exchangeable for
<PAGE>
Securities and Exchange Commission
July 25, 1995
Page 2
Securities or other securities or rights. The Senior Debentures
will be issued under a form of senior debenture indenture filed
with the Registration Statement as Exhibit 4(c)(1) (the "Senior
Debenture Indenture"); the Senior Subordinated Debentures will be
issued under a form of senior subordinated debenture indenture
filed with the Registration Statement as Exhibit 4(c)(2) (the
"Senior Subordinated Debenture Indenture"); and the Subordinated
Debentures will be issued under a form of subordinated debenture
indenture filed with the Registration Statement as Exhibit 4(c)(3)
(the "Subordinated Debenture"). The Senior Debenture Indenture,
the Senior Subordinated Debenture Indenture, and the Subordinated
Debenture Indenture are hereinafter referred to individually as an
"Indenture" and collectively as the "Indentures." The Corporation
may offer Depositary Shares (the "Depositary Shares") representing
interests in Preferred Stock deposited with a Depositary and
evidenced by Depositary Receipts, and such Depositary Shares are
also covered by the Registration Statement.
We have examined the Corporation's Articles of Incorporation,
including all amendments thereto, its Bylaws, including all amendments
thereto, such of its other corporate records as we deemed necessary
or advisable for purposes of rendering this opinion, and
the Registration Statement, including the Prospectus therein and
the forms of Indenture included as exhibits thereto.
Based on the foregoing, we are of the following opinions:
(1) When the specific terms of a particular Debenture
have been duly authorized and established in accordance with an
Indenture, and such Debenture has been duly authorized,
executed, authenticated, issued, and delivered in accordance
with an Indenture, against payment therefor in accordance with
the applicable underwriting or other agreement or upon
conversion or exchange in accordance with the terms of any
other Security that has been duly authorized, issued, paid for
and delivered, such Debenture will constitute a valid and
binding obligation of the Corporation.
(2) Upon designation of the preferences, limitations and
relative rights of any series of Preferred Stock by the Board
of Directors of the Corporation and proper filing of articles
of amendment relating to such series of Preferred Stock with
the Secretary of State of North Carolina, all necessary
corporate action on the part of the Corporation will have been
taken to authorize the issuance and sale of such series of
Preferred Stock proposed to be sold by the Corporation, and
when such shares of Preferred Stock are issued and delivered
against payment therefor in accordance with the applicable
<PAGE>
Securities and Exchange Commission
July 25, 1995
Page 3
underwriting or other agreement or upon conversion or exchange
in accordance with the terms of any other Security that has
been duly authorized, issued, paid for and delivered, such
shares will be validly issued, fully paid, and nonassessable.
(3) When the specific terms of any offering or offerings
of Class A Common Stock have been duly established by the Board
of Directors of the Corporation and shares of Class A Common
Stock have been issued and sold against payment therefor in
accordance with the applicable underwriting or other agreement
or upon conversion or exchange in accordance with the terms of
any Security that has been duly authorized, issued, paid for
and delivered, such shares will be validly issued, fully paid,
and nonassessable.
(4) When the specific terms of any offering or offerings
of Class B Common Stock have been duly established by the Board
of Directors of the Corporation and shares of Class B Common
Stock have been issued and sold against payment therefor in
accordance with the applicable underwriting or other agreement
or upon conversion or exchange in accordance with the terms of
any Security that has been duly authorized, issued, paid for
and delivered, such shares will be validly issued, fully paid,
and nonassessable.
(5) When the specific terms of a particular Warrant have
been duly authorized and established and such Warrant has been
duly authorized, executed, issued, and delivered against
payment therefor in accordance with the applicable underwriting
or other agreement, such Warrant will constitute a valid and
binding obligation of the Corporation.
(6) When Depositary Shares evidenced by Depositary
Receipts are delivered in accordance with the terms of a
Deposit Agreement against the deposit of duly authorized,
validly issued, fully paid and nonassessable shares of
Preferred Stock, such Depositary Shares will entitle the
holders thereof to the rights specified in the Deposit
Agreement.
In connection with our opinions expressed hereinabove, we have
assumed that, at or prior to the time of the delivery of such
Security, (i) the Board of Directors shall have duly authorized the
issuance and sale of such Security and such authorization shall not
have been modified or rescinded; (ii) the Registration Statement
shall have been declared effective and such effectiveness shall not
have been terminated or rescinded; (iii) the applicable Indentures
shall have been duly authorized, executed and delivered by the
<PAGE>
Securities and Exchange Commission
July 25, 1995
Page 4
Corporation and the applicable Trustee and shall have been
qualified under the Trust Indenture Act of 1939, as amended; and
(iv) there will not have occurred any change in law affecting the
validity or enforceability of such Security. We have also assumed
that neither the terms of any Security to be established subsequent
to the date hereof, nor the issuance and delivery of such Security,
nor the compliance by the Corporation with the terms of such
Security will violate any applicable law, any provision of any
instrument or agreement then binding upon the Corporation, or any
restriction imposed by any court or governmental body having
jurisdiction over the Corporation.
The opinions set forth hereinabove are subject to the following
limitations and qualifications:
(a) The enforceability of any obligation of the
Corporation is subject to applicable bankruptcy,
insolvency, reorganization, fraudulent conveyance,
moratorium, and any similar laws generally affecting
creditors' rights and remedies and is also subject to
general principles of equity, including commercial
reasonableness, good faith, and fair dealing (regardless
of whether enforcement is sought at law or in equity).
(b) Each of the Indentures contains a provision to the
effect that the acceptance by the Trustee or the
Securityholders of a past due installment by the
Corporation shall not be deemed a waiver of its or their
right to accelerate. The North Carolina Court of Appeals
has held that, when a holder of an obligation regularly
accepts late payments, it is deemed to waive its right to
accelerate the debt because of late payments until it
notifies the maker of the obligation that prompt payments
are again required.
(c) North Carolina General Statute Section 6-21.2 sets
forth certain procedures and limitations applicable to the
collection of attorneys' fees, and our opinions are
conditioned upon the application of and compliance with
those provisions.
(d) We express no opinion as to any provision of the
Indentures purporting to relieve the Trustee of the
exercise of reasonable diligence.
(e) We express no opinion (i) as to, and assume
compliance with, any applicable federal or state
securities law or (ii) with respect to the enforceability
<PAGE>
Securities and Exchange Commission
July 25, 1995
Page 5
of any provision of the Indentures pursuant to which any
party is indemnified against a liability arising under
applicable securities laws.
(f) The opinions set forth herein are limited to the laws
of the State of North Carolina as applied by courts
located in North Carolina.
We hereby consent to the use of this opinion as Exhibit 5 of
the Registration Statement relating to the offering referred to
hereinabove and filed with the Commission as required by the Act
and to any reference to this opinion or to our firm name under the
heading "Legal Opinion" in the Prospectus. We do not, however,
thereby admit that we are within the category of persons whose
consent is required under Section 7 of the Act or the rules and
regulations of the Commission promulgated thereunder.
Very truly yours,
Schell Bray Aycock Abel & Livingston L.L.P.
<PAGE>
<PAGE>
EXHIBIT 12
VANGUARD CELLULAR SYSTEMS, INC.
COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDENDS
<TABLE>
<CAPTION>
THREE MONTHS ENDED
YEAR ENDED DECEMBER 31, MARCH 30,
1990 1991 1992 1993 1994 1994 1995
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings:
Net Loss.................................. $(29,312) $(32,713) $(26,659) $(18,998) $(22,347) $(3,055) $(7,157)
Add/(deduct):
Extraordinary item..................... -- -- -- 3,715 8,402 -- --
Minority interest...................... (359) (309) (304) 154 153 (5) 23
Interest expense....................... 19,754 19,292 16,177 15,389 22,126 3,984 8,574
(9,917) (13,730) (10,786) 260 8,334 924 1,440
Fixed Charges (1):
Interest expense.......................... 19,754 19,292 16,177 15,389 22,126 3,984 8,574
Capitalized interest...................... 1,046 716 188 188 684 224 248
20,800 20,008 16,365 15,577 22,810 4,208 8,822
Fixed charges in excess of earnings....... $(30,717) $(33,738) $(27,151) $(15,317) $(14,476) $(3,284) $(7,382)
Ratio (2)................................... (N/A) (N/A) (N/A) (N/A) (N/A) (N/A) (N/A)
</TABLE>
(1) The Company has no shares of preferred stock outstanding.
(2) Earnings for all periods were inadequate to cover fixed charges.
<PAGE>
EXHIBIT 23(A)
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
To Vanguard Cellular Systems, Inc.:
As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement of our report dated February 20,
1995, included in Vanguard Cellular Systems, Inc.'s Form 10-K for the year ended
December 31, 1994, and our reports dated March 8, 1994 and November 4, 1994,
included in Vanguard Cellular Systems, Inc.'s Form 8-K filed on February 13,
1995 and to all references to our firm included in this registration statement.
ARTHUR ANDERSEN LLP
Greensboro, North Carolina,
July 24, 1995
