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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report : November 19, 1996
(Date of earliest event reported)
KAUFMAN AND BROAD HOME CORPORATION
(Exact name of registrant as specified in its charter)
Delaware
(State of Incorporation)
(Commission File Number) (IRS Employer Identification No.)
333-14977 95-3666267
10990 Wilshire Boulevard, Los Angeles, California 90024
(Address of principal executive offices)
Registrant's Telephone Number, including area code:
(310) 231-4000
ITEM 5. OTHER EVENTS
Exhibits are filed herewith in connection with the issuance by
Kaufman and Broad Home Corporation (the "Company") of its 9 5/8% Senior
Subordinated Notes due 2006 pursuant to Registration Statement
Nos. 333-14977 and 33-50732.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
EXHIBITS
EXHIBITS
Exhibit
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1.4 Form of Purchase Agreement dated as of November 19, 1996,
between the Company and Merrill Lynch, Pierce, Fenner &
Smith Incorporated.
4.13 Form of Senior Subordinated Debt Indenture dated as of November 19,
1996 between the Company and SunTrust Bank, Atlanta, as Trustee.
4.14 Form of Senior Subordinated Note.
4.15 Form of Officers' Certificate dated as of November 19, 1996
establishing certain terms of the Company's 9 5/8% Senior
Subordinated Notes due 2006.
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
KAUFMAN AND BROAD HOME CORPORATION
By: /s/ Kimberly N. King
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Kimberly N. King
Title: Corporate Secretary and
Associate Counsel
Dated: November 19, 1996
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EXHIBIT 1.4
KAUFMAN AND BROAD HOME CORPORATION
(a Delaware corporation)
$125,000,000
9-5/8% Senior Subordinated Notes due 2006
PURCHASE AGREEMENT
November 14, 1996
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Merrill Lynch World Headquarters
World Financial Center, North Tower
New York, New York 10281-1209
Dear Sirs:
Kaufman and Broad Home Corporation, a Delaware corporation (the
"Company"), confirms its agreement with Merrill Lynch & Co., Merrill Lynch,
Pierce, Fenner & Smith Incorporated (the "Underwriter"), with respect to the
sale by the Company and the purchase by the Underwriter of $125,000,000
aggregate principal amount of the Company's 9-5/8% Senior Subordinated Notes
due 2006 (the "Securities"). The Securities are to be issued pursuant to an
indenture dated as of November 19, 1996 (the "Indenture", which term as used
herein includes the instrument establishing the form and terms of the
Securities) between the Company and SunTrust Bank, Atlanta, as trustee (the
"Trustee").
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 33-50732) (the "Prior
Registration Statement") for the registration under the Securities Act of 1933
(the "1933 Act") of debt securities, which registration statement was declared
effective by the Commission on August 20, 1992 and copies of which have
heretofore been delivered to you. The Company has also filed with the
Commission a registration statement on Form S-3 (No. 333-14977) (the "Current
Registration Statement") for the registration under the 1933 Act of additional
debt securities, which registration statement was declared effective on
November 12, 1996 and copies of which have heretofore been delivered to you.
The Current Registration Statement also constituted post-effective amendment
no. 1 to the Prior Registration Statement. The Indenture has been qualified
under the Trust Indenture Act of 1939, as amended (the "1939 Act"). Each of
the Prior Registration Statement and the Current Registration Statement, as
amended at the date of this Agreement and including all documents incorporated
or deemed to be incorporated by reference therein, is hereinafter referred to
as, individually, a "Registration Statement" and, collectively, the
"Registration Statements". The Company proposes to file with the Commission
pursuant to Rule 424(b) of the rules and regulations of the Commission under
the 1933 Act (the "1933 Act Regulations") the Prospectus Supplement (as
defined in Section 3(i) hereof) and the related prospectus dated November 12,
1996 (the "Base Prospectus"), and has previously advised you of all further
information (financial and other) with respect to the Company set forth
therein. The Base Prospectus together with the Prospectus Supplement, in
their respective forms on the date hereof (being the forms in which they are
to be filed with the Commission pursuant to Rule 424(b) of the 1933 Act
Regulations), including all documents incorporated or deemed to be incorporated
by reference therein through the date hereof, are hereinafter referred to as,
collectively, the "Prospectus", except that if any revised prospectus or
prospectus supplement shall be provided to the Underwriter by the Company for
use in connection with the offering and sale of the Securities which differs
from the Prospectus (whether or not such revised prospectus or prospectus
supplement is required to be filed by the Company pursuant to Rule 424(b) of
the 1933 Act Regulations), the term "Prospectus" shall refer to such revised
prospectus or prospectus supplement, as the case may be, from and after the
time it is first provided to the Underwriter for such use. Unless the context
otherwise requires, all references in this Agreement to documents, financial
statements and schedules and other information which is "contained",
"included", "stated", "described in" or "referred to" in any Registration
Statement or the Prospectus (and all other references of like import) shall be
deemed to mean and include all such documents, financial statements and
schedules and other information which is or is deemed to be incorporated by
reference in such Registration Statement or the Prospectus, as the case may
be; and all references in this Agreement to amendments or supplements to any
Registration Statement or the Prospectus shall be deemed to mean and include
the filing of any document under the Securities Exchange Act of 1934 (the
"1934 Act") after the date of this Agreement which is or is deemed to be
incorporated by reference in such Registration Statement or the Prospectus, as
the case may be.
The Company understands that the Underwriter proposes to make a public
offering of the Securities as soon as the Underwriter deems advisable after
this Agreement has been executed and delivered.
SECTION 1. Representations and Warranties.
(a) The Company represents and warrants to the Underwriter as of the
date hereof (such date being hereinafter referred to as the "Representation
Date") as follows:
(i) The Company meets the requirements for use of Form S-3
under the 1933 Act and the 1933 Act Regulations. The Prior Registration
Statement, at the time it became effective, and the Registration
Statements and the Base Prospectus, at the time the Current Registration
Statement became effective and as of the Representation Date, complied
and comply in all material respects with the requirements of the 1933
Act, the 1933 Act Regulations (including Rule 415(a) of the 1933 Act
Regulations), the 1939 Act and the rules and regulations of the
Commission under the 1939 Act (the "1939 Act Regulations"), and did not
and as of the Representation Date do not contain an untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading. The
Prospectus, at the Representation Date (unless the term "Prospectus"
refers to a prospectus which has been provided to the Underwriter by the
Company for use in connection with the offering of the Securities which
differs from the Prospectus filed with the Commission pursuant to Rule
424(b) of the 1933 Act Regulations, in which case at the time it is
first provided to the Underwriter for such use) and at the Closing Time
referred to in Section 2 hereof, does not and will not include an untrue
statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided, however, that the
representations and warranties in this subsection (a) shall not apply to
statements in or omissions from any Registration Statement or the
Prospectus made in reliance upon and in conformity with information
furnished to the Company in writing by the Underwriter expressly for use
in such Registration Statement or the Prospectus or the information
contained in any Statement of Eligibility of a trustee under the 1939
Act filed or incorporated by reference as an exhibit to any Registration
Statement (a "Form T-1").
(ii) Ernst & Young LLP, whose reports are incorporated by
reference into the Registration Statements, are independent public
accountants with respect to the Company and its subsidiaries and were
also independent public accountants with respect to Rayco, Ltd.
("Rayco"), in each case as required by the 1933 Act and the 1933 Act
Regulations.
(iii) The financial statements included or incorporated by
reference in the Registration Statement and the Prospectus present
fairly the financial position of the Company and its consolidated
subsidiaries and of Rayco, respectively, as at the dates indicated and
the results of operations of the Company and its consolidated
subsidiaries and of Rayco, respectively, for the periods specified;
except as otherwise stated in the Registration Statement, said financial
statements have been prepared in conformity with generally accepted
accounting principles in the United States applied on a consistent
basis; the supporting schedules included or incorporated by reference in
the Registration Statement present fairly the information required to be
stated therein; the Company's ratios of earnings to fixed charges and of
earnings to combined fixed charges and preferred stock dividends
(including the amounts the ratios would have been were interest on the
outstanding collateralized mortgage obligations of the Company's wholly
owned limited purpose financing subsidiaries included in such ratios'
calculation) included in the Prospectus Supplement under the caption
"Selected Consolidated Financial Data," in the Base Prospectus under the
caption "Consolidated Ratios of Earnings to Fixed Charges and of
Earnings to Combined Fixed Charges and Preferred Stock Dividends" and in
Exhibit 12 to the Current Registration Statement have been calculated in
compliance with Item 503(d) of Regulation S-K of the Commission; and the
pro forma financial statements and related notes thereto included in the
Registration Statements and the Prospectus present fairly the
information shown therein, have been prepared in accordance with the
Commission's rules and guidelines with respect to pro forma financial
statements and have been properly compiled on the bases described
therein, and the assumptions used in the preparation thereof are
reasonable and the adjustments used therein are appropriate to give
effect to the transactions and circumstances referred to therein.
(iv) Since the respective dates as of which information is
given in the Registration Statements and the Prospectus, except as
otherwise stated therein, (A) there has been no material adverse change
in the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and its subsidiaries (which
term, as used in this Agreement, includes without limitation
consolidated joint ventures in which the Company or any of its other
subsidiaries is a participant and limited and general partnerships in
which the Company or any of its other subsidiaries owns partnership
interests (such joint ventures and limited and general partnerships
being hereinafter called, collectively, the "Partnerships"))
considered as one enterprise, whether or not arising in the ordinary
course of business, (B) there have been no transactions entered into
by the Company or any of its subsidiaries, other than those in the
ordinary course of business, which are material with respect to the
Company and its subsidiaries considered as one enterprise, and (C)
except for regular quarterly dividends in customary amounts per share
on the common stock, par value $1.00 per share (the "Common Stock"),
of the Company or its Series B Mandatory Conversion Premium Dividend
Preferred Stock, par value $1.00 per share, there has been no
dividend or distribution of any kind declared, paid or made by the
Company on any class of its capital stock.
(v) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware and has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus; and the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by
reason of the ownership or leasing of property or the conduct of
business, except where the failure to so qualify would not have a
material adverse effect on the condition, financial or otherwise, or
the earnings, business affairs or business prospects of the Company
and its subsidiaries considered as one enterprise.
(vi) Each Significant Subsidiary (as defined below) has been
duly organized and is validly existing as a corporation or limited
partnership, as the case may be, in good standing under the laws of the
jurisdiction of its organization, has power and authority to own, lease
and operate its properties and to conduct its business as described in
the Prospectus and is duly qualified to transact business and is in good
standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the conduct
of business, except where the failure to so qualify would not have a
material adverse effect on the condition, financial or otherwise, or the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise; all of the issued and
outstanding capital stock of each Significant Subsidiary which is a
corporation has been duly authorized and validly issued, is fully paid
and non-assessable and is owned (except for directors qualifying shares
and a nominal number of shares held by affiliated parties) by the
Company, directly or through subsidiaries, free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or equity;
and all of the outstanding equity interests in each Significant
Subsidiary which is a Partnership have been duly authorized (if
applicable) and validly issued, are fully paid and non-assessable and
are owned by the Company (except to the extent that a minority interest
in the Partnership is reflected in the Company's consolidated financial
statements included or incorporated by reference in the Prospectus),
directly or through subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity. For
purposes of this Agreement, "Significant Subsidiaries" means the
corporations and limited partnerships identified on Schedule A hereto
which (A) on the basis of the Company's financial statements as of
August 31, 1996, represented 90% or more of the consolidated assets of
the Company and its subsidiaries and (B) includes all "significant
subsidiaries" of the Company, as such term is defined in Rule 405 of the
1933 Act Regulations.
(vii) The authorized, issued and outstanding capital stock of
the Company is as set forth in the Prospectus under "Capitalization"
(except for subsequent issuances, if any, pursuant to reservations,
agreements, employee benefit plans or the exercise of convertible
securities referred to or incorporated by reference in the Prospectus);
the shares of issued and outstanding Common Stock have been duly
authorized and validly issued and are fully paid and non-assessable; the
Common Stock, the Company's authorized but unissued special common
stock, par value $1.00 per share (the "Special Common Stock"), and the
Company's authorized and unissued preferred stock, par value $1.00 per
share (the "Preferred Stock"), conform to the respective statements
relating thereto included in the Prospectus; the Securities have been
duly authorized for issuance and sale to the Underwriter pursuant to
this Agreement and, when issued by the Company, authenticated by the
Trustee and delivered pursuant to the provisions of the Indenture and
this Agreement against payment of the consideration set forth herein,
the Securities will constitute valid and binding obligations of the
Company enforceable in accordance with their terms, except as
enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or
affecting creditors' rights generally or by general equitable
principles, and will be entitled to the benefits of the Indenture; the
Indenture has been duly authorized by the Company and, at Closing Time,
will have been duly executed and delivered by the Company and will
constitute a valid and binding agreement of the Company enforceable in
accordance with its terms, except as enforcement thereof may be limited
by bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to or affecting creditors' rights generally or by general
equitable principles; the Securities and the Indenture conform in all
material respects to the descriptions thereof contained in the
Prospectus; and, after giving effect to the sale of Securities and the
sale of any other securities registered pursuant to any Registration
Statement to be issued prior to the delivery of the Securities, the
aggregate amount of Securities which have been issued and sold by the
Company will not exceed the amount of theretofore unsold securities
registered pursuant to the Registration Statements.
(viii) Neither the Company nor any of its Significant
Subsidiaries is in violation of its charter or in default in the
performance or observance of (A) any obligation, agreement, covenant or
condition contained in the Company's Fourth Amended and Restated Loan
Agreement dated as of February 28, 1996 (the "Loan Agreement") with Bank
of America National Trust and Savings Association, as administrative
agent, and the other parties thereto, the Company's 10-3/8% Senior Notes
due 1999 (the "Senior Notes") or the Indenture dated as of September 1,
1992 between the Company and NBD Bank, N.A. pursuant to which the Senior
Notes were issued, including the instrument establishing the form and
terms of the Senior Notes (the "Senior Indenture"), or the Company's
9-3/8% Senior Subordinated Notes due 2003 (the "Senior Subordinated
Notes") or the Indenture dated as of May 1, 1993 between the Company and
The First National Bank of Boston pursuant to which the Senior
Subordinated Notes were issued (the "Senior Subordinated Indenture")
(the Loan Agreement, the Senior Notes, the Senior Indenture, the Senior
Subordinated Notes and the Senior Subordinated Indenture are hereinafter
called, collectively, the "Subject Instruments" and, individually, a
"Subject Instrument") or (B) any obligation, agreement, covenant or
condition contained in any other contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which the Company or any
of the Significant Subsidiaries is a party or by which it or any of them
may be bound, or to which any of the property or assets of the Company
or any of the Significant Subsidiaries is subject, which default or
violation would have a material adverse effect on the condition,
financial or otherwise, or the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one
enterprise; and the execution, delivery and performance of this
Agreement, the Indenture and the Securities and the consummation of the
transactions contemplated herein and therein and compliance by the
Company with its obligations hereunder and thereunder, have been duly
authorized by all necessary corporate action and will not conflict with
or constitute a breach of, or default under, or result in the creation
or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any of the Significant Subsidiaries pursuant
to, any contract, indenture, mortgage, loan agreement, note, lease or
other instrument to which the Company or any of the Significant
Subsidiaries is a party or by which it or any of them may be bound
(including, without limitation, the Subject Instruments), or to which
any of the property or assets of the Company or any of the Significant
Subsidiaries is subject, except (other than in the case of the Subject
Instruments) for a conflict, breach, default, lien, charge or
encumbrance which would not have a material adverse effect on the
condition, financial or otherwise, or the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as one
enterprise, nor will such action result in any violation of the
provisions of the charter, by-laws or other corresponding organizational
documents of the Company or any of the Significant Subsidiaries or any
applicable law, administrative regulation or administrative or court
order or decree.
(ix) There is no action, suit or proceeding before or by any
court or governmental agency or body, domestic or foreign, now pending,
or, to the knowledge of the Company, threatened, against or affecting
the Company or any of its subsidiaries, which is required to be
disclosed in the Registration Statements (other than as disclosed
therein), or which is not so disclosed and (net of reserves and
insurance) the Company believes might result in any material adverse
change in the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, or which might materially and
adversely affect the properties or assets thereof or which might
materially and adversely affect the consummation of this Agreement; all
pending legal or governmental proceedings to which the Company or any
subsidiary is a party or of which any of their respective property or
assets is the subject which are not described in or incorporated by
reference in the Registration Statements, including ordinary routine
litigation incidental to the business, are, considered in the aggregate
and net of reserves and insurance, not material to the Company and its
subsidiaries considered as one enterprise; and there are no contracts or
documents of the Company or any of its subsidiaries which are required
to be filed as exhibits to, or incorporated by reference in, the
Registration Statements by the 1933 Act or by the 1933 Act Regulations
which have not been so filed or incorporated by reference.
(x) No authorization, approval or consent of any court or
governmental authority or agency is necessary in connection with the
issuance and sale of the Securities hereunder or the consummation by the
Company of any of the other transactions contemplated hereby, except
such as may be required and have been obtained under the 1933 Act, the
1933 Act Regulations and the 1939 Act and such as may be required under
state securities laws.
(xi) This Agreement has been duly authorized, executed and
delivered by the Company.
(xii) The documents incorporated or deemed to be incorporated
by reference in the Prospectus, at the time they were or hereafter are
filed with the Commission, complied and will comply in all material
respects with the requirements of the 1934 Act and the 1934 Act
Regulations, and, when read together with the other information in the
Prospectus, at the respective times the Registration Statements and any
amendments thereto became effective, at the Representation Date and at
Closing Time did not, do not and will not contain an untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(xiii) The Company has complied with, and is and will be in
compliance with, the provisions of that certain Florida act relating to
disclosure of doing business with Cuba, codified as Section 517.075 of
the Florida statutes, and the rules and regulations thereunder
(collectively, the "Cuba Act") or is exempt therefrom.
(xiv) The Securities and the Indenture conform in all material
respects to the respective statements relating thereto contained in the
Prospectus.
(xv) The Securities are pari passu in right of payment with
the Senior Subordinated Notes and are subordinate in right of payment to
the Senior Notes.
(xvi) There are no holders of securities of the Company with
currently exercisable registration rights who have any securities
registered as part of the Registration Statements or included in the
offering contemplated by this Agreement.
(xvii) The Company and each of the Significant Subsidiaries have
good and marketable title to all of their respective properties, in each
case free and clear of all liens, encumbrances and defects, except (i)
customary liens and encumbrances arising in the ordinary course of the
Company's construction and development business and the financing
thereof, (ii) as stated or incorporated by reference in the Prospectus
or (iii) such as do not materially affect the value of such properties
in the aggregate to the Company and its subsidiaries considered as one
enterprise and do not materially interfere with the use made and
proposed to be made of such properties.
(xviii) The Company and its Significant Subsidiaries possess such
certificates, authorities or permits issued by the appropriate state,
federal or foreign regulatory agencies or bodies necessary to conduct
all material aspects of the business now operated by them, and neither
the Company nor any of its Significant Subsidiaries has received any
notice of proceedings relating to the revocation or modification of any
such certificate, authority or permit which, singly or in the aggregate,
if the subject of an unfavorable decision, ruling or finding, would
materially and adversely affect the condition, financial or otherwise,
or the earnings, business affairs or business prospects of the Company
and its subsidiaries considered as one enterprise.
(xix) No default or event of default with respect to any
Indebtedness (as such term is defined the Prospectus) of the Company or
any of its Significant Subsidiaries entitling, or which, with notice or
lapse of time or both, would entitle, the holders thereof to accelerate
the maturity thereof exists or will exist as a result of the execution
and delivery of this Agreement or the Indenture, the issuance and sale
of the Securities or the consummation of the transactions contemplated
hereby or thereby.
(xx) The Company and each of the Significant Subsidiaries have
filed all tax returns required to be filed, which returns, as amended,
are complete and correct in all material respects, and neither the
Company nor any Significant Subsidiary is in default in the payment of
any taxes which were payable pursuant to said returns or any assessments
with respect to said returns which would materially and adversely affect
the condition, financial or otherwise, or the earnings, business affairs
or business prospects of the Company and its subsidiaries considered as
one enterprise.
(xxi) The Company and its Significant Subsidiaries maintain a
system of internal accounting controls sufficient to provide reasonable
assurances that (A) transactions are executed in accordance with
management's general or specific authorization; (B) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain
accountability for assets; (C) access to assets is permitted only in
accordance with management's general or specific authorization; and (D)
the recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(b) Any certificate signed by any officer of the Company and delivered
to the Underwriter or to counsel for the Underwriter shall be deemed a
representation and warranty by the Company to the Underwriter as to the
matters covered thereby.
SECTION 2. Sale and Delivery to Underwriter; Closing.
(a) On the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, the
Company agrees to sell to the Underwriter, and the Underwriter agrees to
purchase from the Company, at 99.525% of the principal amount thereof,
$125,000,000 aggregate principal amount of Securities.
(b) Payment of the purchase price for the Securities shall be made at
the offices of the Company, 10990 Wilshire Boulevard, Los Angeles, California,
or at such other place as shall be agreed upon by the Underwriter and the
Company, at 6:00 a.m., California time, on November 19, 1996, or such other
time not later than ten business days after such date as shall be agreed upon
by the Underwriter and the Company (such time and date of payment and delivery
of the Securities being herein called "Closing Time"). Payment shall be made
to the Company by wire transfer of immediately available funds to a bank
account designated by the Company, against delivery of the Securities to the
Underwriter. Certificates for the Securities shall be in such denominations
and registered in such names as the Underwriter may request in writing at
least one full business day before Closing Time. The certificates for the
Securities will be made available for examination and packaging by the
Underwriter not later than 10:00 a.m. (New York City time) on the last
business day prior to Closing Time in New York, New York.
SECTION 3. Covenants of the Company. The Company covenants with the
Underwriter as follows:
(a) The Company will notify the Underwriter immediately, and
confirm the notice in writing, (i) of the effectiveness of any
post-effective amendment to any Registration Statement, (ii) of the
mailing or the delivery to the Commission for filing of the Prospectus
or any amendment to any Registration Statement or amendment or
supplement to the Prospectus or any document to be filed pursuant to the
1934 Act during any period when the Prospectus is required to be
delivered under the 1933 Act, (iii) of the receipt of any comments or
inquiries from the Commission relating to any Registration Statement or
Prospectus, (iv) of any request by the Commission for any amendment to
any Registration Statement or any amendment or supplement to the
Prospectus or for additional information and (v) of the issuance by the
Commission of any stop order suspending the effectiveness of any
Registration Statement or the initiation of any proceedings for that
purpose. The Company will make every reasonable effort to prevent the
issuance of any stop order and, if any stop order is issued, to obtain
the lifting thereof at the earliest possible moment.
(b) The Company will give the Underwriter notice of its
intention to file or prepare any post-effective amendment to any
Registration Statement or any amendment or supplement to the Prospectus
(including any revised prospectus which the Company proposes for use by
the Underwriter in connection with the offering of the Securities which
differs from the Prospectus filed with the Commission pursuant to Rule
424(b) of the 1933 Act Regulations, whether or not such revised
prospectus is required to be filed pursuant to Rule 424(b) of the 1933
Act Regulations), will furnish the Underwriter with copies of any such
amendment or supplement a reasonable amount of time prior to such
proposed filing or use, as the case may be, and will not file any such
amendment or supplement or use any such prospectus to which the
Underwriter or counsel for the Underwriter shall reasonably object.
(c) The Company has delivered to the Underwriter one signed copy
of each Registration Statement as originally filed and of each amendment
thereto (including exhibits filed therewith or incorporated by reference
therein and documents incorporated or deemed to be incorporated by
reference therein) and will also deliver to the Underwriter as many
conformed copies of the Registration Statements as originally filed and
of each amendment thereto (without exhibits) as the Underwriter may
reasonably request.
(d) The Company will furnish to the Underwriter, from time to
time during the period when the Prospectus is required to be delivered
under the 1933 Act or the 1934 Act, such number of copies of the
Prospectus (as amended or supplemented) as the Underwriter may
reasonably request for the purposes contemplated by the 1933 Act or the
1934 Act or the respective applicable rules and regulations of the
Commission thereunder.
(e) If any event shall occur as a result of which it is
necessary, in the opinion of counsel for the Underwriter, to amend or
supplement the Prospectus in order to make the Prospectus not misleading
in the light of the circumstances existing at the time it is delivered
to a purchaser, the Company will forthwith amend or supplement the
Prospectus (in form and substance satisfactory to the Underwriter and
counsel for the Underwriter) so that, as so amended or supplemented, the
Prospectus will not include an untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances existing at the time it is
delivered to a purchaser, not misleading, and the Company will furnish
to the Underwriter a reasonable number of copies of such amendment or
supplement.
(f) The Company will endeavor, in cooperation with the
Underwriter, to qualify the Securities for offering and sale under the
applicable securities laws of such states and other jurisdictions of the
United States as the Underwriter may designate; provided, however, that
the Company shall not be obligated to qualify as a foreign corporation
in any jurisdiction in which it is not so qualified. In each
jurisdiction in which the Securities have been so qualified, the Company
will file such statements and reports as may be required by the laws of
such jurisdiction to continue such qualification in effect for so long
as may be required by applicable law. The Company will promptly advise
the Underwriter of the receipt by the Company of any notification with
respect to the suspension of qualification of the Securities for sale in
any state or jurisdiction or the initiating or threatening of any
proceeding for such purpose.
(g) The Company will make generally available to its security
holders as soon as practicable, but not later than 60 days after the
close of the period covered thereby (or 120 days in the case of the
close of the Company's fiscal year), an earnings statement (in form
complying with the provisions of Rule 158 of the 1933 Act Regulations)
covering a twelve month period beginning not later than the first day
of the Company's fiscal quarter next following the "effective date" (as
defined in said Rule 158) of the Current Registration Statement.
(h) The Company will use the net proceeds received by it from
the sale of the Securities in the manner to be specified in the
Prospectus Supplement under "Use of Proceeds".
(i) Immediately following the execution of this Agreement, the
Company will prepare a prospectus supplement, dated the date hereof (the
"Prospectus Supplement"), containing the terms of the Securities, the
plan of distribution thereof and such other information as may be
required by the 1933 Act or the 1933 Act Regulations or as the
Underwriter and the Company deem appropriate, and will file or transmit
for filing with the Commission in accordance with such Rule 424(b) of
the 1933 Act Regulations copies of the Prospectus (including such
Prospectus Supplement).
(j) The Company, during the period when the Prospectus is
required to be delivered under the 1933 Act or the 1934 Act, will file
all documents required to be filed with the Commission pursuant to
Sections 13, 14 or 15 of the 1934 Act within the time periods required
by the 1934 Act and the 1934 Act Regulations. For a period of five
years after the Closing Time, the Company will furnish to the
Underwriter copies of all reports and communications delivered to the
Company's stockholders or to holders of the Securities as a class and
will also furnish copies of all reports (excluding exhibits) filed
with the Commission on forms 8-K, 10-Q and 10-K, and all other
reports and information furnished to its stockholders generally, not
later than the time such reports are first furnished to its
stockholders generally.
(k) During a period from the date of this Agreement through
December 31, 1996, the Company will not, without the Underwriter's prior
written consent, directly or indirectly, sell, offer to sell, grant any
option for the sale of, or otherwise dispose of, any debt securities or
any securities convertible into or exchangeable or exercisable for any
debt securities (except for the Securities sold to the Underwriter
pursuant to this Agreement); provided that the foregoing shall not
prevent the Company from making borrowings under the Loan Agreement or
under bank credit lines.
(l) In accordance with the Cuba Act and without limitation to
the provisions of Sections 6 and 7 hereof, the Company agrees to
indemnify and hold harmless the Underwriter from and against any and all
loss, liability, claim, damage and expense whatsoever (including fees
and disbursements of counsel), as incurred, arising out of any
violation by the Company of the Cuba Act.
SECTION 4. Payment of Expenses. The Company will pay all expenses
incident to the performance of its obligations under this Agreement, including
(i) the printing and filing of each Registration Statement as originally filed
and of each amendment thereto, (ii) the printing or reproduction of this
Agreement and the Indenture (iii) the preparation, issuance and delivery of
the certificates for the Securities to the Underwriter, (iv) the fees and
disbursements of the Company's counsel and accountants, (v) the qualification
of the Securities under securities laws in accordance with the provisions of
Section 3(f) hereof, including filing fees and the reasonable fees and
disbursements of counsel for the Underwriter in connection therewith and in
connection with the preparation of the Blue Sky Survey, (vi) the printing and
delivery to the Underwriter of copies of each Registration Statement as
originally filed and of each amendment thereto, of the preliminary
prospectuses and any preliminary prospectus supplements, and of the Prospectus
and any amendments or supplements thereto, (vii) the printing and delivery to
the Underwriter of copies of the Blue Sky Survey, (viii) the fees and expenses
of the Trustee, including the fees and disbursements of counsel for the
Trustee in connection with the Indenture and the Securities, (ix) any fees
payable in connection with the rating of the Securities; and (x) any fees and
expenses of a depositary in connection with holding the Securities in
book-entry form. Concurrently with the purchase of the Securities at the
Closing Time pursuant to Section 2(a) hereto, the Underwriter will pay the
Company $101,250 (by wire transfer of immediately available funds) as
reimbursement for a portion of the Company's expenses in connection with the
offering of the Securities.
If this Agreement is terminated by the Underwriter in accordance with
the provisions of Section 5 or Section 9(a)(i), the Company shall reimburse
the Underwriter for all of its out-of-pocket expenses, including the
reasonable fees and disbursements of counsel for the Underwriter.
SECTION 5. Conditions of Underwriter's Obligations. The obligations of
the Underwriter hereunder are subject to the accuracy of the representations
and warranties of the Company herein contained, to the performance by the
Company of its obligations hereunder, and to the following further conditions:
(a) At Closing Time no stop order suspending the effectiveness
of any Registration Statement shall have been issued under the 1933 Act
or proceedings therefor initiated or threatened by the Commission. The
Prospectus (including the Prospectus Supplement referred to in Section
3(i) hereof) shall have been filed or transmitted for filing with the
Commission pursuant to Rule 424(b) of the 1933 Act Regulations within
the prescribed time period, and prior to Closing Time the Company shall
have provided evidence satisfactory to the Underwriter of such timely
filing or transmittal.
(b) At Closing Time the Underwriter shall have received:
(1) The favorable opinion, dated as of Closing Time, of Davis
Polk & Wardwell, counsel for the Company, in form and substance
satisfactory to counsel for the Underwriter, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
State of Delaware.
(ii) The Indenture has been duly authorized, executed and
delivered by the Company and (assuming the due authorization,
execution and delivery thereof by the Trustee) constitutes a valid
and binding agreement of the Company, enforceable against the
Company in accordance with its terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting
enforcement of creditors' rights generally or by general equitable
principles.
(iii) The Securities are in the form established pursuant to
the Indenture, have been duly authorized for issuance and sale by
the Company and, when issued by the Company, authenticated by the
Trustee in the manner provided for in the Indenture and delivered
pursuant to the provisions of the Indenture and this Agreement
against payment of the purchase price therefor specified herein,
will constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms,
except as the enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws
relating to or affecting enforcement of creditors' rights
generally or by general equitable principles, and will be entitled
to the benefits of the Indenture.
(iv) The issuance and delivery of the Securities, the
execution and delivery of this Agreement and the Indenture, and
the consummation of the transactions contemplated herein and
therein, will not conflict with or constitute a breach of, or
default under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the
Company or any of its Significant Subsidiaries pursuant to, the
Senior Notes, the Senior Indenture, the Senior Subordinated Notes
or the Senior Subordinated Indenture.
(v) The Indenture has been qualified under the 1939 Act.
(vi) This Agreement has been duly authorized, executed and
delivered by the Company.
(vii) The Securities and the Indenture conform in all
material respects to the descriptions thereof contained in the
Prospectus.
(viii) Each Registration Statement is effective under the
1933 Act and, to the best of such counsel's knowledge and
information, no stop order suspending the effectiveness of any
Registration Statement has been issued under the 1933 Act or
proceedings therefor initiated or threatened by the Commission.
(ix) At the respective times the Registration Statements
became effective and at the Representation Date, the Registration
Statements (other than the financial statements and supporting
schedules included or incorporated by reference therein, as to
which no opinion need be rendered) complied as to form in all
material respects with the requirements of the 1933 Act and the
1933 Act Regulations.
(2) The favorable opinion, dated as of Closing Time, of Barton
P. Pachino, Esq., Senior Vice President and General Counsel of the
Company, in form and substance satisfactory to counsel for the
Underwriter, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
State of Delaware and has corporate power and authority to own,
lease and operate its properties and to conduct its business as
described in the Prospectus.
(ii) To the best of such counsel's knowledge and
information, the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, except where
the failure to so qualify would not have a material adverse effect
on the condition, financial or otherwise, or the earnings,
business affairs or business prospects of the Company and its
subsidiaries (as such term is defined in this Agreement)
considered as one enterprise.
(iii) Each of the Company's Significant Domestic
Subsidiaries (as defined below) has been duly organized and is
validly existing as a corporation or limited partnership, as the
case may be, in good standing under the laws of the jurisdiction
of its incorporation or formation, as the case may be, has power
and authority as a corporation or limited partnership, as the case
may be to own, lease and operate its properties and to conduct its
business as described in the Prospectus and, to the best of such
counsel's knowledge and information, is duly qualified to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the
failure to so qualify would not have a material adverse effect on
the Company and its subsidiaries considered as one enterprise or on
their consolidated financial condition or earnings; to the best of
such counsel's knowledge and information, all of the issued and
outstanding capital stock of each such Significant Domestic
Subsidiary which is a corporation has been duly authorized and
validly issued, is fully paid and non-assessable and is owned
(except for directors qualifying shares and a nominal number of
shares held by affiliated parties) by the Company, directly or
through subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity; and to the
best of such counsel's knowledge and information, all of the issued
and outstanding partnership interests in each such Significant
Domestic Subsidiary which is a limited partnership have been duly
authorized (if applicable) and validly issued, are fully paid and
non-assessable and are owned by the Company (except to the extent
that a minority interest in such limited partnership is reflected
in the Company's consolidated financial statements included or
incorporated by reference in the Prospectus), directly or through
subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity. As used in this
Agreement, the term "Significant Domestic Subsidiaries" means the
Significant Subsidiaries set forth in subsections (A), (B), (C),
(D), (E), (F) and (G) of Schedule B hereto, other than those
Significant Subsidiaries whose names are marked with an
asterisk on Schedule A hereto.
(iv) The authorized, issued and outstanding capital stock
of the Company is as set forth in the Prospectus under
"Capitalization" (except for subsequent issuances, if any,
pursuant to the exercise of options issued under employee benefit
plans referred to in the Prospectus or in the documents
incorporated by reference therein); and the shares of issued and
outstanding Common Stock have been duly authorized and validly
issued and are fully paid and non-assessable.
(v) To the best of such counsel's knowledge and
information, there are no statutes or regulations required to be
described in the Registration Statements or the Prospectus or in
the documents incorporated by reference therein which are not
described as required and there are no legal or governmental
proceedings pending or threatened which are required to be
disclosed in the Registration Statements or in the documents
incorporated by reference therein, other than those disclosed
therein, and all pending legal or governmental proceedings to
which the Company or any subsidiary is a party or to which any of
their property is subject which are not described in or
incorporated by reference in the Registration Statements,
including ordinary routine litigation incidental to the
business, are, considered in the aggregate and net of reserves
and insurance, not material to the Company and its subsidiaries
considered as one enterprise.
(vi) The information under "Item 1. Business--Regulation
and Environmental Matters" in the Company's 1995 Annual Report and
in Item 15 in Part II of the Registration Statements, to the
extent that such information constitutes matters of law, summaries
of legal matters, summaries of securities, instruments, agreements
or other documents or legal conclusions, has been reviewed by such
counsel and is correct in all material respects.
(vii) To the best of such counsel's knowledge and
information, there are no contracts, indentures, mortgages, loan
agreements, notes, leases or other instruments required to be
described or referred to in the Registration Statements or to be
filed or incorporated by reference as exhibits thereto other than
those described or referred to or filed as exhibits thereto, the
descriptions thereof or references thereto are correct, and, to
the best of such counsel's knowledge, no default exists in the due
performance or observance of any obligation, agreement, covenant
or condition contained in (A) any Subject Instrument or (B) any
other contract, indenture, mortgage, loan agreement, note, lease
or other instrument so described, referred to or filed or
incorporated by reference, which default (other than in the case
of the Subject Instruments) could have a material adverse effect
on the Company and its subsidiaries considered as one enterprise
or on their consolidated financial condition or earnings.
(viii) No authorization, approval, consent or order of any
court or governmental authority or agency is required in
connection with the sale of the Securities to the Underwriter,
except such as may be required under the 1933 Act, the 1933 Act
Regulations, the 1939 Act, the 1939 Act Regulations or state
securities laws.
(ix) The issuance and delivery of the Securities, the
execution and delivery of this Agreement and the Indenture, and
the consummation of the transactions contemplated herein and
therein, will not conflict with or constitute a breach of, or
default under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the
Company or any of its Significant Subsidiaries pursuant to, (A)
any Subject Instrument or (B) to the best of such counsel's
knowledge and information, any other contract, indenture,
mortgage, loan agreement, note, lease or other instrument to which
the Company or any of its Significant Subsidiaries is a party or
by which it or any of them may be bound, or to which any of the
property or assets of the Company or any of its Significant
Subsidiaries is subject, nor will such action result in any
violation of the provisions of the charter or by-laws of the
Company, or any applicable law, administrative regulation or
administrative or court decree.
(x) The documents incorporated or deemed to be
incorporated by reference in the Prospectus (other than the
financial statements and supporting schedules included or
incorporated by reference therein, as to which no opinion need be
rendered), at the time they were filed with the Commission,
complied as to form in all material respects with the requirements
of the 1934 Act and the 1934 Act Regulations.
(xi) To the best of such counsel's knowledge and
information, no default with respect to any Indebtedness (as such
term is defined in the Prospectus) of the Company or any of its
subsidiaries entitling, or which, with notice or lapse of time or
both, would entitle, the holders thereof to accelerate the
maturity thereof exists or will exist as a result of the execution
and delivery of this Agreement or the Indenture, the issuance and
sale of the Securities or the consummation of the transactions
contemplated hereby or thereby.
In giving such opinion, such counsel may rely, as to matters
governed by laws other than the laws of the States of California
and Delaware and the federal law of The United States of America,
on an opinion or opinions of local counsel satisfactory to the
Underwriter, so long as each such opinion shall be dated as of the
Closing Time and in form and substance satisfactory to the
Underwriter, and shall expressly permit the Underwriter to rely
thereon as if such opinion were addressed to the Underwriter.
(3) The favorable opinion, dated as of Closing Time, of
Brown & Wood llp, counsel for the Underwriter, with respect to the
matters set forth in (i) through (iii) and (v) through (ix) of
subsection (b)(1) of this Section.
(4) In giving their opinions required by subsections
(b)(1), (b)(2) and (b)(3), respectively, of this Section, Davis
Polk & Wardwell, Barton P. Pachino and Brown & Wood llp shall each
additionally state that nothing has come to their attention that
would lead them to believe that either Registration Statement
(except for financial statements and schedules and other financial
data included therein and the Form T-1, as to which counsel need
make no statement), at the time it became effective, contained an
untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus (except
for financial statements and schedules and other financial data
included therein, as to which counsel need make no statement), at
the Representation Date (unless the term "Prospectus" refers to a
prospectus which has been provided to the Underwriter by the
Company for use in connection with the offering of the Securities
which differs from the Prospectus filed with at the Commission
pursuant to Rule 424(b) of the 1933 Act Regulations, in which case
at the time it is first provided to the Underwriter for such use)
or at Closing Time, included or includes an untrue statement of a
material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
(c) At Closing Time, there shall not have been, since the date
hereof or since the respective dates as of which information is given in
the Registration Statements and the Prospectus, any material adverse
change in the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, and the Underwriter shall have received a
certificate of the President or a Vice President of the Company and of
the chief financial or chief accounting officer of the Company, dated as
of Closing Time, to the effect that (i) there has been no such material
adverse change, (ii) the representations and warranties in Section 1 are
true and correct with the same force and effect as though expressly made
at and as of Closing Time, (iii) the Company has complied with all
agreements and satisfied all conditions on its part to be performed or
satisfied at or prior to Closing Time, (iv) no stop order suspending the
effectiveness of any Registration Statement has been issued and, to the
best of such officer's knowledge and information, no proceedings for
that purpose have been initiated or threatened by the Commission and (v)
the rating assigned by any nationally recognized statistical rating
organization to any debt securities of the Company has not been lowered
and no such rating agency has publicly announced that it has placed any
debt securities of the Company on what is commonly termed a "watch list"
for a possible downgrading. As used in this Section 5(c), the term
"Prospectus" means the Prospectus in the form first used to confirm
sales of the Securities.
(d) At the Closing Time, the Underwriter shall have received
from Ernst & Young LLP a letter dated such date, in form and substance
satisfactory to the Underwriter, containing statements and information
of the type ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and financial
information included and incorporated by reference in the Registration
Statements and the Prospectus (including, without limitation, the pro
forma financial statements).
(e) At Closing Time, the Securities shall have a rating of at
least Ba3 from Moody's Investor's Service Inc. and B+ from Standard &
Poor's Corporation, and the Company shall have delivered to the
Underwriter a letter from each such rating agency or other evidence
satisfactory to the Underwriter, confirming that the Securities have
such ratings.
(f) At Closing Time, counsel for the Underwriter shall have been
furnished with such documents and opinions as they may require for the
purpose of enabling them to pass upon the issuance and sale of the
Securities as herein contemplated and related proceedings, or in order
to evidence the accuracy of any of the representations or warranties, or
the fulfillment of any of the conditions, herein contained; and all
proceedings taken by the Company in connection with the issuance and
sale of the Securities as herein contemplated shall be satisfactory in
form and substance to the Underwriter and counsel for the Underwriter.
If any condition specified in this Section shall not have
been fulfilled when and as required to be fulfilled, this Agreement may be
terminated by the Underwriter by notice to the Company at any time at or prior
to Closing Time, and such termination shall be without liability of any party
to any other party except as provided in Section 4 hereof. Notwithstanding
any such termination, the provisions of Sections 4, 6, 7 and 8 shall remain in
effect.
SECTION 6. Indemnification.
(a) The Company agrees to indemnify and hold harmless the Underwriter
and each person, if any, who controls the Underwriter within the meaning of
Section 15 of the 1933 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in any
Registration Statement (or any amendment thereto), or the omission or
alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or
arising out of any untrue statement or alleged untrue statement of a
material fact contained in any preliminary prospectus, any preliminary
prospectus supplement or the Prospectus (or any amendment or supplement
thereto) or the omission or alleged omission therefrom of a material
fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or proceeding
by any governmental agency or body, commenced or threatened, or of any
claim whatsoever based upon any such untrue statement or omission, or
any such alleged untrue statement or omission, if such settlement is
effected with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including, subject to Section 6(c) hereof, the fees and disbursements
of counsel chosen by the Underwriter), reasonably incurred in
investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue statement or
omission, to the extent that any such expense is not paid under (i) or
(ii) above;
provided, however, that (A) the foregoing indemnity agreement shall not
apply to any loss, liability, claim, damage or expense to the extent
arising out of any untrue statement or omission or alleged untrue
statement or omission (1) made in reliance upon and in conformity with
written information furnished to the Company by the Underwriter expressly
for use in a Registration Statement (or any amendment thereto) or any
preliminary prospectus, preliminary prospectus supplement or the
Prospectus (or any amendment or supplement thereto) or (2) in the Form
T-1; and (B) the foregoing indemnity agreement with respect to any
preliminary prospectus or preliminary prospectus supplement shall not
inure to the benefit of the Underwriter from whom the person asserting any
such losses, claims, damages or liabilities purchased Securities, or any
person controlling such Underwriter, if a copy of the Prospectus (as may
then be amended or supplemented if the Company shall have furnished any
amendments or supplements thereto) was not sent or given by or on behalf
of such Underwriter to such person, if such is required by law, at or
prior to the written confirmation of the sale of such Securities to such
person and if the Prospectus (as so amended or supplemented) would have
cured the defect giving rise to such loss, claim, damage, liability or
expense.
(b) The Underwriter agrees to indemnify and hold harmless the Company,
its directors, each of its officers who signed any Registration Statement, and
each person, if any, who controls the Company within the meaning of Section 15
of the 1933 Act against any and all loss, liability, claim, damage and expense
described in the indemnity contained in subsection (a) of this Section, as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in any Registration Statement (or any
amendment thereto) or any preliminary prospectus, preliminary prospectus
supplement or the Prospectus (or any amendment or supplement thereto) in
reliance upon and in conformity with written information furnished to the
Company by the Underwriter expressly for use in such Registration Statement
(or any amendment thereto) or such preliminary prospectus, such preliminary
prospectus supplement or the Prospectus (or any amendment or supplement
thereto).
(c) Each indemnified party shall give written notice as promptly as
reasonably practicable to each indemnifying party of any action commenced
against it in respect of which indemnity may be sought hereunder, but failure
to so notify an indemnifying party shall not relieve such indemnifying party
from any liability which it may have otherwise than on account of this
indemnity agreement. An indemnifying party may participate at its own expense
in the defense of any such action. In no event shall the indemnifying parties
be liable for fees and expenses of more than one counsel (in addition to any
local counsel) separate from their own counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in
the same jurisdiction arising out of the same general allegations or
circumstances.
SECTION 7. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 6 is for any reason held to be unenforceable by the indemnified
parties although applicable in accordance with its terms, the Company and the
Underwriter shall contribute to the aggregate losses, liabilities, claims,
damages and expenses of the nature contemplated by said indemnity agreement
incurred by the Company and the Underwriter, as incurred, in such proportions
that the Underwriter is responsible for that portion represented by the
percentage that the underwriting discount (calculated as described below) with
respect to the Securities bears to the public offering price (calculated as
described below) of the Securities and the Company is responsible for the
balance; provided, however, that no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall
be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of the preceding sentence, the
public offering price of the Securities shall be deemed to be equal to 100% of
the principal amount thereof and the underwriting discount shall be deemed to
be equal to 1.75% of the principal amount thereof. For purposes of this
Section, each person, if any, who controls the Underwriter within the meaning
of Section 15 of the 1933 Act shall have the same rights to contribution as
the Underwriter, and each director of the Company, each officer of the Company
who signed any Registration Statement, and each person, if any, who controls
the Company within the meaning of Section 15 of the 1933 Act shall have the
same rights to contribution as the Company.
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement, or contained in certificates of officers of the Company submitted
pursuant hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of the Underwriter or any
controlling person, or by or on behalf of the Company, and shall survive
delivery of the Securities to the Underwriter.
SECTION 9. Termination of Agreement.
(a) The Underwriter may terminate this Agreement, by notice to the
Company, at any time at or prior to Closing Time (i) if there has been, since
the date of this Agreement or since the respective dates as of which
information is given in any Registration Statement, any material adverse
change in the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and its subsidiaries considered
as one enterprise, whether or not arising in the ordinary course of business,
or (ii) if there has occurred any material adverse change in the financial
markets in the United States or any outbreak of hostilities or escalation
thereof or other calamity or crisis the effect of which is such as to make it,
in the judgment of the Underwriter, impracticable to market the Securities or
to enforce contracts for the sale of the Securities, or (iii) if trading in
the securities of the Company has been suspended by the Commission or a
national securities exchange, or if trading generally on either the American
Stock Exchange or the New York Stock Exchange has been suspended, or minimum
or maximum prices for trading have been fixed, or maximum ranges for prices
for securities have been required, by either of said Exchanges or by order of
the Commission or any other governmental authority, or if a banking moratorium
has been declared by either federal, New York or California authorities, (iv)
if the rating assigned by any nationally recognized statistical rating
organization to any debt securities of the Company shall have been lowered or
if any such rating agency shall have publicly announced that it has placed any
debt securities of the Company on what is commonly termed a "watch list" for a
possible downgrading. As used in this Section 9(a), the term "Prospectus"
means the Prospectus in the form first used to confirm sales of the
Securities.
(b) If this Agreement is terminated pursuant to this Section, such
termination shall be without liability of any party to any other party except
as provided in Section 4 hereof. Notwithstanding any such termination, the
provisions of Sections 4, 6, 7 and 8 shall remain in effect.
SECTION 10. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriter shall be directed to it at 10900 Wilshire Boulevard, Los Angeles,
California 90024, attention of Mathew M. Pendo, Director; notices to the
Company shall be directed to it at 10990 Wilshire Boulevard, Los Angeles,
California 90024 attention of Michael F. Henn, Senior Vice President and
Chief Financial Officer.
SECTION 11. Parties. This Agreement shall inure to the benefit of and be
binding upon the Underwriter and the Company and their respective successors.
Nothing expressed or mentioned in this Agreement is intended or shall be
construed to give any person, firm or corporation, other than the Underwriter
and the Company and their respective successors and the controlling persons
and officers and directors referred to in Sections 6 and 7 and their heirs and
legal representatives, any legal or equitable right, remedy or claim under or
in respect of this Agreement or any provision contained herein. This
Agreement and all conditions and provisions hereof are intended to be for the
sole and exclusive benefit of the Underwriter and the Company and their
respective successors, and said controlling persons and officers and directors
and their heirs and legal representatives, and for the benefit of no other
person, firm or corporation. No purchaser of Securities from the Underwriter
shall be deemed to be a successor by reason merely of such purchase.
SECTION 12. Governing Law and Time. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York applicable
to agreements made and to be performed in said State. Unless otherwise set
forth herein, specified times of day refer to New York City time.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument, along with all counterparts, will become a binding
agreement between the Underwriter and the Company in accordance with its
terms.
Very truly yours,
KAUFMAN AND BROAD HOME CORPORATION
By: ________________________________
Michael F. Henn
Senior Vice President and
Chief Financial Officer
CONFIRMED AND ACCEPTED
as of the date first above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: _____________________________
Authorized Signatory
Schedule A
Significant Subsidiaries
A. California Corporations:
KBASW Mortgage Acceptance Corporation ("KBASW")*
KBI/Mortgage Acceptance Corporation ("KBI")*
KBRAC IV Mortgage Acceptance Corporation ("KBRAC")*
Kaufman and Broad - Central Valley, Inc.
Kaufman and Broad Coastal, Inc.
Kaufman and Broad International, Inc.
Kaufman and Broad of Northern California, Inc.
Kaufman and Broad of San Diego, Inc.
Kaufman and Broad - South Bay, Inc.
Kaufman and Broad of Southern California, Inc.
Kaufman and Broad of Texas, Inc.*
Kaufman and Broad of Utah, Inc.*
B. Colorado Corporation:
Kaufman and Broad of Colorado, Inc.
C. Delaware Corporations:
Kaufman and Broad Development Company*
Kaufman and Broad Limited*
D. Illinois Corporations:
Kaufman and Broad Mortgage Company
E. Nevada Corporations:
Kaufman and Broad of Nevada, Inc.
F. New Mexico Corporation:
Oppel Jenkins of Albuquerque, Inc.
G. Texas Corporation and Limited Partnership:
Kaufman and Broad of San Antonio, Inc.
Rayco, Ltd.
H. French Corporations:
Bati Service Development S.A.R.L.
Bati Service Promotion S.A.
Kaufman and Broad Developpement
Kaufman and Broad, France
Kaufman and Broad Maisons Individuelles S.A.
__________
* See Section 5(b)(2)(iii)
EXHIBIT 4.13
==============================================================================
KAUFMAN AND BROAD HOME CORPORATION
AND
SUNTRUST BANK, ATLANTA
Senior Subordinated Debt Indenture
Dated as of November 19, 1996
__________
==============================================================================
TABLE OF CONTENTS
__________
Page
----
PARTIES................................................................ 1
RECITALS
Authorization of Indenture........................................ 1
Compliance with Legal Requirements................................ 1
Purpose of and Consideration for Indenture........................ 1
ARTICLE ONE
DEFINITIONS
SECTION 1.1. Certain Terms Defined................................... 1
Affiliate ............................................ 2
Authenticating Agent.................................... 2
Authorized Newspaper.................................... 2
Bankruptcy Laws ...................................... 3
Board of Directors...................................... 3
Board Resolution........................................ 3
Business Day............................................ 3
Capital Lease .......................................... 3
Commission.............................................. 3
Corporate Trust Office.................................. 3
Coupon.................................................. 3
covenant defeasance..................................... 3
Debt ................................................... 3
Depositary.............................................. 4
Dollar.................................................. 4
ECU..................................................... 4
Event of Default........................................ 4
Foreign Currency........................................ 4
Holder, Holder of Securities,
Securityholder........................................ 4
Indenture............................................... 5
Interest................................................ 5
Issuer.................................................. 5
Issuer Order............................................ 5
Judgment Currency....................................... 5
Officers' Certificate................................... 5
Opinion of Counsel...................................... 5
Original Issue Discount Security........................ 5
Outstanding............................................. 5
Periodic Offering....................................... 6
Person.................................................. 7
principal............................................... 7
record date............................................. 7
Registered Global Security.............................. 7
Registered Security..................................... 7
Required Currency....................................... 7
Responsible Officer..................................... 7
Security or Securities.................................. 7
Senior Indebtedness .................................... 7
Subsidiary ............................................. 7
Trade Payables ......................................... 8
Trust Indenture Act of 1939............................. 8
Trustee................................................. 8
Unregistered Security................................... 8
U.S. Government Obligations............................. 8
Yield to Maturity....................................... 8
ARTICLE TWO
SECURITIES
SECTION 2.1. Forms Generally......................................... 8
SECTION 2.2. Form of Trustee's Certificate
of Authentication..................................... 9
SECTION 2.3. Amount Unlimited; Issuable in Series.................... 10
SECTION 2.4. Authentication and Delivery of
Securities............................................ 13
SECTION 2.5. Execution of Securities................................. 16
SECTION 2.6. Certificate of Authentication........................... 17
SECTION 2.7. Denomination and Date of
Securities; Payments of Interest...................... 17
SECTION 2.8. Registration, Transfer and Exchange..................... 19
SECTION 2.9. Mutilated, Defaced, Destroyed, Lost
and Stolen Securities................................. 23
SECTION 2.10. Cancellation of Securities;
Destruction Thereof................................... 24
SECTION 2.11. Temporary Securities.................................... 24
ARTICLE THREE
COVENANTS OF THE ISSUER
SECTION 3.1. Payment of Principal and Interest....................... 26
SECTION 3.2. Offices for Payments, etc............................... 26
SECTION 3.3. Appointment to Fill a Vacancy in
Office of Trustee..................................... 28
SECTION 3.4. Paying Agents........................................... 28
SECTION 3.5. Written Statement to Trustee............................ 29
SECTION 3.6. Luxembourg Publications................................. 29
SECTION 3.7. Limitation in Ranking of Future
Indebtedness.......................................... 29
ARTICLE FOUR
SECURITYHOLDERS LISTS AND REPORTS BY THE
ISSUER AND THE TRUSTEE
SECTION 4.1. Issuer to Furnish Trustee Information
as to Names and Addresses of
Securityholders....................................... 30
SECTION 4.2. Reports by the Issuer................................... 30
SECTION 4.3. Reports by the Trustee.................................. 30
ARTICLE FIVE
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 5.1. Event of Default Defined; Acceleration
of Maturity; Waiver of Default........................ 31
SECTION 5.2. Collection of Indebtedness by Trustee;
Trustee May Prove Debt................................ 34
SECTION 5.3. Application of Proceeds................................. 37
SECTION 5.4. Suits for Enforcement................................... 39
SECTION 5.5. Restoration of Rights on Abandonment
of Proceedings........................................ 39
SECTION 5.6. Limitations on Suits by
Securityholders....................................... 39
SECTION 5.7. Unconditional Right of
Securityholders to Institute
Certain Suits......................................... 40
SECTION 5.8. Powers and Remedies Cumulative;
Delay or Omission Not Waiver of
Default............................................... 40
SECTION 5.9. Control by Holders of Securities........................ 41
SECTION 5.10. Waiver of Past Defaults................................. 41
SECTION 5.11. Trustee to Give Notice of Default,
But May Withhold in Certain
Circumstances......................................... 42
SECTION 5.12. Right of Court to Require Filing
of Undertaking to Pay Costs........................... 43
ARTICLE SIX
CONCERNING THE TRUSTEE
SECTION 6.1. Duties and Responsibilities of the
Trustee; During Default; Prior to
Default............................................... 44
SECTION 6.2. Certain Rights of the Trustee........................... 45
SECTION 6.3. Trustee Not Responsible for Recitals,
Disposition of Securities or
Application of Proceeds Thereof....................... 47
SECTION 6.4. Trustee and Agents May Hold
Securities or Coupons;
Collections, etc...................................... 47
SECTION 6.5. Moneys Held by Trustee.................................. 47
SECTION 6.6. Compensation and Indemnification
of Trustee and Its Prior Claim........................ 47
SECTION 6.7. Right of Trustee to Rely on
Officers' Certificate, etc............................ 48
SECTION 6.8. Indentures Not Creating Potential
Conflicting Interests for the
Trustee............................................... 48
SECTION 6.9. Persons Eligible for Appointment
as Trustee............................................ 49
SECTION 6.10. Resignation and Removal; Appointment
of Successor Trustee.................................. 49
SECTION 6.11. Acceptance of Appointment by
Successor Trustee..................................... 51
SECTION 6.12. Merger, Conversion, Consolidation or
Succession to Business of Trustee..................... 52
SECTION 6.13. Appointment of Authenticating Agent..................... 53
ARTICLE SEVEN
CONCERNING THE SECURITYHOLDERS
SECTION 7.1. Evidence of Action Taken by
Securityholders....................................... 55
SECTION 7.2. Proof of Execution of Instruments and
of Holding of Securities.............................. 55
SECTION 7.3. Holders to be Treated as Owners......................... 56
SECTION 7.4. Securities Owned by Issuer Deemed Not
Outstanding........................................... 57
SECTION 7.5. Right of Revocation of Action Taken..................... 58
ARTICLE EIGHT
SUPPLEMENTAL INDENTURES
SECTION 8.1. Supplemental Indentures Without
Consent of Securityholders............................ 58
SECTION 8.2. Supplemental Indentures With Consent
of Securityholders.................................... 60
SECTION 8.3. Effect of Supplemental Indenture........................ 62
SECTION 8.4. Documents to Be Given to Trustee........................ 63
SECTION 8.5. Notation on Securities in Respect of
Supplemental Indentures............................... 63
SECTION 8.6. Subordination Unimpaired................................ 63
ARTICLE NINE
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 9.1. Issuer May Consolidate, etc., on
Certain Terms......................................... 63
SECTION 9.2. Successor Corporation Substituted....................... 64
SECTION 9.3. Opinion of Counsel Delivered
to Trustee............................................ 65
ARTICLE TEN
SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS
SECTION 10.1. Satisfaction and Discharge of
Indenture............................................. 65
SECTION 10.2. Application by Trustee of Funds
Deposited for Payment of Securities.................... 72
SECTION 10.3. Repayment of Moneys Held by Paying
Agent................................................. 73
SECTION 10.4. Return of Moneys Held By Trustee and
Paying Agent Unclaimed for Two
Years................................................. 73
SECTION 10.5. Indemnity for U.S. Government
Obligations........................................... 73
ARTICLE ELEVEN
MISCELLANEOUS PROVISIONS
SECTION 11.1. Incorporators, Stockholders, Officers
and Directors of Issuer Exempt from
Individual Liability.................................. 74
SECTION 11.2. Provisions of Indenture for the Sole
Benefit of Parties, Holders of
Senior Indebtedness and Holders of
Securities and Coupons................................ 74
SECTION 11.3. Successors and Assigns of Issuer
Bound by Indenture.................................... 74
SECTION 11.4. Notices and Demands on Issuer,
Trustee and Holders of Securities
and Coupons........................................... 75
SECTION 11.5. Officers' Certificates and Opinions
of Counsel; Statements to Be Contained therein........ 75
SECTION 11.6. Payments Due on Saturdays, Sundays
and Holidays.......................................... 77
SECTION 11.7. Conflict of Any Provision of
Indenture with Trust Indenture
Act of 1939........................................... 77
SECTION 11.8. New York Law to Govern.................................. 77
SECTION 11.9. Counterparts............................................ 77
SECTION 11.10. Effect of Headings...................................... 77
SECTION 11.11. Securities in a Foreign Currency
or in ECU............................................. 77
SECTION 11.12. Judgment Currency....................................... 78
ARTICLE TWELVE
REDEMPTION OF SECURITIES AND SINKING FUNDS
SECTION 12.1. Applicability of Article................................ 79
SECTION 12.2. Notice of Redemption; Partial
Redemptions........................................... 79
SECTION 12.3. Payment of Securities Called for
Redemption............................................ 81
SECTION 12.4. Exclusion of Certain Securities from
Eligibility for Selection for
Redemption............................................ 82
SECTION 12.5. Mandatory and Optional Sinking
Funds................................................. 83
ARTICLE THIRTEEN
SUBORDINATION
SECTION 13.1 Securities and Coupons Subordinate
to Senior Indebtedness................................ 86
SECTION 13.2 Payment Over of Proceeds Upon
Dissolution, Etc...................................... 87
SECTION 13.3 Acceleration of Securities.............................. 89
SECTION 13.4 Default on Senior Indebtedness.......................... 89
SECTION 13.5 Payment Permitted if No Default......................... 91
SECTION 13.6 Subrogation to Rights of Holders of
Senior Indebtedness................................... 91
SECTION 13.7 Provisions Solely to Define Relative Rights............. 91
SECTION 13.8 Trustee to Effectuate Subordination..................... 92
SECTION 13.9 No Waiver of Subordination Provisions................... 93
SECTION 13.10 Notice to Trustee....................................... 94
SECTION 13.11 Reliance on Judicial Order or
Certificate of Liquidating Agent...................... 95
SECTION 13.12 Trustee Not Fiduciary for Holders of Senior
Indebtedness.......................................... 95
SECTION 13.13 Rights of Trustee as Holder of Senior
Indebtedness; Preservation of Trustee's Rights........ 96
SECTION 13.14 Article 13 Applicable to Paying Agents.................. 96
THIS INDENTURE, dated as of November 19, 1996 between KAUFMAN AND
BROAD HOME CORPORATION, a Delaware corporation (the "Issuer"), and SUNTRUST
BANK, ATLANTA, as trustee (the "Trustee"),
W I T N E S S E T H :
WHEREAS, the Issuer has duly authorized the issue from time to time
of its unsecured debentures, notes or other evidences of indebtedness to be
issued in one or more series (the "Securities") up to such principal amount or
amounts as may from time to time be authorized in accordance with the terms of
this Indenture;
WHEREAS, the Issuer has duly authorized the execution and delivery
of this Indenture to provide, among other things, for the authentication,
delivery and administration of the Securities; and
WHEREAS, all things necessary to make this Indenture a valid
indenture and agreement according to its terms have been done;
NOW, THEREFORE:
In consideration of the premises and the purchases of the Securities
by the Holders thereof, the Issuer and the Trustee mutually covenant and agree
for the equal and proportionate benefit of the respective Holders from time to
time of the Securities and of the coupons, if any, appertaining thereto as
follows:
ARTICLE ONE
DEFINITIONS
SECTION 1.1 Certain Terms Defined. The following terms (except as
otherwise expressly provided or unless the context otherwise clearly requires)
for all purposes of this Indenture and of any indenture supplemental hereto
shall have the respective meanings specified in this Section. All other terms
used in this Indenture that are defined in the Trust Indenture Act of 1939 or
the definitions of which in the Securities Act of 1933 are referred to in the
Trust Indenture Act of 1939, including terms defined therein by reference to
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 said Trust Indenture Act and in said Securities Act as in force
at the date of this Indenture. Except as otherwise provided with respect to
the Securities of any series as contemplated by Section 2.3, all accounting
terms used herein and not expressly defined shall have the meanings assigned
to such terms in accordance with generally accepted accounting principles, and
the term "generally accepted accounting principles" means such accounting
principles as are generally accepted at the time of any computation. 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. The terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the
singular.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified Person. For the purposes of this
definition, "control" when used with respect to any specified Person means the
power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Authenticating Agent" shall have the meaning set forth in Section
6.13.
"Authorized Newspaper" means a newspaper (which, in the case of The
City of New York, will, if practicable, be The Wall Street Journal (Eastern
Edition), in the case of the United Kingdom, will, if practicable, be the
Financial Times (London Edition) and, in the case of Luxembourg, will, if
practicable, be the Luxemburger Wort) published in an official language of the
country of publication customarily published at least once a day for at least
five days in each calendar week and of general circulation in The City of New
York, the United Kingdom or in Luxembourg, as applicable. If it shall be
impractical in the opinion of the Trustee to make any publication of any
notice required hereby in an Authorized Newspaper, any publication or other
notice in lieu thereof which is made or given with the approval of the Trustee
shall constitute a sufficient publication of such notice.
"Bankruptcy Laws" means Title 11, United States Code, or any
similar Federal or state law for the relief of debtors.
"Board of Directors" means either the Board of Directors of the
Issuer or any committee of such Board duly authorized to act on its behalf.
"Board Resolution" means a copy of one or more resolutions,
certified by the secretary or an assistant secretary of the Issuer to have
been duly adopted or consented to by the Board of Directors and to be in full
force and effect, and delivered to the Trustee.
"Business Day" means, with respect to any Security, 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 form of such Security or in or pursuant to this
Indenture, is not a day on which banking institutions are authorized or
required by law or regulation to close.
"Capital Lease" means with respect to any Person at any date,
any lease of property the liability under which, in accordance with generally
accepted accounting principles, is required to be capitalized on such person's
balance sheet or for which the amount of the liability thereunder is required
to be disclosed in a note to such balance sheet.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act of 1934,
or if at any time after the execution and delivery of this Indenture such
Commission is not existing and performing the duties now assigned to it under
the Trust Indenture Act, then the body performing such duties on such date.
"Corporate Trust Office" means the office of the Trustee at which
the corporate trust business of the Trustee shall, at any particular time, be
principally administered, which office is, at the date as of which this
Indenture is dated, located in Atlanta, Georgia.
"Coupon" means any interest coupon appertaining to a Security.
"covenant defeasance" shall have the meaning set forth in Section
10.1(C).
"Debt" means with respect to any Person at any date, without
duplication, (i) all obligations of such Person for borrowed money, (ii) all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments, (iii) all obligations of such Person in respect of
letters of credit or other similar instruments (or reimbursement obligations
with respect thereto), (iv) all obligations of such Person to pay the deferred
purchase price of property or services, except Trade Payables, (v) all
obligations of such Person as lessee under Capital Leases, (vi) all Debt of
others for the payment of which such Person is responsible or liable as
obligor or guarantor and (vii) all Debt of others secured by a Lien on any
asset of such Person, whether or not such Debt is assumed by such Person.
"Depositary" means, with respect to the Securities of any series
issuable or issued in the form of one or more Registered Global Securities,
the Person designated as Depositary by the Issuer pursuant to Section 2.3
until a successor Depositary shall have become such pursuant to the applicable
provisions of this Indenture, and thereafter "Depositary" shall mean or
include each Person who is then a Depositary hereunder, and if at any time
there is more than one such Person, "Depositary" as used with respect to the
Securities of any such series shall mean the Depositary with respect to the
Registered Global Securities of that series.
"Dollar" means the coin or currency of the United States of America
as at the time of payment is legal tender for the payment of public and
private debts.
"ECU" means the European Currency Unit as defined and revised from
time to time by the Council of the European Communities.
"Event of Default" means, except as otherwise provided with respect
to the Securities of any series as contemplated by Section 2.3, any event or
condition specified as such in Section 5.1.
"Foreign Currency" means such coin or currency issued by the
government of a country other than the United States as at the time of payment
is legal tender for the payment of public or private debts in such country.
"Holder", "Holder of Securities", "Securityholder" or other similar
terms mean (a) in the case of any Registered Security, the Person in whose
name such Security is registered in the security register kept by the Issuer
for that purpose in accordance with the terms hereof, and (b) in the case of
any Unregistered Security, the bearer of such Security, or any Coupon
appertaining thereto, as the case may be.
"Indenture" means this instrument as originally executed and
delivered or, if amended or supplemented as herein provided, as so amended or
supplemented or both, and shall include the forms and terms of particular
series of Securities established as contemplated hereunder.
"Interest" means, when used with respect to non-interest bearing
Securities, interest payable after maturity.
"Issuer" means (except as otherwise provided in Article Six) Kaufman
and Broad Home Corporation, a Delaware corporation and, subject to Article
Nine, its successors and permitted assigns.
"Issuer Order" means a written statement, request or order of the
Issuer signed in its name by the chairman or vice chairman of the Board of
Directors, the president, any vice president or the treasurer of the Issuer.
"Judgment Currency" shall have the meaning set forth in Section
11.12.
"Officers' Certificate" means a certificate signed by the chairman
or vice chairman of the Board of Directors, the president or any vice
president and by the treasurer or the secretary or any assistant secretary of
the Issuer and delivered to the Trustee. Each such certificate shall comply
with Section 314 of the Trust Indenture Act of 1939 and include the statements
provided for in Section 11.5.
"Opinion of Counsel" means an opinion in writing signed by the
General Counsel of the Issuer or by such other legal counsel who may be an
employee of or counsel to the Issuer and who shall be satisfactory to the
Trustee. Each such opinion shall comply with Section 314 of the Trust
Indenture Act of 1939 and include the statements provided for in Section 11.5.
"Original Issue Discount Security" means any Security that provides
for an amount less than the principal amount thereof to be due and payable
upon a declaration of acceleration of the maturity thereof pursuant to Section
5.1.
"Outstanding", when used with reference to Securities, shall,
subject to the provisions of Section 7.4, mean, as of any particular time, all
Securities authenticated and delivered by the Trustee under this Indenture,
except
(a) Securities theretofore cancelled by the Trustee or
delivered to the Trustee for cancellation;
(b) Securities, or portions thereof, for the payment or
redemption of which moneys or U.S. Government Obligations (as
provided for in Section 10.1) in the necessary amount shall have been
deposited in trust with the Trustee or with any paying agent (other
than the Issuer) or shall have been set aside, segregated and held in
trust by the Issuer for the Holders of such Securities (if the Issuer
shall act as its own paying agent if permitted to do so hereunder),
provided that if such Securities, or portions thereof, are to be
redeemed prior to the maturity thereof, notice of such redemption
shall have been given as herein provided, or provision satisfactory
to the Trustee shall have been made for giving such notice; and
(c) Securities which shall have been paid or in substitution
for which other Securities shall have been authenticated and
delivered pursuant to the terms of Section 2.9 (except with respect
to any such Security as to which proof satisfactory to the Trustee is
presented that such Security is held by a Person in whose hands such
Security is a legal, valid and binding obligation of the Issuer).
In determining whether the Holders of the requisite principal amount
of Outstanding Securities of any or all series have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, the principal
amount of an Original Issue Discount Security that shall be deemed to be
Outstanding for such purposes shall be the amount of the principal thereof
that would be due and payable as of the date of such determination upon a
declaration of acceleration of the maturity thereof pursuant to Section 5.1.
"Periodic Offering" means an offering of Securities of a series from
time to time, the specific terms of which Securities, including, without
limitation, the rate or rates of interest, if any, thereon, the stated maturity
or maturities thereof and the redemption provisions, if any, with respect
thereto, are to be determined by the Issuer or its agents upon the issuance of
such Securities.
"Person" means any individual, corporation, partnership, joint
venture, association, joint stock company, trust, unincorporated organization
or government or any agency or political subdivision thereof.
"principal" whenever used with reference to the Securities or any
Security or any portion thereof, shall be deemed to include "and premium, if
any".
"record date" shall have the meaning set forth in Section 2.7.
"Registered Global Security", means a Security evidencing all or a
part of a series of Registered Securities, issued to the Depositary for such
series in accordance with Section 2.4, and bearing the legend prescribed in
Section 2.4.
"Registered Security" means any Security registered on the Security
register of the Issuer.
"Required Currency" shall have the meaning set forth in Section
11.12.
"Responsible Officer" when used with respect to the Trustee means
the chairman of its Board of Directors, any vice chairman of its Board of
Directors, the chairman of its trust committee, the chairman of its executive
committee, any vice chairman of its executive committee, the president, any
vice president (whether or not designated by numbers or words added before or
after the title "vice president"), the cashier, the secretary, the treasurer,
any trust officer, any assistant trust officer, any assistant vice president,
any assistant cashier, any assistant secretary, any assistant treasurer, or
any other officer or assistant officer of the Trustee customarily performing
functions similar to those performed by the persons who at the time shall be
such officers, respectively, or to whom any corporate trust matter is referred
because of his knowledge of and familiarity with the particular subject.
"Security" or "Securities" has the meaning stated in the first
recital of this Indenture, or, as the case may be, Securities that have been
authenticated and delivered under this Indenture.
"Senior Indebtedness" shall have the meaning set forth in
Section 13.1.
"Subsidiary" means (i) any corporation at least a majority of
the aggregate voting power of the Common Stock of which is owned by any
Person, directly or through one or more other Subsidiaries of such Person, and
(ii) any entity other than a corporation at least a majority of the Common
Stock of which is owned by any Person, directly or through one or more other
Subsidiaries of such Person.
"Trade Payables" means, with respect to any Person, accounts
payable or any other indebtedness or monetary obligations to trade creditors
created or assumed by such Person in the ordinary course of business in
connection with the obtaining of materials or services.
"Trust Indenture Act of 1939" (except as otherwise provided in
Section 8.3) means the Trust Indenture Act of 1939 as in force at the date as
of which this Indenture was originally executed.
"Trustee" means the Person identified as "Trustee" in the first
paragraph hereof and, subject to the provisions of Article Six, shall also
include any successor trustee. "Trustee" shall also mean or include each
Person who is then a trustee hereunder and if at any time there is more than
one such Person, "Trustee" as used with respect to the Securities of any
series shall mean the trustee with respect to the Securities of such series.
"Unregistered Security" means any Security other than a Registered
Security.
"U.S. Government Obligations" shall have the meaning set forth in
Section 10.1(A).
"Yield to Maturity" means the yield to maturity on a series of
Securities, calculated at the time of issuance of such series, or, if
applicable, at the most recent redetermination of interest on such series, and
calculated in accordance with accepted financial practice.
ARTICLE TWO
SECURITIES
SECTION 2.1 Forms Generally. The Securities of each series and the
Coupons, if any, to be attached thereto shall be substantially in such form
(not inconsistent with this Indenture) as shall be established by or pursuant
to one or more Board Resolutions or Officers' Certificates or in one or more
indentures supplemental hereto, in each case with such appropriate insertions,
omissions, substitutions and other variations as are required or permitted by
this Indenture and may have imprinted or otherwise reproduced thereon such
legend or legends or endorsements, not inconsistent with the provisions of
this Indenture, as may be required to comply with any law or with any rules or
regulations pursuant thereto, or with any rules of any securities exchange or
to conform to general usage, all as may be determined by the officers
executing such Securities and Coupons, if any, as evidenced by their execution
of such Securities and Coupons.
The definitive Securities and Coupons, if any, shall be printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined by the officers executing such Securities and
Coupons, if any, as evidenced by their execution of such Securities and
Coupons, if any.
SECTION 2.2 Form of Trustee's Certificate of Authentication. The
Trustee's certificate of authentication on all Securities shall be in
substantially the following form:
"This is one of the Securities referred to in the within-mentioned
Senior Subordinated Debt Indenture.
______________________,
as Trustee
By_____________________
Authorized Officer"
If at any time there shall be an Authenticating Agent appointed with
respect to any series of Securities, then the Trustee's Certificate of
Authentication to be borne by the Securities of such series shall be
substantially as follows:
"This is one of the Securities referred to in the within-mentioned
Indenture.
_________________________,
as Authenticating Agent
By_______________________
Authorized Officer"
SECTION 2.3 Amount Unlimited; Issuable in Series. The aggregate
principal amount of Securities which may be authenticated and delivered under
this Indenture is unlimited.
The Securities may be issued in one or more series and the
Securities of each such series shall rank equally and pari passu with the
Securities of each other series, but all Securities issued hereunder shall be
subordinate and junior in right of payment, to the extent and in the manner
set forth in Article Thirteen, to all Senior Indebtedness of the Issuer.
There shall be established in or pursuant to one or more Board Resolutions or
Officers' Certificates or in one or more indentures supplemental hereto, prior
to the initial issuance of Securities of any series,
(1) the designation of the Securities of the series, which
shall distinguish the Securities of the series from the Securities of
all other series;
(2) any limit upon the aggregate principal amount of the
Securities of the series that may be authenticated and delivered
under this Indenture (except for Securities authenticated and
delivered upon registration of transfer of, or in exchange for, or in
lieu of, other Securities of the series pursuant to Section 2.8, 2.9,
2.11, 8.5 or 12.3 or pursuant to any provision of this Indenture
providing for redemption, repayment or repurchase of Securities of
such Series in whole or in part);
(3) if other than Dollars, the coin or currency in which the
Securities of that series are denominated (including, but not limited
to, any Foreign Currency or ECU);
(4) the date or dates on which the principal of the Securities
of the series is payable;
(5) the rate or rates at which the Securities of the series
shall bear interest, if any, the date or dates from which such
interest shall accrue, on which such interest shall be payable and
(in the case of Registered Securities) on which a record shall be
taken for the determination of Holders to whom interest is payable
and/or the method by which such rate or rates or date or dates shall
be determined;
(6) the place or places where the principal of and any interest
on Securities of the series shall be payable (if other than as
provided in Section 3.2);
(7) the right, if any, of the Issuer to redeem Securities, in
whole or in part, at its option and the period or periods within
which, the price or prices at which and any terms and conditions upon
which Securities of the series may be so redeemed, pursuant to any
sinking fund or otherwise;
(8) the obligation, if any, of the Issuer to redeem, purchase
or repay Securities of the series pursuant to any mandatory
redemption, sinking fund or analogous provisions or at the option of
a Holder thereof and the price or prices at which and the period or
periods within which and any terms and conditions upon which
Securities of the series shall be redeemed, purchased or repaid, in
whole or in part, pursuant to such obligation;
(9) if other than denominations of $1,000 and any integral
multiple thereof in the case of Registered Securities, or $1,000 and
$5,000 in the case of Unregistered Securities, the denominations in
which Securities of the series shall be issuable;
(10) if other than the principal amount thereof, the portion of
the principal amount of Securities of the series that shall be
payable upon declaration of acceleration of the maturity thereof;
(11) if other than the coin or currency in which the Securities
of that series are denominated, the coin or currency in which payment
of the principal of or interest on the Securities of such series
shall be payable;
(12) if the principal of or interest on the Securities of such
series are to be payable, at the election of the Issuer or a Holder
thereof, in a coin or currency other than that in which the
Securities are denominated, the period or periods within which, and
the terms and conditions upon which, such election may be made;
(13) if the amount of payments of principal of and interest on
the Securities of the series may be determined with reference to an
index based on a coin or currency other than that in which the
Securities of the series are denominated, the manner in which such
amounts shall be determined;
(14) the terms on which the Securities may be converted or
exchanged for stock or other securities of the Issuer or other
entities, any specific terms relating to the adjustment thereof and
the period during which such Securities may be converted or
exchanged;
(15) whether the Securities of the series will be issuable as
Registered Securities (and if so, whether such Securities will be
issuable as Registered Global Securities) or Unregistered Securities
(with or without Coupons), or any combination of the foregoing, any
restrictions applicable to the offer, sale or delivery of
Unregistered Securities or the payment of interest thereon and, if
other than as provided in Section 2.8, the terms upon which
Unregistered Securities of any series may be exchanged for Registered
Securities of such series and vice versa;
(16) whether and under what circumstances the Issuer will pay
additional amounts on the Securities of the series held by a Person
who is not a U.S. Person in respect of any tax, assessment or
governmental charge withheld or deducted and, if so, whether the
Issuer will have the option to redeem such Securities rather than pay
such additional amounts;
(17) if the Securities of such series are to be issuable in
definitive form (whether upon original issue or upon exchange of a
temporary Security of such series) only upon receipt of certain
certificates or other documents or satisfaction of other conditions,
the form and terms of such certificates, documents or conditions;
(18) any trustees, depositaries, authenticating or paying
agents, transfer agents or registrars or any other agents with
respect to the Securities of such series;
(19) any deletions from, modifications of or additions to the
defined terms, Events of Default, covenants or other provisions of
this Indenture with respect to the Securities of such series; and
(20) any other terms of the series.
All Securities of any one series and Coupons, if any, appertaining
thereto, shall be substantially identical, except in the case of Registered
Securities as to denomination and except as may otherwise be provided by or
pursuant to the Board Resolution or Officers' Certificate referred to above or
as set forth in any such indenture supplemental hereto. All Securities of any
one series need not be issued at the same time and may be issued from time to
time, consistent with the terms of this Indenture, if so provided by or
pursuant to such Board Resolution, such Officers' Certificate or in any such
indenture supplemental hereto.
SECTION 2.4 Authentication and Delivery of Securities. The Issuer
may deliver Securities of any series having attached thereto appropriate
Coupons, if any, executed by the Issuer to the Trustee for authentication
together with the applicable documents referred to below in this Section, and
the Trustee shall thereupon authenticate and deliver such Securities to or
upon the order of the Issuer (contained in the Issuer Order referred to below
in this Section) or pursuant to such procedures acceptable to the Trustee and
to such recipients as may be specified from time to time by an Issuer Order.
If provided for in such procedures, such Issuer Order may authorize
authentication and delivery pursuant to oral or electronic instructions from
the Issuer or its duly authorized agent. In authenticating such Securities
and accepting the additional responsibilities under this Indenture in relation
to such Securities, the Trustee shall be entitled to receive (in the case of
subparagraphs 2, 3 and 4 below only at or before the time of the first request
of the Issuer to the Trustee to authenticate Securities of such series,
provided that such documents reasonably contemplate all Securities of such
series) and (subject to Section 6.1) shall be fully protected in relying upon,
unless and until such documents have been superseded or revoked:
(1) an Issuer Order requesting such authentication and setting
forth delivery instructions if the Securities and Coupons, if any,
are not to be delivered to the Issuer, provided that, with respect to
Securities of a series subject to a Periodic Offering, (a) such
Issuer Order may be delivered by the Issuer to the Trustee prior to
the delivery to the Trustee of such Securities for authentication and
delivery, (b) the Trustee shall authenticate and deliver Securities
of such series for original issue from time to time, in an aggregate
principal amount not exceeding the aggregate principal amount
established for such series, pursuant to an Issuer Order or pursuant
to procedures acceptable to the Trustee as may be specified from time
to time by an Issuer Order, (c) the maturity date or dates, interest
rate or rates and any other terms of Securities of such series shall
be determined by an Issuer Order or pursuant to such procedures and
(d) if provided for in such procedures, such Issuer Order may
authorize authentication and delivery pursuant to oral or electronic
instructions from the Issuer or its duly authorized agent or agents,
which oral instructions shall be promptly confirmed in writing;
(2) any Board Resolution, Officers' Certificate and/or executed
supplemental indenture referred to in Sections 2.1 and 2.3 by or
pursuant to which the forms and terms of the Securities and Coupons,
if any, were established;
(3) an Officers' Certificate stating that the form or forms and
terms of the Securities and Coupons, if any, have been established
pursuant to Sections 2.1 and 2.3 and comply with this Indenture, and
covering such other matters as the Trustee may reasonably request;
and
(4) at the option of the Issuer, either an Opinion of Counsel,
or a letter addressed to the Trustee permitting it to rely on an
Opinion of Counsel, substantially to the effect that:
(a) the forms of the Securities and Coupons, if any, have
been duly authorized and established in conformity with the
provisions of this Indenture;
(b) in the case of an underwritten offering, the terms of
the Securities have been duly authorized and established in
conformity with the provisions of this Indenture, and, in the
case of an offering that is not underwritten, certain terms of
the Securities have been established pursuant to a Board
Resolution, an Officers' Certificate or a supplemental
indenture in accordance with this Indenture, and when such
other terms as are to be established pursuant to procedures set
forth in an Issuer Order shall have been established, all such
terms will have been duly authorized by the Issuer and will
have been established in conformity with the provisions of this
Indenture;
(c) when the Securities and Coupons, if any, have been
executed by the Issuer and authenticated by the Trustee in
accordance with the provisions of this Indenture and delivered
to and duly paid for by the purchasers thereof, they will have
been duly issued under this Indenture and will be valid and
legally binding obligations of the Issuer, enforceable in
accordance with their respective terms, and will be entitled to
the benefits of this Indenture; and
(d) the execution and delivery by the Issuer of, and the
performance by the Issuer of its obligations under, the
Securities and Coupons, if any, will not contravene any
provision of applicable law or the certificate of incorporation
or by-laws of the Issuer or any agreement or other instrument
binding upon the Issuer or any of its subsidiaries that is
material to the Issuer and its subsidiaries, considered as one
enterprise, or, to the best of such counsel's knowledge, any
judgment, order or decree of any governmental body, agency or
court having jurisdiction over the Issuer or any subsidiary,
and no consent, approval or authorization of any governmental
body or agency is required for the performance by the Issuer of
its obligations under the Securities and Coupons, if any,
except such as are specified and have been obtained and such as
may be required by the securities or blue sky laws of the
various states in connection with the offer and sale of the
Securities and Coupons, if any.
In rendering such opinions, such counsel may qualify any opinions as
to enforceability by stating that such enforceability may be limited by
bankruptcy, insolvency, reorganization, liquidation, moratorium and other
similar laws affecting the rights and remedies of creditors and is subject to
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law). Such counsel may rely, as to
all matters governed by the laws of jurisdictions other than the State of New
York and the federal law of the United States, upon opinions of other counsel
(copies of which shall be delivered to the Trustee), who shall be counsel
reasonably satisfactory to the Trustee, in which case the opinion shall state
that such counsel believes he and the Trustee are entitled so to rely. Such
counsel may also state that, insofar as such opinion involves factual matters,
he has relied, to the extent he deems proper, upon certificates of officers of
the Issuer and its subsidiaries and certificates of public officials.
The Trustee shall have the right to decline to authenticate and
deliver any Securities under this Section if the Trustee, being advised by
counsel, determines that such action may not lawfully be taken by the Issuer
or if the Trustee in good faith by its board of directors or board of
trustees, executive committee, or a trust committee of directors or trustees
or Responsible Officers shall determine that such action would expose the
Trustee to personal liability to existing Holders or would affect the
Trustee's own rights, duties or immunities under the Securities, this
Indenture or otherwise.
If the Issuer shall establish pursuant to Section 2.3 that the
Securities of a series are to be issued in the form of one or more Registered
Global Securities, then the Issuer shall execute and the Trustee shall, in
accordance with this Section and the Issuer Order with respect to such series,
authenticate and deliver one or more Registered Global Securities that (i)
shall represent and shall be denominated in an amount equal to the aggregate
principal amount of all of the Securities of such series issued and not yet
cancelled, (ii) shall be registered in the name of the Depositary for such
Registered Global Security or Securities or the nominee of such Depositary,
(iii) shall be delivered by the Trustee to such Depositary or pursuant to such
Depositary's instructions and (iv) shall bear a legend substantially to the
following effect: "Unless and until it is exchanged in whole or in part for
Securities in definitive registered form, this Security may not be transferred
except as a whole by the Depositary to a nominee of the Depositary or by a
nominee of the Depositary to the Depositary or another nominee of the
Depositary or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary."
Each Depositary designated pursuant to Section 2.3 must, at the time
of its designation and at all times while it serves as Depositary, be a
clearing agency registered under the Securities Exchange Act of 1934 and any
other applicable statute or regulation.
SECTION 2.5 Execution of Securities. The Securities and, if
applicable, each Coupon appertaining thereto shall be signed on behalf of the
Issuer by the chairman or vice chairman of its Board of Directors or its
president or any vice president or its treasurer, under its corporate seal
(except in the case of Coupons) which may, but need not, be attested. Such
signatures may be the manual or facsimile signatures of the present or any
future such officers. The seal of the Issuer may be in the form of a
facsimile thereof and may be impressed, affixed, imprinted or otherwise
reproduced on the Securities. Typographical and other minor errors or defects
in any such reproduction of the seal or any such signature shall not affect
the validity or enforceability of any Security that has been duly
authenticated and delivered by the Trustee.
In case any officer of the Issuer who shall have signed any of the
Securities or Coupons, if any, shall cease to be such officer before the
Security or Coupon so signed (or the Security to which the Coupon so signed
appertains) shall be authenticated and delivered by the Trustee or disposed of
by the Issuer, such Security or Coupon nevertheless may be authenticated and
delivered or disposed of as though the person who signed such Security or
Coupon had not ceased to be such officer of the Issuer; and any Security or
Coupon may be signed on behalf of the Issuer by such persons as, at the actual
date of the execution of such Security or Coupon, shall be the proper officers
of the Issuer, although at the date of the execution and delivery of this
Indenture any such person was not such an officer.
SECTION 2.6 Certificate of Authentication. Only such Securities as
shall bear thereon a certificate of authentication substantially in the form
hereinbefore recited, executed by the Trustee by the manual signature of one
of its authorized officers, employees or other signatories, shall be entitled
to the benefits of this Indenture or be valid or obligatory for any purpose.
No Coupon shall be entitled to the benefits of this Indenture or shall be
valid and obligatory for any purpose until the certificate of authentication
on the Security to which such Coupon appertains shall have been duly executed
by the Trustee. The execution of such certificate by the Trustee upon any
Security executed by the Issuer shall be conclusive evidence that the Security
so authenticated has been duly authenticated and delivered hereunder and that
the Holder is entitled to the benefits of this Indenture.
SECTION 2.7 Denomination and Date of Securities; Payments of
Interest. The Securities of each series shall be issuable as Registered
Securities or Unregistered Securities in denominations established as
contemplated by Section 2.3 or, with respect to the Registered Securities of
any series, if not so established, in denominations of $1,000 and any integral
multiple thereof. If denominations of Unregistered Securities of any series
are not so established, such Securities shall be issuable in denominations of
$1,000 and $5,000. The Securities of each series shall be numbered, lettered
or otherwise distinguished in such manner or in accordance with such plan as
the officers of the Issuer executing the same may determine with the approval
of the Trustee, as evidenced by the execution and authentication thereof.
Each Registered Security shall be dated the date of its
authentication. Each Unregistered Security shall be dated as provided in the
resolution or resolutions of the Board of Directors, Officers' Certificate or
supplemental indenture referred to in Section 2.3. The Securities of each
series shall bear interest, if any, from the date, and such interest shall be
payable on the dates, established as contemplated by Section 2.3.
Except as otherwise provided as contemplated pursuant to Section 2.3
with respect to the Securities of any series, the Person in whose name any
Registered Security of any series is registered at the close of business on
any record date applicable to such series with respect to any interest payment
date for such series shall be entitled to receive the interest, if any,
payable on such interest payment date notwithstanding any transfer or exchange
of such Registered Security subsequent to the record date and prior to such
interest payment date, except if and to the extent the Issuer shall default in
the payment of the interest due on such interest payment date for such series,
in which case such defaulted interest shall be paid to the Persons in whose
names Registered Securities of such series are registered at the close of
business on a subsequent record date (which shall be not less than five
Business Days prior to the date of payment of such defaulted interest)
established by notice given by mail by or on behalf of the Issuer to the
Holders of such Registered Securities not less than 15 days preceding such
subsequent record date. The term "record date" as used with respect to any
interest payment date (except a date for payment of defaulted interest) for
the Securities of any series shall mean the date specified as such in the
terms of the Registered Securities of such series established as contemplated
by Section 2.3, or, if no such date is so established, if such interest
payment date is the first day of a calendar month, the fifteenth day of the
next preceding calendar month or, if such interest payment date is the
fifteenth day of a calendar month, the first day of such calendar month,
whether or not such record date is a Business Day.
SECTION 2.8 Registration, Transfer and Exchange. The Issuer will
keep at each office or agency to be maintained for the purpose as provided in
Section 3.2 for each series of Securities a register or registers in which,
subject to such reasonable regulations as it may prescribe, it will provide
for the registration of Registered Securities of such series and the
registration of transfer of Registered Securities of such series. Such
register shall be in written form in the English language or in any other form
capable of being converted into such form within a reasonable time. At all
reasonable times such register or registers shall be open for inspection by
the Trustee.
Upon due presentation for registration of transfer of any Registered
Security of any series at any such office or agency to be maintained for the
purpose as provided in Section 3.2, the Issuer shall execute and the Trustee
shall authenticate and deliver in the name of the transferee or transferees a
new Registered Security or Registered Securities of the same series in
authorized denominations for a like aggregate principal amount.
Unregistered Securities (except for any temporary global
Unregistered Securities) and Coupons (except for Coupons attached to any
temporary global Unregistered Securities) shall be transferable by delivery.
At the option of the Holder thereof, Registered Securities of any
series (other than a Registered Global Security, except as set forth below)
may be exchanged for a Registered Security or Registered Securities of such
series having authorized denominations and an equal aggregate principal
amount, upon surrender of such Registered Securities to be exchanged at the
agency of the Issuer that shall be maintained for such purpose in accordance
with Section 3.2 and upon payment, if the Issuer shall so require, of the
charges hereinafter provided. If the Securities of any series are issued in
both registered and unregistered form, except as otherwise specified pursuant
to Section 2.3, at the option of the Holder thereof, Unregistered Securities
of any series may be exchanged for Registered Securities of such series having
authorized denominations and an equal aggregate principal amount, upon
surrender of such Unregistered Securities to be exchanged at the agency of the
Issuer that shall be maintained for such purpose in accordance with Section
3.2, with, in the case of Unregistered Securities that have Coupons attached,
all unmatured Coupons and all matured Coupons in default thereto appertaining,
and upon payment, if the Issuer shall so require, of the charges hereinafter
provided. At the option of the Holder thereof, if Unregistered Securities of
any series, maturity date and interest rate are issued in more than one
authorized denomination, except as otherwise specified pursuant to Section
2.3, such Unregistered Securities may be exchanged for Unregistered Securities
of such series having authorized denominations and an equal aggregate
principal amount, upon surrender of such Unregistered Securities to be
exchanged at the agency of the Issuer that shall be maintained for such
purpose in accordance with Section 3.2 or as specified pursuant to Section
2.3, with, in the case of Unregistered Securities that have Coupons attached,
all unmatured Coupons and all matured Coupons in default thereto appertaining,
and upon payment, if the Issuer shall so require, of the charges hereinafter
provided. Unless otherwise specified pursuant to Section 2.3, Registered
Securities of any series may not be exchanged for Unregistered Securities of
such series. Whenever any Securities are so surrendered for exchange, the
Issuer shall execute, and the Trustee shall authenticate and deliver, the
Securities which the Holder making the exchange is entitled to receive. All
Securities and Coupons surrendered upon any exchange or transfer provided for
in this Indenture shall be promptly cancelled and disposed of by the Trustee
and the Trustee will deliver a certificate of disposition thereof to the
Issuer.
Except as otherwise provided with respect to the Securities of any
series as contemplated by Section 2.3, all Registered Securities presented for
registration of transfer, exchange, redemption, repurchase or payment shall
(if so required by the Issuer or the Trustee) be duly endorsed by, or be
accompanied by a written instrument or instruments of transfer in form
satisfactory to the Issuer and the Trustee duly executed by, the Holder or his
attorney duly authorized in writing.
The Issuer may require payment of a sum sufficient to cover any tax
or other governmental charge that may be imposed in connection with any
exchange or registration of transfer of Securities. No service charge shall
be made for any such transaction.
The Issuer shall not be required to exchange or register a transfer
of (a) any Securities of any series for a period of 15 days next preceding the
first mailing of notice of redemption of Securities of such series to be
redeemed or (b) any Securities selected, called or being called for
redemption, in whole or in part, except, in the case of any Security to be
redeemed in part, the portion thereof not so to be redeemed.
Notwithstanding any other provision of this Section 2.8, unless and
until it is exchanged in whole or in part for Securities in definitive
registered form, a Registered Global Security representing all or a portion of
the Securities of a series may not be transferred except as a whole by the
Depositary for such series to a nominee of such Depositary or by a nominee of
such Depositary to such Depositary or another nominee of such Depositary or by
such Depositary or any such nominee to a successor Depositary for such series
or a nominee of such successor Depositary.
If at any time the Depositary for any Registered Securities of a
series represented by one or more Registered Global Securities notifies the
Issuer that it is unwilling or unable to continue as Depositary for such
Registered Securities or if at any time the Depositary for such Registered
Securities shall no longer be eligible under Section 2.4, the Issuer shall
appoint a successor Depositary eligible under Section 2.4 with respect to such
Registered Securities. If a successor Depositary eligible under Section 2.4
for such Registered Securities is not appointed by the Issuer within 90 days
after the Issuer receives such notice or becomes aware of such ineligibility,
the Issuer's election pursuant to Section 2.3 that such Registered Securities
be represented by one or more Registered Global Securities shall no longer be
effective and the Issuer will execute, and the Trustee, upon receipt of an
Officers' Certificate for the authentication and delivery of definitive
Securities of such series, will authenticate and deliver, Securities of such
series in definitive registered form without coupons, in any authorized
denominations, in an aggregate principal amount equal to the principal amount
of the Registered Global Security or Securities representing such Registered
Securities in exchange for such Registered Global Security or Securities.
The Issuer may at any time and in its sole discretion determine that
the Registered Securities of any series issued in the form of one or more
Registered Global Securities shall no longer be represented by a Registered
Global Security or Securities. In such event the Issuer will execute, and the
Trustee, upon receipt of an Officers' Certificate for the authentication and
delivery of definitive Securities of such series, will authenticate and
deliver, Securities of such series in definitive registered form without
coupons, in any authorized denominations, in an aggregate principal amount
equal to the principal amount of the Registered Global Security or Securities
representing such Registered Securities, in exchange for such Registered
Global Security or Securities.
If specified by the Issuer pursuant to Section 2.3 with respect to
Securities represented by a Registered Global Security, the Depositary for
such Registered Global Security may surrender such Registered Global Security
in exchange in whole or in part for Securities of the same series in
definitive registered form on such terms as are acceptable to the Issuer and
such Depositary. Thereupon, the Issuer shall execute, and the Trustee shall
authenticate and deliver, without service charge,
(i) to the Person specified by such Depositary a new Registered
Security or Securities of the same series, of any authorized
denominations as requested by such Person, in an aggregate principal
amount equal to and in exchange for such Person's beneficial interest
in the Registered Global Security; and
(ii) to such Depositary a new Registered Global Security in a
denomination equal to the difference, if any, between the principal
amount of the surrendered Registered Global Security and the
aggregate principal amount of Registered Securities authenticated and
delivered pursuant to clause (i) above.
Upon the exchange of a Registered Global Security for Securities in
definitive registered form without coupons, in authorized denominations, such
Registered Global Security shall be cancelled by the Trustee or an agent of
the Issuer or the Trustee. Securities in definitive registered form without
coupons issued in exchange for a Registered Global Security pursuant to this
Section 2.8 shall be registered in such names and in such authorized
denominations as the Depositary for such Registered Global Security, pursuant
to instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee or an agent of the Issuer or the Trustee. The Trustee or
such agent shall deliver such Securities to or as directed by the Persons in
whose names such Securities are so registered.
All Securities issued upon any transfer or exchange of Securities
shall be valid obligations of the Issuer, evidencing the same debt, and
entitled to the same benefits under this Indenture, as the Securities
surrendered upon such transfer or exchange.
Notwithstanding anything herein or in the terms of any series of
Securities to the contrary, none of the Issuer, the Trustee or any agent of
the Issuer or the Trustee (any of which, other than the Issuer, shall rely on
an Officers' Certificate and an Opinion of Counsel) shall be required to
exchange any Unregistered Security for a Registered Security if such exchange
would result in adverse Federal income tax consequences to the Issuer (such
as, for example, the inability of the Issuer to deduct from its income, as
computed for Federal income tax purposes, the interest payable on the
Unregistered Securities) under then applicable United States Federal income
tax laws.
SECTION 2.9 Mutilated, Defaced, Destroyed, Lost and Stolen
Securities. In case any temporary or definitive Security or any Coupon
appertaining to any Security shall become mutilated, defaced or be destroyed,
lost or stolen, the Issuer shall execute, and upon the written request of any
officer of the Issuer, the Trustee shall authenticate and deliver a new
Security of the same series, maturity date and interest rate, bearing a number
or other distinguishing symbol not contemporaneously outstanding, in exchange
and substitution for the mutilated or defaced Security, or in lieu of and in
substitution for the Security so destroyed, lost or stolen with Coupons
corresponding to the Coupons appertaining to the Securities so mutilated,
defaced, destroyed, lost or stolen, or in exchange or substitution for the
Security to which such mutilated, defaced, destroyed, lost or stolen Coupon
appertained, with Coupons appertaining thereto corresponding to the Coupons so
mutilated, defaced, destroyed, lost or stolen. In every case the applicant
for a substitute Security or Coupon shall furnish to the Issuer and to the
Trustee and any agent of the Issuer or the Trustee such security or indemnity
as may be required by them to indemnify and defend and to save each of them
harmless and, in every case of destruction, loss or theft, evidence to their
satisfaction of the destruction, loss or theft of such Security or Coupon and
of the ownership thereof and in the case of mutilation or defacement shall
surrender the Security and related Coupons to the Trustee or such agent.
Upon the issuance of any substitute Security or Coupon, the Issuer
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee or its agent)
connected therewith. In case any Security or Coupon which has matured or is
about to mature or has been called for redemption in full shall become
mutilated or defaced or be destroyed, lost or stolen, the Issuer may instead
of issuing a substitute Security, pay or authorize the payment of the same or
the relevant Coupon (without surrender thereof except in the case of a
mutilated or defaced Security or Coupon), if the applicant for such payment
shall furnish to the Issuer and to the Trustee and any agent of the Issuer or
the Trustee such security or indemnity as any of them may require to save each
of them harmless, and, in every case of destruction, loss or theft, the
applicant shall also furnish to the Issuer and the Trustee and any agent of
the Issuer or the Trustee evidence to their satisfaction of the destruction,
loss or theft of such Security or Coupon and of the ownership thereof.
Every substitute Security or Coupon of any series issued pursuant to
the provisions of this Section by virtue of the fact that any such Security or
Coupon is destroyed, lost or stolen shall constitute an additional contractual
obligation of the Issuer, whether or not the destroyed, lost or stolen
Security or Coupon shall be at any time enforceable by anyone and shall be
entitled to all the benefits of (but shall be subject to all the
limitations of rights set forth in) this Indenture equally and
proportionately with any and all other Securities or Coupons of such series
duly authenticated and delivered hereunder. All Securities and Coupons
shall be held and owned upon the express condition that, to the extent
permitted by law, the foregoing provisions are exclusive with respect to
the replacement or payment of mutilated, defaced or destroyed, lost or
stolen Securities and Coupons and shall preclude 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 Cancellation of Securities; Destruction Thereof. All
Securities and Coupons surrendered for payment, redemption, registration of
transfer or exchange, or for credit against any payment in respect of a
sinking or analogous fund or any obligation of the Issuer to redeem,
repurchase or repay Securities, if surrendered to the Issuer or any agent of
the Issuer or the Trustee or any agent of the Trustee, shall be delivered to
the Trustee or its agent for cancellation or, if surrendered to the Trustee,
shall be cancelled by it; and no Securities or Coupons shall be issued in lieu
thereof except as expressly permitted by any of the provisions of this
Indenture. The Trustee or its agent shall dispose of cancelled Securities and
Coupons held by it and deliver a certificate of disposition to the Issuer. If
the Issuer or its agent shall acquire any of the Securities or Coupons, such
acquisition shall not operate as a redemption or satisfaction of the
indebtedness represented by such Securities or Coupons unless and until the
same are delivered to the Trustee or its agent for cancellation.
SECTION 2.11 Temporary Securities. Pending the preparation of
definitive Securities for any series, the Issuer may execute and the Trustee
shall authenticate and deliver temporary Securities for such series (printed,
lithographed, typewritten or otherwise reproduced, in each case in form
satisfactory to the Trustee). Temporary Securities of any series shall be
issuable as Registered Securities without Coupons, or as Unregistered
Securities with or without Coupons attached thereto, of any authorized
denomination, and substantially in the form of the definitive Securities of
such series but with such omissions, insertions and variations as may be
appropriate for temporary Securities, all as may be determined by the Issuer
with the concurrence of the Trustee as evidenced by the execution and
authentication thereof. Temporary Securities may contain such references to
any provisions of this Indenture as may be appropriate. Every temporary
Security shall be executed by the Issuer and be authenticated by the Trustee
upon the same conditions and in substantially the same manner, and with like
effect, as the definitive Securities. Without unreasonable delay the Issuer
shall execute and shall furnish definitive Securities of such series and
thereupon temporary Registered Securities of such series may be surrendered in
exchange therefor without charge at each office or agency to be maintained by
the Issuer for that purpose pursuant to Section 3.2 and, in the case of
Unregistered Securities, at any agency maintained by the Issuer for such
purpose as specified pursuant to Section 3.2, and the Trustee shall
authenticate and deliver in exchange for such temporary Securities of such
series an equal aggregate principal amount of definitive Securities of the
same series having authorized denominations and, in the case of Unregistered
Securities, having attached thereto any appropriate Coupons. Until so
exchanged, the temporary Securities of any series shall be entitled to the
same benefits under this Indenture as definitive Securities of such series,
unless otherwise established pursuant to Section 2.3. The provisions of this
Section are subject to any restrictions or limitations on the issue and
delivery of temporary Unregistered Securities of any series that may be
established pursuant to Section 2.3 (including any provision that Unregistered
Securities of such series initially be issued in the form of a single global
Unregistered Security to be delivered to a depositary or agency located
outside the United States and the procedures pursuant to which definitive or
global Unregistered Securities of such series would be issued in exchange for
such temporary global Unregistered Security).
ARTICLE THREE
COVENANTS OF THE ISSUER
SECTION 3.1 Payment of Principal and Interest. The Issuer
covenants and agrees for the benefit of each series of Securities that it will
duly and punctually pay or cause to be paid the principal of, and interest on,
each of the Securities of such series (together with any additional amounts
payable pursuant to the terms of such Securities) at the place or places, at
the respective times and in the manner provided in such Securities and in the
Coupons, if any, appertaining thereto and in this Indenture. The interest on
Securities with Coupons attached (together with any additional amounts payable
pursuant to the terms of such Securities) shall be payable only upon
presentation and surrender of the several Coupons for such interest
installments as are evidenced thereby as they severally mature. If any
temporary Unregistered Security provides that interest thereon may be paid
while such Security is in temporary form, the interest on any such temporary
Unregistered Security (together with any additional amounts payable pursuant
to the terms of such Security) shall be paid, as to the installments of
interest evidenced by Coupons attached thereto, if any, only upon presentation
and surrender thereof, and, as to the other installments of interest, if any,
only upon presentation of such Securities for notation thereon of the payment
of such interest, in each case subject to any restrictions that may be
established pursuant to Section 2.3. The interest on Registered Securities
(together with any additional amounts payable pursuant to the terms of such
Securities) shall be payable only to or upon the written order of the Holders
thereof and, at the option of the Issuer, may (except as otherwise provided as
contemplated pursuant to Section 2.3 with respect to the Securities of any
series) be paid by wire transfer or by mailing checks for such interest
payable to or upon the written order of such Holders at their last
addresses as they appear on the registry books of the Issuer.
SECTION 3.2 Offices for Payments, etc. So long as any Registered
Securities are authorized for issuance pursuant to this Indenture or are
Outstanding hereunder, the Issuer will maintain in the Borough of Manhattan,
City of New York, an office or agency where the Registered Securities of each
series may be presented for payment, where the Securities of each series may
be presented for exchange as is provided in this Indenture and, if applicable,
pursuant to Section 2.3 and where the Registered Securities of each series may
be presented for registration of transfer as in this Indenture provided.
The Issuer will maintain one or more offices or agencies in a city
or cities located outside the United States (including any city in which such
an agency is required to be maintained under the rules of any stock exchange
on which the Securities of such series are listed) where the Unregistered
Securities, if any, of each series and Coupons, if any, appertaining thereto
may be presented for payment. No payment on any Unregistered Security or
Coupon will be made upon presentation of such Unregistered Security or Coupon
at an agency of the Issuer within the United States nor will any payment be
made by transfer to an account in, or by mail to an address in, the United
States unless pursuant to applicable United States laws and regulations then
in effect such payment can be made without adverse tax consequences to the
Issuer. Notwithstanding the foregoing, payments in Dollars of Unregistered
Securities of any series and Coupons appertaining thereto which are payable in
Dollars may be made at an agency of the Issuer maintained in the Borough of
Manhattan, City of New York, if such payment in Dollars at each agency
maintained by the Issuer outside the United States for payment on such
Unregistered Securities is illegal or effectively precluded by exchange
controls or other similar restrictions.
The Issuer will maintain in the Borough of Manhattan, City of New
York, an office or agency where notices and demands to or upon the Issuer in
respect of the Securities of any series, the Coupons appertaining thereto or
this Indenture may be served. The agent of the Trustee, First Chicago Trust
Company of New York, 14 Wall Street, New York, New York 10005, shall be the
initial such office or agency for all of the purposes set forth in this
paragraph and in the first paragraph of this Section 3.2 unless the Issuer
shall maintain some other office or agency for such purposes and shall give
prompt written notice to the Trustee of the location, and any change in the
location, of such other office or agency.
The Issuer will give to the Trustee written notice of the location
of each such office or agency and of any change of location thereof. In case
the Issuer shall fail to maintain any agency required by this Section to be
located in the Borough of Manhattan, City of New York, or shall fail to give
such notice of the location or of any change in the location of any of the
above agencies, presentations and demands may be made and notices may be
served at the Corporate Trust Office of the Trustee.
The Issuer may from time to time designate one or more additional
offices or agencies where the Securities of a series and any Coupons
appertaining thereto may be presented for payment, where the Securities of
that series may be presented for exchange as provided in this Indenture and
pursuant to Section 2.3 and where the Registered Securities of that series may
be presented for registration of transfer as in this Indenture provided, and
the Issuer may from time to time rescind any such designation, as the Issuer
may deem desirable or expedient; provided, however, that no such designation
or rescission shall in any manner relieve the Issuer of its obligation to
maintain the offices or agencies provided for in this Section. The Issuer
will give to the Trustee prompt written notice of any such designation or
rescission thereof.
SECTION 3.3 Appointment to Fill a Vacancy in Office of Trustee.
The Issuer, whenever necessary to avoid or fill a vacancy in the office of
Trustee, will appoint, in the manner provided in Section 6.10, a Trustee, so
that there shall at all times be a Trustee with respect to each series of
Securities hereunder.
SECTION 3.4 Paying Agents. Whenever the Issuer shall appoint a
paying agent other than the Trustee with respect to the Securities of any
series, it will cause such paying agent to execute and deliver to the Trustee
an instrument in which such agent shall agree with the Trustee, subject to the
provisions of this Section,
(a) that it will hold all sums received by it as such agent for
the payment of the principal of or interest on the Securities of such
series (whether such sums have been paid to it by the Issuer or by
any other obligor on the Securities of such series) in trust for the
benefit of the Holders of the Securities of such series, or Coupons
appertaining thereto, if any, or of the Trustee,
(b) that it will give the Trustee notice of any failure by the
Issuer (or by any other obligor on the Securities of such series) to
make any payment of the principal of or interest on the Securities of
such series when the same shall be due and payable, and
(c) that it will pay any such sums so held in trust by it to
the Trustee upon the Trustee's written request at any time during the
continuance of the failure referred to in clause (b) above.
The Issuer will, on or prior to each due date of the principal of or
interest on the Securities of such series, deposit with the paying agent a sum
sufficient to pay such principal or interest so becoming due, and (unless such
paying agent is the Trustee) the Issuer will promptly notify the Trustee of
any failure to take such action.
If the Issuer shall act as its own paying agent with respect to the
Securities of any series, it will, on or before each due date of the principal
of or interest on the Securities of such series, set aside, segregate and hold
in trust for the benefit of the Holders of the Securities of such series or
the Coupons appertaining thereto a sum sufficient to pay such principal or
interest so becoming due. The Issuer will promptly notify the Trustee of any
failure to take such action.
Anything in this Section to the contrary notwithstanding, but
subject to Section 10.1, the Issuer may at any time, for the purpose of
obtaining a satisfaction and discharge with respect to one or more or all
series of Securities hereunder, or for any other reason, pay or cause to be
paid to the Trustee all sums held in trust for any such series by the Issuer
or any paying agent hereunder, as required by this Section, such sums to be
held by the Trustee upon the trusts herein contained.
Anything in this Section to the contrary notwithstanding, the
agreement to hold sums in trust as provided in this Section is subject to the
provisions of Sections 10.3 and 10.4.
SECTION 3.5 Written Statement to Trustee. The Issuer will furnish
to the Trustee within 120 days after the end of each fiscal year of the Issuer
(beginning with the fiscal year ending on November 30, 1996) a brief
certificate (which need not comply with Section 11.5) from the principal
executive, financial or accounting officer of the Issuer as to his or her
knowledge of the Issuer's compliance with all conditions and covenants under
the Indenture (such compliance to be determined without regard to any period of
grace or requirement of notice provided under the Indenture).
SECTION 3.6 Luxembourg Publications. In the event of the
publication of any notice pursuant to Section 5.11, 6.8, 6.10(a), 6.11, 8.2,
10.4, 12.2 or 12.5, the party making such publication in the Borough of
Manhattan, The City of New York and London shall also, to the extent that
notice is required to be given to Holders of Securities of any series by
applicable Luxembourg law or stock exchange regulation, as evidenced by an
Officers' Certificate delivered to such party, make a similar publication in
Luxembourg.
SECTION 3.7 Limitation in Ranking of Future Indebtedness. The
Issuer will not incur any Debt which is subordinated by the terms of the
instrument creating such Debt in right of payment to any other Debt of the
Issuer and which is not expressly by the terms of the instrument creating such
Debt made pari passu with, or subordinate and junior in right of payment to,
the Securities.
ARTICLE FOUR
SECURITYHOLDERS LISTS AND REPORTS BY THE
ISSUER AND THE TRUSTEE
SECTION 4.1 Issuer to Furnish Trustee Information as to Names and
Addresses of Securityholders. If and so long as the Trustee shall not be the
Security registrar for the Securities of any series, the Issuer and any other
obligor on the Securities will furnish or cause to be furnished to the Trustee
a list in such form as the Trustee may reasonably require of the names and
addresses of the Holders of the Registered Securities of such series pursuant
to Section 312 of the Trust Indenture Act of 1939 (a) semi-annually not more
than 15 days after each record date for the payment of interest on such
Registered Securities, as hereinabove specified, as of such record date and on
dates to be determined pursuant to Section 2.3 for non-interest bearing
Registered Securities in each year, and (b) at such other times as the Trustee
may request in writing, within thirty days after receipt by the Issuer of any
such request as of a date not more than 15 days prior to the time such
information is furnished.
SECTION 4.2 Reports by the Issuer. The Issuer covenants to file
with the Trustee, within 15 days after the Issuer is required to file the same
with the Commission, copies of the annual reports and of the information,
documents, and other reports that the Issuer may be required to file with the
Commission pursuant to Section 13 or Section 15(d) of the Securities Exchange
Act of 1934 or pursuant to Section 314 of the Trust Indenture Act of 1939.
SECTION 4.3 Reports by the Trustee. Any Trustee's report required
under Section 313(a) of the Trust Indenture Act of 1939 shall be transmitted
on or before the 60th day after each May 15 beginning with the May 15
following the date of this Indenture, as provided in Section 313(c) of the
Trust Indenture Act of 1939, so long as any Securities are Outstanding
hereunder, and shall be dated as of a date convenient to the Trustee no more
than 60 days prior thereto.
ARTICLE FIVE
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 5.1 Event of Default Defined; Acceleration of Maturity;
Waiver of Default. Except as otherwise provided with respect to the
Securities of any series as contemplated by Section 2.3, "Event of Default"
with respect to Securities of any series wherever used herein, means each one
of the following events which shall have occurred and be continuing (whatever
the reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) default in the payment of any installment of interest upon
any of the Securities of such series as and when the same shall
become due and payable, and continuance of such default for a period
of 30 days; or
(b) default in the payment of all or any part of the principal
of any of the Securities of such series as and when the same shall
become due and payable either at maturity, upon any redemption, by
declaration or otherwise; or
(c) default in the payment of any sinking fund
installment as and when the same shall become due and payable by the
terms of the Securities of such series; or
(d) failure on the part of the Issuer duly to observe or
perform any other of the covenants or agreements on the part of the
Issuer in the Securities of such series or in this Indenture
contained (other than a covenant or warranty in respect of the
Securities of such series a default in the performance or breach of
which is elsewhere in this Section specifically dealt with or which
has expressly been included in this Indenture solely for the benefit
of one or more series of Securities other than such series) for a
period of 60 days after the date on which written notice specifying
such failure, stating that such notice is a "Notice of Default"
hereunder and demanding that the Issuer remedy the same, shall have
been given by registered or certified mail, return receipt requested,
or by overnight courier or by hand delivery in each case with
evidence of the receipt of such overnight courier or hand delivery by
the Issuer, to the Issuer by the Trustee, or to the Issuer and the
Trustee by the Holders of at least 25% in aggregate principal amount
of the Outstanding Securities of all series affected thereby; or
(e) a court having jurisdiction in the premises shall enter a
decree or order for relief in respect of the Issuer in an involuntary
case under any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect, or appointing a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) of
the Issuer or for any substantial part of its property or ordering the
winding up or liquidation of its affairs, and such decree or order
shall remain unstayed and in effect for a period of 60 consecutive
days; or
(f) the Issuer shall commence a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or consent to the entry of an order for relief
in an involuntary case under any such law, or consent to the
appointment or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator (or similar official) of the Issuer
or for any substantial part of its property, or make any general
assignment for the benefit of creditors; or
(g) any other Event of Default provided in the supplemental
indenture, Board Resolution or Officers' Certificate establishing the
terms of such series of Securities or in the form of Security for
such series.
Except as otherwise provided with respect to the Securities of any
series as contemplated by Section 2.3, if an Event of Default described in
clauses (a), (b), (c), (d) or (g) (if the Event of Default under clause (d) or
(g), as the case may be, is with respect to less than all series of Securities
then Outstanding) occurs and is continuing, then, and in each and every such
case, except for any series of Securities the principal of which shall have
already become due and payable, either the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Securities of such series then
Outstanding hereunder (such series voting as a separate class) by notice in
writing to the Issuer (and to the Trustee if given by Securityholders), may
declare the entire principal (or, if the Securities of such series are
Original Issue Discount Securities, such portion of the principal amount as
may be specified in the terms of such series) of all Securities of such
series, and the interest accrued thereon, if any, to be due and payable
immediately, and upon any such declaration, the same shall become immediately
due and payable. Except as otherwise provided with respect to the Securities
of any series as contemplated by Section 2.3, if an Event of Default described
in clause (d) or (g) (if the Event of Default under clause (d) or (g), as the
case may be, is with respect to all series of Securities then Outstanding),
clause (e) or (f) occurs and is continuing, then and in each and every such
case, unless the principal of all the Securities shall have already become due
and payable, either the Trustee or the Holders of not less than 25% in
aggregate principal amount of all the Securities then Outstanding hereunder
(treated as one class), by notice in writing to the Issuer (and to the Trustee
if given by Securityholders), may declare the entire principal (or, if any
Securities are Original Issue Discount Securities, such portion of the
principal as may be specified in the terms thereof) of all the Securities then
Outstanding, and interest accrued thereon, if any, to be due and payable
immediately, and upon any such declaration the same shall become immediately
due and payable.
Except as otherwise provided with respect to the Securities of any
series as contemplated by Section 2.3, the foregoing provisions, however, are
subject to the condition that if, at any time after the principal (or, if the
Securities are Original Issue Discount Securities, such portion of the
principal as may be specified in the terms thereof) of the Securities of any
series (or of all the Securities, as the case may be) shall have been so
declared 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 Issuer shall pay or shall deposit with the Trustee a sum sufficient to pay
all matured installments of interest upon all the Securities of such series
(or of all the Securities, as the case may be) and the principal of any and
all Securities of such series (or of all the Securities, as the case may be)
which shall have become due otherwise than by acceleration (with interest upon
such principal and, to the extent that payment of such interest is enforceable
under applicable law, on overdue installments of interest, at the same rate as
the rate of interest or Yield to Maturity (in the case of Original Issue
Discount Securities) specified in the Securities of such series (or at the
respective rates of interest or Yields to Maturity of all the Securities, as
the case may be) to the date of such payment or deposit) and such amount as
shall be sufficient to cover reasonable compensation to the Trustee and each
predecessor Trustee, its agents, attorneys and counsel, and all other expenses
and liabilities incurred, and all advances made, by the Trustee and each
predecessor Trustee except as a result of negligence or bad faith, and if any
and all Events of Default with respect to the Securities of such series (or
with respect to all of the Securities, as the case may be), other than the
non-payment of the principal of Securities which shall have become due by
acceleration, shall have been cured, waived or otherwise remedied as provided
herein -- then and in every such case the Holders of a majority in aggregate
principal amount of all the Securities of such series, each series voting as a
separate class, (or of all the Securities, as the case may be, voting as a
single class) then Outstanding, by written notice to the Issuer and to the
Trustee, may waive all defaults with respect to such series (or with respect
to all the Securities, as the case may be) and rescind and annul such
declaration and its consequences, but no such waiver or rescission and
annulment shall extend to or shall affect any subsequent default or shall
impair any right consequent thereon.
For all purposes under this Indenture, if a portion of the principal
of any Original Issue Discount Securities 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, the principal amount of such Original Issue Discount Securities
shall be deemed, for all purposes hereunder, to be such portion of the
principal thereof as shall be due and payable as a result of such
acceleration, and payment of such portion of the principal thereof as shall be
due and payable as a result of such acceleration, together with interest, if
any, thereon and all other amounts owing thereunder, shall constitute payment
in full of such Original Issue Discount Securities.
SECTION 5.2 Collection of Indebtedness by Trustee; Trustee May
Prove Debt. The Issuer covenants that (a) in case default shall be made in
the payment of any installment of interest on any of the Securities of any
series when such interest shall have become due and payable, and such default
shall have continued for a period of 30 days or (b) in case default shall be
made in the payment of all or any part of the principal of any of the
Securities of any series when the same shall have become due and payable,
whether upon maturity of the Securities of such series or upon any redemption,
repurchase or repayment at the option of the Holders or by declaration or
otherwise -- then upon demand of the Trustee, the Issuer will pay to the
Trustee for the benefit of the Holders of the Securities of such series the
whole amount that then shall have become due and payable on all Securities of
such series, and any appurtenant Coupons, for principal or interest, as the
case may be (with interest to the date of such payment upon the overdue
principal and, to the extent that payment of such interest is enforceable
under applicable law, on overdue installments of interest at the same rate as
the rate of interest or Yield to Maturity (in the case of Original Issue
Discount Securities) specified in the Securities of such series); and in
addition thereto, such further amount as shall be sufficient to cover the
costs and expenses of collection, including reasonable compensation to the
Trustee and each predecessor Trustee, their respective agents, attorneys and
counsel, and any expenses and liabilities incurred, and all advances made, by
the Trustee and each predecessor Trustee except as a result of its negligence
or bad faith.
Until such demand is made by the Trustee, the Issuer may pay the
principal of and interest on the Securities of any series to the registered
Holders, whether or not the Securities of such series be overdue.
In case the Issuer shall fail forthwith to pay such amounts upon
such demand, the Trustee, in its own name and as trustee of an express trust,
shall be entitled and empowered to institute any action or proceedings at law
or in equity for the collection of the sums so due and unpaid, and may
prosecute any such action or proceedings to judgment or final decree, and may
enforce any such judgment or final decree against the Issuer or other obligor
upon the Securities and collect in the manner provided by law out of the
property of the Issuer or other obligor upon the Securities, wherever
situated, the moneys adjudged or decreed to be payable.
In case there shall be pending proceedings relative to the Issuer or
any other obligor upon the Securities under Title 11 of the United States Code
or any other applicable Federal or state bankruptcy, insolvency or other
similar law, or in case a receiver, assignee or trustee in bankruptcy or
reorganization, liquidator, sequestrator or similar official shall have been
appointed for or taken possession of the Issuer or its property or such other
obligor, or in case of any other comparable judicial proceedings relative to
the Issuer or other obligor upon the Securities, or to the creditors or
property of the Issuer or such other obligor, the Trustee, irrespective of
whether the principal of the Securities shall then be due and payable as
therein expressed or by declaration or otherwise and irrespective of whether
the Trustee shall have made any demand pursuant to the provisions of this
Section, shall be entitled and empowered, by intervention in such proceedings
or otherwise:
(a) to file and prove a claim or claims for the whole amount of
principal and interest (or, if the Securities of any series are
Original Issue Discount Securities, such portion of the principal
amount as may be specified in the terms of such series) owing and
unpaid in respect of the Securities of any series, 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 reasonable
compensation to the Trustee and each predecessor Trustee, and their
respective agents, attorneys and counsel, and for reimbursement of
all reasonable expenses and reasonable liabilities incurred, and all
reasonable advances made, by the Trustee and each predecessor
Trustee, except as a result of negligence or bad faith) and of the
Securityholders allowed in any judicial proceedings relative to the
Issuer or other obligor upon the Securities, or to the creditors or
property of the Issuer or such other obligor,
(b) unless prohibited by applicable law and regulations, to
vote on behalf of the Holders of the Securities of any series in any
election of a trustee or a standby trustee in arrangement,
reorganization, liquidation or other bankruptcy or insolvency
proceedings or Person performing similar functions in comparable
proceedings, and
(c) to collect and receive any moneys or other property
payable or deliverable on any such claims, and to distribute all
amounts received with respect to the claims of the Securityholders
and of the Trustee on their behalf; and any trustee, receiver, or
liquidator, custodian or other similar official is hereby authorized
by each of the Securityholders to make payments to the Trustee, and,
in the event that the Trustee shall consent to the making of payments
directly to the Securityholders, to pay to the Trustee such amounts
as shall be sufficient to cover reasonable compensation to the
Trustee, each predecessor Trustee and their respective agents,
attorneys and counsel, and all other reasonable expenses and
reasonable liabilities incurred, and all reasonable advances made,
by the Trustee and each predecessor Trustee except as a result of
negligence or bad faith.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or vote for or accept or adopt on behalf of any
Securityholder any plan of reorganization, arrangement, adjustment or
composition affecting the Securities of any series or the rights of any Holder
thereof, or to authorize the Trustee to vote in respect of the claim of any
Securityholder in any such proceeding except, as aforesaid, to vote for the
election of a trustee in bankruptcy or similar person.
All rights of action and of asserting claims under this Indenture,
or under any of the Securities of any series or Coupons appertaining to such
Securities, may be enforced by the Trustee without the possession of any of the
Securities of such series or Coupons appertaining to such Securities or the
production thereof in any trial or other proceedings relative thereto, and any
such action or proceedings instituted by the Trustee shall be brought in its
own name as trustee of an express trust, and any recovery of judgment, subject
to the payment of the reasonable expenses, reasonable disbursements and
reasonable compensation of the Trustee, each predecessor Trustee and their
respective agents and attorneys, shall be for the ratable benefit of the
Holders of the Securities or Coupons appertaining to such Securities in
respect of which such action was taken.
In any proceedings brought by the Trustee (and also any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party) the Trustee shall be held to represent all the
Holders of the Securities or Coupons appertaining to such Securities in
respect to which such action was taken, and it shall not be necessary to make
any Holders of such Securities or Coupons appertaining to such Securities
parties to any such proceedings.
SECTION 5.3 Application of Proceeds. Any moneys collected by the
Trustee pursuant to this Article in respect of any series of Securities shall,
subject to the subordination provisions hereof, be applied in the following
order at the date or dates fixed by the Trustee and, in case of the
distribution of such moneys on account of principal or interest, upon
presentation of the several Securities and Coupons appertaining to such
Securities in respect of which moneys have been collected and stamping (or
otherwise noting) thereon the payment, or issuing Securities of such series in
reduced principal amounts in exchange for the presented Securities of like
series if only partially paid, or upon surrender thereof if fully paid:
FIRST: To the payment of costs and expenses applicable to such
series of Securities in respect of which moneys have been collected,
including reasonable compensation to the Trustee and each predecessor
Trustee and their respective agents and attorneys and of all
reasonable expenses and reasonable liabilities incurred, and all
reasonable advances made, by the Trustee and each predecessor Trustee
except as a result of negligence or bad faith;
SECOND: In case the principal of the Securities of such series
in respect of which moneys have been collected shall not have become
and be then due and payable, to the payment of interest on the
Securities of such series in default in the order of the maturity of
the installments of such interest, with interest (to the extent that
such interest has been collected by the Trustee and to the extent
permitted by law) upon the overdue installments of interest at the
same rate as the rate of interest or Yield to Maturity (in the case
of Original Issue Discount Securities) specified in such Securities,
such payments to be made ratably to the Persons entitled thereto,
without discrimination or preference;
THIRD: In case the principal of the Securities of such series
in respect of which moneys have been collected shall have become and
shall be then due and payable, to the payment of the whole amount
then owing and unpaid upon all the Securities of such series for
principal and interest, with interest upon the overdue principal and
(to the extent that such interest has been collected by the Trustee
and to the extent permitted by law) upon overdue installments of
interest at the same rate as the rate of interest or Yield to
Maturity (in the case of Original Issue Discount Securities)
specified in the Securities of such series; and in case such moneys
shall be insufficient to pay in full the whole amount so due and
unpaid upon the Securities of such series, then to the payment of such
principal and interest or Yield to Maturity, without preference or
priority of principal over interest or Yield to Maturity, or of
interest or Yield to Maturity over principal, or of any installment
of interest over any other installment of interest, or of any Security
of such series over any other Security of such series, ratably to the
aggregate of such principal and accrued and unpaid interest or Yield
to Maturity; and
FOURTH: To the payment of the remainder, if any, to the Issuer
or any other Person lawfully entitled thereto.
SECTION 5.4 Suits for Enforcement. In case an Event of Default has
occurred, has not been waived and is 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 shall deem
most effectual to protect and enforce any of such rights, either at law or in
equity or in bankruptcy or otherwise, whether for the specific enforcement 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.
SECTION 5.5 Restoration of Rights on Abandonment of Proceedings.
In case the Trustee shall have proceeded to enforce any right under this
Indenture and such proceedings shall have been discontinued or abandoned for
any reason, or shall have been determined adversely to the Trustee, then and
in every such case the Issuer and the Trustee shall be restored respectively
to their former positions and rights hereunder, and all rights, remedies and
powers of the Issuer, the Trustee and the Securityholders shall continue as
though no such proceedings had been taken.
SECTION 5.6 Limitations on Suits by Securityholders. No Holder of
any Security of any series or of any Coupon appertaining thereto shall have
any right by virtue or by availing of any provision of this Indenture to
institute any action or proceeding at law or in equity or in bankruptcy or
otherwise upon or under or with respect to this Indenture, or for the
appointment of a trustee, receiver, liquidator, custodian or other similar
official or for any other remedy hereunder, unless such Holder previously
shall have given to the Trustee written notice of default and of the
continuance thereof, as hereinbefore provided, and unless also the Holders of
not less than 25% in aggregate principal amount of the Securities of such
series then Outstanding shall have made written request upon the Trustee to
institute such action or proceedings in its own name as trustee hereunder and
shall have offered to the Trustee such reasonable indemnity as it may require
against the reasonable costs, expenses and liabilities to be incurred therein
or thereby and the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity shall have failed to institute any such action
or proceeding and no direction inconsistent with such written request shall
have been given to the Trustee pursuant to Section 5.9; it being understood
and intended, and being expressly covenanted by the taker and Holder of every
Security or Coupon with every other taker and Holder and the Trustee, that no
one or more Holders of Securities of any series or Coupons appertaining to
such Securities shall have any right in any manner whatever by virtue or by
availing of any provision of this Indenture to affect, disturb or prejudice
the rights of any other such Holder of Securities or Coupons appertaining to
such Securities, or to obtain or seek to obtain priority over or preference to
any other such Holder or to enforce any right under this Indenture, except in
the manner herein provided and for the equal, ratable and common benefit of
all Holders of Securities of the applicable series and Coupons appertaining to
such Securities. For the protection and enforcement of the provisions of this
Section, each and every Securityholder and the Trustee shall be entitled to
such relief as can be given either at law or in equity.
SECTION 5.7 Unconditional Right of Security-holders to Institute
Certain Suits. Notwithstanding any other provision in this Indenture and any
provision of any Security, the right of any Holder of any Security or Coupon
to receive payment of the principal of and interest on such Security or Coupon
on or after the respective due dates expressed in this Indenture, such
Security or Coupon, or to institute suit for the enforcement of any such
payment on or after such respective dates, shall not be impaired or affected
without the consent of such Holder.
SECTION 5.8 Powers and Remedies Cumulative; Delay or Omission Not
Waiver of Default. Except as provided in Section 5.6, no right or remedy
herein conferred upon or reserved to the Trustee or to the Holders of
Securities or Coupons is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent
the concurrent assertion or employment of any other appropriate right or
remedy.
No delay or omission of the Trustee or of any Holder of Securities
or Coupons to exercise any right or power accruing upon any Event of Default
occurring and continuing as aforesaid shall impair any such right or power or
shall be construed to be a waiver of any such Event of Default or an
acquiescence therein; and, subject to Section 5.6, every power and remedy
given by this Indenture or by law to the Trustee or to the Holders of
Securities or Coupons may be exercised from time to time, and as often as
shall be deemed expedient, by the Trustee or by the Holders of Securities or
Coupons.
SECTION 5.9 Control by Holders of Securities. Except as otherwise
provided with respect to the Securities of any series as contemplated by
Section 2.3, the Holders of a majority in aggregate principal amount of (i) the
Securities of all series affected (with all such series voting as a single
class) at the time Outstanding or (ii) if provided with respect to the
Securities of any series as contemplated by Section 2.3, the Securities of any
series affected (with each such series voting as a separate class), shall have
the right to direct the time, method, and place of conducting any proceeding
for any remedy available to the Trustee, or exercising any trust or power
conferred on the Trustee with respect to the Securities of all series so
affected or with respect to the Securities of such series, as the case may be,
by this Indenture; provided that such direction shall not be otherwise than in
accordance with law and the provisions of this Indenture and provided further
that (subject to the provisions of Section 6.1) the Trustee shall have the
right to decline to follow any such direction if the Trustee, being advised by
counsel, shall determine that the action or proceeding so directed may not
lawfully be taken or if the Trustee in good faith by its board of directors,
the executive committee, or a trust committee of directors or Responsible
Officers of the Trustee shall determine that the action or proceedings so
directed would involve the Trustee in personal liability or if the Trustee in
good faith shall so determine that the actions or forebearances specified in
or pursuant to such direction would be unduly prejudicial to the interests of
Holders of the Securities of all series so affected or with respect to the
Securities of such series, as the case may be, not joining in the giving of
said direction, it being understood that (subject to Section 6.1) the Trustee
shall have no duty to ascertain whether or not such actions or forebearances
are unduly prejudicial to such Holders.
Nothing in this Indenture shall impair the right of the Trustee in
its discretion to take any action deemed proper by the Trustee and which is
not inconsistent with such direction or directions by Securityholders.
SECTION 5.10 Waiver of Past Defaults. Except as otherwise provided
with respect to the Securities of any series as contemplated by Section 2.3,
prior to a declaration of the acceleration of the maturity of the Securities
of any series as provided in Section 5.1, the Holders of not less than a
majority in aggregate principal amount of the Securities of such series at the
time Outstanding (such series voting as a separate class) may on behalf of the
Holders of all the Securities of such series waive any past default or Event
of Default described in clause (d) or (g) of Section 5.1 that relates to such
series of Securities but to less than all series of Securities then
Outstanding, except a default in respect of a covenant or provision hereof
that cannot be modified or amended without the consent of each Holder
affected. Except as otherwise provided with respect to the Securities of any
series as contemplated by Section 2.3, prior to the acceleration of the
maturity of the Securities of any series as provided in Section 5.1, the
Holders of not less than a majority in aggregate principal amount of all the
Securities at the time Outstanding (voting as a single class) may on behalf of
all Holders waive any past default or Event of Default described in clause (d)
or (g) of Section 5.1 that relates to all series of Securities then
Outstanding, or described in clause (e) or (f) of Section 5.1, except a
default in respect of a covenant or provision hereof that cannot be modified
or amended without the consent of the Holder of each Security affected. In
the case of any such waiver, the Issuer, the Trustee and the Holders of all
such Securities 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.
Upon any such waiver, such default shall cease to exist and be
deemed to have been cured and not to have occurred, and any Event of Default
arising therefrom shall be deemed to have been cured, and not to have occurred
for every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.
SECTION 5.11 Trustee to Give Notice of Default, But May Withhold in
Certain Circumstances. The Trustee shall, within ninety days after the
occurrence of a default with respect to the Securities of any series, give
notice of all defaults with respect to that series known to the Trustee (i) if
any Unregistered Securities of that series are then Outstanding, to the
Holders thereof, by publication at least once in an Authorized Newspaper in
the Borough of Manhattan, The City of New York and at least once in an
Authorized Newspaper in London (and, if required by Section 3.6, at least once
in an Authorized Newspaper in Luxembourg) and (ii) by first class mail,
postage prepaid, to all Holders of Securities of such series, as the names and
addresses of such Holders appear on the registry books, unless in each case
such defaults shall have been cured before the mailing or publication of such
notice (the term "default" for the purpose of this Section being hereby
defined to mean any event or condition which is, or with notice or lapse of
time or both would become, an Event of Default); provided that, except in the
case of default in the payment of the principal of or interest on any of the
Securities of such series, or in the payment of any sinking fund installment
on such series, the Trustee shall be protected in withholding such notice if
and so long as the board of directors, the executive committee, or a trust
committee of directors or trustees and/or Responsible Officers of the Trustee
in good faith determines that the withholding of such notice is in the
interests of the Securityholders of such series.
SECTION 5.12 Right of Court to Require Filing of Undertaking to Pay
Costs. Except as otherwise provided with respect to the Securities of any
series as contemplated by Section 2.3, all parties to this Indenture agree,
and each Holder of any Security or Coupon by his acceptance thereof shall be
deemed to have agreed, that any court may in its discretion require, in any
suit for the enforcement of any right or remedy under this Indenture or in any
suit against the Trustee for any action taken, 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 that such court may in its discretion assess
reasonable costs, including reasonable attorneys' fees, against any party
litigant in such suit, having due regard to the merits and good faith of the
claims or defenses made by such party litigant; but the provisions of this
Section shall not apply to any suit instituted by the Trustee, to any suit
instituted by any Securityholder or group of Securityholders of any series
holding in the aggregate more than 10% in aggregate principal amount of the
Securities of such series then Outstanding, or, in the case of any suit
relating to or arising under clause (d) or (g) of Section 5.1 (if the suit
relates to Securities of more than one but less than all series), l0% in
aggregate principal amount of Securities then Outstanding and affected
thereby, or in the case of any suit relating to or arising under clause (d) or
(g) (if the suit under clause (d) or (g) relates to all the Securities then
Outstanding), clause (e) or (f) of Section 5.1, 10% in aggregate principal
amount of all Securities then Outstanding, or to any suit instituted by any
Securityholder for the enforcement of the payment of the principal of or
interest on any Security on or after the due date expressed in such Security
or any date fixed for redemption.
ARTICLE SIX
CONCERNING THE TRUSTEE
SECTION 6.1 Duties and Responsibilities of the Trustee; During
Default; Prior to Default. With respect to the Holders of any series of
Securities issued hereunder, the Trustee, prior to the occurrence of an Event
of Default with respect to the Securities of such series and after the curing
or waiving of all Events of Default which may have occurred with respect to
such series, undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture. In case an Event of Default with
respect to the Securities of a series has occurred (which has not been cured
or waived) the Trustee shall exercise with respect to such series of
Securities 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 person
would exercise or use under the circumstances in the conduct of his or her own
affairs.
No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own wilful misconduct, except that
(a) prior to the occurrence of an Event of Default with respect
to the Securities of any series and after the curing or waiving of
all such Events of Default with respect to such series which may have
occurred:
(i) the duties and obligations of the Trustee with
respect to the Securities of such series shall be determined
solely by the express provisions of this Indenture, and the
Trustee shall not be liable except for the performance of such
duties and obligations as are specifically set forth in this
Indenture, and no implied covenants or obligations shall be
read into this Indenture against the Trustee; and
(ii) 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
therein, upon any statements, certificates or opinions
furnished to the Trustee and conforming to the requirements of
this Indenture; but in the case of any such statements,
certificates or opinions that by any provision hereof are
specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this
Indenture;
(b) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer or Responsible Officers
of the Trustee, unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(c) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with
the direction of the Holders pursuant to Section 5.9 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.
None of the provisions contained in this Indenture shall
require the Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties or in the
exercise of any of its rights or powers, if there shall be reasonable ground
for believing that the repayment of such funds or adequate indemnity against
such liability is not reasonably assured to it.
The provisions of this Section 6.1 are in furtherance of and subject
to Section 315 of the Trust Indenture Act of 1939.
SECTION 6.2 Certain Rights of the Trustee. In furtherance of and
subject to the Trust Indenture Act of 1939, and subject to Section 6.1:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, Officers' Certificate or
any other certificate, statement, instrument, opinion, report,
notice, request, consent, order, bond, debenture, note, coupon,
security or other paper or document believed by it to be genuine and
to have been signed or presented by the proper party or parties;
(b) any request, direction, order or demand of the Issuer
mentioned herein shall be sufficiently evidenced by an Officers'
Certificate (unless other evidence in respect thereof be herein
specifically prescribed); and any resolution of the Board of
Directors or Officers' Certificate may be evidenced to the Trustee by
a copy thereof certified by the secretary or an assistant secretary
of the Issuer;
(c) the Trustee may consult with counsel and any written advice
or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted to
be taken by it hereunder in good faith and in reliance thereon in
accordance with such advice or Opinion of Counsel;
(d) the Trustee shall be under no obligation to exercise any of
the trusts or powers vested in it by this Indenture at the request,
order or direction of any of the Securityholders pursuant to the
provisions of this Indenture, unless such Securityholders shall have
offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities that might be incurred therein or
thereby;
(e) the Trustee shall not be liable for any action taken or
omitted by it in good faith and believed by it to be authorized or
within the discretion, rights or powers conferred upon it by this
Indenture;
(f) prior to the occurrence of an Event of Default with respect
to the Securities of any series hereunder and after the curing or
waiving of all Events of Default with respect to the Securities of any
series, the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent,
order, approval, appraisal, bond, debenture, note, coupon, security,
or other paper or document unless requested in writing so to do by
the Holders of not less than a majority in aggregate principal amount
of the Securities of all series affected then Outstanding; provided
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, 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 expenses or liabilities as a condition to
proceeding; the reasonable expenses of every such investigation shall
be paid by the Issuer or, if paid by the Trustee or any predecessor
Trustee, shall be repaid by the Issuer upon demand; and
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys not regularly in its employ and the
Trustee shall not be responsible for any misconduct or negligence on
the part of any such agent or attorney appointed with due care by it
hereunder.
SECTION 6.3 Trustee Not Responsible for Recitals, Disposition of
Securities or Application of Proceeds Thereof. The recitals contained herein
and in the Securities, except the Trustee's certificates of authentication,
shall be taken as the statements of the Issuer, and the Trustee assumes no
responsibility for the correctness of the same. The Trustee makes no
representation as to the validity or sufficiency of this Indenture or of the
Securities or Coupons. The Trustee shall not be accountable for the use or
application by the Issuer of any of the Securities or of the proceeds thereof.
SECTION 6.4 Trustee and Agents May Hold Securities or Coupons;
Collections, etc. The Trustee or any agent of the Issuer or the Trustee, in
its individual or any other capacity, may become the owner or pledgee of
Securities or Coupons with the same rights it would have if it were not the
Trustee or such agent and may otherwise deal with the Issuer and receive,
collect, hold and retain collections from the Issuer with the same rights it
would have if it were not the Trustee or such agent.
SECTION 6.5 Moneys Held by Trustee. Subject to the provisions of
Section 10.4 hereof, all moneys received by the Trustee shall, until used or
applied as herein provided, be held in trust for the purposes for which they
were received, but need not be segregated from other funds except to the
extent required by mandatory provisions of law. Neither the Trustee nor any
agent of the Issuer or the Trustee shall be under any liability for interest
on any moneys received by it hereunder.
SECTION 6.6 Compensation and Indemnification of Trustee and Its
Prior Claim. The Issuer covenants and agrees to pay to the Trustee from time
to time, and the Trustee shall be entitled to, reasonable compensation (which,
to the extent permitted by law, shall not be limited by any provision of law
in regard to the compensation of a trustee of an express trust) and the Issuer
covenants and agrees to pay or reimburse the Trustee and each predecessor
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by or on behalf of it in accordance with any of the
provisions of this Indenture (including the reasonable compensation and the
expenses and disbursements of its counsel and of all agents and other persons
not regularly in its employ) except any such expense, disbursement or advance
as may arise from its negligence or bad faith. The Issuer also covenants to
indemnify the Trustee and each predecessor Trustee for, and to hold it
harmless against, any loss, liability or expense incurred without negligence
or bad faith on its part, arising out of or in connection with the acceptance
or administration of this Indenture or the trusts hereunder and its duties
hereunder, including the costs and expenses of defending itself against or
investigating any claim of liability in the premises. The obligations of the
Issuer under this Section to compensate and indemnify the Trustee and each
predecessor Trustee and to pay or reimburse the Trustee and each predecessor
Trustee for expenses, disbursements and advances shall constitute additional
indebtedness hereunder and shall survive the satisfaction and discharge of
this Indenture. Such additional indebtedness shall be a senior claim to that
of the Securities 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 Securities or Coupons, and the Securities are hereby subordinated
to such senior claim.
SECTION 6.7 Right of Trustee to Rely on Officers' Certificate, etc.
Subject to Sections 6.1 and 6.2, whenever in the administration of the trusts
of this Indenture the Trustee shall deem it necessary or desirable that a
matter be proved or established prior to taking or suffering or omitting any
action hereunder, such matter (unless other evidence in respect thereof be
herein specifically prescribed) may, in the absence of negligence or bad faith
on the part of the Trustee, be deemed to be conclusively proved and
established by an Officers' Certificate delivered to the Trustee, and such
certificate, in the absence of negligence or bad faith on the part of the
Trustee, 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.
SECTION 6.8 Indentures Not Creating Potential Conflicting Interests
for the Trustee. The following indentures are hereby specifically described
for the purposes of Section 310(b)(1) of the Trust Indenture Act of 1939:
None.
SECTION 6.9 Persons Eligible for Appointment as Trustee. The
Trustee for each series of Securities hereunder shall at all times be a
corporation having a combined capital and surplus of at least $100,000,000 and
which is eligible in accordance with the provisions of Section 310(a) of the
Trust Indenture Act of 1939. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of a
Federal, State or District of Columbia supervising or examining authority,
then for the purposes of this Section, the combined capital and surplus of
such corporation shall be deemed to be its combined capital and surplus as set
forth in its most recent report of condition so published.
In case at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, the Trustee shall resign
immediately in the manner and with the effect specified in Section 6.10.
SECTION 6.10 Resignation and Removal; Appointment of Successor
Trustee. (a) The Trustee, or any trustee or trustees hereafter appointed,
may at any time resign with respect to one or more or all series of Securities
by giving written notice of resignation to the Issuer and (i) if any
Unregistered Securities of a series affected are then Outstanding, by giving
notice of such resignation to the Holders thereof, by publication at least
once in an Authorized Newspaper in the Borough of Manhattan, The City of New
York, and at least once in an Authorized Newspaper in London (and, if required
by Section 3.6, at least once in an Authorized Newspaper in Luxembourg), (ii)
if any Unregistered Securities of a series affected are then Outstanding, by
mailing notice of such resignation to the Holders thereof who have filed their
names and addresses with the Trustee at such addresses as were so furnished to
the Trustee and (iii) by mailing notice of such resignation to the Holders of
then Outstanding Registered Securities of each series affected at their
addresses as they shall appear on the registry books. Upon receiving such
notice of resignation, the Issuer shall promptly appoint a successor trustee
or trustees with respect to the applicable series by written instrument in
duplicate, executed by authority of the Board of Directors, one copy of which
instrument shall be delivered to the resigning Trustee and one copy to the
successor trustee or trustees. If no successor trustee shall have been so
appointed with respect to any series and have accepted appointment within 30
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 Securityholder who has been a bona fide Holder of a
Security or Securities of the applicable series for at least six months may,
subject to the provisions of Section 5.12, 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:
(i) the Trustee shall fail to comply with the provisions of
Section 310(b) of the Trust Indenture Act of 1939 with respect to any
series of Securities after written request therefor by the Issuer or
by any Securityholder who has been a bona fide Holder of a Security
or Securities of such series for at least six months; or
(ii) the Trustee shall cease to be eligible in accordance with
the provisions of Section 6.9 and Section 310(a) of the Trust
Indenture Act of 1939 and shall fail to resign after written request
therefor by the Issuer or by any Securityholder; or
(iii) the Trustee shall become incapable of acting with respect
to any series of Securities, or shall be adjudged a bankrupt or
insolvent, or a receiver or liquidator of the Trustee or of its
property shall be appointed, or any public officer shall take charge
or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation;
then, in any such case, the Issuer may remove the Trustee with respect to the
applicable series of Securities and appoint a successor trustee for such
series by written instrument, in duplicate, executed by order of the Board of
Directors of the Issuer, one copy of which instrument shall be delivered to
the Trustee so removed and one copy to the successor trustee, or, subject to
the provisions of Section 5.12, any Securityholder who has been a bona fide
Holder of a Security or Securities of such series for at least six months may
on behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor trustee with respect to such series. Such court may thereupon,
after such notice, if any, as it may deem proper and prescribe, remove the
Trustee and appoint a successor trustee.
(c) The Holders of a majority in aggregate principal amount of the
Securities of any series at the time Outstanding may at any time remove the
Trustee with respect to Securities of such series and appoint a successor
trustee with respect to the Securities of such series by delivering to the
Trustee so removed, to the successor trustee so appointed and to the Issuer
the evidence provided for in Section 7.1 of the action in that regard taken by
the Securityholders.
(d) Any resignation or removal of the Trustee with respect to any
series and any appointment of a successor trustee with respect to such series
pursuant to any of the provisions of this Section 6.10 shall become effective
upon acceptance of appointment by the successor trustee as provided in Section
6.11.
SECTION 6.11 Acceptance of Appointment by Successor Trustee. Any
successor trustee appointed as provided in Section 6.10 shall execute and
deliver to the Issuer and to its predecessor trustee an instrument accepting
such appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee with respect to all or any applicable series shall become
effective and such successor trustee, without any further act, deed or
conveyance, shall become vested with all rights, powers, duties and
obligations with respect to such series of its predecessor hereunder, with
like effect as if originally named as trustee for such series hereunder; but,
nevertheless, on the written request of the Issuer or of the successor
trustee, upon payment of its charges then unpaid, the trustee ceasing to act
shall, subject to Section 10.4, pay over to the successor trustee all moneys
at the time held by it hereunder and shall execute and deliver an instrument
transferring to such successor trustee all such rights, powers, duties and
obligations. Upon request of any such successor trustee, the Issuer shall
execute any and all instruments in writing for more fully and certainly vesting
in and confirming to such successor trustee all such rights and powers. Any
trustee ceasing to act shall, nevertheless, retain a prior claim upon all
property or funds held or collected by such trustee to secure any amounts then
due it pursuant to the provisions of Section 6.6.
If a successor trustee is appointed with respect to the Securities
of one or more (but not all) series, the Issuer, the predecessor Trustee and
each successor trustee with respect to the Securities of any applicable series
shall execute and deliver an indenture supplemental hereto that shall contain
such provisions as shall be deemed necessary or desirable to confirm that all
the rights, powers, trusts and duties of the predecessor Trustee with respect
to the Securities of any series as to which the predecessor Trustee is not
retiring shall continue to be vested in the predecessor Trustee, and shall add
to or change any of the provisions of this Indenture as shall be necessary to
provide for or facilitate the administration of the trusts hereunder by more
than one trustee, it being understood that nothing herein or in such
supplemental indenture shall constitute such trustees co-trustees of the same
trust and that each such trustee shall be trustee of a trust or trusts under
separate indentures.
No successor trustee with respect to any series of Securities shall
accept appointment as provided in this Section 6.11 unless at the time of such
acceptance such successor trustee shall be qualified under Section 310(b) of
the Trust Indenture Act of 1939 and eligible under the provisions of Section
6.9.
Upon acceptance of appointment by any successor trustee as provided
in this Section 6.11, the Issuer shall give notice thereof (a) if any
Unregistered Securities of a series affected are then Outstanding, to the
Holders thereof, by publication of such notice at least once in an Authorized
Newspaper in the Borough of Manhattan, The City of New York and at least once
in an Authorized Newspaper in London (and, if required by Section 3.6, at
least once in an Authorized Newspaper in Luxembourg), (b) if any Unregistered
Securities of a series affected are then Outstanding, to the Holders thereof
who have filed their names and addresses with the Trustee by mailing such
notice to such Holders at such addresses as were so furnished to the Trustee
(and the Trustee shall make such information available to the Issuer for such
purpose) and (c) to the Holders of Registered Securities of each series
affected, by mailing such notice to such Holders at their addresses as they
shall appear on the registry books. If the acceptance of appointment is
substantially contemporaneous with the resignation, then the notice called for
by the preceding sentence may be combined with the notice called for by
Section 6.10. If the Issuer fails to give such notice within ten days after
acceptance of appointment by the successor trustee, the successor trustee
shall cause such notice to be given at the expense of the Issuer.
SECTION 6.12 Merger, Conversion, Consolidation or Succession to
Business of Trustee. Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, provided that such
corporation shall be qualified under Section 310(b) of the Trust Indenture Act
of 1939 and eligible under the provisions of Section 6.9, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding. The
successor of the Trustee shall promptly provide notice of such succession to
the Holders of Securities then Outstanding in the manner provided in Section
11.4.
In case at the time such successor to the Trustee shall succeed to
the trusts created by this Indenture any of the Securities of any series shall
have been authenticated but not delivered, any such successor to the Trustee
may adopt the certificate of authentication of any predecessor Trustee and
deliver such Securities so authenticated; and, in case at that time any of the
Securities of any series shall not have been authenticated, any successor to
the Trustee may authenticate such Securities either in the name of any
predecessor hereunder or in the name of the successor Trustee; and in all such
cases such certificate shall have the full force which it is anywhere in the
Securities of such series or in this Indenture provided that the certificate
of the Trustee shall have; provided, that the right to adopt the certificate
of authentication of any predecessor Trustee or to authenticate Securities of
any series in the name of any predecessor Trustee shall apply only to its
successor or successors by merger, conversion or consolidation.
SECTION 6.13 Appointment of Authenticating Agent. As long as any
Securities of a series remain Outstanding, the Trustee may, by an instrument
in writing, appoint with the approval of the Issuer an authenticating agent
(the "Authenticating Agent") which shall be authorized to act on behalf of the
Trustee to authenticate Securities, including Securities issued upon exchange,
registration of transfer, partial redemption or repurchase or pursuant to
Section 2.9. Securities of each such series authenticated by such
Authenticating Agent shall be entitled to the benefits of this Indenture and
shall be valid and obligatory for all purposes as if authenticated by the
Trustee. Whenever reference is made in this Indenture to the authentication
and delivery of Securities of any series by the Trustee or to 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
for such series and a certificate of authentication executed on behalf of the
Trustee by such Authenticating Agent. Such Authenticating Agent shall at all
times be a corporation organized and doing business under the laws of the
United States of America or of any State, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at
least $5,000,000 (determined as provided in Section 6.9 with respect to the
Trustee) and subject to supervision or examination by Federal or State
authority.
Any corporation into which any 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 any Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency
business of any Authenticating Agent, shall continue to be the Authenticating
Agent with respect to all series of Securities for which it served as
Authenticating Agent without the execution or filing of any paper or any
further act on the part of the Trustee or such Authenticating Agent. Any
Authenticating Agent may at any time, and if it shall cease to be eligible
shall, resign by giving written notice of resignation to the Trustee and to
the Issuer.
Upon receiving such a notice of resignation or upon such a
termination, or in case at any time any Authenticating Agent shall cease to be
eligible in accordance with the provisions of this Section 6.13 with respect
to one or more series of Securities, the Trustee shall upon receipt of an
Issuer Order appoint a successor Authenticating Agent and the Issuer shall
provide notice of such appointment to all Holders of Securities of each such
series in the manner and to the extent provided in Section 11.4. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all rights, powers, duties and responsibilities of its
predecessor hereunder, with like effect as if originally named as
Authenticating Agent. The Issuer agrees to pay to the Authenticating Agent
for any series from time to time reasonable compensation. The Authenticating
Agent for the Securities of any series shall have no responsibility or
liability for any action taken by it as such at the direction of the Trustee.
Sections 6.2, 6.3, 6.4, 6.6, 6.9 and 7.3 shall be applicable to any
Authenticating Agent.
ARTICLE SEVEN
CONCERNING THE SECURITYHOLDERS
SECTION 7.1 Evidence of Action Taken by Securityholders. Any
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Indenture to be given or taken by a specified
percentage in principal amount of the Securityholders of any or all series may
be embodied in and evidenced by one or more instruments of substantially
similar tenor signed by such specified percentage of Securityholders in Person
or by agent duly appointed in writing; and, except as herein otherwise
expressly provided, such action shall become effective when such instrument or
instruments are delivered to the Trustee. Proof of execution of any
instrument or of a writing appointing any such agent shall be sufficient for
any purpose of this Indenture and (subject to Sections 6.1 and 6.2) conclusive
in favor of the Trustee and the Issuer, if made in the manner provided in this
Article.
SECTION 7.2 Proof of Execution of Instruments and of Holding of
Securities. Subject to Sections 6.1 and 6.2, the execution of any instrument
by a Securityholder or his agent or proxy may be proved in the following
manner:
(a) The fact and date of the execution by any Holder of any
instrument may be proved by the certificate of any notary public or
other officer of any jurisdiction authorized to take acknowledgments
of deeds or administer oaths that the Person executing such
instruments acknowledged to him the execution thereof, or by an
affidavit of a witness to such execution sworn to before any such
notary or other such officer. Where such execution is by or on
behalf of any legal entity other than an individual, such certificate
or affidavit shall also constitute sufficient proof of the authority
of the Person executing the same. The fact of the holding by any
Holder of an Unregistered Security of any series, and the identifying
number of such Security and the date of his holding the same, may be
proved by the production of such Security or by a certificate
executed by any trust company, bank, banker or recognized securities
dealer wherever situated satisfactory to the Trustee, if such
certificate shall be deemed by the Trustee to be satisfactory, and
each such certificate shall be dated and shall state that on the date
thereof an Unregistered Security of such series bearing a specified
identifying number was deposited with or exhibited to such trust
company, bank, banker or recognized securities dealer by the Person
named in such certificate. Any such certificate may be issued in
respect of one or more Unregistered Securities of one or more series
specified therein. The holding by the Person named in any such
certificate of any Unregistered Securities of any series specified
therein shall be presumed to continue for a period of one year from
the date of such certificate unless at the time of any determination
of such holding (1) another certificate bearing a later date issued
in respect of the same Unregistered Securities shall be produced, or
(2) the Unregistered Security of such series specified in such
certificate shall be produced by some other Person, or (3) the
Unregistered Security of such series specified in such certificate
shall have ceased to be Outstanding. Subject to Sections 6.1 and
6.2, the fact and date of the execution of any such instrument and
the amount and numbers of Unregistered Securities of any series held
by the Person so executing such instrument and the amount and numbers
of any Unregistered Security or Securities of such series may also be
proven in accordance with such reasonable rules and regulations as
may be prescribed by the Trustee for such series or in any other
manner which the Trustee for such series may deem sufficient.
(b) In the case of Registered Securities, the ownership of such
Securities shall be proved by the Security register or by a
certificate of the Security registrar.
The Issuer may set a record date for purposes of determining the
identity of Holders of Registered Securities of any series entitled to vote or
consent to any action referred to in Section 7.1, which record date may be set
at any time or from time to time by notice to the Trustee, for any date or
dates (in the case of any adjournment or reconsideration) not more than 60
days nor less than five days prior to the proposed date of such vote or
consent, and thereafter, notwithstanding any other provisions hereof, with
respect to Registered Securities of any series, only Holders of Registered
Securities of such series of record at the close of business on such record
date shall be entitled to so vote or give such consent or revoke such vote or
consent; provided that no authorization, vote or consent by the Holders of
Registered Securities on a record date shall be deemed effective unless it
shall become effective pursuant to the provisions of this Indenture not later
than six months after such record date.
SECTION 7.3 Holders to Be Treated as Owners. The Issuer, the
Trustee and any agent of the Issuer or the Trustee may deem and treat the
Person in whose name any Security shall be registered upon the Security
register for such series as the absolute owner of such Security (whether or
not such Security shall be overdue and notwithstanding any notation of
ownership or other writing thereon) for the purpose of receiving payment of or
on account of the principal of and, subject to the provisions of this
Indenture, interest on such Security and for all other purposes; and neither
the Issuer nor the Trustee nor any agent of the Issuer or the Trustee shall be
affected by any notice to the contrary. The Issuer, the Trustee and any agent
of the Issuer or the Trustee may treat the Holder of any Unregistered Security
and the Holder of any Coupon as the absolute owner of such Unregistered
Security or Coupon (whether or not such Unregistered Security or Coupon shall
be overdue) for the purpose of receiving payment thereof or on account thereof
and for all other purposes and neither the Issuer, the Trustee, nor any agent
of the Issuer or the Trustee shall be affected by any notice to the contrary.
All such payments so made to any such Person, or upon his order, shall be
valid, and, to the extent of the sum or sums so paid, effectual to satisfy and
discharge the liability for moneys payable upon any such Unregistered Security
or Coupon.
SECTION 7.4 Securities Owned by Issuer Deemed Not Outstanding. In
determining whether the Holders of the requisite aggregate principal amount of
Outstanding Securities of any or all series have concurred in any direction,
consent or waiver under this Indenture, Securities that are owned by the
Issuer or any other obligor on the Securities with respect to which such
determination is being made or by any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
the Issuer or any other obligor on the Securities with respect to which such
determination is being made shall be disregarded and deemed not to be
Outstanding for the purpose of any such determination, except that for the
purpose of determining whether the Trustee shall be protected in relying on
any such direction, consent or waiver only Securities that the Trustee knows
are so owned shall be so disregarded. Securities so owned that have been
pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgee's right so to act
with respect to such Securities and that the pledgee is not the Issuer or any
other obligor upon the Securities or any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
the Issuer or any other obligor on the Securities. In case of a dispute as to
such right, the advice of counsel shall be full protection in respect of any
decision made by the Trustee in accordance with such advice. Upon request of
the Trustee, the Issuer shall furnish to the Trustee promptly an Officers'
Certificate listing and identifying all Securities, if any, known by the
Issuer to be owned or held by or for the account of any of the above-described
persons; and, subject to Sections 6.1 and 6.2, the Trustee shall be entitled
to accept such Officers' Certificate as conclusive evidence of the facts
therein set forth and of the fact that all Securities not listed therein are
Outstanding for the purpose of any such determination.
SECTION 7.5 Right of Revocation of Action Taken. At any time prior
to (but not after) the evidencing to the Trustee, as provided in Section 7.1,
of the taking of any action by the Holders of the percentage in aggregate
principal amount of the Securities of any or all series, as the case may be,
specified in this Indenture in connection with such action, any Holder of a
Security the serial number of which is shown by the evidence to be included
among the serial numbers of the Securities the Holders of which have consented
to such action may, by filing written notice at the Corporate Trust Office and
upon proof of holding as provided in this Article, revoke such action so far as
concerns such Security. Except as aforesaid any such action taken by the
Holder of any Security shall be conclusive and binding upon such Holder and
upon all future Holders and owners of such Security and of any Securities
issued in exchange or substitution therefor or on registration of transfer
thereof, irrespective of whether or not any notation in regard thereto is made
upon any such Security. Any action taken by the Holders of the percentage in
aggregate principal amount of the Securities of any or all series, as the case
may be, specified in this Indenture in connection with such action shall be
conclusively binding upon the Issuer, the Trustee and the Holders of all the
Securities affected by such action.
ARTICLE EIGHT
SUPPLEMENTAL INDENTURES
SECTION 8.1 Supplemental Indentures Without Consent of
Securityholders. The Issuer, when authorized by a resolution of its Board of
Directors (which resolution may provide general terms or parameters for such
action and may provide that the specific terms of such action may be
determined in accordance with or pursuant to an Issuer Order), and the Trustee
may from time to time and at any time enter into an indenture or indentures
supplemental hereto for one or more of the following purposes:
(a) to convey, transfer, assign, mortgage or pledge to the
Trustee as security for the Securities of one or more series any
property or assets;
(b) to evidence the succession of another corporation to the
Issuer, or successive successions, and the assumption by the
successor corporation of the covenants, agreements and obligations of
the Issuer pursuant to Article Nine;
(c) to add to the covenants of the Issuer such further
covenants, restrictions, conditions or provisions as the Issuer and
the Trustee shall reasonably consider to be for the protection of the
Holders of Securities or Coupons (or any series thereof), and to make
the occurrence, or the occurrence and continuance, of a default in
any such additional covenants, restrictions, conditions or provisions
an Event of Default permitting the enforcement of all or any of the
several remedies provided in this Indenture as herein set forth;
provided, that in respect of any such additional covenant,
restriction, condition or provision such supplemental indenture may
provide for a particular period of grace after default (which period
may be shorter or longer than that allowed in the case of other
defaults) or may provide for an immediate enforcement upon such an
Event of Default or may limit the remedies available to the Trustee
upon such an Event of Default or may limit the right of the Holders
of a majority in aggregate principal amount of the Securities of such
series to waive such an Event of Default;
(d) to cure any ambiguity or to correct or supplement any
provision contained herein or in any supplemental indenture that may
be defective or inconsistent with any other provision contained herein
or in any supplemental indenture, or to make any other changes or
provisions as the Issuer may deem necessary or desirable, provided
that no such action shall adversely affect the interests of the
Holders of the Securities or Coupons;
(e) to establish the forms or terms of Securities of any series
or of the Coupons appertaining to such Securities as permitted by
Sections 2.1 and 2.3;
(f) to evidence and provide for the acceptance of appointment
hereunder by a successor trustee with respect to the Securities of
one or more series and to add to or change any of the provisions of
this Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one trustee,
pursuant to the requirements of Section 6.11; and
(g) to add to, change or eliminate any of the provisions of
this Indenture (which addition, change or elimination may apply to
one or more series of Securities), provided that any such addition,
change or elimination shall neither (A) apply to any Security of any
series created prior to the execution of such supplemental indenture
and entitled to the benefit of such provision nor (B) modify the
rights of the Holder of any such Security with respect to such
provision.
The Trustee is hereby authorized to join with the Issuer in the
execution of any such supplemental indenture, to make any further appropriate
agreements and stipulations that may be therein contained and to 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 that affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
Any supplemental indenture authorized by the provisions of this
Section may be executed without the consent of the Holders of any of the
Securities at the time Outstanding, notwithstanding any of the provisions of
Section 8.2.
SECTION 8.2 Supplemental Indentures With Consent of
Securityholders. With the consent (evidenced as provided in Article Seven) of
the Holders of not less than a majority in aggregate principal amount of the
Securities at the time Outstanding of all series affected by such supplemental
indenture (voting as one class), the Issuer, when authorized by a resolution
of its Board of Directors (which resolution may provide general terms or
parameters for such action and may provide that the specific terms of such
action may be determined in accordance with or pursuant to an Issuer Order),
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
provisions 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 the Securities of each such series or of
the Coupons appertaining to such Securities; provided, that no such
supplemental indenture shall (a) extend the final maturity of any Security, or
reduce the principal amount thereof, or reduce the rate or extend the time of
payment of interest thereon, or reduce any amount payable on redemption or
repurchase thereof, or make the principal thereof (including any amount in
respect of original issue discount), or interest thereon payable in any coin
or currency other than that provided in the Securities and Coupons or in
accordance with the terms thereof, or reduce the amount of the principal of an
Original Issue Discount Security that would be due and payable upon an
acceleration of the maturity thereof pursuant to Section 5.1 or the amount
thereof provable in bankruptcy pursuant to Section 5.2 or modify the
percentage of Holders required pursuant to Section 5.1 or 5.10 to waive any
default or to rescind and annul any declaration of acceleration, or alter the
provisions of Section 11.11 or 11.12 or impair or affect the right of any
Securityholder to institute suit for the payment thereof or, if the Securities
provide therefor, any right of repayment, repurchase or redemption at the
option of the Securityholder, in each case without the consent of the Holder
of each Security so affected, or (b) reduce the aforesaid percentage of
Securities of any series, the consent of the Holders of which is required for
any such supplemental indenture, without the consent of the Holders of each
Security so affected; provided further that if the terms of the Securities of
any series so provides as contemplated by Section 2.3, no such supplemental
indenture shall affect the Securities of such series without the consent of
the Holders of not less than a majority in aggregate principal amount of the
Securities at the time Outstanding of such series (voting as a separate
class).
A supplemental indenture that changes or eliminates any covenant or
other provision of this Indenture that has expressly been included solely for
the benefit of one or more particular series of Securities, or which modifies
the rights of Holders of Securities of such series, or of Coupons appertaining
to such Securities, with respect to such covenant or provision, shall be
deemed not to affect the rights under this Indenture of the Holders of
Securities of any other series or of the Coupons appertaining to such
Securities.
Upon the request of the Issuer, accompanied by a copy of a
resolution of the Board of Directors (which resolution may provide general
terms or parameters for such action and may provide that the specific terms of
such action may be determined in accordance with or pursuant to an Issuer
Order) certified by the secretary or an assistant secretary of the Issuer
authorizing the execution of any such supplemental indenture, and upon the
filing with the Trustee of evidence of the consent of the Holders of the
Securities as aforesaid and other documents, if any, required by Section 7.1,
the Trustee shall join with the Issuer 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 Securityholders
under this Section to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
Promptly after the execution by the Issuer and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the Trustee
shall give notice thereof (i) to the Holders of then Outstanding Registered
Securities of each series affected thereby, by mailing a notice thereof by
first-class mail to such Holders at their addresses as they shall appear on
the Security register, (ii) if any Unregistered Securities of a series
affected thereby are then Outstanding, to the Holders thereof who have
filed their names and addresses with the Trustee, by mailing a notice
thereof by first-class mail to such Holders at such addresses as were so
furnished to the Trustee and (iii) if any Unregistered Securities of a
series affected thereby are then Outstanding, to all Holders thereof, by
publication of a notice thereof at least once in an Authorized Newspaper in
the Borough of Manhattan, The City of New York and at least once in an
Authorized Newspaper in London (and, if required by Section 3.6, at least
once in an Authorized Newspaper in Luxembourg), and in each case such
notice shall set forth in general terms the substance of such supplemental
indenture. Any failure of the Issuer to give such notice, or any defect
therein, shall not, however, in any way impair or affect the validity of
any such supplemental indenture.
SECTION 8.3 Effect of Supplemental Indenture. Upon the execution
of any supplemental indenture pursuant to the provisions hereof, 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 Issuer and the
Holders of Securities of each series affected thereby 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. Each supplemental
indenture shall comply with the Trust Indenture Act of 1939 as in effect at
the time it is entered into.
SECTION 8.4 Documents to Be Given to Trustee. The Trustee, subject
to the provisions of Sections 6.1 and 6.2, may receive an Officers'
Certificate and an Opinion of Counsel as conclusive evidence that any
supplemental indenture executed pursuant to this Article 8 complies with the
applicable provisions of this Indenture.
SECTION 8.5 Notation on Securities in Respect of Supplemental
Indentures. Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to the provisions of this
Article may bear a notation in form approved by the Trustee for such series as
to any matter provided for by such supplemental indenture or as to any action
taken by Securityholders. If the Issuer or the Trustee shall so determine,
new Securities of any series so modified as to conform, in the opinion of the
Trustee and the Board of Directors, to any modification of this Indenture
contained in any such supplemental indenture may be prepared by the Issuer,
authenticated by the Trustee and delivered in exchange for the Securities of
such series then Outstanding.
SECTION 8.6 Subordination Unimpaired. This Indenture may not
be amended to alter the subordination of any of the Outstanding Securities
without the written consent of each holder of Senior Indebtedness then
outstanding that would be adversely affected thereby.
ARTICLE NINE
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 9.1 Issuer May Consolidate, etc., on Certain Terms. The
Issuer covenants that it will not merge or consolidate with or into any other
Person or sell, lease or convey all or substantially all of its assets to any
other Person, unless (i) either the Issuer shall be the continuing
corporation, or the successor corporation or the Person which acquires by
sale, lease or conveyance all or substantially all the assets of the Issuer
(if other than the Issuer) shall be a corporation organized and existing under
the laws of the United States of America or any State thereof or the District
of Columbia and shall expressly assume the due and punctual payment of the
principal of and interest on all the Securities and Coupons, if any, according
to their tenor, and the due and punctual performance and observance of all of
the covenants and conditions of this Indenture and of the Securities to be
performed or observed by the Issuer, by supplemental indenture satisfactory to
the Trustee, executed and delivered to the Trustee by such corporation, and
(ii) the Issuer or such successor corporation, as the case may be, shall not,
immediately after such merger or consolidation, or such sale, lease or
conveyance, be in default in the performance of any such covenant or
condition.
SECTION 9.2 Successor Corporation Substituted. In case of any such
consolidation, merger, sale, lease or conveyance, and following such an
assumption by the successor corporation, such successor corporation shall
succeed to and be substituted for the Issuer, with the same effect as if it
had been named herein. Such successor corporation may cause to be signed, and
may issue either in its own name or in the name of the Issuer prior to such
succession any or all of the Securities issuable hereunder that together with
any Coupons appertaining thereto theretofore shall not have been signed by the
Issuer and delivered to the Trustee; and, upon the order of such successor
corporation, instead of the Issuer, and subject to all the terms, conditions
and limitations in this Indenture prescribed, the Trustee shall authenticate
and shall deliver any Securities together with any Coupons appertaining
thereto that previously shall have been signed and delivered by the officers
of the Issuer to the Trustee for authentication, and any Securities that such
successor corporation thereafter shall cause to be signed and delivered to the
Trustee for that purpose. All of the Securities so issued together with any
Coupons appertaining thereto shall in all respects have the same legal rank
and benefit under this Indenture as the Securities theretofore or
thereafter issued in accordance with the terms of this Indenture as though
all of such Securities had been issued at the date of the execution hereof.
In case of any such consolidation, merger, sale, lease or conveyance
such changes in phrasing and form (but not in substance) may be made in the
Securities and Coupons thereafter to be issued as may be appropriate.
In the event of any such sale or conveyance (other than a conveyance
by way of lease) the Issuer or any successor corporation that shall
theretofore have become such in the manner described in this Article shall be
discharged from all obligations and covenants under this Indenture and the
Securities and may be liquidated and dissolved.
SECTION 9.3 Opinion of Counsel Delivered to Trustee. The Trustee,
subject to the provisions of Sections 6.1 and 6.2, may receive an Opinion of
Counsel as conclusive evidence that any such consolidation, merger, sale,
lease or conveyance, and any such assumption, and any such liquidation or
dissolution, complies with the applicable provisions of this Indenture.
ARTICLE TEN
SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS
SECTION 10.1 Satisfaction and Discharge of Indenture. (A) If at
any time (a) the Issuer shall have paid or caused to be paid the principal of
and interest on all the Securities of any series Outstanding hereunder and all
unmatured Coupons appertaining thereto (other than Securities of such series
and Coupons appertaining thereto that have been destroyed, lost or stolen and
that have been replaced or paid as provided in Section 2.9) as and when the
same shall have become due and payable, or (b) the Issuer shall have delivered
to the Trustee for cancellation all Securities of any series theretofore
authenticated and all unmatured Coupons appertaining thereto (other than any
Securities of such series and Coupons appertaining thereto that shall have
been destroyed, lost or stolen and that shall have been replaced or paid as
provided in Section 2.9) or (c) in the case of any series of Securities where
the exact amount (including the currency of payment) of principal of and
interest due on which can be determined at the time of making the deposit
referred to in clause (ii) below, (i) all the Securities of such series and
all unmatured Coupons appertaining thereto not theretofore delivered to the
Trustee for cancellation shall have become due and payable, or are by their
terms to become due and payable within one year or are to be called for
redemption within one year under arrangements satisfactory to the Trustee for
the giving of notice of redemption, and (ii) the Issuer shall have irrevocably
deposited or caused to be irrevocably deposited with the Trustee as trust
funds for the purpose of making the following payments, specifically pledged
as security for, and dedicated solely to, the benefit of the Holders of the
Securities of such series and Coupons appertaining thereto (x) cash in an
amount, or (y) in the case of any series of Securities the payments on which
may only be made in Dollars, direct obligations of the United States of
America, backed by its full faith and credit ("U.S. Government Obligations"),
maturing as to principal and interest at such times and in such amounts as
will insure the availability of cash, or (z) a combination thereof, sufficient
(without investment of such cash or reinvestment of any interest or proceeds
from such U.S. Government Obligations) in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay (A) the principal of
and interest on all Securities of such series and Coupons appertaining thereto
on each date that such principal or interest is or may, through the
repurchase, redemption or repayment at the option of the Issuer or the Holders
thereof, become due and payable and (B) any mandatory sinking fund payments on
the dates on which such payments are due and payable, in accordance with the
terms of the Indenture and the Securities of such series; and if, in any such
case, the Issuer shall also pay or cause to be paid all other sums payable
hereunder by the Issuer and the Issuer has delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to such discharge of this
Indenture have been complied with, then this Indenture shall cease to be of
further effect with respect to the Securities of such Series and the Coupons
appertaining thereto (except as to (i) rights of registration of transfer and
exchange of Securities of such Series and of Coupons appertaining thereto and
the Issuer's right of optional redemption, if any, (ii) substitution of
mutilated, defaced, destroyed, lost or stolen Securities or Coupons, (iii)
rights of Holders of Securities and Coupons appertaining thereto to receive
payments of principal thereof and interest thereon, upon the original stated
due dates therefor (but not upon acceleration) or dates called for redemption,
and remaining rights of the Holders to receive mandatory sinking fund
payments, if any, (iv) the rights, obligations, duties and immunities of the
Trustee hereunder, (v) the rights of the Holders of Securities of such series
and Coupons appertaining thereto as beneficiaries hereof with respect to the
property so deposited with the Trustee payable to all or any of them, and (vi)
the obligations of the Issuer and the rights of the Holders of the Securities
under Sections 3.1, 3.2, 3.3 and Article Eight (solely insofar as it
relates to the surviving rights and obligations with respect to the
Securities under this Indenture)), and the Trustee, on demand of the Issuer
accompanied by an Officers' Certificate and an Opinion of Counsel and at
the cost and expense of the Issuer, shall execute proper instruments
acknowledging such satisfaction of and discharging this Indenture. The
Issuer agrees to reimburse the Trustee for any costs or expenses thereafter
reasonably and properly incurred and to compensate the Trustee for any
services thereafter reasonably and properly rendered by the Trustee in
connection with this Indenture or the Securities of such series.
(B) The following provisions shall apply to the Securities of each
series unless specifically otherwise provided in a Board Resolution, Officers'
Certificate or indenture supplemental hereto provided pursuant to Section 2.3.
In addition to discharge of the Indenture pursuant to the next preceding
paragraph, in the case of any series of Securities the exact amounts
(including the currency of payment) of principal of and interest due on which
can be determined at the time of making the deposit referred to in clause (a)
below, the Issuer shall be deemed to have paid and discharged the entire
indebtedness on all the Securities of such a series and the Coupons
appertaining thereto on the 91st day after the date of the deposit referred to
in clause (a) below, and the provisions of this Indenture with respect to the
Securities of such series and Coupons appertaining thereto shall no longer be
in effect (except as to (i) rights of registration of transfer and exchange of
Securities of such series and of Coupons appertaining thereto and the Issuer's
right of optional redemption, if any, (ii) substitution of mutilated, defaced,
destroyed, lost or stolen Securities or Coupons, (iii) rights of Holders of
Securities and Coupons appertaining thereto to receive payments of principal
thereof and interest thereon, upon the original stated due dates therefor (but
not upon acceleration) or dates called for redemption, and remaining rights of
the Holders to receive mandatory sinking fund payments, if any, (iv) the
rights, obligations, duties and immunities of the Trustee hereunder, (v) the
rights of the Holders of Securities of such series and Coupons appertaining
thereto as beneficiaries hereof with respect to the property so deposited with
the Trustee payable to all or any of them and (vi) the obligations of the
Issuer under Sections 3.1, 3.2, 3.3 and Article Eight (solely insofar as it
relates to the surviving rights and obligations with respect to the Securities
under this Indenture)) ("defeasance"), and the Trustee, at the expense of the
Issuer, shall at the Issuer's request, execute proper instruments
acknowledging the same, if
(a) with reference to this provision the Issuer has irrevocably
deposited or caused to be irrevocably deposited with the Trustee as
trust funds in trust for the purpose of making the following payments,
specifically pledged as security for, and dedicated solely to, the
benefit of the Holders of the Securities of such series and Coupons
appertaining thereto, (i) cash in an amount, or (ii) in the case of
any series of Securities the payments on which may only be made in
Dollars, U.S. Government Obligations, maturing as to principal and
interest at such times and in such amounts as will insure the
availability of cash or (iii) a combination thereof, sufficient
(without investment of such cash or reinvestment of any interest or
proceeds from such U.S. Government Obligations), in the opinion of a
nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the
Trustee, to pay (A) the principal of and interest on all
Securities of such series and Coupons appertaining thereto on each
date that such principal or interest is or may, through the
repurchase, redemption or repayment at the option of the Issuer or
the Holders thereof, become due and payable and (B) any mandatory
sinking fund payments on the dates on which such payments are due
and payable in accordance with the terms of the Indenture and the
Securities of such series;
(b) no Event of Default or event which with notice or lapse of
time or both would become an Event of Default with respect to the
Securities of such series shall have occurred and be continuing on
the date of such deposit or, except as may otherwise be provided with
respect to the Securities of such series as contemplated by Section
2.3, insofar as subsections 5.1(e) and (f) are concerned, at any time
during the period ending on and including the 91st day after the date
of such deposit (it being understood that this condition shall not be
deemed satisfied until the expiration of such period);
(c) such defeasance shall not cause the Trustee to have a
conflicting interest as defined in Section 6.8 and for purposes of
the Trust Indenture Act of 1939 with respect to any securities of the
Issuer;
(d) such defeasance shall not result in a breach or violation
of, or constitute a default under, this Indenture or any Securities
or any other agreement or instrument to which the Issuer is a party
or by which it is bound;
(e) such defeasance shall not cause any Securities then listed
on any registered national securities exchange under the Securities
Exchange Act of 1934, as amended, to be delisted;
(f) the Issuer has delivered to the Trustee an Officers'
Certificate and Opinion of Counsel (i) to the effect that (x) the
Issuer has received from or there has been published by the Internal
Revenue Service a ruling or (y) since the date of the Indenture there
has been a change in applicable federal income tax law, in either
case to the effect that, and based thereon such Officers' Certificate
and Opinion of Counsel shall confirm that, the Holders of the
Securities of such series and Coupons appertaining thereto will not
recognize income, gain or loss for Federal income tax purposes as a
result of such deposit, defeasance and discharge and will be subject
to Federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if such deposit,
defeasance and discharge had not occurred, and (ii) to the effect
that the trust arising from such deposit shall not constitute an
"investment company" or an entity "controlled" by an "investment
company" as such terms are defined in the Investment Company Act of
1940, as amended;
(g) the Issuer has paid or caused to be paid all other sums
payable hereunder by the Issuer and the Issuer has delivered to the
Trustee an Officers' Certificate and an Opinion of Counsel, each
stating that all conditions precedent provided for relating to the
defeasance contemplated by this provision have been complied with;
(h) no event or condition shall exist that,
pursuant to the provisions of Article Thirteen, would prevent the
Issuer from making payments of the principal of or interest on the
Securities of such series and Coupons appertaining thereto on the
date of such deposit or at any time during the period ending on the
91st day after the date of such deposit (it being understood that
this condition shall not be deemed satisfied until the expiration of
such period); and
(i) the Issuer has delivered to the Trustee an Opinion of
Counsel to the effect that (x) the trust funds will not be subject
to any rights of holders of Senior Indebtedness, including without
limitation those arising under Article Thirteen of this Indenture,
and (y) after the 91st day following the deposit, the trust funds
will not be subject to the effect of any applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors'
rights generally, except that if a court were to rule under any
such law in any case or proceeding that the trust funds remained
property of the Issuer, no opinion is given as to the effect of
such laws on the trust funds except the following: (A) assuming
such trust funds remained in the Trustee's possession prior to
such court ruling to the extent not paid to Holders of Securities
of such series and Coupons appertaining thereto, the Trustee will
hold, for the benefit of such Holders, a valid and perfected
security interest in such trust funds that is not avoidable in
bankruptcy or otherwise, (B) such Holders will be entitled to
receive adequate protection of their interests in such trust funds
if such trust funds are used, and (C) no property, rights in
property or other interests granted to the Trustee or such Holders
in exchange for or with respect to any of such funds will be
subject to any prior rights of holders of Senior Indebtedness,
including without limitation those arising under Article Thirteen
of this Indenture.
(C) The Issuer shall be released from its obligations under
Section 9.1 with respect to the Securities of any Series, and any Coupons
appertaining thereto Outstanding on and after the date the conditions set
forth below are satisfied (hereinafter, "covenant defeasance"). For this
purpose, such covenant defeasance means that, with respect to the
Outstanding Securities of such Series, the Issuer may omit to comply with
and shall have no liability in respect of any term, condition or limitation
set forth in such Section, whether directly or indirectly by reason of any
reference elsewhere herein to such Section or by reason of any reference in
such Section to any other provision herein or in any other document and
such omission to comply shall not constitute an Event of Default under
Section 5.1, but the remainder of this Indenture and such Securities and
Coupons shall be unaffected thereby. The following shall be the conditions
to application of this subsection (C) of this Section 10.1:
(a) The Issuer has irrevocably deposited or caused to be
irrevocably deposited with the Trustee as trust funds in trust for
the purpose of making the following payments, specifically pledged as
security for, and dedicated solely to, the benefit of the Holders of
the Securities of such series and Coupons appertaining thereto, (i)
cash in an amount, or (ii) in the case of any series of Securities
the payments on which may only be made in Dollars, U.S. Government
Obligations maturing as to principal and interest at such times and
in such amounts as will insure the availability of cash or (iii) a
combination thereof, sufficient (without investment of such cash or
reinvestment of any interest or proceeds from such U.S. Government
Obligations), in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay (A) the principal of and
interest on all Securities of such series and Coupons appertaining
thereto on each date that such principal or interest is or may,
through the repurchase, redemption or repayment at the option of the
Issuer or the Holders thereof, become due and payable and (B) any
mandatory sinking fund payments on the day on which such payments are
due and payable in accordance with the terms of the Indenture and the
Securities of such series;
(b) no Event of Default or event which with notice or lapse of
time or both would become an Event of Default with respect to the
Securities of such series shall have occurred and be continuing on
the date of such deposit or, except as may otherwise be provided with
respect to the Securities of such series as contemplated by Section
2.3, insofar as subsections 5.1(e) and (f) are concerned, at any time
during the period ending on and including the 91st day after the date
of such deposit (it being understood that this condition shall not be
deemed satisfied until the expiration of such period);
(c) such covenant defeasance shall not cause the Trustee to
have a conflicting interest as defined in Section 6.8 and for
purposes of the Trust Indenture Act of 1939 with respect to any
securities of the Issuer;
(d) such covenant defeasance shall not result in a breach or
violation of, or constitute a default under, this Indenture or any
Securities or any other agreement or instrument to which the Issuer
is a party or by which it is bound;
(e) such covenant defeasance shall not cause any Securities
then listed on any registered national securities exchange under the
Securities Exchange Act of 1934, as amended, to be delisted;
(f) the Issuer shall have delivered to the Trustee an Opinion
of Counsel (i) to the effect that the Holders of the Securities of
such series and Coupons appertaining thereto will not recognize
income, gain or loss for Federal income tax purposes as a result of
such covenant defeasance and will be subject to Federal income tax on
the same amounts, in the same manner and at the same times as would
have been the case if such covenant defeasance had not occurred, and
(ii) to the effect that the trust arising from such deposit shall not
constitute an "investment company" or an entity "controlled" by an
"investment company" as such terms are defined in the Investment
Company Act of 1940, as amended;
(g) the Issuer has paid or caused to be paid all other sums
payable hereunder by the Issuer and the Issuer shall have delivered
to the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that all conditions precedent provided for relating to
the covenant defeasance contemplated by this provision have been
complied with;
(h) no event or condition shall exist that, pursuant to the
provisions of Article Thirteen, would prevent the Issuer from
making payments of the principal of or interest on the Securities
of such series and Coupons appertaining thereto on the date of
such deposit or at any time during the period ending on the 91st
day after the date of such deposit (it being understood that this
condition shall not be deemed satisfied until the expiration of
such period); and
(i) the Issuer has delivered to the Trustee an Opinion of
Counsel to the effect that (x) the trust funds will not be subject
to any rights of holders of Senior Indebtedness, including without
limitation those arising under Article Thirteen of this Indenture,
and (y) after the 91st day following the deposit, the trust funds
will not be subject to the effect of any applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors'
rights generally, except that if a court were to rule under any
such law in any case or proceeding that the trust funds remained
the property of the Issuer, no opinion is given as to the effect
of such laws on the trust funds except the following: (A)
assuming such trust funds remained in the Trustee's possession
prior to such court ruling to the extent not paid to Holders of
Securities of such series and Coupons appertaining thereto, the
Trustee will hold, for the benefit of such Holders, a valid and
perfected security interest in such trust funds that is not
avoidable in bankruptcy or otherwise, (B) such Holders will be
entitled to receive adequate protection of their interests in such
trust funds if such trust funds are used, and (C) no property,
rights in property or other interest granted to the Trustee or
such Holders in exchange for or with respect to any of such funds
will be subject to any prior rights of holders of "Senior
Indebtedness, including without limitation those arising under
Article Thirteen of this Indenture.
SECTION 10.2 Application by Trustee of Funds Deposited for Payment
of Securities. Subject to Section 10.4, all moneys deposited with the Trustee
(or other trustee) pursuant to Section 10.1 shall be held in trust and applied
by it to the payment, either directly or through any paying agent (including
the Issuer acting as its own paying agent), to the Holders of the Securities
of such series and of Coupons appertaining thereto for the payment or
redemption or repurchase of which such moneys have been deposited with the
Trustee, of all sums due and to become due thereon for principal and interest;
but such money need not be segregated from other funds except to the extent
required by law.
SECTION 10.3 Repayment of Moneys Held by Paying Agent. In
connection with the satisfaction and discharge of this Indenture with respect
to Securities of any series, all moneys then held by any paying agent under
the provisions of this Indenture with respect to such series of Securities
shall, upon demand of the Issuer, be repaid to it or paid to the Trustee and
thereupon such paying agent shall be released from all further liability with
respect to such moneys.
SECTION 10.4 Return of Moneys Held by Trustee and Paying Agent
Unclaimed for Two Years. Any moneys deposited with or paid to the Trustee or
any paying agent for the payment of the principal of or interest on any
Security of any series or Coupons attached thereto and not applied but
remaining unclaimed for two years after the date upon which such principal or
interest shall have become due and payable, shall, upon the written request of
the Issuer and unless otherwise required by mandatory provisions of applicable
escheat or abandoned or unclaimed property law, be repaid to the Issuer by the
Trustee for such series or such paying agent, and the Holder of the Securities
of such series and of any Coupons appertaining thereto shall, unless otherwise
required by mandatory provisions of applicable escheat or abandoned or
unclaimed property laws, thereafter look only to the Issuer for any payment
that such Holder may be entitled to collect, and all liability of the Trustee
or any paying agent with respect to such moneys shall thereupon cease;
provided, however, that the Trustee or such paying agent, before being
required to make any such repayment with respect to moneys deposited with it
for any payment (a) in respect of Registered Securities of any series, shall
at the expense of the Issuer, mail by first-class mail to Holders of such
Securities at their addresses as they shall appear on the Security register,
and (b) in respect of Unregistered Securities of any series, shall at the
expense of the Issuer cause to be published once, in an Authorized Newspaper
in the Borough of Manhattan, The City of New York and once in an Authorized
Newspaper in London (and if required by Section 3.6, once in an Authorized
Newspaper in Luxembourg) notice, that such moneys remain and that, after a
date specified therein, which shall not be less than thirty days from the
date of such mailing or publication, any unclaimed balance of such money
then remaining will be repaid to the Issuer and provided, further, that the
provisions of this Section 10.4 shall not apply with respect to any moneys
deposited with the Trustee pursuant to Section 10.1(B).
SECTION 10.5 Indemnity for U.S. Government Obligations. The Issuer
shall pay and indemnify the Trustee against any tax, fee or other charge
imposed on or assessed against the U.S. Government Obligations deposited
pursuant to Section 10.1 or the principal or interest received in respect of
such obligations.
ARTICLE ELEVEN
MISCELLANEOUS PROVISIONS
SECTION 11.1 Incorporators, Stockholders, Officers and Directors of
Issuer Exempt from Individual Liability. No recourse under or upon any
obligation, covenant or agreement contained in this Indenture, or in any
Security, or because of any indebtedness evidenced thereby, shall be had
against any incorporator, as such, or against any past, present or future
stockholder, officer or director, as such, of the Issuer or of any successor,
either directly or through the Issuer or any successor, under any rule of law,
statute or constitutional provision or by the enforcement of any assessment or
by any legal or equitable proceeding or otherwise, all such liability being
expressly (to the extent permitted by law) waived and released by the
acceptance of the Securities and the Coupons appertaining thereto by the
Holders thereof and as part of the consideration for the issue of the
Securities and the Coupons appertaining thereto.
SECTION 11.2 Provisions of Indenture for the Sole Benefit of
Parties, Holders of Senior Indebtedness and Holders of Securities and Coupons.
Nothing in this Indenture, in the Securities or in the Coupons appertaining
thereto, expressed or implied, shall give or be construed to give to any
person, firm or corporation, other than the parties hereto and their
successors, the holders of Senior Indebtedness and the Holders of the
Securities or Coupons, if any, any legal or equitable right, remedy or claim
under this Indenture or under any covenant or provision herein contained, all
such covenants and provisions being for the sole benefit of the parties hereto
and their successors, the holders of Senior Indebtedness and of the Holders of
the Securities or Coupons, if any.
SECTION 11.3 Successors and Assigns of Issuer Bound by Indenture.
All the covenants, stipulations, promises and agreements in this Indenture
contained by or on behalf of the Issuer shall bind its successors and
permitted assigns, whether so expressed or not.
SECTION 11.4 Notices and Demands on Issuer, Trustee and Holders of
Securities and Coupons. Any notice or demand that by any provision of this
Indenture is required or permitted to be given or served by the Trustee or by
the Holders of Securities or Coupons to or on the Issuer may be given or
served by being deposited postage prepaid, first-class mail (except as
otherwise specifically provided herein) addressed (until another address of
the Issuer is filed by the Issuer with the Trustee) to Kaufman and Broad Home
Corporation, 10990 Wilshire Boulevard, Los Angeles, California 90024,
Attention: General Counsel. Any notice, direction, request or demand by the
Issuer or any Holder of Securities or Coupons to or upon the Trustee shall be
deemed to have been sufficiently given or served by being deposited postage
prepaid, first-class mail (except as otherwise specifically provided herein)
addressed (until another address of the Trustee is filed by the Trustee with
the Issuer) to SunTrust Bank, Atlanta, 58 Edgewood Avenue, Suite 400, Atlanta,
Georgia 30303, Attention: Corporate Trust Department.
Where this Indenture provides for notice to Holders of Registered
Securities, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage prepaid, to
each Holder entitled thereto, at his last address as it appears in the
Security register. In any case where notice to such Holders is given by mail,
neither the failure to mail such notice, nor any defect in any notice so
mailed, to any particular Holder shall affect the sufficiency of such notice
with respect to other Holders. Where this Indenture provides for notice in
any manner, such notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and such waiver shall
be the equivalent of such notice. Waivers of notice by Holders shall be filed
with the Trustee, but such filing shall not be a condition precedent to the
validity of any action taken in reliance upon such waiver.
In case, by reason of the suspension of or irregularities in regular
mail service, it shall be impracticable to mail notice to the Issuer when such
notice is required to be given pursuant to any provision of this Indenture,
then any manner of giving such notice as shall be reasonably satisfactory to
the Trustee shall be deemed to be a sufficient giving of such notice.
SECTION 11.5 Officers' Certificates and Opinions of Counsel;
Statements to Be Contained Therein. Upon any application or demand by the
Issuer to the Trustee to take any action under any of the provisions of this
Indenture, the Issuer shall furnish to the Trustee an Officers' Certificate
stating that all conditions precedent provided for in this Indenture relating
to the proposed action have been complied with and an Opinion of Counsel
stating that in the opinion of such counsel all such conditions precedent have
been complied with, except that in the case of any such application or demand
as to which the furnishing of such documents is specifically required by any
provision of this Indenture relating to such particular application or demand,
no additional certificate or opinion need be furnished.
Each certificate or opinion provided for in this Indenture and
delivered to the Trustee 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 Issuer
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 or information with respect to which
is in the possession of the Issuer, upon the certificate, statement or opinion
of or representations by an officer or officers of the Issuer, 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 Issuer 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 Issuer, 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 and directed to the Trustee shall contain a statement
that such firm is independent.
SECTION 11.6 Payments Due on Saturdays, Sundays and Holidays.
Unless otherwise provided pursuant to Section 2.3 with respect to the
Securities of any series, if the date of maturity of interest on or principal
of the Securities of any series or any Coupons appertaining thereto or the
date fixed for redemption or repayment of any such Security or Coupon shall
not be a Business Day, then payment of interest or principal need not be made
on such date, but may be made on the next succeeding Business Day with the
same force and effect as if made on the date of maturity or the date fixed for
redemption or repayment, and no interest shall accrue for the period after
such date.
SECTION 11.7 Conflict of Any Provision of Indenture with Trust
Indenture Act of 1939. If and to the extent that any provision of this
Indenture limits, qualifies or conflicts with the duties imposed by, or with
another provision (an "incorporated provision") included in this Indenture by
operation of, Sections 310 to 318, inclusive, of the Trust Indenture Act of
1939, such imposed duties or incorporated provision shall control.
SECTION 11.8 New York Law to Govern. This Indenture and each
Security and Coupon shall be deemed to be a contract under the laws of the
State of New York, and for all purposes shall be governed by and construed in
accordance with the laws of such State.
SECTION 11.9 Counterparts. This Indenture may be executed in any
number of counterparts, each of which shall be an original; but such
counterparts shall together constitute but one and the same instrument.
SECTION 11.10 Effect of Headings. The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.
SECTION 11.11 Securities in a Foreign Currency or in ECU. Unless
otherwise specified in an Officers' Certificate delivered pursuant to Section
2.3 of this Indenture with respect to a particular series of Securities,
whenever for purposes of this Indenture any action may be taken by the Holders
of a specified percentage in aggregate principal amount of Securities of all
series or all series affected by a particular action at the time Outstanding
and, at such time, there are Outstanding Securities of any series which are
denominated in a coin or currency other than Dollars (including ECUs), then
the principal amount of Securities of such series that shall be deemed to be
Outstanding for the purpose of taking such action shall be that amount of
Dollars that could be obtained for such amount at the Market Exchange Rate.
For purposes of this Section 11.11, Market Exchange Rate shall mean the noon
Dollar buying rate in New York City for cable transfers of that currency as
published by the Federal Reserve Bank of New York; provided, however, in the
case of ECUs, Market Exchange Rate shall mean the rate of exchange determined
by the Commission of the European Communities (or any successor thereto) as
published in the Official Journal of the European Communities (such
publication or any successor publication, the "Journal"). If such Market
Exchange Rate is not available for any reason with respect to such currency,
the Trustee shall use, in its sole discretion and without liability on its
part, such quotation of the Federal Reserve Bank of New York or, in the case
of ECUs, the rate of exchange as published in the Journal, as of the most
recent available date, or quotations or, in the case of ECUs, rates of
exchange from one or more major banks in The City of New York or in the
country of issue of the currency in question, which for purposes of the ECU
shall be Brussels, Belgium, or such other quotations or, in the case of ECU,
rates of exchange as the Trustee shall deem appropriate. The provisions of
this paragraph shall apply in determining the equivalent principal amount in
respect of Securities of a series denominated in a currency other than Dollars
in connection with any action taken by Holders of Securities pursuant to the
terms of this Indenture.
All decisions and determinations of the Trustee regarding the Market
Exchange Rate or any alternative determination provided for in the preceding
paragraph shall be in its sole discretion and shall, in the absence of
manifest error, be conclusive to the extent permitted by law for all purposes
and irrevocably binding upon the Issuer and all Holders.
SECTION 11.12 Judgment Currency. The Issuer agrees, to the extent
that it may effectively do so under applicable law, that (a) if for the
purpose of obtaining judgment in any court it is necessary to convert the sum
due in respect of the principal of or interest on the Securities of any series
(the "Required Currency") into a currency in which a judgment will be rendered
(the "Judgment Currency"), the rate of exchange used shall be the rate at
which in accordance with normal banking procedures the Trustee could purchase
in The City of New York the Required Currency with the Judgment Currency on
the day on which final unappealable judgment is entered, unless such day is
not a New York Banking Day, then, to the extent permitted by applicable law,
the rate of exchange used shall be the rate at which in accordance with normal
banking procedures the Trustee could purchase in The City of New York the
Required Currency with the Judgment Currency on the New York Banking Day
preceding the day on which final unappealable judgment is entered and (b) its
obligations under this Indenture to make payments in the Required Currency (i)
shall not be discharged or satisfied by any tender, or any recovery pursuant
to any judgment (whether or not entered in accordance with subsection (a)), in
any currency other than the Required Currency, except to the extent that such
tender or recovery shall result in the actual receipt, by the payee, of the
full amount of the Required Currency expressed to be payable in respect of
such payments, (ii) shall be enforceable as an alternative or additional cause
of action for the purpose of recovering in the Required Currency the amount,
if any, by which such actual receipt shall fall short of the full amount of
the Required Currency so expressed to be payable and (iii) shall not be
affected by judgment being obtained for any other sum due under this
Indenture. For purposes of the foregoing, "New York Banking Day" means any
day except a Saturday, Sunday or a legal holiday in The City of New York or a
day on which banking institutions in The City of New York are authorized or
required by law or executive order to close.
ARTICLE TWELVE
REDEMPTION OF SECURITIES AND SINKING FUNDS
SECTION 12.1 Applicability of Article. The provisions of this
Article shall be applicable to the Securities of any series that are
redeemable before their maturity or to any sinking fund for the retirement of
Securities of a series except as otherwise specified as contemplated by
Section 2.3 for Securities of such series.
SECTION 12.2 Notice of Redemption; Partial Redemptions. Notice of
redemption to the Holders of Registered Securities of any series to be
redeemed as a whole or in part at the option of the Issuer shall be given by
mailing notice of such redemption by first class mail, postage prepaid, at
least 30 days and not more than 60 days prior to the date fixed for redemption
to such Holders of Securities of such series at their last addresses as they
shall appear upon the registry books. Notice of redemption to the Holders of
Unregistered Securities to be redeemed as a whole or in part, who have filed
their names and addresses with the Trustee shall be given by mailing notice of
such redemption, by first class mail, postage prepaid, at least 30 days and
not more than 60 prior to the date fixed for redemption, to such Holders at
such addresses as were so furnished to the Trustee (and, in the case of any
such notice given by the Issuer, the Trustee shall make such information
available to the Issuer for such purpose). Notice of redemption to all other
Holders of Unregistered Securities shall be published in an Authorized
Newspaper in the Borough of Manhattan, The City of New York and in an
Authorized Newspaper in London (and, if required by Section 3.6, in an
Authorized Newspaper in Luxembourg), in each case, once in each of three
successive calendar weeks, the first publication to be not less than 30 nor
more than 60 days prior to the date fixed for redemption. Any notice that is
mailed in the manner herein provided shall be conclusively presumed to have
been duly given, whether or not the Holder receives the notice. Failure to
give notice by mail, or any defect in the notice to the Holder of any Security
of a series designated for redemption as a whole or in part shall not affect
the validity of the proceedings for the redemption of any other Security of
such series.
The notice of redemption to each such Holder shall specify the
principal amount of each Security of such series held by such Holder to be
redeemed, the date fixed for redemption, the redemption price, the place or
places of payment, that payment will be made upon presentation and surrender
of such Securities and, in the case of Securities with Coupons attached
thereto, of all Coupons appertaining thereto maturing after the date fixed for
redemption, that such redemption is pursuant to the mandatory or optional
sinking fund, or both, if such be the case, that interest accrued to the date
fixed for redemption will be paid as specified in such notice and that on and
after said date interest thereon or on the portions thereof to be redeemed
will cease to accrue. In case any Security of a series is to be redeemed in
part only the notice of redemption shall state the portion of the principal
amount thereof to be redeemed and shall state that on and after the date fixed
for redemption, upon surrender of such Security, a new Security or Securities
of such series in principal amount equal to the unredeemed portion thereof
will be issued.
The notice of redemption of Securities of any series to be redeemed
at the option of the Issuer shall be given by the Issuer or, at the Issuer's
request, by the Trustee in the name and at the expense of the Issuer.
On or before the redemption date specified in the notice of
redemption given as provided in this Section, the Issuer will deposit with the
Trustee or with one or more paying agents (or, if the Issuer is acting as its
own paying agent, set aside, segregate and hold in trust as provided in
Section 3.4) an amount of money sufficient to redeem on the redemption date
all the Securities of such series so called for redemption at the appropriate
redemption price, together with accrued interest to the date fixed for
redemption. The Issuer will deliver to the Trustee at least 70 days prior to
the date fixed for redemption an Officers' Certificate stating the aggregate
principal amount of Securities to be redeemed. In case of a redemption at the
election of the Issuer prior to the expiration of any restriction on such
redemption, the Issuer shall deliver to the Trustee, prior to the giving of
any notice of redemption to Holders pursuant to this Section, an Officers'
Certificate stating that such restriction has been complied with.
If less than all the Securities of a series are to be redeemed, the
Trustee shall select, in such manner as it shall deem appropriate and fair,
Securities of such Series to be redeemed in whole or in part. Securities may
be redeemed in part in amounts equal to the minimum authorized denomination
for Securities of such series or any multiple thereof. The Trustee shall
promptly notify the Issuer in writing of the Securities of such series
selected for redemption and, in the case of any Securities of such series
selected for partial redemption, the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise requires, all
provisions relating to the redemption of Securities of any series shall
relate, in the case of any Security redeemed or to be redeemed only in part,
to the portion of the principal amount of such Security which has been or is
to be redeemed.
SECTION 12.3 Payment of Securities Called for Redemption. If
notice of redemption has been given as above provided, the Securities or
portions of Securities specified in such notice shall become due and payable
on the date and at the place stated in such notice at the applicable
redemption price, together with interest accrued to the date fixed for
redemption, and on and after said date (unless the Issuer shall default in the
payment of such Securities at the redemption price, together with interest
accrued to said date) interest on the Securities or portions of Securities so
called for redemption shall cease to accrue, and the unmatured Coupons, if
any, appertaining thereto shall be void, and, except as provided in Sections
6.5 and 10.2, such Securities shall cease from and after the date fixed for
redemption to be entitled to any benefit or security under this Indenture, and
the Holders thereof shall have no right in respect of such Securities except
the right to receive the redemption price thereof and unpaid interest to the
date fixed for redemption. On presentation and surrender of such Securities
at a place of payment specified in said notice, together with all Coupons, if
any, appertaining thereto maturing after the date fixed for redemption, said
Securities or the specified portions thereof shall be paid and redeemed by the
Issuer at the applicable redemption price, together with interest accrued
thereon to the date fixed for redemption; provided that payments of interest
becoming due on or prior to the date fixed for redemption shall be payable in
the case of Securities with Coupons attached thereto, to the Holders of the
Coupons for such interest upon surrender thereof, and in the case of
Registered Securities, to the Holders of such Registered Securities registered
as such on the relevant record date subject to the terms and provisions of
Sections 2.3 and 2.7 hereof.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal shall, until paid or duly
provided for, bear interest from the date fixed for redemption at the rate of
interest or Yield to Maturity (in the case of an Original Issue Discount
Security) borne by such Security.
If any Security with Coupons attached thereto is surrendered for
redemption and is not accompanied by all appurtenant Coupons maturing after
the date fixed for redemption, the surrender of such missing Coupon or Coupons
may be waived by the Issuer and the Trustee, if there be furnished to each of
them such security or indemnity as they may require to save each of them
harmless.
Upon presentation of any Security redeemed in part only, the Issuer
shall execute and the Trustee shall authenticate and deliver to or on the
order of the Holder thereof, at the expense of the Issuer, a new Security or
Securities of such series, of authorized denominations, in principal amount
equal to the unredeemed portion of the Security so presented.
SECTION 12.4 Exclusion of Certain Securities from Eligibility for
Selection for Redemption. Securities shall be excluded from eligibility for
selection for redemption if they are identified by registration and
certificate number in an Officers' Certificate delivered to the Trustee at
least 40 days prior to the last date on which notice of redemption may be
given as being owned of record and beneficially by, and not pledged or
hypothecated by either (a) the Issuer or (b) an entity specifically identified
in such written statement as directly or indirectly controlling or controlled
by or under direct or indirect common control with the Issuer.
SECTION 12.5 Mandatory and Optional Sinking Funds. The minimum
amount of any sinking fund payment provided for by the terms of the Securities
of any series is herein referred to as a "mandatory sinking fund payment," and
any payment in excess of such minimum amount provided for by the terms of the
Securities of any series is herein referred to as an "optional sinking fund
payment." The date on which a sinking fund payment is to be made is herein
referred to as the "sinking fund payment date."
In lieu of making all or any part of any mandatory sinking fund
payment with respect to any series of Securities in cash, the Issuer may at
its option (a) deliver to the Trustee Securities of such series theretofore
purchased or otherwise acquired (except upon redemption pursuant to the
mandatory sinking fund) by the Issuer or receive credit for Securities of such
series (not previously so credited) theretofore purchased or otherwise
acquired (except as aforesaid) by the Issuer and delivered to the Trustee
for cancellation pursuant to Section 2.10, (b) receive credit for optional
sinking fund payments (not previously so credited) made pursuant to this
Section, or (c) receive credit for Securities of such series (not
previously so credited) redeemed by the Issuer through any optional
redemption provision contained in the terms of such series. Securities so
delivered or credited shall be received or credited by the Trustee at the
sinking fund redemption price specified in such Securities.
On or before the 60th day next preceding each sinking fund payment
date for any series, the Issuer will deliver to the Trustee an Officers'
Certificate (which need not contain the statements required by Section 11.5)
(a) specifying the portion of the mandatory sinking fund payment to be
satisfied by payment of cash and the portion to be satisfied by credit of
Securities of such series and the basis for such credit, (b) stating that none
of the Securities of such series has theretofore been so credited, (c) stating
that no defaults in the payment of interest or Events of Default with respect
to such series have occurred (which have not been waived or cured) and are
continuing and (d) stating whether or not the Issuer intends to exercise its
right to make an optional sinking fund payment with respect to such series
and, if so, specifying the amount of such optional sinking fund payment that
the Issuer intends to pay on or before the next succeeding sinking fund
payment date. Any Securities of such series to be credited and required to
be delivered to the Trustee in order for the Issuer to be entitled to
credit therefor as aforesaid that have not theretofore been delivered to
the Trustee shall be delivered for cancellation pursuant to Section 2.10 to
the Trustee with such Officers' Certificate (or reasonably promptly
thereafter if acceptable to the Trustee). Such Officers' Certificate shall
be irrevocable and upon its receipt by the Trustee the Issuer shall become
unconditionally obligated to make all the cash payments or payments therein
referred to, if any, on or before the next succeeding sinking fund payment
date. Failure of the Issuer, on or before any such 60th day, to deliver
such Officers' Certificate and Securities specified in this paragraph, if
any, shall not constitute a default but shall constitute, on and as of such
date, the irrevocable election of the Issuer (i) that the mandatory sinking
fund payment for such series due on the next succeeding sinking fund
payment date shall be paid entirely in cash without the option to deliver
or credit Securities of such series in respect thereof and (ii) that the
Issuer will make no optional sinking fund payment with respect to such
series as provided in this Section.
If the sinking fund payment or payments (mandatory or optional or
both) to be made in cash on the next succeeding sinking fund payment date plus
any unused balance of any preceding sinking fund payments made in cash shall
exceed $50,000 (or the equivalent thereof in any Foreign Currency or ECU) or a
lesser sum in Dollars (or the equivalent thereof in any Foreign Currency or
ECU) if the Issuer shall so request with respect to the Securities of any
particular series, such cash shall be applied on the next succeeding sinking
fund payment date to the redemption of Securities of such series at the
sinking fund redemption price together with accrued interest to the date fixed
for redemption. If such amount shall be $50,000 (or the equivalent thereof in
any Foreign Currency or ECU) or less and the Issuer makes no such request then
it shall be carried over until a sum in excess of $50,000 (or the equivalent
thereof in any Foreign Currency or ECU) is available. The Trustee shall
select, in the manner provided in Section 12.2, for redemption on such sinking
fund payment date a sufficient principal amount of Securities of such series
to absorb said cash, as nearly as may be, and shall (if requested in writing
by the Issuer) inform the Issuer of the serial numbers of the Securities of
such series (or portions thereof) so selected. Securities shall be excluded
from eligibility for redemption under this Section if they are identified by
registration and certificate number in an Officers' Certificate delivered to
the Trustee at least 60 days prior to the sinking fund payment date as being
owned of record and beneficially by, and not pledged or hypothecated by either
(a) the Issuer or (b) an entity specifically identified in such Officers'
Certificate as directly or indirectly controlling or controlled by or under
direct or indirect common control with the Issuer. The Trustee, in the name
and at the expense of the Issuer (or the Issuer, if it shall so request the
Trustee in writing) shall cause notice of redemption of the Securities of such
series to be given in substantially the manner provided in Section 12.2 (and
with the effect provided in Section 12.3) for the redemption of Securities of
such series in part at the option of the Issuer. The amount of any sinking
fund payments not so applied or allocated to the redemption of Securities of
such series shall be added to the next cash sinking fund payment for such
series and, together with such payment, shall be applied in accordance with
the provisions of this Section. Any and all sinking fund moneys held on the
stated maturity date of the Securities of any particular series (or earlier,
if such maturity is accelerated) that are not held for the payment or
redemption of particular Securities of such series shall be applied, together
with other moneys, if necessary, sufficient for the purpose, to the payment of
the principal of, and interest on, the Securities of such series at maturity.
On or before each sinking fund payment date, the Issuer shall pay to
the Trustee in cash or shall otherwise provide for the payment of all interest
accrued to the date fixed for redemption on Securities to be redeemed on the
next following sinking fund payment date.
The Trustee shall not redeem or cause to be redeemed any Securities
of a series with sinking fund moneys or give any notice of redemption of
Securities for such series by operation of the sinking fund during the
continuance of a default in payment of interest on such Securities or of any
Event of Default except that, where the giving of notice of redemption of any
Securities shall theretofore have been made, the Trustee shall redeem or cause
to be redeemed such Securities, provided that it shall have received from the
Issuer a sum sufficient for such redemption. Except as aforesaid, any moneys
in the sinking fund for such series at the time when any such default or Event
of Default shall occur, and any moneys thereafter paid into the sinking fund,
shall, during the continuance of such default or Event of Default, be deemed
to have been collected under Article Five and held for the payment of all such
Securities. In case such Event of Default shall have been waived as provided
in Section 5.10 or the default cured on or before the sixtieth day preceding
the sinking fund payment date in any year, such moneys shall thereafter be
applied on the next succeeding sinking fund payment date in accordance with
this Section to the redemption of such Securities.
ARTICLE THIRTEEN
SUBORDINATION
SECTION 13.1. Securities and Coupons Subordinate to Senior
Indebtedness. The Issuer covenants and agrees, and each Holder of a Security
or Coupon by such Holder's acceptance thereof likewise covenants and agrees,
that, to the extent and in the manner hereinafter set forth in this Article
13, the indebtedness represented by the Securities and any Coupons and the
Payment of the principal of and interest on, or any other amount owing in
respect of each and all of the Securities and of any Coupons is hereby
expressly made subordinate and subject in right of payment to the prior
payment in full of all Senior Indebtedness.
"Senior Indebtedness" means the principal of (and premium, if
any) and unpaid interest (including interest accruing after the filing of a
petition initiating any proceeding pursuant to any Bankruptcy Laws, whether or
not the payment of such interest is permitted by law) or accrued original
issue discount on and other amounts due on or in connection with any Debt
incurred, assumed or guaranteed by the Issuer whether outstanding on the date
of this Indenture or thereafter incurred, assumed or guaranteed and all
renewals, extensions and refundings of any such Debt; provided, however, that
the following will not constitute Senior Indebtedness:
(a) any Debt as to which, in the instrument creating the same
or evidencing the same or pursuant to which the same is outstanding,
it is expressly provided that such Debt is subordinate in right of
payment to all other Debt of the Issuer not expressly subordinated
to such Debt;
(b) any Debt which by its terms refers explicitly to the
Securities and states that such Debt shall not be senior in right of
payment to the Securities;
(c) any Debt of the Issuer in respect of the Securities;
(d) any Debt of the Issuer to any Subsidiary of the Issuer;
(e) any Debt of the Issuer to any joint venture or
partnership, which joint venture or partnership is required, under
generally accepted accounting principles, to be consolidated in the
Issuer's consolidated financial statements; and
(f) any Debt of the Issuer which by its terms ranks pari passu
with or subordinate to the Securities.
SECTION 13.2. Payment Over of Proceeds Upon Dissolution, Etc.
Upon any Distribution of assets of the Issuer in the event of (a) any
insolvency or bankruptcy case or proceeding, or any receivership, liquidation,
reorganization or other similar case or proceeding in connection therewith,
relative to the Issuer or to its creditors, as such, or to its assets, or (b)
any liquidation, dissolution or other winding up of the Issuer, whether
voluntary or involuntary, or (c) any assignment for the benefit of creditors
or any other marshalling of assets and liabilities of the Issuer, then and in
such event;
(1) the holders of Senior Indebtedness shall be entitled to
receive payment in full of all amounts due or to become due on or in
respect of all Senior Indebtedness, or provision shall be made for
such payment in cash, before the Holders of the Securities or Coupons
are entitled to receive any payment on account of the principal of or
interest on or any other amount owing in respect of the Securities
and any Coupons; and
(2) any payment or distribution of assets of the Issuer of any
kind or character, whether in cash, property or securities, by
set-off or otherwise, to which the Holders or the Trustee would be
entitled but for the provisions of this Article 13, including any
such payment or distribution which may be payable or deliverable by
reason of the payment of any other Debt of the Issuer being
subordinated to the payment of the Securities or Coupons, shall be
paid, to the extent permitted by law, by the liquidating trustee or
agent or other Person making such payment or distribution, whether a
trustee in bankruptcy, a receiver or liquidating trustee or
otherwise, directly to the holders of Senior Indebtedness or their
representative or representatives or to the trustee or trustees under
any indenture under which any instruments evidencing any of such
Senior Indebtedness may have been issued, ratably according to the
aggregate amounts remaining unpaid on account of the principal of,
and premium, if any, and interest on the Senior Indebtedness held or
represented by each, to the extent necessary to make payment in full
of all Senior Indebtedness remaining unpaid, after giving effect to
any concurrent payment or distribution to the holders of such Senior
Indebtedness.
In the event that, notwithstanding the foregoing provisions of
this Section 13.2, the Trustee or the Holder of any Security or Coupon shall
receive any payment or distribution of assets of the Issuer of any kind or
character, whether in cash, property or securities, including any such payment
or distribution which may be payable or deliverable by reason of the payment
of any other Debt of the Issuer being subordinated to the payment of the
Securities or Coupons, before all Senior Indebtedness is paid in full or
payment thereof provided for, then and in such event such payment or
distribution shall, to the extent permitted by law, be held in trust for the
benefit of and paid over or delivered forthwith to the holders of Senior
Indebtedness or their representative or representatives or to the trustee or
trustees under any indenture under which any instruments evidencing any such
Senior Indebtedness have been issued for application to the payment of all
Senior Indebtedness remaining unpaid in the manner provided in clause (2) of
the immediately preceding paragraph, 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.
For purposes of this Article 13 only, the words "cash, property
or securities" shall not be deemed to include shares of capital stock of the
Issuer as reorganized or readjusted, or securities of the Issuer or any other
corporation provided for by a plan of reorganization or readjustment the
payment of which is subordinated, at least to the extent provided in this
Article 13 with respect to the Securities and Coupons, to the payment of all
Senior Indebtedness which may at the time be outstanding; provided, however,
that (i) Senior Indebtedness is assumed by the new corporation, if any,
resulting from any such reorganization or readjustment, and (ii) the rights of
the holders of the Senior Indebtedness are not, without the consent of such
holders, altered by such reorganization or readjustment, including without
limitation, such rights being impaired within the meaning of Section 1124 of
Title 11 of the United States Code, or any impairment of the right to receive
interest accruing during the pendency of a bankruptcy or insolvency
proceeding, including proceedings under Title 11 of the United States Code.
The consolidation of the Issuer with, or the merger of the
Issuer into, another corporation or the liquidation or dissolution of the
Issuer following the conveyance or transfer of all or substantially all of its
assets to another Person upon the terms and conditions set forth in Article 9
shall not be deemed a dissolution, winding up, liquidation, reorganization,
assignment for the benefit of creditors or marshalling of assets and
liabilities of the Issuer for the purposes of this Section 13.2 if the
corporation or Person formed by such consolidation or into which the Issuer is
merged or the Person which acquires by conveyance or transfer all or
substantially all the assets of the Issuer, as the case may be, shall, as a
part of such consolidation, merger, conveyance or transfer, comply with the
conditions set forth in Article 9.
SECTION 13.3. Acceleration of Securities. In the event that
any Securities shall have been accelerated and declared due and payable
pursuant to Section 5.1, then and in such event the Issuer shall promptly
notify holders of Senior Indebtedness of such acceleration. The Issuer may
not pay or acquire the Securities until 135 days have passed after such
acceleration occurs and may thereafter pay or acquire the Securities only if
this Article 13 permits the payment or acquisition at that time.
In the event that, notwithstanding the foregoing, the Issuer
shall make any payment to the Trustee or the Holder of any Securities
prohibited by the foregoing provisions of this Section 13.3, then and in such
event such payment shall, to the extent permitted by law, be held in trust for
the benefit of and be paid over and delivered forthwith to the holders of
Senior Indebtedness or their representative or representatives or to the
trustee or trustees under any indenture under which any instruments evidencing
any such Senior Indebtedness may have been issued.
The provisions of this Section 13.3 shall not apply to any
payment with respect to which Section 13.2 would be applicable.
SECTION 13.4. Default on Senior Indebtedness. The Issuer may
not make any payment of the principal of or interest on or any other amount
owing in respect of the Securities or any Coupons and may not acquire any
Securities or Coupons for cash or property if:
(1) a default on Senior Indebtedness occurs and is continuing
that permits holders of such Senior Indebtedness to accelerate the
maturity thereof; and
(2) unless such default relates to a failure by the Issuer to
make any payment in respect of such Senior Indebtedness when due or
within any applicable grace period (a "Payment Default"), such
default is either the subject of judicial proceedings or the Issuer
receives notice of the default. If the Issuer receives any such
notice, then a similar notice received within nine months thereafter
relating to the same default on the same issue of Senior Indebtedness
shall not be effective for purposes of this Section 13.4.
The Issuer may resume payments on the Securities and any
Coupons and may acquire Securities or Coupons if and when:
(A) (i) 135 days pass after, in the case of a Payment
Default, the later of the date such payment was due and the
expiration of any applicable grace period for such payment or,
in the case of any other such default, the date the related
judicial proceedings commence or that notice of such default is
given to the Issuer, as the case may be, and (ii) the Senior
Indebtedness in respect of which such default exists has not
been declared due and payable in its entirety within such 135
day period or, if declared due and payable, such declaration
has been rescinded, waived or annulled; or
(B) the default with respect to the Senior Indebtedness
is cured or waived; and
this Article 13 otherwise permits the payment or acquisition at that time.
In the event that, notwithstanding the foregoing, the Issuer
shall make any payment to the Trustee or the Holder of any Security or Coupon
prohibited by the foregoing provisions of this Section 13.4, then and in such
event such payment shall, to the extent permitted by law, be held in trust for
the benefit of and be paid over and delivered forthwith to the holders of the
Senior Indebtedness or their
representative or representatives or to the trustee or trustees under any
indenture under which any instruments evidencing such Senior Indebtedness may
have been issued.
The provisions of this Section 13.4 shall not apply to any
payment with respect to which Section 13.2 would be applicable.
SECTION 13.5. Payment Permitted if No Default. Nothing
contained in this Article 13 or elsewhere in this Indenture or in any of the
Securities or Coupons shall prevent (a) the Issuer, at any time except during
the pendency of any case, proceeding, dissolution, liquidation or other
winding up, assignment for the benefit of creditors or other marshalling of
assets and liabilities of the Issuer referred to in Section 13.2 or under the
conditions described in Section 13.3 or 13.4, from making payments at any time
of the principal of or interest on the Securities or Coupons, or (b) the
application by the Trustee of any money deposited with it hereunder to the
payment of or on account of the principal of or interest on the Securities or
Coupons if the Trustee did not have, at the time provided in the proviso to
the first paragraph of Section 13.10, notice that such payment would have been
prohibited by the provisions of this Article 13.
SECTION 13.6. Subrogation to Rights of Holders of Senior
Indebtedness. Subject to the payment in full of all Senior Indebtedness, the
Holders of the Securities or any Coupons shall be subrogated to the extent of
the payments or distributions made to the holders of such Senior Indebtedness
pursuant to the provisions of this Article 13 to the rights of the holders of
such Senior Indebtedness to receive payments or distributions of cash,
property or securities applicable to the Senior Indebtedness until the
principal of or interest on the Securities or any Coupons shall be paid in
full. For purposes of such subrogation, no payments or distributions to the
holders of the Senior Indebtedness of any cash, property or securities to which
the Holders of the Securities or the Trustee would be entitled except for the
provisions of this Article 13, and no payments pursuant to the provisions of
this Article 13 to the Issuer or to the holders of Senior Indebtedness by
Holders of the Securities or the Trustee, shall, as between the Issuer, its
creditors other than holders of Senior Indebtedness and the Holders of the
Securities or Coupons, be deemed to be a payment or distribution by the Issuer
to or on account of the Senior Indebtedness.
SECTION 13.7. Provisions Solely to Define Relative Rights.
The provisions of this Article 13 are and are intended solely for the purpose
of defining the relative rights of the Holders of the Securities or Coupons,
on one hand, and the holders of Senior Indebtedness, on the other hand.
Nothing contained in this Article 13 or elsewhere in this Indenture or in the
Securities or Coupons is intended to or shall
(a) impair, as between the Issuer and the Holders of the
Securities or Coupons, the obligation of the Issuer, which is
absolute and unconditional, to pay to the Holders of the
Securities or Coupons the principal of and interest on the
Securities or Coupons as and when the same shall become due and
payable in accordance with the terms of the Securities and this
Indenture and which, subject to the rights under this Article
13 of the holders of Senior Indebtedness, is intended to rank
equally with all other general obligations of the Issuer, or
(b) affect the relative rights against the Issuer of the
Holders of the Securities or Coupons and creditors of the
Issuer other than holders of Senior Indebtedness, or
(c) prevent the Trustee or the Holder of any Security or
Coupon from exercising all remedies otherwise permitted by
applicable law upon default under this Indenture, subject to
the rights, if any, under this Article 13 of the holders of
Senior Indebtedness to receive cash, property or securities
otherwise payable or deliverable to the Trustee or such Holder.
SECTION 13.8. Trustee to Effectuate Subordination. Each
Holder of a Security or Coupon by such Holder's acceptance thereof authorizes
and directs the Trustee on such Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article 13 and appoints the Trustee such Holder's attorney-in-fact for any and
all such purposes. If the Trustee does not file a proper claim or proof of
debt in connection with any insolvency or bankruptcy case or proceeding or any
receivership, liquidation, reorganization or other similar case or proceeding
in connection therewith relative to the Issuer in proper form within 30 days
prior to the expiration of the time to file such claim or proof of debt, then
the holders of the Senior Indebtedness are hereby authorized to file an
appropriate claim for and on behalf of the Holders of the Securities or
Coupons.
SECTION 13.9. No Waiver of Subordination Provisions. No right
of any present or future holder of any Senior Indebtedness 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 Issuer or by any act
or failure to act, in good faith, by any such holder, or by any noncompliance
by the Issuer with there terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof any such holder may have or be otherwise
charged with.
Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Indebtedness may, at any time and from time
to time, without the consent of, or notice to, the Trustee or the Holders of
the Securities or Coupons, without incurring responsibility to the Holders of
the Securities or Coupons and without impairing or releasing the subordination
provided in this Article 13 or the obligations hereunder of the Holders of the
Securities or Coupons to the holders of Senior Indebtedness, do any one or
more of the following: (i) change the manner, place or terms of payment or
extend the time of payment of, or renew or alter, Senior Indebtedness, or
otherwise amend or supplement in any manner Senior Indebtedness or any
instrument evidencing the same or any agreement under which Senior
Indebtedness is outstanding; (ii) sell, exchange, release or otherwise dispose
of any property pledged, mortgaged or otherwise securing Senior Indebtedness;
(iii) release any person liable in any manner for the collection of Senior
Indebtedness ; and (iv) exercise or refrain from exercising any rights against
the Issuer and any other Person.
Notwithstanding the payment in full of all Senior Indebtedness,
the provisions of this Article 13 shall be reinstated and revived, and the
enforceability of such provisions shall continue, in each case to the extent
permitted by law, with respect to (and only with respect to) any amount of
Senior Indebtedness which the Issuer shall have repaid to the holders thereof
(or to their representative or the trustee under the indenture under which the
instruments evidencing such Senior Indebtedness shall have been issued)
following a demand for such repayment by such holders (or representatives or
trustee) made pursuant to provisions set forth in the instrument evidencing
such Senior Indebtedness or under which such Senior Indebtedness shall have
been issued, which provisions entitle such holders (or such representative or
trustee) to demand such repayment upon the occurrence of a Change in Control
or other substantially similar event with respect to the Issuer specified
therein, if such amount thereafter must be restored or returned by such
holders of Senior Indebtedness (or representative or trustee) because it
constitutes a voidable preference under Section 547 of Title 11 of the United
States Code (or any successor provision thereto) or under any similar
provision of any other applicable Bankruptcy Law or a fraudulent transfer
under any applicable law regarding fraudulent transfers.
SECTION 13.10. Notice to Trustee. The Issuer shall give
prompt written notice to the Trustee of any fact known to the Issuer which
would prohibit the making of any payment to or by the Trustee in respect of
the Securities or Coupons. Failure to give such notice shall not affect the
subordination of the Securities or Coupons to Senior Indebtedness.
Notwithstanding the provisions of this Article 13 or any other provision of
this Indenture, the Trustee shall not be charged with knowledge of the
existence of any facts which would prohibit the making of any payment to or by
the Trustee in respect of the Securities or Coupons, unless and until the
Trustee shall have received written notice thereof at the address specified in
Section 11.4 from the Issuer or a holder of Senior Indebtedness or from any
trustee or agent therefore; and, prior to the receipt of any such written
notice, the Trustee, subject to the provisions of Section 6.1, shall be
entitled in all respects to assume that no such facts exist; provided,
however, that if a Responsible Officer of the Trustee shall not have received,
at least three Business Days prior to the date upon which by the terms hereof
any such money may become payable for any purpose (including, without
limitation, the payment of the principal of or interest on any Security or
Coupon), the notice with respect to such money provided for in this Section
13.10, then, anything herein contained to the contrary notwithstanding, the
Trustee shall have full power and authority to receive such money and to apply
the same to the purpose for which such money was received and shall not be
affected by any notice to the contrary which may be received by it within
three Business Days prior to such date.
Subject to the provisions of Section 6.1, the Trustee shall be
entitled to reply on the delivery to it of a written notice by a Person
representing himself to be a holder of Senior Indebtedness (or a trustee or
agent on behalf of such holder) to establish that such notice has been given
by a holder of Senior Indebtedness (or a trustee or agent on behalf of any
such holder). 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 Article 13, the Trustee may request such Person 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 any other facts
pertinent to the rights of such Person under this Article 13, and if such
evidence is not furnished, the Trustee may defer any payment which it may be
required to make for the benefit of such Person pursuant to the terms of this
Indenture pending judicial determination as to the right of such Person to
receive such payment.
SECTION 13.11. Reliance on Judicial Order or Certificate of
Liquidation Agent. Upon any payment or distribution of assets of the Issuer
referred to in this Article 13, the Trustee, subject to the provisions of
Section 6.1, and the Holders of the Securities or Coupons shall be entitled to
reply upon any order or decree entered by any court of competent jurisdiction
in which such insolvency, bankruptcy, receivership, liquidation,
reorganization, dissolution, winding up or similar case or proceeding is
pending, or a certificate of the trustee in bankruptcy, liquidating
trustee, custodian, receiver, assignee for the benefit of creditors, agent
or other person making such payment or distribution, delivered to the
Trustee or to the Holders of Securities or Coupons, for the purpose of
ascertaining the persons entitled to participate in such payment or
distribution, the holders of Senior Indebtedness and other indebtedness of
the Issuer, the amount thereof or payable thereon, the amount or amounts
paid or distributed thereon and all other facts pertinent thereto or to
this Article 13.
SECTION 13.12. Trustee Not Fiduciary for Holders of Senior
Indebtedness. The Trustee shall not be deemed to owe any fiduciary duty to
the holders of Senior Indebtedness and not be liable to any such holders if
the Trustee shall in good faith mistakenly pay over or distribute to Holders
of Securities or Coupons or to the Issuer of to any other person cash,
property or securities to which any holders of Senior Indebtedness shall be
entitled by virtue of this Article 13 or otherwise. The Trustee shall not be
charged with knowledge of the existence of Senior Indebtedness or of any facts
that would prohibit any payment hereunder unless a Responsible Officer of the
Trustee shall have received written notice to that effect at the address of
the Trustee set forth in Section 11.4. With respect to the holders of Senior
Indebtedness, the Trustee undertakes to perform or to observe only such of its
covenants or obligations as are specifically set forth in this Article 13 and
no implied covenants or obligations with respect to holders of Senior
Indebtedness shall be read into this Indenture against the Trustee.
SECTION 13.13. Rights of Trustee as Holder of Senior
Indebtedness; Preservation of Trustee's Rights. The Trustee in its individual
capacity shall be entitled to all the rights set forth in this Article 13 with
respect to any Senior Indebtedness which may at any time be held by it, to the
same extent as any other holder of Senior Indebtedness, and nothing in this
Indenture shall deprive the Trustee of any of its rights as such holder.
Nothing in this Article 13 shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 6.6.
SECTION 13.14. Article 13 Applicable to Paying Agents. In
case at any time any paying agent other than the Trustee shall have been
appointed by the Issuer and be then acting hereunder, the term "Trustee" as
used in this Article 13 shall in such case (unless the context otherwise
requires) be construed as extending to and including such paying agent within
its meaning as fully for all intents and purposes as if such paying agent were
named in this Article 13 in addition to or in place of the Trustee; provided,
however, that Section 13.10 and 13.12 shall not apply to the Issuer or any
Subsidiary or Affiliate of the Issuer if it or such Subsidiary or Affiliate
acts as paying agent.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture
to be duly executed, and their respective corporate seals to be hereunto
affixed and attested, all as of the date first above written.
KAUFMAN AND BROAD HOME
CORPORATION
By:______________________________
Title:
[CORPORATE SEAL]
Attest:
By ______________________________
SUNTRUST BANK, ATLANTA,
TRUSTEE
By: _____________________________
Title:
[CORPORATE SEAL]
Attest:
By ______________________________
STATE OF CALIFORNIA )
) ss.:
COUNTY OF )
On this of , 1996 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 Kaufman and Broad Home Corporation, one of the corporations
described in and which executed the above instrument; that he knows the
corporate seal of said corporation; that the seal affixed to said instrument
is such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
[NOTARIAL SEAL]
_______________________
Notary Public
STATE OF )
) ss.:
COUNTY OF )
On this of , 1996 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 a
of SunTrust Bank, Atlanta, one of the corporations described in
and which executed the above instrument; that he knows the corporate seal of
said corporation; that the seal affixed to said instrument is such corporate
seal; that it was so affixed by authority of the Board of Directors of said
corporation, and that he signed his name thereto by like authority.
[NOTARIAL SEAL]
_______________________
Notary Public
EXHIBIT 4.14
FACE OF NOTE
KAUFMAN AND BROAD HOME CORPORATION
95/8% Senior Subordinated Note Due 2006
No. R-_____________ $__________________
CUSIP 486168 AD 9
Kaufman and Broad Home Corporation, a Delaware corporation (the
"Issuer"), for value received, hereby promises to pay to
_______________________, or registered assigns, the principal sum of
___________ Dollars at the Issuer's office or agency for said purpose in the
Borough of Manhattan, The City of New York, on May 15, 2006, in such coin or
currency of the United States of America as at the time of payment shall be
legal tender for the payment of public and private debts, and to pay interest,
semi-annually on May 15 and November 15 of each year, on said principal sum in
like coin or currency, at the rate per annum set forth in the title of this
Note at said office or agency from the May 15 or the November 15, as the case
may be, next preceding the date of this Note to which interest on the Notes
has been paid or duly provided for, unless the date hereof is a date to which
interest on the Notes has been paid or duly provided for, in which case from
the date of this Note, or unless no interest has been paid or duly provided
for on the Notes, in which case from November 19, 1996 until payment of said
principal sum has been made or duly provided for. Notwithstanding the
foregoing, if the date hereof is after May 1 or November 1, as the case may
be, and before the following May 15 or November 15, this Note shall bear
interest from such May 15 or November 15; provided, that if the Issuer shall
default in the payment of interest due on such May 15 or November 15, then
this Note shall bear interest from the next preceding May 15 or November 15 to
which interest on the Notes has been paid or duly provided for or, if no
interest has been paid or duly provided for on the Notes, from November 19,
1996. The interest so payable on any May 15 or November 15 will, except as
otherwise provided in the Indenture referred to on the reverse hereof, be paid
to the Person in whose name this Note is registered at the close of business
on the May 1 or November 1 preceding such May 15 or November 15, whether or
not such date is a Business Day; provided that, except as otherwise
provided in the Indenture referred to on the reverse hereof, interest may
be paid, at the option of the Issuer, by mailing a check therefor payable
to the holder entitled thereto at his last address as it appears on the
Note register.
Reference is made to the further provisions set forth on the reverse
hereof. Such further provisions shall for all purposes have the same effect
as though fully set forth at this place.
This Note shall not be valid or obligatory until the certificate of
authentication hereon shall have been duly signed by the Trustee acting under
the Indenture.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly
executed under its corporate seal.
Dated:
KAUFMAN AND BROAD HOME
CORPORATION
______________________ __________________________________
Secretary Chairman and Chief
Executive Officer
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the within-mentioned
Indenture.
SUNTRUST BANK, ATLANTA, as Trustee
By:_______________________________
Authorized Signatory
[FORM OF REVERSE OF NOTE]
KAUFMAN AND BROAD HOME CORPORATION
95/8% SENIOR SUBORDINATED NOTE DUE 2006
This Note is one of a duly authorized issue of 95/8% Senior
Subordinated Notes due 2006 (the "Notes") of the Issuer, limited to the
aggregate principal amount of $125,000,000, issued pursuant to an indenture
dated as of November 19, 1996 (as the same may be amended or supplemented from
time to time, the "Indenture"), duly executed and delivered by the Issuer to
SunTrust Bank, Atlanta, Trustee (herein called, together with any successor in
such capacity, the "Trustee"). Reference is hereby made to the Indenture and
all indentures supplemental thereto for a description of the rights,
limitations of rights, obligations, duties and immunities thereunder of the
Trustee, the Issuer and the holders of the Notes.
The indebtedness evidenced by, and the payment of the principal of
and interest on, or any other amount owing in respect of, the Notes is, to the
extent and in the manner provided in the Indenture, expressly made subordinate
and subject in right of payment to the prior payment in full or all Senior
Indebtedness (as defined in the Indenture) of the Issuer, and each Holder of
this Note, by his acceptance hereof, agrees to and shall be bound by all the
provisions of the Indenture relating to such subordination and authorizes and
directs the Trustee to take such action in his behalf as may be necessary or
appropriate to acknowledge or effectuate the subordination of the indebtedness
evidenced by this Note as provided in the Indenture and appoints the Trustee
his attorney-in-fact for any and all such purposes.
In case an Event of Default shall have occurred and be continuing,
the principal of and accrued interest on all the Notes may be declared due and
payable, in the manner and with the effect, and subject to the conditions,
provided in the Indenture. The Indenture provides that in certain events such
declaration and its consequences may be waived by the Holders of a majority
in aggregate principal amount of the Notes then Outstanding and that, prior to
any such declaration, such Holders may waive any past default under the
Indenture and its consequences except a default in the payment of principal of
or interest on any of the Notes and subject to certain further exceptions.
Any such consent or waiver by the Holder of this Note shall be conclusive and
binding upon such Holder and upon all future Holders and owners of this Note
and any Note which may be issued in exchange or substitution herefor, whether
or not any notation thereof is made upon this Note or such other Notes.
To the extent permitted by, and as provided and subject to the
limitations in, the Indenture, the Issuer and the Trustee, with the consent of
the Holders of not less than a majority in aggregate principal amount of the
Notes then Outstanding, may execute supplemental indentures adding any
provisions to or changing in any manner or eliminating any of the
provisions of the Indenture or any supplemental indenture or modifying in
any manner the rights of the Holders.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note
at the place, times and rate, and in the coin and currency, herein prescribed.
The Notes are issuable only as registered Notes without coupons in
denominations of $1,000 and any integral multiple of $1,000.
At the office or agency of the Issuer referred to on the face hereof,
and in the manner and subject to the limitations provided in the Indenture,
Notes may be exchanged for a like aggregate principal amount of Notes of other
authorized denominations.
Upon due presentation for registration of transfer of this Note at
the above-mentioned office or agency of the Issuer, a new Note or Notes of
authorized denominations, for a like aggregate principal amount, will be
issued to the transferee as provided in the Indenture.
No service charge shall be made for any such transfer or any such
exchange of any Note, but the Issuer may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in
connection therewith.
This Note may be redeemed at the option of the Issuer in whole or in
part on any date on or after November 15, 2001 and prior to maturity, upon not
less than 30 nor more than 60 days' notice given in accordance with the
provisions of the Indenture, at the redemption prices (expressed as
percentages of the principal amount hereof) set forth below, together with
accrued and unpaid interest to the date fixed for redemption, if redeemed
during the 12-month period beginning November 15 of the years indicated below:
Year Redemption
---- Price
----------
2001..................................... 104.8125%
2002..................................... 103.2125%
2003..................................... 101.6125%
2004 and thereafter...................... 100.0000%
If less than all of the Notes are called for redemption, the Trustee shall
select, in such manner as it deems appropriate and fair, the Notes (or
portions thereof) to be redeemed.
Subject to payment by the Issuer of a sum sufficient to pay the
amount due on redemption, interest on this Note (or portion hereof if this
Note is redeemed in part) shall cease to accrue upon the date duly fixed for
redemption of this Note (or portion hereof if this Note is redeemed in part).
If at any time there occurs a Change of Control with respect to the
Issuer, each Holder of Notes will have the right, at such Holder's option, to
require the Issuer to repurchase all of such Holder's Notes, or a portion
thereof which is $1,000 or any integral multiple thereof, on the date (the
"Change of Control Repurchase Date") that is 30 Change of Control Business
Days after the date of the Change of Control at a price equal to 101% of the
principal amount thereof, plus accrued and unpaid interest to the Change of
Control Repurchase Date, all upon the terms and subject to the conditions set
forth in the Indenture.
If the Consolidated Net Worth of the Issuer at the end of each of any
two consecutive fiscal quarters is less than $195,000,000 then the Issuer will
make an offer (a "Net Worth Offer") to acquire on a date (a "Net Worth
Repurchase Date") falling on or before the last day of the next following
fiscal quarter, Notes in an aggregate principal amount equal to 10% of the
aggregate principal amount of the Notes initially issued (or such lesser
amount of Notes as may be Outstanding at the time such Net Worth Offer is
made) at a purchase price equal to 100% of the principal amount thereof, plus
accrued and unpaid interest to the Net Worth Repurchase Date, all upon the
terms and subject to the conditions set forth in the Indenture. In no event
shall the failure to meet the minimum Consolidated Net Worth requirement set
forth above at the end of any fiscal quarter be counted toward the making of
more than one Net Worth Offer.
The Indenture includes a number of restrictive covenants affecting
the Issuer and certain of its subsidiaries. These restrictive covenants are
subject to a number of important qualifications and exceptions and reference
is made to the Indenture for a description thereof.
The Issuer, the Trustee, and any agent of the Issuer or the Trustee,
may deem and treat the Holder hereof as the absolute owner of this Note
(whether or not this Note shall be overdue and notwithstanding any notation of
ownership or other writing hereon), for the purpose of receiving payment of,
or on account of, the principal hereof and, subject to the provisions in the
Indenture, interest hereon and for all other purposes, and neither the Issuer
nor the Trustee nor any agent of the Issuer or the Trustee shall be affected
by any notice to the contrary.
No recourse under or upon any obligation, covenant or agreement
contained in the Indenture or in this Note or because of any indebtedness
evidenced hereby shall be had against any incorporator, shareholder, officer
or director, as such, past, present or future, of the Issuer or of any
successor corporation, either directly or through the Issuer or any successor
corporation, under any rule of law, statute or constitutional provision or by
the enforcement of any assessment or otherwise, all such liability being (to
the extent permitted by law), by the acceptance hereof and as part of the
consideration for the issue hereof, expressly waived and released.
Certain of the Issuer's obligations under this Note and under the
Indenture with respect to the Notes may be terminated if the Issuer
irrevocably deposits with the Trustee money or U.S. Government Obligations
sufficient to pay and discharge the entire indebtedness on all of the Notes,
all upon the terms and subject to the conditions set forth in the Indenture.
This Note shall be governed by and construed in accordance with the
laws of the State of New York.
Terms (whether or not capitalized) used in this Note and not defined
herein which are defined in the Indenture shall have the respective meanings
ascribed thereto in the Indenture.
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations.
TEN COM--as tenants in common
UNIF GIFT MIN ACT--....................... Custodian.......................
(Cust) (Minor)
under Uniform Gifts to Minors Act
.........................................
(State)
TEN ENT--as tenants by the entireties
JT TEN --as joint tenants with right of survivorship
and not as tenants in common
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT/TRANSFER FORM
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
(Please Insert Social Security or Other Identifying Number of Assignee)
______________________________________________________________________________
______________________________________________________________________________
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing ___________________________________________________________________
attorney to transfer said Note on the books of the Issuer, with full power of
substitution in the premises.
Dated: ________________________________________________________________
NOTICE: The signature to this assignment must correspond with
the name as written upon the face of the within instrument in
every particular, without alteration or enlargement or any
change whatever.
Signature Guaranteed:
_________________________________________
The signature should be guaranteed by a
commercial bank or a member broker of
either the New York Stock Exchange,
American Stock Exchange, Midwest Stock
Exchange or Pacific Coast Stock Exchange.
EXHIBIT 4.15
OFFICERS' CERTIFICATE PURSUANT TO THE
INDENTURE IDENTIFIED BELOW
The undersigned Michael F. Henn, Senior Vice President and
Chief Financial Officer of Kaufman and Broad Home Corporation (the "Issuer"),
and Kimberly N. King, Corporate Secretary and Associate Counsel of the Issuer:
(a) Each hereby certifies that he has read and is familiar
with the provisions of Article Two of the Indenture referred to
below relating to the issuance of Securities thereunder; that he
is generally familiar with the other provisions of the Indenture
and with the affairs of the Issuer and its corporate acts and
proceedings; that, in his opinion, he has made such examination
or investigation as is necessary to enable him to express an
informed opinion as to whether or not the covenants and
conditions have been complied with and that all covenants or
conditions provided for in the Indenture relating to the
establishment of a series of Securities and the form and terms of
such series and the issuance, authentication and delivery of such
Securities have been complied with.
(b) Acting pursuant to Article Two of the Indenture referred
to below, do hereby authorize, adopt and approve the following
terms for a series of Securities to be issued under a Senior
Subordinated Indenture dated as of November 19, 1996 (the
"Indenture", which term, as used herein, includes the terms of
the Notes established by this Officers' Certificate), between the
Issuer and SunTrust Bank, Atlanta, as Trustee:
(1) Designation of Securities of the series:
9 5/8% Senior Subordinated Notes due 2006 (the "Notes").
(2) Limit on the aggregate principal amount of Notes (except for
Notes authenticated and delivered upon registration of transfer, or in
exchange for, or in lieu of, other Notes pursuant to Section 2.8, 2.9, 2.11,
8.5 or 12.3 of the Indenture, or Section 11 of this Officers' Certificate or
pursuant to any provision of the Indenture providing for redemption, repayment
or repurchase of Notes in whole or in part):
$125,000,000
(3) Date on which the principal of Notes is payable at maturity:
November 15, 2006.
(4) Interest on the Notes:
(a) The rate of interest on the Notes and the method of
calculation thereof:
9 5/8% per annum calculated on the basis of a 360-day
year of twelve 30-day months.
(b) The date from which such interest shall accrue:
November 19, 1996.
(c) Interest payment dates:
May 15 and November 15, commencing May 15, 1997.
(d) Record dates:
May 1 and November 1 (in each case whether or not a
Business Day) next preceding each May 15 and November
15, respectively.
(5) Place or places where Notes shall be payable:
The principal of and interest on the Notes shall be payable in
the Borough of Manhattan, The City of New York at an office or agency
maintained by the Issuer for such purpose pursuant to Section 3.2 of the
Indenture. Such office or agency shall initially be the agent of the Trustee
in The City of New York, which on the date hereof is First Chicago Trust
Company of New York, 14 Wall Street, New York, New York 10005. In addition,
so long as the Trustee shall act as trustee with respect to the Notes, the
principal of and interest on the Notes shall be payable at the office of the
Trustee in Atlanta, Georgia designated for such purpose.
(6) With respect to redemption, in whole or in part, of Notes at
the option of the Issuer:
The Notes will be redeemable at the Issuer's option, in whole
or in part, on any date on or after November 15, 2001 and prior to maturity,
upon not less than 30 nor more than 60 days' notice given in accordance with
the provisions of the Indenture, at the redemption prices (expressed as
percentages of principal amount) set forth below, together with accrued and
unpaid interest to the date fixed for redemption, if redeemed during the
12-month period beginning November 15 of the years indicated below:
Redemption
Year Price
---- ----------
2001...................................... 104.8125%
2002...................................... 103.2125%
2003...................................... 101.6125%
2004 and thereafter....................... 100.0000%
(7) Repurchase of Notes at option of the Holders upon Change of
Control:
(a) If at any time there occurs a Change of Control with
respect to the Issuer, each Holder of Notes will have the right,
at such Holder's option, to require the Issuer to repurchase all
of such Holder's Notes, or a portion thereof which is in a
principal amount of $1,000 or any integral multiple thereof, on
the date (the "Change of Control Repurchase Date") that is 30
Change of Control Business Days after the date of the Change of
Control at a price equal to 101% of the principal amount thereof,
plus accrued and unpaid interest to the Change of Control
Repurchase Date (the "Change of Control Repurchase Price");
provided, however, that if a Change of Control Repurchase Date is
after a record date for the payment of interest on the Notes and
on or before the related interest payment date, accrued and
unpaid interest on the Notes surrendered for repurchase pursuant
to this Section 7 and not withdrawn which otherwise would have
been paid as part of the Change of Control Repurchase Price will
instead be paid (such payment to be made on the Change of Control
Repurchase Date) to the Persons in whose names such Notes are
registered at the close of business on such record date and, in
such case, the term "Change of Control Repurchase Price" shall be
deemed to mean 101% of the principal amount of such Notes without
accrued and unpaid interest.
(b) Within 15 Change of Control Business Days after the
occurrence of a Change of Control, the Issuer or, at the request
of the Issuer, the Trustee will give notice (the "Change of
Control Notice"), in the manner provided in Section 11.4 of the
Indenture, to all Holders of the Notes of the occurrence of such
Change of Control and of the Issuer's offer to repurchase Notes
pursuant to the repurchase right arising as a result thereof and
will cause a copy of such notice to be published in an Authorized
Newspaper in The City of New York. If such Change of Control
Notice is given by the Issuer, the Issuer shall also deliver a
copy thereof to the Trustee. Such Change of Control Notice shall
contain all instructions and (except in the case of the published
notice) materials necessary to enable Holders of Notes to
surrender their Notes to the Issuer for repurchase (including
(except in the case of the published notice), without limitation,
a form of Change of Control Repurchase Notice (as defined below))
and, without limitation to the foregoing, shall state:
(i) that the Issuer is offering to repurchase all of the
Notes as a result of a Change of Control pursuant to this
Section 7, and shall state the events causing such Change of
Control and the date of such Change of Control;
(ii) the Change of Control Repurchase Date;
(iii) the Change of Control Repurchase Price, including a
statement as to whether or not Holders surrendering Notes
for repurchase will be entitled to receive accrued and
unpaid interest or whether accrued and unpaid interest will
be payable to Holders on the relevant record date;
(iv) that a Holder electing to have a Note (or any
portion thereof which is a principal amount of $1,000 or any
integral multiple thereof) repurchased will be required to
surrender the Note, duly endorsed by, or accompanied by a
written instrument or instruments of transfer executed by,
the Holder or his attorney duly authorized in writing,
together with a duly completed Change of Control Repurchase
Notice, at an address specified in subparagraph (v) below
prior to the Change of Control Repurchase Date (such notice
shall specify the information which the Holder must set
forth in such Change of Control Repurchase Notice, and shall
indicate that copies of the form of Change of Control
Repurchase Notice are available at the office of the Trustee
and at each other office or agency specified in subparagraph
(v) below);
(v) the address of the Trustee where Notes may be
surrendered for repurchase pursuant to such Change of
Control, and the name and address of each other office or
agency where Notes may be surrendered for repurchase
pursuant to such Change of Control, which shall include the
office or agency in the Borough of Manhattan, The City of
New York maintained with respect to the Notes pursuant to
Section 3.2 of the Indenture;
(vi) that the Change of Control Repurchase Price for any
Note which has been duly surrendered, together with a duly
completed Change of Control Repurchase Notice, and not
withdrawn will be paid on the Change of Control Repurchase
Date;
(vii) that any Note repurchased by the Issuer on the
Change of Control Repurchase Date shall cease to accrue
interest on the Change of Control Repurchase Date unless the
Issuer defaults in making payment in full of the Change of
Control Repurchase Price, and that any Note which is not
surrendered for repurchase or which is surrendered and
thereafter withdrawn shall continue to accrue interest;
(viii) that Holders who have surrendered Notes for
repurchase will be entitled to withdraw such Notes (or any
portion thereof in a principal amount of $1,000 or any
integral multiple thereof) if the Trustee or any office or
agency referred to in clause (v) above, as the case may be,
receives, prior to the Change of Control Repurchase Date, a
telegram, telex, facsimile transmission, letter or hand
delivery notice setting forth the name of the Holder, the
certificate number and the principal amount of the Note
(which may be all or a portion of such principal amount
which is $1,000 or an integral multiple thereof) with
respect to which such notice of withdrawal is being
submitted and the principal amount, if any, of the Note
which is not being withdrawn;
(ix) that Holders whose Notes are repurchased only in
part will be issued new Notes equal in principal amount to
the unrepurchased portion of the Notes surrendered, and that
Holders surrendering Notes for repurchase in part may
specify the denomination or denominations (which must be
$1,000 or an integral multiple of $1,000) of the Note or
Notes to be issued for the unrepurchased portion of the
Notes being surrendered and that, in the absence of any such
specification, one Note will be issued for the portion not
repurchased; and
(x) any other procedures the Holder must follow to
exercise its rights under this Section 7.
(c) "Change of Control Repurchase Notice" means a written
notice (which may be the form thereof provided by the Issuer
pursuant to Section 7(b) or any other written notice which sets
forth the information described below), signed by the Holder or
his attorney duly authorized in writing, stating:
(i) the name and address of the Holder and the
certificate number of the Note which the Holder is delivering
to be repurchased;
(ii) if the Note is surrendered for repurchase in part,
the portion of the principal amount of the Note which the
Holder is delivering to be repurchased, which portion must
be $1,000 or an integral multiple thereof;
(iii) if the Note is surrendered for repurchase in part,
the denomination or denominations (which must be $1,000 or
any integral multiple thereof) of the Note or Notes to be
issued to the Holder for the unrepurchased portion of the
Note being surrendered, provided that the failure so to
specify such denomination or denominations shall not
constitute a defect in the Change of Control Repurchase
Notice and, in such event, one Note will be issued for such
unrepurchased portion of the Note being surrendered; and
(iv) that such Holder is electing to have such Note (or
portion thereof) repurchased by the Issuer on the Change of
Control Repurchase Date.
The delivery of a Note, by hand, by mail or otherwise, prior to
the Change of Control Repurchase Date to the Trustee or to an office or agency
referred to in Section 7(b)(v) above shall be a condition to the receipt by
the Holder of the Change of Control Repurchase Price therefor.
(8) Repurchase of Notes due to failure to maintain Consolidated
Net Worth:
(a) If the Consolidated Net Worth of the Issuer at the end
of each of any two consecutive fiscal quarters (the last day of
such second fiscal quarter being referred to as the "Trigger
Date") is less than $195,000,000, then the Issuer will make an
offer (a "Net Worth Offer"), on a date (a "Net Worth Repurchase
Date") falling on or before the last day of the next following
fiscal quarter, to acquire Notes in an aggregate principal amount
equal to 10% of the aggregate principal amount of the Notes
initially issued (or such lesser amount of Notes as may be
outstanding at the time such Net Worth Offer is made) (the "Net
Worth Offer Amount") at a purchase price equal to 100% of the
principal amount thereof, plus accrued and unpaid interest to the
Net Worth Repurchase Date (the "Net Worth Repurchase Price");
provided, however, that if a Net Worth Repurchase Date is after a
record date for the payment of interest on the Notes and on or
before the related interest payment date, accrued and unpaid
interest on the Notes accepted for repurchase pursuant to this
Section 8 which otherwise would have been paid as part of the Net
Worth Repurchase Price will instead be paid (such payment to be
made on the Net Worth Repurchase Date) to the Persons in whose
names such Notes are registered at the close of business on such
record date and, in such case, the term "Net Worth Repurchase
Price" shall be deemed to mean 100% of the principal amount of
such Notes without accrued and unpaid interest. The Issuer may
credit against its obligation to purchase Notes on a Net Worth
Repurchase Date the principal amount of Notes acquired by the
Issuer and surrendered for cancellation through optional
purchase, optional redemption or optional exchange subsequent to
the related Trigger Date which have not previously been used as a
credit against any obligation to repurchase Notes pursuant to
this Section 8. In no event shall the failure to meet the
minimum Consolidated Net Worth requirement set forth above at the
end of any fiscal quarter be counted toward the making of more
than one Net Worth Offer.
(b) The Issuer shall provide the Trustee with notice of the
Net Worth Offer at least 10 days before the notice of any Net
Worth Offer is mailed to Holders. Such notice shall state
whether the Issuer elects to credit any Notes against its
obligation to repurchase Notes as provided above and shall set
forth the amount of such credit and the basis therefor (including
identification of any previously cancelled Notes not theretofore
credited). Such notice shall be accompanied by any Notes
required to be delivered to the Trustee for cancellation, as
provided above, in order to be credited against the Issuer's
obligation to repurchase Notes under this Section 8.
(c) Not less than 30 nor more than 60 days prior to the Net
Worth Repurchase Date, the Issuer or, at the request of the
Issuer, the Trustee will give notice of the Net Worth Offer (the
"Net Worth Notice"), in the manner provided in Section 11.4 of
the Indenture, to all Holders of the Notes and will cause a copy
of such notice to be published in an Authorized Newspaper in The
City of New York. If such Net Worth Notice is given by the
Issuer, the Issuer shall also deliver a copy thereof to the
Trustee. The Net Worth Notice sent to Holders shall be
accompanied by a copy of the information regarding the Issuer
which is or would be required to be contained in a Quarterly
Report on Form 10-Q for the fiscal quarter ending on the Trigger
Date if such fiscal quarter is one of the Issuer's first three
fiscal quarters. If such fiscal quarter is the Issuer's last
fiscal quarter, a copy of the information which is or would be
required to be contained in an Annual Report on Form 10-K for the
fiscal year ending with such fiscal quarter shall either
accompany the Net Worth Notice sent to Holders or be delivered to
Holders not less than 15 days before the Net Worth Repurchase
Date. Such Net Worth Notice shall contain all instructions and
(except in the case of the published notice) materials necessary
to enable Holders of Notes to surrender their Notes to the Issuer
for repurchase (including, without limitation (except in the case
of the published notice), a form of Net Worth Repurchase Notice
(as defined below)) and, without limitation to the foregoing,
shall state:
(i) that the Issuer is offering to repurchase Notes in an
aggregate principal amount equal to the Net Worth Offer
Amount pursuant to this Section 8 because its Consolidated
Net Worth as of the end of each of two specified consecutive
fiscal quarters was less than $195,000,000;
(ii) the Net Worth Repurchase Date;
(iii) the Net Worth Offer Amount and the Net Worth
Repurchase Price, including a statement as to whether or not
Holders surrendering Notes for repurchase will be entitled
to receive accrued and unpaid interest or whether accrued
and unpaid interest will be payable to Holders on the
relevant record date;
(iv) that a Holder electing to have a Note (or any portion
thereof which is a principal amount of $1,000 or any
integral multiple thereof) repurchased will be required to
surrender the Note, duly endorsed by, or accompanied by a
written instrument or instruments of transfer executed by,
the Holder or his attorney duly authorized in writing,
together with a duly completed Net Worth Repurchase Notice,
at an address specified in subparagraph (v) below prior to
the fifth day before the Net Worth Repurchase Date (such
notice shall specify the information which the Holder must
set forth in such Net Worth Repurchase Notice and shall
indicate that copies of the form of Net Worth Repurchase
Notice are available at the office of the Trustee and at
each other office or agency specified in subparagraph (v)
below);
(v) the address of the Trustee where Notes may be
surrendered for repurchase pursuant to such Net Worth Offer,
and the name and address of each other office or agency
where Notes may be surrendered for repurchase pursuant to
such Net Worth Offer, which shall include the office or
agency in the Borough of Manhattan, The City of New York
maintained with respect to the Notes pursuant to Section 3.2
of the Indenture;
(vi) that, if the aggregate principal amount of Notes
surrendered by Holders exceeds the Net Worth Offer Amount,
the Issuer shall select the Notes to be purchased on a pro
rata basis (with such adjustments as may be deemed
appropriate by the Issuer so that only Notes in
denominations of $1,000, or integral multiples thereof,
shall be repurchased);
(vii) that the Net Worth Repurchase Price for any Note
which has been duly surrendered, together with a duly
completed Net Worth Repurchase Notice, and accepted for
payment will be paid on the Net Worth Repurchase Date;
(viii) that any Note repurchased by the Issuer on the Net
Worth Repurchase Date shall cease to accrue interest on the
Net Worth Repurchase Date unless the Issuer defaults in
making payment in full of the Net Worth Repurchase Price,
and that any Note (A) which is not surrendered for
repurchase, (B) which is surrendered for repurchase but is
not accepted for repurchase following pro rata selection of
Notes because the aggregate principal amount of Notes
surrendered exceeds the Net Worth Offer Amount or (C) which
is surrendered and thereafter withdrawn, shall continue to
accrue interest;
(ix) that Holders who have surrendered Notes for
repurchase will be entitled to withdraw such Notes (or any
portion thereof in a principal amount of $1,000 or any
integral multiple thereof) if the Trustee or any office or
agency referred to in clause (v) above, as the case may be,
receives, not later than three days prior to the Net Worth
Repurchase Date, a telegram, telex, facsimile transmission,
letter or hand delivery notice setting forth the name of the
Holder, the certificate number and the principal amount of
the Note (which may be all or a portion of such principal
amount which is $1,000 or an integral multiple thereof) with
respect to which such notice of withdrawal is being
submitted and the principal amount, if any, of the Note
which is not being withdrawn;
(x) that Holders whose Notes are repurchased only in part
will be issued new Notes equal in principal amount to the
unrepurchased portion of the Notes surrendered, and that
Holders surrendering Notes for repurchase in part may specify
the denomination or denominations (which must be $1,000 or an
integral multiple of $1,000) of the Note or Notes to be
issued for the unrepurchased portion of the Note being
surrendered and that, in the absence of any such
specification, one Note will be issued for the portion not
repurchased; and
(xi) any other procedures the Holder must follow to
exercise its rights under this Section 8.
On the Net Worth Repurchase Date, the Issuer shall accept for
payment (on a pro rata basis if required by subparagraph (vi) above) all Notes
duly surrendered and not withdrawn. The Issuer will cause any Notes not
accepted for payment due to such a pro rata repurchase promptly to be mailed
or otherwise delivered to the Holders thereof.
(d) "Net Worth Repurchase Notice" means a written notice
(which may be the form thereof provided by the Issuer pursuant to Section 8(c)
or any other written notice which sets forth the information described below),
signed by the Holder or his attorney duly authorized in writing, stating:
(i) the name and address of the Holder and the
certificate number of the Note which the Holder is delivering
to be repurchased;
(ii) if the Note is surrendered for repurchase in part,
the portion of the principal amount of the Note which the
Holder is delivering to be repurchased, which portion must
be $1,000 or any integral multiple thereof;
(iii) if the Note is surrendered for repurchase in part,
the denomination or denominations (which must be $1,000 or
any integral multiple thereof) of the Note or Notes to be
issued to the Holder for the unrepurchased portion of the
Notes being surrendered, provided that the failure so to
specify such denomination or denominations shall not
constitute a defect in the Net Worth Repurchase Notice and,
in such event, one Note will be issued for such
unrepurchased portion of the Note being surrendered; and
(iv) that such Holder is electing to have such Note (or
portion thereof) repurchased by the Issuer on the Net Worth
Repurchase Date.
The delivery of a Note, by hand, by mail or otherwise, prior to
the fifth day before the Net Worth Repurchase Date to the Trustee or to an
office or agency referred to in Section 8(c)(v) above shall be a condition to
the receipt by the Holder of the Net Worth Repurchase Price therefor.
(9) Effect of Net Worth Repurchase Notice or Change of Control
Repurchase Notice; Right of Withdrawal:
Upon surrender by a Holder of a Note for repurchase pursuant to
Section 7 or 8, together with a duly completed Net Worth Repurchase Notice or
Change of Control Repurchase Notice, as the case may be, such Holder shall
(unless such Note is withdrawn as specified in the following paragraph or
unless, in the case of a Net Worth Offer, such Note is not accepted for
payment due to pro rata selection of Notes for repurchase pursuant to Section
8(c)(vi)) thereafter be entitled to receive, on the Net Worth Repurchase Date
or Change of Control Repurchase Date, as the case may be, the Net Worth
Repurchase Price or Change of Control Repurchase Price, as the case may be,
with respect to such Note. On the Net Worth Repurchase Date or Change of
Control Repurchase Date, the Issuer will pay or cause the Trustee or a paying
agent to pay the Holders of Notes which have been duly surrendered for
repurchase and not withdrawn (and, in the case of Net Worth Offer, which have
been accepted for repurchase as described in the last paragraph of Section
8(c)) the Net Worth Repurchase Price or Change of Control Repurchase Price, as
the case may be, and, if such date is after a record date for the payment of
interest on the Notes and on or before the related interest payment date,
shall pay or cause to be paid accrued and unpaid interest on such Notes to the
Holders thereof on such record date.
A Holder who has surrendered a Note for repurchase on a Net
Worth Repurchase Date or Change of Control Repurchase Date, as the case may
be, will be entitled to withdraw such Note (or any portion thereof in a
principal amount of $1,000 or any integral multiple thereof) if the Trustee or
any office or agency referred to in Section 7(b)(v) or Section 8(c)(v), as the
case may be, receives, prior to the Change of Control Repurchase Date or not
later than three days prior to the Net Worth Repurchase Date, as the case may
be, a telegram, telex, facsimile transmission, letter or hand delivery notice
setting forth the information specified in Section 7(b)(viii) or Section
8(c)(ix), as the case may be.
If any Note is withdrawn in whole, the Issuer shall cause such
Note promptly to be mailed or otherwise delivered to the Holder thereof.
If any Note surrendered for repurchase (and, in the case of a
Net Worth Offer, accepted for repurchase as described in the last paragraph of
Section 8(c)) shall not be so paid in full on the relevant Net Worth
Repurchase Date or Change of Control Repurchase Date, as the case may be, the
principal thereof (including, in the case of a Change of Control Repurchase
Date, the premium thereon) shall, until paid, bear interest from such Net
Worth Repurchase Date or Change of Control Repurchase Date, as the case may
be, at the rate of interest borne by the Notes, and the Issuer shall cause
such Note promptly to be mailed or otherwise delivered to the Holder thereof.
The Issuer shall publicly announce the results of a Net Worth
Offer or an offer made following a Change of Control on or promptly after the
Net Worth Repurchase Date or Change of Control Repurchase Date, as the case
may be.
(10) Deposit of Net Worth Repurchase Price or Change of Control
Repurchase Price:
On or prior to the Net Worth Repurchase Date or the Change of
Control Repurchase Date, as the case may be, the Issuer shall deposit with the
Trustee or with a paying agent for the Notes (or, if the Issuer is acting as
its own paying agent, shall set aside, segregate and hold in trust as provided
in Section 3.4 of the Indenture) an amount of cash sufficient to pay (i) the
aggregate Net Worth Repurchase Price or Change of Control Repurchase Price, as
the case may be, for all Notes or portions thereof which have been duly
surrendered for repurchase, not withdrawn and, in the case of a Net Worth
Offer, accepted for payment and (ii) if the Net Worth Repurchase Date or the
Change of Control Repurchase Date is after a record date for the payment of
interest on the Notes and on or before the related interest payment date, the
aggregate amount of interest payable on such Net Worth Repurchase Date or
Change of Control Repurchase Date, as the case may be, to the Persons in whose
names such Notes were registered at the close of business on such record date.
Anything in this Officers' Certificate, the Notes or the
Indenture to the contrary notwithstanding, except in the case of a Change of
Control Repurchase Date or Net Worth Repurchase Date which falls after a
record date for the payment of interest on the Notes and on or before the
related interest payment date, interest payable on Notes duly surrendered for
repurchase on a Change of Control Repurchase Date or Net Worth Repurchase Date
shall be paid with and in the same manner as the principal of such Notes
payable on such Change of Control Repurchase Date or Net Worth Repurchase
Date, as the case may be.
(11) Notes repurchased in part:
In the case of any Note which is repurchased only in part, the
Issuer shall execute and the Trustee shall authenticate and deliver to the
Holder of such Note, without service charge, a new Note or Notes, of any
authorized denominations as specified by such Holder (or, if the Holder shall
fail to specify any such denominations, a single Note in an authorized
denomination), in aggregate principal amount equal to, and in exchange for,
the portion of the principal amount of the Note so surrendered which is not
repurchased.
Provisions of this Indenture that apply to the repurchase of
all of a Note pursuant to Section 7 or 8 also apply to the repurchase of a
portion of such Note.
(12) Covenant to comply with securities laws upon repurchase of
Notes:
In connection with any offer to purchase Notes under Sections 7
or 8, the Issuer will conduct such offer in compliance with applicable
securities laws and regulations, including Section 14(e) of the Exchange Act
and Rule 14e-1 thereunder, to the extent applicable.
(13) Denominations in which Notes are issuable, if other than
$1,000 and any integral multiples thereof:
Not Applicable.
(14) If other than the principal amount thereof, the portion of
the principal amount of Notes payable on declaration of acceleration:
Not Applicable.
(15) Whether Notes are issuable as Registered Securities,
Unregistered Securities (with or without interest coupons), or any combination
thereof:
The Notes may be issued only in fully registered form without
coupons. The Notes will not be issuable as Registered Global Securities.
(16) Any other terms of Notes:
The Issuer covenants and agrees for the benefit of the Holders
of the Notes as follows:
(a) Limitation on Incurrence of Additional Indebtedness
The Issuer will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume,
guarantee, extend the maturity of or in any other manner become liable with
respect to, or otherwise become responsible for the payment of (collectively,
"incur"), any Indebtedness unless after giving effect to the incurrence
thereof and the receipt and application of the net proceeds therefrom either
(i) the Consolidated Fixed Charge Coverage Ratio of the Issuer (determined on
a pro forma basis for the last four fiscal quarters of the Issuer for which
financial statements are available at the date of determination) is at least 2
to 1 or (ii) the ratio of Indebtedness of the Issuer and its Restricted
Subsidiaries to Consolidated Net Worth of the Issuer is less than 3.25 to 1.
Notwithstanding the foregoing, the Issuer and its Restricted
Subsidiaries may incur: (i) Refinancing Indebtedness; (ii) Non-Recourse
Indebtedness incurred for the acquisition or improvement of real property or
improvement and secured by mortgage Liens on such real property or
improvements; (iii) Indebtedness to the Issuer or to Restricted Subsidiaries;
(iv) Indebtedness under the Existing Credit Facility in an aggregate principal
amount at any one time of not more than $350,000,000; and (v) Excluded Debt.
(b) Limitation on Restrictions on Distributions from Restricted
Domestic Subsidiaries
The Issuer will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, assume or otherwise cause or
permit to exist or become effective any consensual encumbrance or restriction
on the ability of any Restricted Domestic Subsidiary to: (i) pay dividends or
make any other distributions on its Capital Stock or on any other interest or
participation in, or measured by, its profits, owned by the Issuer or any of
its other Restricted Subsidiaries, or pay interest on or principal of any
Indebtedness owed to the Issuer or any of its other Restricted Subsidiaries;
(ii) make loans or advances to the Issuer or any of its other Restricted
Subsidiaries; or (iii) transfer any of its properties or assets to the Issuer
or any of its other Restricted Subsidiaries, except for encumbrances or
restrictions on the payment of cash by any Restricted Domestic Subsidiary
which does not exceed $10,000 in the aggregate and encumbrances and
restrictions existing or created under or by reason of (a) applicable law; (b)
covenants or restrictions contained in Existing Indebtedness; (c) customary
provisions restricting subletting or assignment of any contract or of any
lease governing a leasehold interest of the Issuer or any Restricted Domestic
Subsidiary; (d) restrictions under any instrument creating or evidencing any
Acquired Indebtedness that was permitted to be incurred pursuant to the
Indenture and the Notes and which (1) only apply to assets that were subject
to such restrictions and encumbrances prior the acquisition of such assets by
the Issuer or its Restricted Domestic Subsidiaries and (2) were not created in
connection with, or in contemplation of, such acquisition; (e) restrictions
replacing those permitted by clause (b) or (d) which are not more restrictive
than, and do not extend to any Persons or assets other than the Persons or
assets subject to, the restrictions and encumbrances so replaced; (f)
restrictions under any instrument creating or evidencing any Refinancing
Indebtedness which are not more restrictive than those under, and do not
extend to any Persons or assets other than the Persons or assets subject
thereto under, the instrument creating or evidencing the Indebtedness being
refunded, extended or refinanced by such Refinancing Indebtedness; (g) any
Permitted Lien or any agreement restricting the sale or other disposition of
property securing Indebtedness permitted by the Indenture and the Notes if
such Permitted Lien or agreement, as the case may be, does not by its terms
expressly restrict the ability of a Restricted Domestic Subsidiary of the
Issuer to make any of the dividends, payments, distributions, loans, advances
or transfers referred to in clauses (i), (ii) or (iii) above; (h) reasonable
and customary borrowing base covenants set forth in credit agreements
evidencing Indebtedness otherwise permitted by the Indenture and the Notes
which covenants restrict or limit the distribution of revenues or sale
proceeds from real estate or a real estate project based upon the amount of
Indebtedness outstanding on such real estate or real estate project and the
value of some or all of the remaining real estate or the project's remaining
assets; (i) customary agreements entered into in the ordinary course of
business restricting the ability of the joint venture to make distributions or
payments of cash or property to participants in such joint venture; or (j) the
Existing Credit Facility or a Substitute Credit Facility but only so long
as no such encumbrance or restriction under the Existing Credit Facility or
a Substitute Credit Facility by its terms expressly restricts the ability
of a Restricted Domestic Subsidiary of the Issuer to make any of the
dividends, payments, distributions, loans, advances or transfers referred
to in clauses (i), (ii) or (iii) above (it being understood that covenants
requiring or having the effect of requiring the maintenance of a specified
level of net worth which do not by their terms expressly restrict the
ability of a Restricted Domestic Subsidiary of the Issuer to make any such
dividends, payments or distributions, loans, advances or transfers referred
to in clauses (i), (ii) or (iii) above shall be permitted under this clause
(j)).
(c) Limitation on Restricted Payments
The Issuer will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, make any Restricted Payment if, after
giving effect thereto, (i) a Default or an Event of Default shall have
occurred and be continuing; or (ii) the aggregate amount of Restricted
Payments (the amount of any Restricted Payment, if other than in cash, to be
determined by the Board of Directors of the Issuer, whose reasonable
determination shall be conclusive and evidenced by a Board Resolution
certified by an Officers' Certificate and filed with the Trustee) made by the
Issuer and its Restricted Subsidiaries from and after November 19, 1996 would
exceed the sum of (a) 50% of the Consolidated Net Income of the Issuer accrued
on a cumulative basis for the period commencing on September 1, 1996 (the
"Commencement Date") and ending on the last day (the "Reference Day") of the
Issuer's last fiscal quarter ending prior to the date of such proposed
Restricted Payment (or, in the event such Consolidated Net Income as so
determined on a cumulative basis shall be a deficit, minus 100% of such
deficit), (b) the aggregate net proceeds, including the fair market value of
property other than cash (such fair market value to be determined by a
majority of the disinterested members of the full Board of Directors of the
Issuer, whose reasonable determination shall be conclusive and evidenced by a
Board Resolution certified by an Officers' Certificate and filed with the
Trustee) received by the Issuer from any Person (other than a Restricted
Subsidiary) after the Commencement Date and on or prior to the Reference Date
from the issue or sale of Qualified Capital Stock of the Issuer, or any
options, warrants or other rights (other than convertible or exchangeable debt
securities except as provided below) to purchase Qualified Capital Stock of
the Issuer, or from the issuance or sale of debt securities of the Issuer
which are converted into or exchanged for Qualified Capital Stock of the
Issuer, and (c) $75 million; or (iii) the Issuer would be unable to incur an
additional $1.00 of Indebtedness pursuant to the first paragraph of the
covenant set forth in Section 16(a) of the Officers' Certificate; provided,
however, that the foregoing provisions shall not prevent (a) the payment of
any dividend or distribution within 60 days after the date of declaration
thereof, if the payment would have complied with the foregoing provisions on
the date of such declaration or (b) the repurchase or redemption of shares of
Capital Stock from any officer, director or employee of the Issuer or its
Restricted Subsidiaries whose employment has been terminated or who has died
or become disabled in an aggregate amount not to exceed $5,000,000 for any
fiscal year of the Issuer; provided that amounts paid pursuant to this clause
(b) shall reduce amounts available for future Restricted Payments.
(d) Limitations on Transactions with Officers, Directors and
Employees
The Issuer will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, (A) make any loan, advance, guarantee
or capital contribution to, or for the benefit of, or (B) sell, lease,
transfer or otherwise dispose of any of its properties or assets to, or for
the benefit of, or (C) purchase or lease any property or assets from, or (D)
enter into or amend any contract, agreement or understanding with, or for the
benefit of, (i) any officer, director or employee of the Issuer, (ii) any
officer, director or employee of a Subsidiary of the Issuer (provided that
clause (D) above shall not apply with respect to this clause (ii)) or (iii)
any former officer or director of the Issuer or any of its Subsidiaries who
owns, directly or indirectly, 7.5% or more of the voting power of the Common
Stock of the Issuer (each an "Affiliate Transaction"), except on terms that
are no less favorable to the Issuer or the relevant Restricted Subsidiary, as
the case may be, than those that could have been obtained in a comparable
transaction on an arm's length basis from a Person that is not such an
officer, director or employee.
Notwithstanding the foregoing, the term "Affiliate Transaction"
shall not include any transaction with an officer, director or employee of the
Issuer or of any Subsidiary of the Issuer in their capacity as officer,
director or employee entered into in the ordinary course of business or which
is consistent with past practice (including compensation and employee benefit
arrangements with any officer, director or employee of the Issuer or of any
Subsidiary of the Issuer) and shall not include the acquisition by any
officer, director or employee of the Issuer of any securities of the Issuer in
the open market in arm's length transactions.
(e) Limitation on Investments in Restricted Foreign
Subsidiaries, Unrestricted Subsidiaries and Equity Method Persons
The Issuer will not, and will not permit any of its Restricted
Domestic Subsidiaries to, directly or indirectly, make any Investment in any
Restricted Foreign Subsidiary, Unrestricted Subsidiary or Equity Method Person
(each, a "Subject Entity") if, after giving effect thereto, the aggregate
amount of all such Investments made after the date of the Indenture would
exceed the sum of (i) $110,000,000, (ii) the aggregate amount of cash
dividends and distributions received by the Issuer after the date of the
Indenture from Subject Entities, (iii) in the case of any such Investment made
after the date of the Indenture as a loan or advance to, or purchase (or other
acquisition for consideration) of Indebtedness or other debt securities of, a
Subject Entity, the amount of all cash repayments of principal of such loans,
advances, Indebtedness or debt securities paid to the Issuer or any of its
Restricted Domestic Subsidiaries (or to a Person designated by the Issuer or
any of its Restricted Domestic Subsidiaries, which Person is not a Subsidiary
or Affiliate of the Issuer) by such Subject Entity, (iv) in the case of any
such Investment made after November 19, 1996 as a capital contribution to, or
purchase (or other acquisition for consideration) of Capital Stock or other
equity securities of, a Subject Entity, the aggregate cash amount paid to the
Issuer or any of its Restricted Domestic Subsidiaries (or to a Person
designated by the Issuer or any of its Restricted Domestic Subsidiaries, which
Person is not a Subsidiary or Affiliate of the Issuer) by such Subject Entity
as a return of such capital or to repurchase such Capital Stock or other
equity securities (not to exceed the respective amount paid to purchase such
Capital Stock or equity securities), and (v) in the case of any other such
Investment made in a Subject Entity after November 19, 1996, the cash amount
paid to the Issuer or any of its Restricted Domestic Subsidiaries (or to a
Person designated by the Issuer or any of its Restricted Domestic
Subsidiaries, which Person is not a Subsidiary or Affiliate of the Issuer) by
such Subject Entity as a repayment or reimbursement of such Investment.
(f) Corporate Existence
Subject to Article Nine of the Indenture (as modified by
Section 24(h) of this Officers' Certificate), the Issuer will do or cause to
be done all things necessary to preserve and keep in full force and effect its
corporate existence and its rights (charter and statutory) and franchises;
provided, however, that the Issuer shall not be required to preserve any such
right or franchise if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Issuer and its Subsidiaries taken as a whole.
(g) Payment of Taxes
The Issuer will pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, all taxes, assessments
and governmental charges levied or imposed upon the Issuer or any Restricted
Significant Subsidiary or upon the income, profits or property of the Issuer
or any Restricted Significant Subsidiary; provided that the Issuer shall not
be required to pay or discharge or cause to be paid or discharged any such
tax, assessment or charge whose amount, applicability or validity is being
contested in good faith by appropriate proceedings; provided, further, that
the Issuer shall not be required to pay or cause to be paid (i) any such
delinquent taxes, assessments or charges until the aggregate amount thereof at
any time outstanding shall exceed $10,000,000 or (ii) any such tax, assessment
or charge levied on any property of the Issuer or any Restricted Significant
Subsidiary that is without recourse to the Issuer or any Restricted
Significant Subsidiary.
(h) Waiver of Stay, Extension or Usury Laws
The Issuer covenants (to the extent that it may lawfully do so)
that it will not at any time insist upon, plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay or extension law or any
usury law or other law which would prohibit or forgive the Issuer from paying
all or any portion of the principal of or interest on the Notes as
contemplated herein and in the Indenture, wherever enacted, now or at any time
hereafter in force, or which may affect the covenants or the performance of
this Officers' Certificate or the Indenture and (to the extent that it may
lawfully do so) the Issuer hereby expressly waives all benefit or advantage of
any such law, and covenants that it will not hinder, delay or impede the
execution of any power granted to the Trustee, but will suffer and permit the
execution of every such power as though no such law had been enacted.
(17) Initial public offering price of Notes:
The Issuer will sell the Notes to an underwriter for 99.525% of
the principal amount thereof. The underwriter proposes to offer the Notes
from time to time for sale in one or more negotiated transactions or
otherwise, at market prices prevailing at the time of sale, prices related to
such market prices or negotiated prices.
(18) Underwriting discount as a percentage of the principal
amount of Notes:
See Section 17.
(19) If other than Dollars, the coin or currency in which payment
of principal of and interest on the Notes shall be payable and in which the
Notes shall be denominated.
Not applicable.
(20) Terms defined for purposes of this Officers' Certificate and
the issuance of the Notes:
"Acquired Indebtedness" means (i) with respect to any Person
(except a Person formed or organized by or on behalf of the Company for
purposes other than to act as an acquisition vehicle) that becomes a
Subsidiary of the Company after the date of the Indenture, Indebtedness of
such person and its Subsidiaries existing at the time such person becomes a
Subsidiary of the Company that was not incurred in connection with, or in
contemplation of, such Person becoming a Subsidiary of the Company, (ii) with
respect to the Company or any of its Subsidiaries, any Indebtedness incurred
by the Company or any of its Subsidiaries in connection with the acquisition
of an asset from another Person after the date of the Indenture that was not
incurred in connection with, or in contemplation of, such acquisition.
"Associate" shall have the meaning ascribed to such term in
Rule 12b-2 of the General Rules and Regulations under the Exchange Act, as in
effect on November 19, 1996.
"Capital Stock" of any Person means any and all shares,
interests, participations or other equivalents (however designated) in or of
the equity (which includes, but is not limited to, common stock, preferred
stock and partnership and joint venture interests) of such Person.
"Capitalized Lease Obligation" means an obligation under a
Capital Lease and the amount of Indebtedness represented by such obligation
shall be the capitalized amount of such obligation determined in accordance
with GAAP.
A "Change of Control" shall be deemed to have occurred at such
time as either of the following events shall occur: (i) there shall be
consummated any consolidation or merger of the Issuer in which the Issuer is
not the continuing or surviving corporation or pursuant to which the Voting
Stock (as defined below) would be converted into cash, securities or other
property, other than a merger of the Issuer in which the holders of Voting
Stock immediately prior to the merger have the same or greater proportionate
ownership, directly or indirectly, of the Voting Stock of the surviving
corporation immediately after such merger as they had of the Voting Stock
immediately prior to such merger; or (ii) there is a report filed by any
Person, including its Affiliates and Associates, on Schedule 13D or 14D-1 (or
any successor schedule, form or report) pursuant to the Exchange Act,
disclosing that such Person (for the purposes of this definition only, the
term "Person" shall include a "person" within the meaning of Section 13(d)(3)
or Section 14(d)(2) of the Exchange Act or any successor provision to either
of the foregoing) has become the beneficial owner (as the term "beneficial
owner" is defined under Rule 13d-3 or any successor rule or regulation
promulgated under the Exchange Act) of 50% or more of the voting power of the
Issuer's Voting Stock then outstanding; provided, however, that a Person shall
not be deemed beneficial owner of, or to own beneficially, (A) any securities
tendered pursuant to a tender or exchange offer made by or on behalf of such
Person or any of such Person's Affiliates or Associates until such tendered
securities are accepted for purchase or exchange thereunder, or (B) any
securities if such beneficial ownership (1) arises solely as a result of a
revocable proxy delivered in response to a proxy or consent solicitation made
pursuant to, and in accordance with, the applicable rules and regulations
under the Exchange Act, and (2) is not also then reportable on Schedule 13D
(or any successor schedule, form or report) under the Exchange Act.
Notwithstanding the foregoing, a Change of Control shall not be deemed to have
occurred if at any time the Issuer, any Subsidiary of the Issuer, any employee
stock ownership plan or any other employee benefit plan of the Issuer or any
Subsidiary of the Issuer, or any Person holding Voting Stock for or pursuant
to the terms of any such employee benefit plan, files or becomes obligated to
file a report under or in response to Schedule 13D or Schedule 14D-1 (or any
successor schedule, form or report) under the Exchange Act disclosing
beneficial ownership by it of shares of Voting Stock, whether in excess of 50%
or otherwise.
"Change of Control Business Day" means a day on which banking
institutions are not authorized or required by law or regulation to close in
The City of New York.
"Common Stock" of any Person means all Capital Stock of such
Person that is generally entitled to (i) vote in the election of directors of
such Person or (ii) if such Person is not a corporation, vote or otherwise
participate in the selection of the governing body, partners, managers or
others that will control the management and policies of such Person.
"Consolidated Adjusted Net Income" of the Issuer means, for any
period, the Consolidated Net Income of the Issuer and its Restricted
Subsidiaries for such period, provided that (i) the Net Income of any Person
acquired in a pooling of interests transaction for any period prior to the
date of such acquisition shall be excluded and (ii) the Net Income of any
Person which is not a Restricted Subsidiary or is an Equity Method Person
shall be included only to the extent of the amount of cash dividends or
distributions paid by it to the Issuer or a Restricted Subsidiary during such
period.
"Consolidated Fixed Charge Coverage Ratio" means, for any
period, the ratio of (i) the sum, without duplication, of Consolidated
Adjusted Net Income, Consolidated Interest Expense (but only to the extent
that such Consolidated Interest Expense reduces such Consolidated Adjusted Net
Income for such period), Consolidated Tax Expense, depreciation and
amortization (including, without limitation, previously capitalized interest
amortized to cost of sales), in each case for such period, of the Issuer and
its Restricted Subsidiaries (determined on a consolidated basis in accordance
with GAAP) to (ii) Consolidated Interest Expense of the Issuer and its
Restricted Subsidiaries for such period; provided, however, that in making
such computation, the Consolidated Interest Expense attributable to interest
on any Indebtedness computed on a pro forma basis and bearing a floating
interest rate shall be computed as if the rate in effect on the date of
computation had been the applicable rate for the entire period unless such
interest rate has been fixed by hedging or other similar contracts or
agreements, in which case such interest rate shall be deemed to be equal to
such fixed rate of interest.
"Consolidated Interest Expense" means, for any period, the
aggregate amount of interest which, in conformity with GAAP, would be set
forth opposite the caption "interest expense" or any like caption on a
consolidated income statement of the Issuer and its Restricted Subsidiaries
(including, but not limited to, imputed interest on Capitalized Lease
Obligations, all commissions, discounts and other fees and charges owed with
respect to letters of credit and bankers' acceptance financing, the net costs
associated with hedging obligations, amortization of other financing fees and
expenses, the interest portion of any deferred payment obligation,
amortization of discount or premium, if any, and all other non-cash
interest expense (other than previously capitalized interest amortized to
cost of sales)) plus, without duplication, all capitalized interest of the
Issuer and its Restricted Subsidiaries for such period and all interest
incurred or paid by the Issuer or any of its Restricted Subsidiaries under
any guarantee of Indebtedness (including a guarantee of principal, interest
or any combination thereof) of any Person for such period, in each case
determined on a consolidated basis in accordance with GAAP.
"Consolidated Net Income" of the Issuer means, for any period,
the consolidated Net Income of the Issuer and its Restricted Subsidiaries for
such period, determined in accordance with GAAP.
"Consolidated Net Worth" means the consolidated shareholders'
equity of the Issuer.
"Consolidated Tax Expense" of the Issuer means, for any period,
the consolidated federal, state, local and foreign tax expense of the Issuer
and its Restricted Subsidiaries for such period, determined in accordance with
GAAP.
"Default" means any event or condition which is or, with notice
or lapse of time or both, would be an Event of Default.
"Disqualified Capital Stock" means any Capital Stock that, by
its terms (or by the terms of any security into which it is convertible or for
which it is exchangeable), or upon the happening of any event, matures or is
mandatorily redeemable other than solely for Qualified Capital Stock, pursuant
to a sinking fund obligation or otherwise, or is redeemable or required to be
repurchased or repaid at the option of the holder thereof for consideration
other than solely for Qualified Capital Stock, in whole or in part, on or
prior to the final maturity date of the Notes; provided that, in the case of
any Restricted Domestic Subsidiary through which the Issuer conducts any real
estate joint venture, the fact that any participant in such joint venture who
holds Capital Stock of such Restricted Domestic Subsidiary may have the right,
pursuant to a "buy-sell" agreement or similar arrangement, to require that the
Issuer or any other Subsidiary of the Issuer purchase such Capital Stock from
such joint venturer, shall not cause such Capital Stock to be deemed
Disqualified Capital Stock.
"Equity Method Person" means, as of any date of determination,
any Person (other than a Subsidiary of the Issuer) which is or is required to
be accounted for by the Issuer by the equity method of accounting in the
Issuer's consolidated financial statements in accordance with GAAP.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Excluded Debt" means any Indebtedness of the Issuer or its
Restricted Subsidiaries which is (i) subordinated (subject to the rights of
holders of Senior Indebtedness) in right of payment to the Notes (upon
liquidation or otherwise) at least to the extent that the Notes are
subordinated to the Senior Indebtedness and (ii) matures after, and is not
redeemable mandatorily or at the option of the holder thereof prior to, the
final maturity date of the Notes.
"Existing Credit Facility" means the Fourth Amended and
Restated Loan Agreement dated as of February 28, 1996 among the Issuer, the
banks party thereto, Bank of America National Trust and Savings Association,
as administrative agent, The First National Bank of Chicago, as documentation
agent, and the other parties thereto, and any credit facility which is an
extension or renewal thereof (including, in each case, any increase in the
amount of credit available thereunder).
"Existing Indebtedness" means all Indebtedness of the Issuer
and its Restricted Subsidiaries that is outstanding on November 19, 1996.
"GAAP" means generally accepted accounting principles as in
effect and implemented by the Issuer from time to time.
A "guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Indebtedness
of any other Person including, without limiting the generality of the
foregoing, any obligation, direct or indirect, contingent or otherwise, of
such Person to purchase or pay principal of or interest on (or advance or
supply funds or pledge assets for the purchase or payment of or payment of
interest on) Indebtedness of such other Person (whether by agreement to
provide additional capital or to maintain financial condition or other similar
agreement).
"incur" has the meaning set forth in Section 16(a) of this
Officers' Certificate.
"Indebtedness" means (i) any liability of any Person (a) for
borrowed money or for the deferred purchase price of property or services
(other than current liabilities, including Trade Payables, arising in the
ordinary course of business) or which is evidenced by a note, bond, debenture
or similar instrument, and which would appear as a liability upon a balance
sheet of such Person prepared on a consolidated basis in accordance with GAAP,
or (b) for the payment of money relating to a Capitalized Lease Obligation;
(ii) any liability of such Person in respect of letters of credit or other
similar instruments (or reimbursement obligations with respect thereto), but
this clause (ii) does not include letters of credit provided in the ordinary
course of business and securing performance (and not financial) obligations
and performance, completion, surety or similar bonds or obligations provided
in the ordinary course of business; (iii) any liability or obligation of
others described in clause (i) or (ii) with respect to which such Person
has made a guarantee or similar arrangement, directly or indirectly (to the
extent of such guarantee or arrangement), but this clause (iii) does not
include obligations in respect of banker's acceptances and performance,
completion, surety or similar bonds or obligations provided in the ordinary
course of business; and (iv) all Indebtedness of others secured by a Lien
(other than assessment district and similar Liens arising in connection
with municipal financings) on any asset of such Person, whether or not such
Indebtedness is assumed by such Person. The amount of Indebtedness of any
Person at any date shall be the outstanding balance at such date of all
unconditional obligations described above and the maximum liability of such
Person for any such contingent obligations at such date. To the extent
such Person guarantees the obligation of another Person to pay interest on
Indebtedness owed by such other Person, then a designated percentage of the
interest guaranteed or the principal amount of the underlying Indebtedness,
as the case may be, shall be deemed Indebtedness of the referent Person.
For purposes of this definition, the amount of such deemed Indebtedness of
the referent Person shall be equal to the lesser of (a) the aggregate
principal amount of the underlying Indebtedness relating to such interest
guarantee and (b) the aggregate amount of interest due and payable over the
term of such Indebtedness (or the term of the Notes, if shorter) determined
based upon the rate of interest in effect as of the date of such
determination, together with the maximum prepayment premium or penalty
which could become due or payable with respect to such Indebtedness if such
Indebtedness were prepaid prior to the maturity of the Notes.
"Investment" of any Person means (i) all investments by such
Person in any other Person in the form of loans, advances or capital
contributions, (ii) all payments of Indebtedness or other obligations of any
other Person by such Person, (iii) all purchases (or other acquisitions for
consideration) by such Person of Indebtedness, Capital Stock or other
securities of any other Person, and (iv) all other items that would be
classified as investments (including, without limitation, purchases of assets
outside the ordinary course of business) on a balance sheet of such Person
prepared in accordance with GAAP.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or other similar encumbrance of any kind in
respect of such asset, whether or not filed, recorded or otherwise perfected
under applicable law (including, without limitation, any conditional sale or
other title retention agreement and any lease in the nature thereof, any
option or other agreement to sell, and any filing of, or agreement to give,
any financing statement under the Uniform Commercial Code (or equivalent
statute) of any jurisdiction).
"Mortgage Finance Subsidiary" means Kaufman and Broad Mortgage
Company, an Illinois corporation.
"Net Income" means, with respect to any Person, the net income
(loss) of such Person, determined in accordance with GAAP, excluding, however,
(i) any gain (but not loss) realized upon the sale or other disposition
(including, without limitation, dispositions pursuant to sale and leaseback
transactions) of any real property or equipment of such Person which is not
sold or otherwise disposed of in the ordinary course of business, and (ii) any
gain (but not loss) realized upon the sale or other disposition of any Capital
Stock of such Person or any of its Restricted Subsidiaries owned by such
Person.
"Non-Recourse Indebtedness" means Indebtedness secured by a
Lien on property to the extent that the liability for such Indebtedness (and
any interest thereon) is limited to the security of such property without
liability on the part of the Issuer or any of its Subsidiaries for any
deficiency, including liability by reason of any agreement by the Issuer or
any of its Subsidiaries to provide additional capital or maintain the
financial condition of or otherwise support the credit of the Person incurring
such Indebtedness.
"Qualified Capital Stock" means Capital Stock other than
Disqualified Capital Stock.
"Refinancing Indebtedness" means Indebtedness that solely
refunds, refinances or extends, and is incurred within six months of the
scheduled maturity date or a mandatory repurchase date or optional redemption
date of, any Notes, Existing Indebtedness (excluding any Existing Indebtedness
repaid with the proceeds from the sale of the Notes) or other Indebtedness
incurred by the Issuer or its Restricted Subsidiaries pursuant to the terms of
the Indenture and the Notes, but only to the extent that (i) if the
Indebtedness being refunded, refinanced or extended is subordinated to the
Notes, the Refinancing Indebtedness is also subordinated to the Notes at least
to the extent and in the manner as such Indebtedness, (ii) if the Indebtedness
being refunded, refinanced or extended is subordinated to the Notes, the
Refinancing Indebtedness (a) is scheduled to mature either no earlier than the
Indebtedness being refunded, refinanced or extended or after the scheduled
maturity date of the Notes and (b) has a Weighted Average Life to Maturity at
the time such Refinancing Indebtedness is incurred that is equal to or greater
than the Weighted Average Life to Maturity of the Indebtedness being refunded,
refinanced or extended, (iii) such Refinancing Indebtedness is in an aggregate
principal amount that is equal to or less than the aggregate principal amount
then outstanding under the Indebtedness being refunded, refinanced or extended
and (iv) such Refinancing Indebtedness is incurred by the same Person that
initially incurred the Indebtedness being refunded, refinanced or extended
except that (a) the Issuer may incur Refinancing Indebtedness to refund,
refinance or extend Indebtedness of any Restricted Subsidiary and (b) any
Restricted Subsidiary may incur Refinancing Indebtedness to refund, refinance
or extend Indebtedness of any other Restricted Subsidiary.
"Restricted Domestic Subsidiary" means, as of any date of
determination, a Restricted Subsidiary (i) that is organized under the laws of
the United States of America or any state thereof or the District of Columbia
and (ii) the majority of the assets of which (as reflected on a balance sheet
of such Subsidiary prepared in accordance with GAAP) is located in the United
States of America.
"Restricted Foreign Subsidiary" means, as of any date of
determination, a Restricted Subsidiary that is not a Restricted Domestic
Subsidiary.
"Restricted Payment" means, with respect to any Person, (i) the
declaration or payment of any dividend or the making of any other payment or
distribution of cash, securities or other property in respect of such Person's
Capital Stock or in respect of any warrants, options or other rights (other
than convertible or exchangeable debt securities of such Person) to purchase
or acquire such Person's Capital Stock (except that a dividend payable solely
in Qualified Capital Stock of the Issuer shall not constitute a Restricted
Payment), (ii) any payment on account of the purchase, redemption, retirement
or other acquisition for value of such Person's Capital Stock or any warrants,
options or other rights (other than convertible or exchangeable debt
securities of such Person) to purchase or acquire such Person's Capital Stock,
or any other payment or distribution made in respect thereof, either directly
or indirectly, or (iii) any principal payment, redemption, repurchase,
defeasance or other acquisition or retirement, prior to scheduled principal
payment or scheduled maturity, of Indebtedness (other than collateralized
mortgage obligations issued by Subsidiaries of the Mortgage Finance
Subsidiary) of the Issuer or any of its Subsidiaries which is subordinated in
right of payment to the Notes; provided, however, that with respect to the
Issuer and its Restricted Subsidiaries, Restricted Payments shall not include
(a) any payment described in clause (i) or (ii) above made to the Issuer or
any of its Restricted Subsidiaries by any of the Issuer's other Restricted
Subsidiaries, (b) any exchange offer, but only to the extent the Issuer
exchanges solely Capital Stock of the Issuer (other than Disqualified Stock)
for Indebtedness of the Issuer or a Restricted Subsidiary in such exchange
offer or (c) any redemption, repurchase or retirement of Indebtedness (the
Indebtedness being so redeemed, repurchased or retired being hereinafter
called "Subject Indebtedness") described in clause (iii) above if made from
the proceeds of Indebtedness which (x) is subordinated to the Notes to the
same extent as the Subject Indebtedness, (y) is scheduled to mature either no
earlier than the Subject Indebtedness or after the scheduled maturity date of
the Notes and (z) has a Weighted Average Life to Maturity at the time such
Indebtedness is incurred that is equal to or greater than the Weighted Average
Life to Maturity of the Subject Indebtedness.
"Restricted Significant Subsidiary" means any Restricted
Subsidiary which is a "significant subsidiary" as defined in Rule 1-02(v) of
Regulation S-X under the Securities Act of 1933, as amended and the Exchange
Act (as such Regulation S-X was in effect on June 1, 1996).
"Restricted Subsidiary" means a Subsidiary of the Issuer which
is not, as of the determination date, an Unrestricted Subsidiary.
"Substitute Credit Facility" means any credit facility of the
Issuer which is created subsequent to the date of the Indenture and which
replaces all or part of the Existing Credit Facility or a Substitute Credit
Facility (and which may provide for an increase in the amount of credit
available thereunder), so long as the Issuer is the borrower under such
Substitute Credit Facility.
"Unrestricted Subsidiary" means (a) the Mortgage Finance
Subsidiary, (b) any Subsidiary of the Mortgage Finance Subsidiary on the date
of the Indenture, (c) any other Subsidiary of the Issuer which is designated
as an Unrestricted Subsidiary by the Issuer's Board of Directors as provided
below and (d) any Subsidiary of an Unrestricted Subsidiary; provided that, in
each case referred to in clause (a), (b), (c) or (d), the creditors of such
Subsidiary have no direct or indirect recourse (including, but not limited to,
recourse with respect to the payment of principal of or interest on
Indebtedness of such Subsidiary) to the Issuer or any of its Restricted
Subsidiaries. The Board of Directors of the Issuer may designate an
Unrestricted Subsidiary to be a Restricted Subsidiary; provided that no such
designation shall result in any Restricted Subsidiary becoming a Subsidiary of
any Unrestricted Subsidiary; and provided, further that (i) any such
designation shall be deemed to be an incurrence by the Issuer and its
Restricted Subsidiaries, as of the date of such designation, of the
consolidated Indebtedness (if any) of such designated Subsidiary and its
Subsidiaries (if any) which are or are being designated as Restricted
Subsidiaries, determined in accordance with GAAP, for purposes of the covenant
described above in Section 16(a) of this Officers' Certificate, (ii)
immediately after giving effect to such designation and the deemed incurrence
of any such additional Indebtedness (A) no Default or Event of Default shall
have occurred and shall be continuing, (B) the Issuer could incur $1.00 of
additional Indebtedness pursuant to the first paragraph of the covenant
described above in Section 16(a) of this Officers' Certificate and (C) without
limitation to clause (A) above, such designated Subsidiary and its
Subsidiaries (if any) which are or are being designated as Restricted
Subsidiaries are in compliance with the covenant described above in Section
16(b) of this Officers' Certificate. Subject to the foregoing, the Board
of Directors of the Issuer also may designate any Restricted Subsidiary
(together with its Subsidiaries (if any) to be an Unrestricted Subsidiary;
provided that (i) the consolidated shareholders' equity (determined in
accordance with GAAP) of such designated Subsidiary and its Subsidiaries
(if any) at the time of such designation shall be deemed to be an
Investment by the Issuer in an Unrestricted Subsidiary at the time of such
designation and shall reduce the amount of Investments which the Issuer and
its Restricted Domestic Subsidiaries shall be permitted to make under the
covenant described above in Section 16(e) of this Officers' Certificate and
(ii) immediately after giving effect to such designation and reduction of
amounts available for Investments under such covenant, (A) no Default or
Event of Default shall have occurred and shall be continuing, (B) the
Issuer could incur $1.00 of additional Indebtedness pursuant to the first
paragraph of the covenant described above in Section 16(a) of this
Officers' Certificate and (C) the Issuer could make $1.00 of additional
Investments in Unrestricted Subsidiaries pursuant to the covenant described
above in Section 16(e) of this Officers' Certificate. Any designation by
the Board of Directors described above shall be evidenced to the Trustee by
the filing with the Trustee of a certified copy of the resolution of the
Issuer's Board of Directors giving effect to such designation and an
Officers' Certificate certifying that such designation complied with the
foregoing conditions and setting forth the underlying calculations
supporting such certification. As of the date of this Officers'
Certificate, the only Unrestricted Subsidiaries are the Mortgage Finance
Subsidiary and its Subsidiaries.
"Voting Stock" means, with respect to any Person, the capital
stock of such Person having general voting power under ordinary circumstances
to elect at least a majority of the board of directors, managers or trustees
of such Person (irrespective of whether or not at the time capital stock of
any other class or classes shall have or might have voting power by reason of
the happening of any contingency).
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness or portion thereof at any date, the number of years obtained by
dividing (i) the then outstanding principal amount of such Indebtedness or
portion thereof, as the case may be, into (ii) the sum of the products
obtained by multiplying (a) the amount of each then remaining installment,
sinking fund, serial maturity or other required payment of principal of such
indebtedness or portion thereof, as the case may be, including payment at
final maturity, in respect thereof, by (b) the number of years (calculated to
the nearest one-twelfth) that will elapse between such date and the making of
such payment.
(21) The Notes will be in substantially the form attached hereto
as Exhibit A, and said terms are hereby incorporated herein and in the
Indenture by reference.
(22) SunTrust Bank, Atlanta shall be the initial Trustee, paying
agent, transfer agent and registrar for the Notes and shall be empowered so to
act through its agent in the Borough of Manhattan, The City of New York.
(23) Terms (whether or not capitalized) used in this Officers'
Certificate and not defined herein which are defined in the Indenture shall
have the respective meanings given them in the Indenture.
(24) Any deletions from, modifications of or additions to the
defined terms, Events of Default, covenants and other provisions of the
Indenture with respect to the Notes:
(a) Section 5.1 of the Indenture is hereby amended and
restated, but only insofar as it relates to the Notes, to read in
full as follows, and the term "Event of Default", insofar (but
only insofar) as such term relates to the Notes, shall have the
meaning set forth below:
Section 5.1 Event of Default Defined;
Acceleration of Maturity; Waiver of Default. "Event of
Default" with respect to the Notes, wherever used herein,
means each one of the following events which shall have
occurred and be continuing (whatever the reason for such
Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order,
rule or regulation of any administrative or governmental
body):
(a) default in the payment of any installment of
interest upon any of the Notes as and when the same shall become
due and payable, and continuance of such default for a period of
30 days; or
(b) default in the payment of all or any part of the
principal of any of the Notes as and when the same shall become
due and payable, either at maturity, upon any redemption at the
option of the Issuer or repurchase at the option of the Holders,
by declaration of acceleration or otherwise; or
(c) failure on the part of the Issuer duly to observe or
perform any other of the covenants or agreements on the part of
the Issuer in the Notes or in this Indenture contained (other
than a covenant or warranty in respect of the Notes a default in
the performance or breach of which is elsewhere in this Section
5.1 specifically dealt with or which has expressly been included
in this Indenture solely for the benefit of one or more series of
Securities other than the Notes) for a period of 60 days (or for
10 days in the case of any of the other covenants set forth in
Section 7 of the Officers' Certificate dated November 19, 1996
establishing the form and terms of the Notes or, insofar as
relates to the repurchase of Notes following a Change of Control,
Sections 9, 10, 11 or 12 of such Officers' Certificate) after the
date on which written notice specifying such failure, stating
that such notice is a "Notice of Default" hereunder and demanding
that the Issuer remedy the same, shall have been given by
registered or certified mail, return receipt requested, or by
overnight courier or by hand delivery with evidence of the
receipt of such overnight courier or hand delivery by the Issuer,
to the Issuer by the Trustee, or to the Issuer and the Trustee by
the Holders of at least 25% in aggregate principal amount of the
Notes then Outstanding; or
(d) a court having jurisdiction in the premises shall
enter a decree or order for relief in respect of the Issuer or
any of its Restricted Significant Subsidiaries in an involuntary
case under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or
similar official) of the Issuer or any of its Restricted
Significant Subsidiaries or for any substantial part of the
property of the Issuer or any of its Restricted Significant
Subsidiaries or ordering the winding up or liquidation of the
affairs of the Issuer or any of its Restricted Significant
Subsidiaries, and such decree or order shall remain unstayed and
in effect for a period of 60 consecutive days; or
(e) the Issuer or any of its Restricted Significant
Subsidiaries shall commence a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in
effect, or consent to the entry of an order for relief in an
involuntary case under any such law, or consent to the
appointment or taking possession by a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official)
of the Issuer or any of its Restricted Significant Subsidiaries
or for any substantial part of the property of the Issuer or any
of its Restricted Significant Subsidiaries, or make any general
assignment for the benefit of creditors; or
(f) a default under any mortgage, indenture or other
instrument or agreement (including this Indenture with respect to
any other series of Securities) under which there may be issued
or by which there may be secured or evidenced any Indebtedness
(other than Non-Recourse Indebtedness) of the Issuer or any
Restricted Subsidiary, whether such indebtedness existed on the
date of this Indenture or shall be created hereafter, if (a) such
default results from the failure to pay any such Indebtedness
when due (provided that no such failure to pay indebtedness when
due shall be deemed to have occurred so long as the Issuer or
such Restricted Subsidiary, as the case may be, shall be
contesting whether such Indebtedness is due in good faith by
appropriate proceedings) or as a result of such default the
maturity of such Indebtedness has been accelerated prior to its
expressed maturity and (b) the sum of (x) the principal amount of
such Indebtedness plus (y) the aggregate principal amount of all
other such Indebtedness in default for failure to pay any such
Indebtedness when due or the maturity of which has been so
accelerated equals $20,000,000 or more, individually, or
$40,000,000 or more in the aggregate, without such Indebtedness
having been discharged or such acceleration having been rescinded
or annulled within a period of 30 days after notice thereof shall
have been given to the Issuer by the Trustee, or to the Issuer
and the Trustee by the Holders of at least 25% in aggregate
principal amount of the Notes then Outstanding.
If an Event of Default occurs and is continuing, then,
and in each and every such case, either the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Notes then Outstanding
hereunder, by notice in writing to the Issuer (and to the Trustee if given by
Holders of the Notes), may declare the principal of all Notes and interest
accrued thereon, if any, to be due and payable immediately and, upon any such
declaration the same shall become immediately due and payable.
The foregoing provisions, however, are subject to the
condition that if, at any time after the principal of the Notes shall have
been so declared 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 Issuer shall pay or shall deposit with the Trustee a sum
sufficient to pay all matured installments of interest upon all the Notes and
the principal of any and all of the Notes which shall have become due
otherwise than by acceleration (with interest upon such principal and, to the
extent that payment of such interest is enforceable under applicable law, on
overdue installments of interest, at the same rate as the rate of interest
borne by the Notes to the date of such payment or deposit) and such amount as
shall be sufficient to cover reasonable compensation to the Trustee and each
predecessor Trustee, its agents, attorneys and counsel, and all other expenses
and liabilities incurred, and all advances made, by the Trustee and each
predecessor Trustee except as a result of negligence or bad faith, and if any
and all Events of Default with respect to the Notes, other than the
non-payment of the principal of Notes which shall have become due by
acceleration, shall have been cured, waived or otherwise remedied as provided
herein, then and in every such case the Holders of a majority in aggregate
principal amount of all of the Notes then Outstanding, by written notice to
the Issuer and to the Trustee, may waive all defaults with respect to the
Notes and rescind and annul such declaration and its consequences, but no such
waiver or rescission and annulment shall extend to or shall affect any
subsequent default or shall impair any right consequent thereon.
(b) Section 5.6 of the Indenture is hereby amended and
restated, but only insofar as it relates to the Notes, to read in
full as follows:
SECTION 5.6 Limitations on Suits by Securityholders.
No Holder of any Notes shall have any right by virtue or by
availing of any provision of this Indenture to institute any
action or proceeding at law or in equity or in bankruptcy or
otherwise upon or under or with respect to this Indenture,
or for the appointment of a trustee, receiver, liquidator,
custodian or other similar official or for any other remedy
hereunder, unless such Holder previously shall have given to
the Trustee written notice of default and of the continuance
thereof, as hereinbefore provided, and unless also the
Holders of not less than 25% in aggregate principal amount
of the Notes then Outstanding shall have made written
request upon the Trustee to institute such action or
proceedings in its own name as trustee hereunder and shall
have offered to the Trustee such reasonable indemnity as it
may require against the reasonable costs, expenses and
liabilities to be incurred therein or thereby and the
Trustee for 60 days after its receipt of such notice,
request and offer of indemnity shall have failed to
institute any such action or proceeding and no direction
inconsistent with such written request by the Holders of a
majority in principal amount of the Notes then Outstanding
shall have been given to the Trustee pursuant to Section
5.9; it being understood and intended, and being expressly
covenanted by the taker and Holder of every Note with every
other taker and Holder of any Note and the Trustee, that no
one or more Holders of Notes shall have any right in any
manner whatever by virtue or by availing of any provision of
this Indenture to affect, disturb or prejudice the rights of
any such Holder of Notes, or to obtain or seek to obtain
priority over or preference to any other such Holder or to
enforce any right under this Indenture, except in the manner
herein provided and for the equal, ratable and common
benefit of all Holders of Notes. For the protection and
enforcement of the provisions of this Section, each and
every Holder of Notes and the Trustee shall be entitled to
such relief as can be given either at law or in equity.
(c) Section 5.9 of the Indenture is hereby amended and
restated, but only insofar as it relates to the Notes, to read in
full as follows:
SECTION 5.9 Control by Holders of Notes. The Holders of
a majority in aggregate principal amount of the Notes at the
time Outstanding shall have the right to direct the time,
method, and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee with respect to the Notes by
this Indenture; provided that such direction shall not be
otherwise than in accordance with law and the provisions of
this Indenture and provided further that (subject to the
provisions of Section 6.1) the Trustee shall have the right
to decline to follow any such direction if the Trustee,
being advised by counsel, shall determine that the action or
proceeding so directed may not lawfully be taken or if the
Trustee in good faith by its board of directors, the
executive committee, or a trust committee of directors or
Responsible Officers of the Trustee shall determine that the
action or proceedings so directed would involve the Trustee
in personal liability or if the Trustee in good faith shall
so determine that the actions or forebearances specified in
or pursuant to such direction would be unduly prejudicial to
the interests of Holders of the Notes not joining in the
giving of said direction, it being understood that (subject
to Section 6.1) the Trustee shall have no duty to ascertain
whether or not such actions or forebearances are unduly
prejudicial to such Holders.
Nothing in this Indenture shall impair the right of the
Trustee in its discretion to take any action deemed proper
by the Trustee and which is not inconsistent with such
direction or directions by Holders of the Notes.
(d) Section 5.10 of the Indenture is hereby amended and
restated, but only insofar as it relates to the Notes, to read in
full as follows:
Section 5.10. Waiver of Past Defaults. Prior to a
declaration of the acceleration of the maturity of the Notes
as provided in Section 5.1, the Holders of not less than a
majority in aggregate principal amount of the Notes at the
time Outstanding may on behalf of the Holders of all the
Notes waive any past default or Event of Default, except a
default in respect of a covenant or provision hereof that
cannot be modified or amended without the consent of each
Holder of any Notes affected. In the case of any such
waiver, the Issuer, the Trustee and the Holders of all Notes
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.
Upon any such waiver, such default shall cease to exist
and be deemed to have been cured and not to have occurred, and
any Event of Default arising therefrom shall be deemed to
have been cured, and not to have occurred for every purpose
of this Indenture; but no such waiver shall extend to any
subsequent or other default or Event of Default or impair
any right consequent thereon.
(e) Section 5.12 of the Indenture is hereby amended and
restated, but only insofar as it relates to the Notes, to read in
full as follows:
Section 5.12. Right of Court to Require Filing of
Undertaking to Pay Costs. All parties to this Indenture
agree, and each Holder of any Note by his acceptance thereof
shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any
right or remedy under this Indenture or in any suit against
the Trustee for any action taken, 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 that such
court may in its discretion assess reasonable costs,
including reasonable attorneys' fees, against any party
litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party
litigant; but the provisions of this Section shall not apply
to any suit instituted by the Trustee, to any suit
instituted by any Holder or group of Holders holding in the
aggregate more than 10% in aggregate principal amount of the
Notes then Outstanding, or to any suit instituted by any
Holder for the enforcement of the payment of the principal
of or interest on any Note on or after the due date
expressed in such Note or any date fixed for redemption or
repurchase.
(f) Section 6.2(f) of the Indenture is hereby amended and
restated, but only insofar as it relates to the Notes, to read in
full as follows:
(f) prior to the occurrence of an Event of Default with
respect to the Notes hereunder and after the curing or
waiving of all Events of Default with respect to the Notes,
the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, appraisal, bond,
debenture, note, coupon, security, or other paper or
document unless requested in writing so to do by the Holders
of not less than a majority in aggregate principal amount of
the Notes then Outstanding; provided 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, 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
expenses or liabilities as a condition to proceeding; the
reasonable expenses of every such investigation shall be
paid by the Issuer or, if paid by the Trustee or any
predecessor Trustee, shall be repaid by the Issuer upon
demand; and
(g) The first paragraph of Section 8.2 of the Indenture is
hereby amended and restated, but only insofar as it relates to the
Notes, to read in full as follows:
Section 8.2. Supplemental Indentures With Consent of
Securityholders. With the consent (evidenced as provided in
Article Seven) of the Holders of not less than a majority in
aggregate principal amount of the Notes at the time
Outstanding, the Issuer, when authorized by a resolution of
its Board of Directors (which resolution may provide general
terms or parameters for such action and may provide that the
specific terms of such action may be determined in
accordance with or pursuant to an Issuer Order), and the
Trustee may, from time to time and at any time, enter into
an indenture or indentures supplemental hereto insofar as
relates to the Notes for the purpose of adding any
provisions 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 Notes; provided, that no such supplemental
indenture shall (a) extend the final maturity of any Note or
any date on which the Change of Control Repurchase Price or
Net Worth Repurchase Price of any Note is payable, or reduce
the principal amount thereof, or reduce the rate or extend
the time of payment of interest thereon, or reduce any
amount payable on redemption or repurchase thereof, or make
the principal thereof or interest thereon payable in any
coin or currency other than that provided in the Notes or in
accordance with the terms thereof, or modify the percentage
of Holders of Notes required pursuant to Section 5.1 or 5.10
to waive any default or to rescind and annul any declaration
of acceleration, or alter the provisions of Section 11.12 or
impair or affect the right of any Holder of Notes to
institute suit for the payment thereof or any right of
repayment, repurchase or redemption at the option of the
Holders of Notes, in each case without the consent of the
Holder of each Note so affected, or (b) reduce the aforesaid
percentage of Notes, the consent of the Holders of which is
required for any such supplemental indenture, without the
consent of the Holders of each Note so affected.
(h) Section 9.1 of the Indenture is hereby amended and
restated, but only insofar as it relates to the Notes, to read in full as
follows:
Section 9.1. Issuer May Consolidate, etc., on Certain
Terms. The Issuer covenants that it will not merge or
consolidate with or into any other Person or sell, lease or
convey all or substantially all of its assets to any other
Person, unless (i) either the Issuer shall be the continuing
corporation, or the successor corporation (if other than the
Issuer) or the Person which acquires by sale, lease or
conveyance all or substantially all the assets of the Issuer
shall be a corporation organized and existing under the laws
of the United States of America or any State thereof or the
District of Columbia and shall expressly assume the due and
punctual payment of the principal of and interest on all the
Notes, according to their tenor, and the due and punctual
performance and observance of all of the covenants and
conditions in this Indenture and the Notes to be performed
or observed by the Issuer, by supplemental indenture
satisfactory to the Trustee, executed and delivered to the
Trustee by such corporation, (ii) immediately after giving
effect to such transaction, no Default or Event of Default
shall have occurred and be continuing, (iii) immediately
after giving effect to such transaction, the Issuer or such
corporation, as the case may be, would be able to incur at
least $0.50 of additional Indebtedness pursuant to the first
paragraph of the covenant set forth in Section 16(a) of the
Officers' Certificate dated November 19, 1996 establishing
the form and terms of the Notes, and (iv) the Issuer shall
have delivered to the Trustee an Officers' Certificate and
Opinion of Counsel, each stating that such transaction and
such supplemental indenture comply with this Indenture and
the Notes, and that all conditions precedent relating to
such transaction have been complied with.
(i) Section 10.1(B)(b) of the Indenture is hereby amended, but
only insofar as it relates to the Notes, by deleting the
references therein to Sections 5.1(e) and (f) of the Indenture
and replacing the same with references to Sections 5.1(d) and (e)
of the Indenture, the purpose of such replacement being to
reflect the amendment and restatement of such Section 5.1
pursuant to Section 24(a) of this Officers' Certificate.
(j) Section 10.1(C)(b) of the Indenture is hereby amended, but
only insofar as it relates to the Notes, by deleting the
references therein to Sections 5.1(e) and (f) of the Indenture
and replacing the same with references to Sections 5.1(d) and (e)
of the Indenture, the purpose of such replacement being to
reflect the amendment and restatement of such Section 5.1
pursuant to Section 24(a) of this Officers' Certificate.
(k) Pursuant to Section 10.1(C) of the Indenture, it is hereby
expressly provided that Section 9.1 of the Indenture (as amended
and restated pursuant to Section 24(h) of this Officers'
Certificate) and the covenants set forth in Sections 7, 8, 9, 10,
11, 12, and 16 (other than Section 16(h)) of this Officers'
Certificate shall be subject to covenant defeasance upon the
terms and subject to the conditions set forth in Section 10.1(C)
of the Indenture.
(l) To the extent that Section 5.1, 5.9, 5.10, 5.12, 6.2(f),
or 8.2 of the Indenture (as set forth in the Indenture and not as
amended by this Officers' Certificate) or any other provisions of
the Indenture shall require the action or vote of two or more
series of Securities under the Indenture acting together as a
class, the Notes shall be excluded from such class for all
purposes, it being expressly understood and agreed that the Notes
shall be entitled to act alone in respect of all matters under
the Indenture and that no other series of Securities issued under
the Indenture shall have any right to participate in or vote in
connection with any action, vote or other matter relating to the
Notes.
(m) All references in the Notes and in the Indenture to "the
Indenture", "this Indenture" or to terms or provisions contained
or set forth in the Indenture or the Notes (and all references of
like import) shall be deemed to mean and include the terms and
provisions of the Notes set forth in this Officers' Certificate,
which shall for all purposes be deemed to constitute a part of
the Indenture and the Notes.
(n) For purposes of the Indenture, as amended hereby, the term
"Notes" shall mean the series of Securities established pursuant
to this Officers' Certificate.
(25) Captions and headings in this Officers' Certificate are for
convenience of reference only and shall not affect the construction hereof.
(26) Each of the undersigned hereby further certifies, pursuant to
Section 2.4(3) of the Indenture, that the form and terms of the Notes have
been established pursuant to Sections 2.1 and 2.3 of the Indenture and comply
with the Indenture.
(27) The Notes will rank pari passu with the Issuer's 9 3/8% Senior
Subordinated Notes due 2003.
IN WITNESS WHEREOF, we have executed this Certificate on
behalf of the Issuer this 19th day of November, 1996.
[SEAL]
_______________________________________
Name: Michael F. Henn
Title: Senior Vice President and
Chief Financial Officer
_______________________________________
Name: Kimberly N. King
Title: Corporate Secretary and
Associate Counsel
