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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported): JANUARY 27, 1997
DVI, INC.
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(Exact Name of Registrant as Specified in Its Charter)
DELAWARE 0-16271 22-2722773
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(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File No.) Identification No.)
500 HYDE PARK, DOYLESTOWN, PENNSYLVANIA 18901
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(Address of Principal Executive Office) (Zip Code)
Registrant's Telephone Number, Including Area Code: (215) 345-6600
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NOT APPLICABLE
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS
On November 29, 1996, DVI, Inc. (the "Company") filed a registration
statement on Form S-3 (File No. 333-17097) (the "Registration Statement"),
relating to $100,000,000 aggregate offering price of notes, debentures or other
evidences of indebtedness ("Debt Securities") with the Securities and Exchange
Commission (the "SEC"). On December 19, 1996, the Registration Statement was
declared effective by the SEC. The Company has offered for sale $100,000,000
aggregate principal amount of its 9-7/8% Senior Notes due February 1, 2004 (the
"Senior Notes") in an underwritten public offering through the several
underwriters (the "Underwriters") listed on Schedule I to the Underwriting
Agreement which is filed as Exhibit 1.1 hereto. In connection with the
foregoing, the Underwriting Agreement, the Indenture and the First Supplemental
Indenture with respect to the offering of the Senior Notes are attached hereto
as Exhibits 1.1, 4.1 and 4.2, respectively. The form of the global note
representing the Senior Notes is attached hereto as Exhibit 4.3.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(c) Exhibits
1.1 Underwriting Agreement dated January 27, 1997 by and between
the Company and the Underwriters named therein.
4.1 Indenture dated January 27, 1997 for Debt Securities between
the Company and the Trustee
4.2 First Supplemental Indenture dated January 30, 1997 between
the Company and the Trustee
4.3 Form of Global Note representing $100,000,000 aggregate
principal amount of the Company's 9-7/8% Senior Notes due 2004
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SIGNATURES
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.
DVI, INC.
By:___________________________
Steven R. Garfinkel
Chief Financial Officer
Date: January 30, 1997
S-1
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EXHIBIT INDEX
EXHIBIT
1.1 Underwriting Agreement dated January 27, 1997 by and between
the Company and the Underwriters named therein
4.1 Indenture dated January 27, 1997 for Debt Securities between
the Company and the Trustee
4.2 First Supplemental Indenture dated January 30, 1997 between
the Company and the Trustee
4.3 Form of Global Note representing $100,000,000 aggregate
principal amount of the Company's 9 7/8% Senior Notes due 2004
E-1
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DVI, INC.
$100,000,000
9 7/8% Senior Notes due 2004
UNDERWRITING AGREEMENT
January 27, 1997
PRUDENTIAL SECURITIES INCORPORATED
CIBC WOOD GUNDY SECURITIES CORP.
c/o Prudential Securities Incorporated
One New York Plaza
New York, New York 10292
Dear Sirs:
DVI, Inc., a Delaware corporation (the "Company"), hereby
confirms its agreement with the several underwriters named in Schedule 1 hereto
(the "Underwriters") for whom you have been authorized to act as representatives
(in such capacities, the "Representatives") as set forth below. If you are the
only Underwriters, all references herein to the Representatives shall be deemed
to be to the Underwriters.
1. Securities. Subject to the terms and conditions herein
contained, the Company proposes to issue and sell to the several Underwriters
$100,000,000 aggregate principal amount at maturity of its 97/8% Senior Notes
due 2004 (the "Securities"), to be issued pursuant to an indenture dated as of
January 27, 1997, as supplemented by a supplemental indenture to be dated as of
January 30, 1997 (collectively, the "Indenture") between the Company and First
Trust National Association, as trustee (the "Trustee").
2. Registration Statement. The Company has filed with the
Securities and Exchange Commission (the "Commission") a registration statement
on Form S-3 (Registration No. 333-17097), including a prospectus, relating to
certain of its debt securities (including the Securities) and the offering
thereof from time to time in accordance with Rule 415 under the Securities Act
of 1933, as amended (the "Act"). Such registration statement has been declared
effective by the Commission. As provided in Section 6(a) hereof, a prospectus
supplement reflecting the terms of the Securities, the terms of the offering
thereof
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and the other matters set forth therein has been prepared and will be filed
pursuant to Rule 424 under the Act. Such prospectus supplement, in the form
first filed after the date hereof pursuant to Rule 424, is herein referred to as
the "Prospectus Supplement." Such registration statement, as amended at the date
hereof, including the exhibits thereto and the documents incorporated by
reference therein, is herein called the "Registration Statement," and the basic
prospectus included therein relating to all offerings of securities under the
Registration Statement, as supplemented by the Prospectus Supplement, is herein
called the "Prospectus," except that, if such basic Prospectus is amended or
supplemented on or prior to the date on which the Prospectus Supplement is first
filed pursuant to Rule 424, the term "Prospectus" shall refer to the basic
Prospectus as so amended or supplemented and as supplemented by the Prospectus
Supplement, in either case including the documents filed by the Company with the
Commission pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), that are incorporated by reference therein. The term
"Preliminary Prospectus" shall refer to each basic prospectus or prospectus
supplement which is subject to completion.
3. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, each of the several Underwriters
that:
(a) The Company meets the requirements for use of Form S-3
under the Act and on the original effective date of the Registration
Statement, on the effective date of the most recent post-effective
amendment thereto, if any, and on the date of the filing by the Company
of any annual report on Form 10-K after the original filing of the
Registration Statement, the Registration Statement complied in all
material respects with the requirements of the Act and the rules and
regulations of the Commission thereunder (the "Regulations"), the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"), and the
rules and regulations of the Commission under the Trust Indenture Act
(the "Trust Indenture Act Regulations") and did 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; on the date hereof and at the Closing Date (as defined
below), (A) the Registration Statement and any amendments and
supplements thereto, comply and will comply in all material respects
with the requirements of the Act, the Regulations, the Trust Indenture
Act and the Trust Indenture Act Regulations, (B) neither the
Registration Statement nor any amendment or supplement thereto includes
or will include an untrue statement of a material fact or omits or will
omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading and (C) neither
any Preliminary Prospectus nor the Prospectus nor any amendment or
supplement thereto includes or will include an untrue statement of a
material fact or omits or will omit to state a material fact necessary
in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that the Company makes no representations or
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warranties as to statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by or
on behalf of any Underwriter, directly or through you, expressly for
use in the Registration Statement or the Prospectus, or as to
statements in the Statement of Eligibility (Form T-1) under the Trust
Indenture Act of the Trustee filed as an exhibit to the Registration
Statement. At the Closing Date, the Indenture will comply in all
material respects with the requirements of the Trust Indenture Act and
the Trust Indenture Act Regulations.
(b) The documents incorporated by reference in the Prospectus,
at the time they were filed with the Commission, complied in all
material respects with the requirements of the Exchange Act and the
rules and regulations of the Commission thereunder, and when read
together with the other information in the Prospectus, do not and will
not, on the date hereof and at the Closing Date, include 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.
(c) The Company and each of its subsidiaries have been duly
organized and are validly existing as corporations in good standing
under the laws of their respective jurisdictions of incorporation. The
Company and each of DVI Financial Services Inc. and DVI Business Credit
Corporation (the"Principal Operating Subsidiaries") are duly qualified
to transact business as foreign corporations and are in good standing
under the laws of all other jurisdictions where the ownership or
leasing of their respective properties or the conduct of their
respective businesses requires such qualification, except where the
failure to be so qualified does not amount to a material liability or
disability to the Company and the Principal Operating Subsidiaries,
taken as a whole. The subsidiaries listed on Schedule 2 hereto
constitute all of the active subsidiaries of the Company. All of the
other subsidiaries of the Company do not actively conduct business,
have not entered into any material existing agreements and do not have
any material liabilities of any kind, and the Company does not
currently intend for any of such subsidiaries to conduct business,
enter into agreements or incur material liabilities in the future.
(d) The Company and each of its subsidiaries have full power
(corporate and other) to own or lease their respective properties and
conduct their respective businesses as described in the Registration
Statement and the Prospectus or, if the Prospectus is not in existence,
the most recent Preliminary Prospectus; and the Company has full power
(corporate and other) to enter into this Agreement and to carry out all
the terms and provisions hereof to be carried out by it.
(e) The issued shares of capital stock of each of the
Company's subsidiaries have been duly authorized and validly issued,
are fully paid and nonassessable and are, directly or indirectly, owned
of record and beneficially by the
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Company free and clear of any security interests, liens, encumbrances,
equities or claims.
(f) The Company has an authorized, issued and outstanding
capitalization as set forth in the Prospectus or, if the Prospectus is
not in existence, the most recent Preliminary Prospectus. All of the
issued shares of capital stock of the Company have been duly authorized
and validly issued and are fully paid and nonassessable. No holder of
outstanding securities of the Company or any of its Subsidiaries is
entitled as such to any preemptive or other rights to subscribe for any
of the Securities, and no holder of securities of the Company has any
right which has not been fully exercised or waived to require the
Company to register the offer or sale of any securities owned by such
holder under the Act in connection with the public offering
contemplated by this Agreement. No holder of securities has the right
to require the Company to register such holder's securities under the
Act in connection with this Registration Statement.
(g) The Indenture has been qualified under the Trust Indenture
Act. The execution and delivery of the Indenture have been duly
authorized by the Company, and, on and as of the Closing Date, the
Indenture will have been duly executed and delivered by the Company and
duly qualified under the Trust Indenture Act and, assuming due
authorization, execution and delivery by the Trustee, will be a legal,
valid, binding and enforceable instrument of the Company.
(h) The issuance, execution and delivery of the Securities
have been duly authorized by the Company and, on and as of the Closing
Date, the Securities will have been duly executed by the Company and,
assuming due authentication by the Trustee, will be the legal, valid,
binding and enforceable obligations of the Company, entitled to the
benefits of the Indenture.
(i) The statements set forth under the headings "Description
of the Notes" and "Description of Debt Securities" in the Prospectus
(or, if the Prospectus is not in existence, the most recent Preliminary
Prospectus) are complete and accurate in all material respects.
(j) The consolidated financial statements and schedules of the
Company and its consolidated subsidiaries included or incorporated by
reference in the Registration Statement and the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus)
fairly present the financial position of the Company and its
consolidated subsidiaries and the results of operations and cash flows
as of the dates and periods therein specified. Such financial
statements and schedules have been prepared in accordance with
generally accepted accounting principles consistently applied
throughout the periods involved (except as otherwise noted
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therein). The selected financial data set forth under the caption
"Selected Financial Information and Other Data" in the Prospectus (or,
if the Prospectus is not in existence, the most recent Preliminary
Prospectus) fairly present, on the basis stated in the Prospectus (or
such Preliminary Prospectus), the information included therein and have
been compiled on a basis consistent with the audited consolidated
financial statements included or incorporated by reference in the
Registration Statement.
(k) Deloitte & Touche LLP, who have certified certain
financial statements of the Company and its consolidated subsidiaries
and delivered their report with respect to the audited consolidated
financial statements and schedules included or incorporated by
reference in the Registration Statement and the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary
Prospectus), are independent public accountants as required by the Act,
the Exchange Act and the related published rules and regulations
thereunder.
(l) The execution and delivery of this Agreement have been
duly authorized by the Company and this Agreement has been duly
executed and delivered by the Company, and is the valid and binding
agreement of the Company, enforceable against the Company in accordance
with its terms.
(m) No legal or governmental proceedings are pending to which
the Company or any of its subsidiaries is a party or to which the
property of the Company or any of its subsidiaries is subject that are
required to be described in the Registration Statement or the
Prospectus and are not described therein (or, if the Prospectus is not
in existence, the most recent Preliminary Prospectus), and, to the
knowledge of the Company, no such proceedings have been threatened
against the Company or any of its subsidiaries or with respect to any
of their respective properties; and no contract or other document is
required to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration Statement
that is not described therein (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus) or filed as
required.
(n) The issuance, offering and sale of the Securities to the
Underwriters by the Company pursuant to this Agreement, the compliance
by the Company with the other provisions of this Agreement, the
Securities and the Indenture and the consummation of the other
transactions herein contemplated do not (i) require the consent,
approval, authorization, registration or qualification of or with any
governmental authority, except such as have been obtained, such as may
be required under state securities or blue sky laws or (ii) conflict
with or result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any indenture, mortgage,
deed of trust, lease or other agreement or instrument to which the
Company or any of its subsidiaries is a party or by which the Company
or any of
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its subsidiaries or any of their respective properties are bound, or
the charter documents or by-laws of the Company or any of its
subsidiaries, or any statute or any judgment, decree, order, rule or
regulation of any court or other governmental authority or any
arbitrator applicable to the Company or any of its subsidiaries.
(o) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus,
(i) neither the Company nor any of its subsidiaries has sustained any
material loss or interference with their respective businesses or
properties from fire, flood, hurricane, accident or other calamity,
whether or not covered by insurance, or from any labor dispute or any
legal or governmental proceeding and (ii) there has not been any
material adverse change, or any development involving a prospective
material adverse change, in the condition (financial or otherwise),
management, business prospects, net worth or results of operations of
the Company or any of its subsidiaries, except in each case as
described in or contemplated by the Prospectus or, if the Prospectus is
not in existence, the most recent Preliminary Prospectus.
(p) The Company has not, directly or indirectly, (i) taken any
action designed to cause or to result in, or that has constituted or
which might reasonably be expected to constitute, the stabilization or
manipulation of the price of any security of the Company to facilitate
the sale or resale of the Securities or (ii) since the filing of the
Registration Statement (A) sold, bid for, purchased, or paid anyone any
compensation for soliciting purchases of, the Securities or (B) paid or
agreed to pay to any person any compensation for soliciting another to
purchase any other securities of the Company.
(q) None of the Company, its subsidiaries or any employee of
the Company or its subsidiaries has made any payment of funds of the
Company or its subsidiaries prohibited by law and no funds of the
Company or its subsidiaries have been set aside to be used for any
payment prohibited by law.
(r) The Securities have been approved for listing on the New
York Stock Exchange (the "NYSE"), subject to official notice of
issuance.
(s) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary
Prospectus), (i) neither the Company nor any of its subsidiaries has
incurred any material liability or obligation, direct or contingent,
nor entered into any material transaction not in the ordinary course of
business; (ii) the Company has not purchased any of its outstanding
capital stock, nor declared, paid or otherwise made any dividend or
distribution of any kind on its
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capital stock; (iii) there has not been any material change in the
capital stock of the Company and its consolidated subsidiaries; and
(iv) there has not been any change in the short-term debt or long-term
debt of the Company or any of its consolidated subsidiaries other than
in the ordinary course of business consistent with past practice as
described in the Prospectus, except in each case described in clauses
(i) through (iv) as described in or contemplated by the Prospectus (or,
if the Prospectus is not in existence, the most recent Preliminary
Prospectus).
(t) Except as described in or contemplated by the Prospectus
(or, if the Prospectus is not in existence, the most recent Preliminary
Prospectus), (i) the Company and each of its subsidiaries have good and
marketable title in fee simple to all material real property and
marketable title to all material personal property owned by each of
them, in each case free and clear of any security interests, liens,
encumbrances, equities, claims and other defects, except such as do not
materially and adversely affect the value of such property and do not
interfere with the use made or proposed to be made of such property by
the Company or such subsidiary, and (ii) any real property and
buildings held under lease by the Company or any such subsidiary are
held under valid, subsisting and enforceable leases, with such
exceptions as are not material and do not interfere with the use made
or proposed to be made of such property and buildings by the Company or
such subsidiary.
(u) No labor dispute with the employees of the Company or any
of its subsidiaries exists or is threatened or imminent that could
result in a material adverse change in the condition (financial or
otherwise), business prospects, net worth or results of operations of
the Company and its subsidiaries, taken as a whole, except as described
in or contemplated by the Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus).
(v) The Company and its subsidiaries own or possess, or can
acquire on reasonable terms, all patents, patent applications,
trademarks, service marks, trade names, licenses, copyrights and
proprietary or other confidential information currently employed by
them in connection with their respective businesses, or necessary in
order to conduct their respective businesses, as presently conducted,
and neither the Company nor any such subsidiary has received, or has
reason to believe that it may receive, any notice of infringement of or
conflict with asserted rights of any third party or otherwise with
respect to any of the foregoing which, singly or in the aggregate, if
the subject of an unfavorable decision, ruling or finding, would result
in a material adverse change in the condition (financial or otherwise),
business prospects, net worth or results of operations of the Company
and its subsidiaries, taken as a whole, except as described in or
contemplated by the Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus).
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(w) The Company and each of its subsidiaries are insured by
insurers of recognized financial responsibility against such losses and
risks and in such amounts as are prudent and customary in the
businesses in which they are engaged. Neither the Company nor any of
the subsidiaries have been refused any insurance coverage sought or
applied for, which refusal has had, or could have in the future, a
material adverse effect on the Company's business. Neither the Company
nor any subsidiary has reason to believe that it will not be able to
renew its existing insurance coverage as and when such coverage expires
or to obtain similar coverage from similar insurers as may be necessary
to continue its business at a cost that would not materially and
adversely affect the condition (financial or otherwise), business,
prospects, net worth or results of operations of the Company or its
subsidiaries, taken as a whole, except as described in or contemplated
by the Prospectus (or, if the Prospectus is not in existence, the most
recent Preliminary Prospectus).
(x) DVI Financial Services Inc. is not currently prohibited,
directly or indirectly, from repaying to the Company any loans or
advances to such subsidiary from the Company pursuant to the
Intercompany Note (as defined in the Prospectus), except as described
in or contemplated by the Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus).
(y) The Company and its subsidiaries possess all certificates,
authorizations and permits issued by the appropriate federal, state,
local or foreign regulatory authorities necessary to conduct their
respective businesses, and neither the Company nor any subsidiary has
received any notice of proceedings relating to the revocation or
modification of any such certificate, authorization or permit which,
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would result in a material adverse change in the
condition (financial or otherwise), business, prospects, net worth or
results of operations of the Company or its subsidiaries, taken as a
whole, except as described in or contemplated by the Prospectus (or, if
the Prospectus is not in existence, the most recent Preliminary
Prospectus).
(z) The Company and each of its subsidiaries conduct their
respective operations in a manner that does not subject it or them to
registration as an investment company under the Investment Company Act
of 1940, as amended, and the transactions contemplated hereby will not
cause the Company or any of its subsidiaries to become an investment
company subject to registration thereunder.
(aa) The Company and each of its subsidiaries have filed all
foreign, federal, state and local tax returns that are required to be
filed or have requested extensions thereof (except in any case in which
the failure so to file would not have a material adverse effect on the
Company and its subsidiaries, taken as a whole) and have paid all taxes
required to be paid by it and any other assessment, fine or penalty
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levied against it, to the extent that any of the foregoing is due and
payable, except for any such assessment, fine or penalty that is
currently being contested in good faith or as described in or
contemplated by the Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus).
(bb) Neither the Company nor any of its subsidiaries is in
violation of any federal, state or foreign law or regulation relating
to occupational safety and health or to the storage, handling or
transportation of hazardous or toxic materials and the Company and its
subsidiaries have received all permits, licenses or other approvals
required of them under applicable federal, state and foreign
occupational safety and health and environmental laws and regulations
to conduct their respective businesses, and the Company and each of its
subsidiaries is in compliance with all terms and conditions of any such
permit, license or approval, except any such violation of law or
regulation, failure to receive required permits, licenses or other
approvals or failure to comply with the terms and conditions of such
permits, licenses or approvals which would not, singly or in the
aggregate, result in a material adverse change in the condition
(financial or otherwise), business prospects, net worth or results of
operations of the Company and its subsidiaries, taken as a whole,
except as described in or contemplated by the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary
Prospectus).
(cc) Except for the shares of capital stock of the
subsidiaries and Aegis Therapies LLC owned by either the Company or
another subsidiary, neither the Company nor any such subsidiary owns
any shares of stock or other equity securities of any corporation or
any equity interest in any firm, partnership, association or other
entity, except as described in or contemplated by the Prospectus (or,
if the Prospectus is not in existence, the most recent Preliminary
Prospectus).
(dd) The Company and each of its subsidiaries maintain a
system of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with
management's general or specific authorizations; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain asset accountability; (iii) access to assets is permitted only
in accordance with management's general or specific authorization; and
(iv) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
(ee) No default exists, and no event has occurred which, with
notice or lapse of time or both, would constitute a default, in the due
performance and observance of any term, covenant or condition of any
indenture, mortgage, deed of trust, lease or other agreement or
instrument to which the Company or any of its
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subsidiaries is a party or by which the Company or any of its
subsidiaries or any of their respective properties is bound or may be
affected in any respect that is materially adverse with regard to the
property, business or operations of the Company and its subsidiaries.
(ff) Subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus,
or if the Prospectus is not in existence, the most recent Preliminary
Prospectus, there has not been any downgrading in the ratings of any of
the Company's debt securities or preferred stock or any of the debt
securities of any of its subsidiaries or affiliates, including, without
limitation any of the Company's securitized debt securities or any
action threatening such a downgrading or placing the Company or any of
its subsidiaries or affiliates under special surveillance by any
"nationally recognized rating agency" (as defined in Rule 436 (g) under
the Act); nor does the Company have any knowledge of any facts or
circumstances that are likely to cause such downgrading, threatened
downgrading or the placing of the Company or any of its subsidiaries or
affiliates under such surveillance.
(gg) Each certificate signed by any officer of the Company and
delivered to the Underwriters or counsel for the Underwriters shall be
deemed to be a representation and warranty by the Company to each
Underwriter as to the matters covered thereby.
4. Purchase, Sale and Delivery of the Securities. (a) On the
basis of the representations, warranties, agreements and covenants herein
contained and subject to the terms and conditions herein set forth, the Company
agrees to issue and sell to each of the Underwriters, and each of the
Underwriters, severally and not jointly, agrees to purchase from the Company,
the principal amount of Securities set forth opposite the name of such
Underwriter in Schedule 1 hereto at an aggregate purchase price of $96,380,000.
One or more certificates in definitive form for the Securities that the several
Underwriters have agreed to purchase hereunder, and in such denomination or
denominations and registered in such name or names as the Underwriters request
upon notice to the Company at least 48 hours prior to the Closing Date, shall be
delivered by or on behalf of the Company to the Underwriters, against payment by
or on behalf of the Underwriters of the purchase price therefor by wire
transfer. Such delivery of and payment for the Securities shall be made at the
offices of Shearman & Sterling, 599 Lexington Avenue, New York, New York 10022
at 9:30 a.m., New York time, on January 30, 1997, or at such other place, time
or date as the Underwriters and the Company may agree upon or as the
Underwriters may determine pursuant to Section 9 hereof, such time and date of
delivery against payment being herein referred to as the "Closing Date." The
Company will make such certificate or certificates for the Securities available
for checking and packaging by the Underwriters at the offices in
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New York, New York of the Trustee or of Prudential Securities Incorporated at
least 24 hours prior to the Closing Date.
(b) It is understood that you, individually and not as one of
the Underwriters, may (but shall not be obligated to) make payment on behalf of
any Underwriter or Underwriters for any of the Securities to be purchased by
such Underwriter or Underwriters. No such payment shall relieve such Underwriter
or Underwriters from any of its or their obligations hereunder.
5. Offering by the Underwriters. Upon your authorization of
the release of the Securities, the several Underwriters shall offer the
Securities for sale to the public upon the terms set forth in the Prospectus.
6. Covenants of the Company. The Company covenants and agrees
with each of the Underwriters that:
(a) Immediately following the execution of this Agreement, the
Company will prepare a Prospectus Supplement that complies with the Act
and the Regulations and that sets forth the principal amount of the
Securities and their material terms, the name of each Underwriter
participating in the offering and the principal amount of the
Securities that each severally has agreed to purchase, the price at
which the Securities are to be purchased by the Underwriters from the
Company, any initial public offering price, any selling concession and
reallowance and any delayed delivery arrangements, and such other
information as you and the Company deem appropriate in connection with
the offering of the Securities. The Company will promptly transmit
copies of the Prospectus Supplement to the Commission for filing
pursuant to Rule 424 under the Act and will furnish to the Underwriters
as many copies of any preliminary Prospectus Supplement and the
Prospectus as you shall reasonably request.
(b) During the period when the Prospectus is required by the
Act to be delivered in connection with the sale of the Securities, the
Company will, subject to Section 6(c) hereof, file promptly all
documents required to be filed with the Commission pursuant to Section
13 or 14 of the Exchange Act.
(c) During the period when the Prospectus is required by the
Act to be delivered in connection with the sale of the Securities, the
Company will inform you of its intention to file any amendment to the
Registration Statement, any supplement to the Prospectus or any
document that would as a result thereof be incorporated by reference in
the Prospectus; will furnish you with copies of any such amendment,
supplement or other document a reasonable time in advance of filing and
will not file
<PAGE> 12
12
any such amendment, supplement or other document in a form to which you
shall reasonably object.
(d) The Company will use its best efforts to arrange for the
qualification of the Securities for offering and sale under the
securities or blue sky laws of such jurisdictions as the Underwriters
may designate and to continue such qualifications in effect for as long
as may be necessary to complete the distribution of the Securities,
provided, however, that in connection therewith the Company shall not
be required to qualify as a foreign corporation or to execute a general
consent to service of process in any jurisdiction.
(e) If, at any time prior to the later of (i) the final date
when a Prospectus relating to the Securities is required to be
delivered under the Act or (ii) the Closing Date, any event occurs as a
result of which the Prospectus, as then amended or supplemented, would
include any 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 under which they were made, not misleading,
or if for any other reason it is necessary at any time to amend or
supplement the Prospectus to comply with the Act, the Exchange Act or
the Trust Indenture Act or the respective rules or regulations of the
Commission thereunder, the Company will promptly notify the
Underwriters thereof and, subject to Section 6(a) hereof, will prepare
and file with the Commission, at the Company's expense, an amendment to
the Registration Statement or an amendment or supplement to the
Prospectus that corrects such statement or omission or effects such
compliance.
(f) The Company will, without charge, provide (i) to the
Underwriters and to counsel for the Underwriters a signed copy of the
registration statement originally filed with respect to the Securities
and each amendment thereto (in each case including exhibits thereto),
(ii) to each other Underwriter a conformed copy of such registration
statement and each amendment thereto (in each case without exhibits
thereto) and (iii) so long as a Prospectus relating to the Securities
is required to be delivered under the Act, as many copies of each
Preliminary Prospectus or the Prospectus or any amendment or supplement
thereto as the Underwriters may reasonably request; without limiting
the application of clause (iii) of this sentence, the Company, not
later than 6:00 PM, New York City time, on the business day following
the date of determination of the public offering price, will deliver to
the Underwriters, without charge, as many copies of the Prospectus and
any amendment or supplement thereto as the Underwriters may reasonably
request for purposes of confirming orders that are expected to settle
on the Closing Date.
(g) The Company, as soon as practicable, will make generally
available to its security holders and to the Underwriters a
consolidated earnings statement of the
<PAGE> 13
13
Company and its subsidiaries that satisfies the provisions of Section
11(a) of the Act and Rule 158 thereunder.
(h) The Company will apply the net proceeds from the sale of
the Securities as set forth under "Use of Proceeds" in the Prospectus.
(i) The Company will not, directly or indirectly, without the
prior written consent of Prudential Securities Incorporated, on behalf
of the Underwriters, offer, sell, offer to sell, contract to sell,
grant any option to purchase or otherwise transfer or dispose (or
announce any offer, transfer, offer of sale, contract of sale, grant of
any option to purchase or other sale or disposition) of any debt
securities of the Company that are substantially similar to the
Securities during the period commencing on the date hereof and
terminating on the earlier of (a) the Closing Date and (b) the date of
notice to the Company by the Underwriters of the termination of trading
restrictions with respect to the Securities, except pursuant to this
Agreement.
(j) The Company will not, directly or indirectly, (i) take any
action designed to cause or to result in, or that has constituted or
which might reasonably be expected to constitute, the stabilization or
manipulation of the price of any security of the Company to facilitate
the sale or resale of the Securities or (ii) (A) sell (except pursuant
to this Agreement), bid for, purchase, or pay anyone any compensation
for soliciting purchases of, the Securities or (B) pay or agree to pay
to any person any compensation for soliciting another to purchase any
other securities of the Company.
7. Expenses.
(a) The Company will pay all costs and expenses incident to
the performance of its obligations under this Agreement, whether or not
the transactions contemplated herein are consummated or this Agreement
is terminated pursuant to Section 12 hereof, including all costs and
expenses incident to (a) the printing or other production of documents
with respect to the transactions, including any costs of printing the
registration statement originally filed with respect to the Securities
and any amendment thereto, any Preliminary Prospectus and the
Prospectus and any amendment or supplement thereto, the Indenture, this
Agreement and any blue sky memoranda, (b) all arrangements relating to
the delivery to the Underwriters of copies of the foregoing documents,
(c) the fees and disbursements of the counsel, the accountants and any
other experts or advisors retained by the Company, (d) preparation,
issuance and delivery to the Underwriters of any certificates
evidencing the Securities, including transfer agent's and registrar's
fees, (e) the qualification of the Securities under state securities
and blue sky laws, including filing fees and reasonable fees and
disbursements of counsel for the Underwriters relating thereto, (f) the
fees and disbursements of the Trustee, (g) the filing fees of the
Commission and
<PAGE> 14
14
the National Association of Securities Dealers, Inc. relating to the
Securities, (h) any meetings with prospective investors in the
Securities (other than as shall have been specifically approved by the
Underwriters to be paid for by the Underwriters), (i) any fees charged
by investment rating agencies for the rating of Securities and (j) the
fees associated with any listing of the Securities on any securities
exchange. If the sale of the Securities provided for herein is not
consummated because any condition to the obligations of the
Underwriters set forth in Section 8 hereof is not satisfied, because
this Agreement is terminated pursuant to Section 12(a)(i) hereof or
because of any failure, refusal or inability on the part of the Company
to perform all obligations and satisfy all conditions on its part to be
performed or satisfied hereunder other than by reason of a default by
any of the Underwriters, the Company will reimburse the Underwriters
severally upon demand for all out-of-pocket expenses (including fees
and disbursements of counsel) that shall have been incurred by them in
connection with the proposed purchase and sale of the Securities. The
Company shall not in any event be liable to any of the Underwriters for
the loss of anticipated profits from the transactions covered by this
Agreement.
(b) In addition to its obligations under Section 9(a) hereof,
the Company agrees that, as an interim measure during the pendency of
any claim, action, investigation, inquiry or other proceeding arising
out of or based upon any loss, claim, damage or liability described in
Section 9(a) hereof, it will reimburse the Underwriters, and each of
them, on a monthly basis against submission of invoices and such
additional information as the Company reasonably may request for all
reasonable legal or other expenses incurred in connection with
investigating or defending any such claim, action, investigation,
inquiry or other proceeding, notwithstanding the absence of a judicial
determination as to the propriety and enforceability of the obligations
of the Company to reimburse the Underwriters for such expenses and the
possibility that such payments might later be held to have been
improper by a court of jurisdiction. To the extent that any portion, or
all, of any such interim reimbursement payments are so held to have
been improper, the Underwriters receiving the same shall promptly
return such amounts to the party or parties who have paid such amounts
together with interest, compounded daily, determined on the basis of
the prime rate (or other commercial lending rate for borrowers of the
highest credit standing) announced from time to time by Bank of America
(the "Prime Rate"). Any such interim reimbursement payments that are
not made to the Underwriters within 30 days of a request for
reimbursement shall bear interest at the Prime Rate from the date of
such request until the date paid.
(c) In addition to their obligations under Section 9(a)
hereof, the Underwriters agree that, as an interim measure during the
pendency of any claim, action, investigation, inquiry or other
proceeding arising out of or based upon any loss, claim, damage or
liability described in Section 9(b)(i) or 9(b)(ii) hereof, (in each
<PAGE> 15
15
case to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was made in
reliance upon and in conformity with written information furnished to
the Company by any Underwriter through the Representatives specifically
for use therein), they will reimburse the Company on a monthly basis,
against submission of invoices and such additional information as the
Underwriters reasonably may request, for all reasonable legal or other
expenses incurred by the Company in connection with investigating or
defending any such claim, action, investigation, inquiry or other
proceeding, notwithstanding the absence of a judicial determination as
to the propriety and enforceability of the Underwriters' obligation to
reimburse the Company for such expenses and the possibility that such
payments might later be held to have been improper by a court of
competent jurisdiction. To the extent that any portion, or all, of any
such interim reimbursement payments are so held to have been improper,
the Company shall promptly return such amounts to the Underwriters
together with interest, compounded daily, determined on the basis of
the Prime Rate. Any such interim reimbursement payments that are not
made to the Company within 30 days of a request for reimbursement shall
bear interest at the Prime Rate from the date of such request until the
date paid.
(d) It is agreed that any controversy arising out of the
operation of the interim reimbursement arrangements set forth in
Sections 7(b) and 7(c) above, including the amounts of any requested
reimbursement payments, the method of determining such amounts and the
basis on which such amounts shall be apportioned among the indemnifying
parties, shall be settled by arbitration conducted under the provisions
of the Constitution and Rules of the Board of Governors of the NYSE or
pursuant to the Code of Arbitration Procedure of the NASD. Any such
arbitration must be commenced by service of a written demand for
arbitration or a written notice of intention to arbitrate, therein
electing the arbitration tribunal. If the party demanding arbitration
does not make designation of an arbitration tribunal in such demand or
notice, then the party responding to said demand or notice is
authorized to do so. Any such arbitration will be limited to the
interpretation and obligations of the parties under the interim
reimbursement provisions contained in Sections 7(b) and 7(c) hereof and
will not resolve the ultimate propriety or enforceability of the
obligation to indemnify for expenses that is created by the provisions
of Section 9 hereof.
8. Conditions of the Underwriters' Obligations. The
obligations of the several Underwriters to purchase and pay for the Securities
shall be subject, in the Underwriters' sole discretion, to the accuracy of the
representations and warranties of the Company contained herein as of the date
hereof and as of the Closing Date, as if made on and as of the Closing Date, to
the accuracy of the statements of the Company's officers made pursuant to the
provisions hereof, to the performance by the Company of its covenants and
agreements hereunder and to the following additional conditions:
<PAGE> 16
16
(a) No stop order suspending the effectiveness of the
Registration Statement or any post-effective amendment thereto and no order
directed at any document incorporated by reference in the Registration Statement
shall have been issued, and no proceedings for that purpose shall have been
instituted or threatened or, to the knowledge of the Company or the
Underwriters, shall be contemplated by the Commission; and the Company shall
have complied with any request of the Commission for additional information (to
be included in the Registration Statement or the Prospectus or otherwise).
(b) The Underwriters shall have received an opinion, dated the
Closing Date, of Rogers & Wells, counsel for the Company, to the effect that:
(i) the Company and each of its subsidiaries (other than
non-U.S. subsidiaries) listed in Schedule 2 hereto have been duly
organized and are validly existing as corporations in good standing
under the laws of their respective jurisdictions of incorporation;
(ii) the Company and each of the Principal Operating
Subsidiaries are duly qualified to transact business as foreign
corporations and are in good standing under the laws of all other
jurisdictions where the ownership or leasing of their respective
properties or the conduct of their respective businesses requires such
qualification, except where the failure to be so qualified does not
amount to a material liability or disability to the Company and each of
such subsidiaries, taken as a whole;
(iii) the Company and each of the Principal Operating
Subsidiaries have corporate power to own or lease their respective
properties and conduct their respective businesses as described in the
Registration Statement and the Prospectus, and the Company has
corporate power to enter into this Agreement and the Indenture and to
carry out all the terms and provisions hereof and thereof to be carried
out by it;
(iv) the issued shares of capital stock of each of the
Company's Principal Operating Subsidiaries have been duly authorized
and validly issued, are fully paid and nonassessable and, to the best
knowledge of such counsel, are owned beneficially by the Company free
and clear of any perfected security interests or any other security
interests, liens, encumbrances, equities or claims;
(v) the execution and delivery of the Indenture have been duly
authorized by all necessary corporate action of the Company, and the
Indenture has been duly executed and delivered by the Company, has been
duly qualified under the Trust Indenture Act and, assuming due
authorization, execution and delivery by the Trustee, is a valid and
binding agreement of the Company, enforceable against the Company in
accordance with its terms, subject to applicable bankruptcy, insolvency
and similar
<PAGE> 17
17
laws affecting creditors' rights generally and subject, as to
enforceability, to general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law);
(vi) the issuance, offering and sale of the Securities by the
Company to the Underwriters pursuant to this Agreement have been duly
authorized by all necessary corporate action of the Company and the
Securities have been duly issued, executed and delivered by the Company
and, assuming due authentication by the Trustee, when executed,
authenticated and issued in a manner provided in the Indenture and paid
for as provided in this Agreement, will be the valid and binding
obligations of the Company, enforceable against the Company in
accordance with their terms, and entitled to the benefits of the
Indenture, subject to applicable bankruptcy, insolvency and similar
laws affecting creditors' rights generally and subject, as to
enforceability, to general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law);
(vii) as of the dates shown the Company has an authorized
capitalization as set forth under the heading "Capitalization" in the
Prospectus;
(viii) the statements set forth under the headings
"Description of the Notes" and "Description of Debt Securities" in the
Prospectus, insofar as such statements constitute a summary of certain
provisions of the Indenture, provide in all material respects a fair
summary of such provisions;
(ix) the execution and delivery of this Agreement have been
duly authorized by all necessary corporate action of the Company and
this Agreement has been duly executed and delivered by the Company;
(x) to such counsel's best knowledge (A) no legal or
governmental proceedings are pending to which the Company or any of its
subsidiaries is a party or to which the property of the Company or any
of its subsidiaries is subject that are required to be described in the
Registration Statement or the Prospectus and are not described therein,
and no such proceedings have been threatened against the Company or any
of its subsidiaries or with respect to any of their respective
properties and (B) no contract or other document is required to be
described in the Registration Statement or the Prospectus or to be
filed as an exhibit to the Registration Statement that is not described
therein or filed as required;
(xi) the issuance, offering and sale of the Securities to the
Underwriters by the Company pursuant to this Agreement, the compliance
by the Company with the other provisions of this Agreement, the
Securities and the Indenture and the consummation of the other
transactions herein contemplated do not (A) require the
<PAGE> 18
18
consent, approval, authorization, registration or qualification of or
with any governmental authority, except such as have been obtained and
such as may be required under state securities or blue sky laws, or (B)
conflict with or result in a breach or violation of any of the terms
and provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, lease or other agreement or instrument
specifically described in the Registration Statement or any material
contract or agreement listed on Schedule 3 hereto and to which the
Company or any of its subsidiaries or any of their respective
properties are bound, or the charter documents or by-laws of the
Company or any of its subsidiaries, or to such counsel's best knowledge
any statute or any judgment, decree, order, rule or regulation of any
court or other governmental authority or any arbitrator and
specifically naming the Company or any of its subsidiaries or any rule
or regulation of any governmental authority and applicable to the
Company or any of its subsidiaries;
(xii) the Registration Statement is effective under the Act;
any required filing of the Prospectus, or any Term Sheet that
constitutes a part thereof, pursuant to Rules 434 and 424(b) has been
made in the manner and within the time period required by Rules 434 and
424(b); and, to such counsel's best knowledge, no stop order suspending
the effectiveness of the Registration Statement or any amendment
thereto has been issued, and no proceedings for that purpose have been
instituted or threatened or, to such counsel's best knowledge, are
contemplated by the Commission;
(xiii) the Registration Statement originally filed with
respect to the Securities and each amendment thereto and the Prospectus
and each document incorporated by reference therein (in each case,
other than the financial statements and other financial information
contained or incorporated by reference therein, as to which such
counsel need express no opinion) comply as to form in all material
respects with the applicable requirements of the Act, the Exchange Act
and the Trust Indenture Act and the respective rules and regulations of
the Commission thereunder;
(xiv) pursuant to Section 3 (c) (5) of the Investment Company
Act of 1940, as amended (the "1940 Act"), and based on no-action
letters issued by the staff of the Commission with respect to Sections
3 (c) (5) (A) or (B) of the 1940 Act, the Company is not, and the
transactions contemplated by this Agreement will not cause the Company
to become an investment company subject to registrations thereunder;
and
(xv) to such counsel's best knowledge, DVI Financial Services
Inc. is not currently prohibited, directly or indirectly, from repaying
the Company any loans or advances to such subsidiary from the Company
pursuant to the Intercompany Note (as
<PAGE> 19
19
defined in the Prospectus), except as described in or contemplated by
the Prospectus (or, if the Prospectus is not in existence, the most
recent Preliminary Prospectus).
Such counsel shall also state that they have no reason to
believe that the Registration Statement, as of its effective date, contained any
untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading or that the Prospectus, as of its date or the date of such opinion,
included or includes any 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.
Counsel may state that this belief is based upon its participation in the
preparation of the Registration Statement and the Prospectus and its review and
discussion of the contents thereof but is without independent investigation or
verification.
Such counsel need not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or Prospectus, except to the limited extent stated in
paragraph (vi) above. In addition, such counsel need not express any opinion or
belief as to the financial statements or schedules or any other financial,
economic or statistical data contained in the Registration Statement or the
Prospectus.
In rendering any such opinion, such counsel may rely, as to
matters of fact, to the extent such counsel deems proper, on certificates of
responsible officers of the Company and public officials. Such counsel may state
that as to matters on which its opinion is expressed to its "best knowledge"
such counsel is responsible for knowledge of only those facts (i) set forth in
certificates of responsible officers of the Company, (ii) described in the
Registration Statement or (iii) within the actual knowledge of those attorneys
in such counsel's firm that have performed services for the Company in
connection with the transactions contemplated by this Agreement.
Such counsel may state that its opinions are limited to
matters of United States federal law, the laws of the state of New York and
Delaware corporate law and that its references in its opinions to governmental
authorities are to federal and New York authorities. References to the
Registration Statement and the Prospectus in this paragraph (b) shall include
any amendment or supplement thereto at the date of such opinion.
(c) The Underwriters shall have received an opinion, dated the
Closing Date, of Melvin C. Breaux, General Counsel of the Company and of DVI
Financial Services Inc., to the effect that:
(i) to such counsel's best knowledge (A) no legal or
governmental proceedings are pending to which the Company or any of its
subsidiaries is a party or
<PAGE> 20
20
to which the property of the Company or any of its subsidiaries is
subject that are required to be described in the Registration Statement
or the Prospectus and are not described therein, and no such
proceedings have been threatened against the Company or any of its
subsidiaries or with respect to any of their respective properties and
(B) no contract or other document is required to be described in the
Registration Statement or the Prospectus or to be filed as an exhibit
to the Registration Statement that is not described therein or filed as
required;
(ii) the issuance, offering and sale of the Securities to the
Underwriters by the Company pursuant to this Agreement, the compliance
by the Company with the other provisions of this Agreement, the
Securities and the Indenture and the consummation of the other
transactions herein contemplated do not conflict with or result in a
breach or violation of any of the terms and provisions of, or
constitute a default under, any indenture, mortgage, deed of trust,
lease or other agreement or instrument, known to such counsel, to which
the Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries or any of their respective
properties are bound, or the charter documents or by-laws of the
Company or any of its subsidiaries, or any statute or any judgment,
decree, order, rule or regulation of any court or other governmental
authority or any arbitrator and specifically naming the Company or any
of its subsidiaries or any rule or regulation of any governmental
authority and applicable to the Company or any of its subsidiaries; and
(iii) (A) no default exists, and (B) no event has occurred
which, with notice or lapse of time or both, would constitute a
default, in the due performance and observance of any term, covenant or
condition of any indenture, mortgage, deed of trust, lease or other
agreement or instrument, known to such counsel, to which the Company or
any of its subsidiaries is a party or by which the Company or any of
its subsidiaries or any of their respective properties is bound or may
be affected which would have a material adverse effect upon the
property, business, or operations of the Company and any of its
subsidiaries.
In rendering any such opinion, such counsel may rely, as to
matters of fact, to the extent such counsel deems proper, on certificates of
responsible officers of the Company and public officials. Such counsel may also
state that, wherever such counsel's opinion with respect to the existence or
absence of facts is stated to be "to the best of such counsel's knowledge" or
"known to such counsel", such statements are intended to signify that, during
the course of such counsel's representation of the Company, no information has
come to the attention of such counsel which gives such counsel actual knowledge
of facts contrary to the existence or absence of the facts indicated.
Such counsel may state that his opinions are limited to
matters of United States federal law, the laws of the state of Pennsylvania and
Delaware corporate law and that its
<PAGE> 21
21
references in its opinions to governmental authorities are to federal and
Pennsylvania authorities. References to the Registration Statement and the
Prospectus in this paragraph (c) shall include any amendment or supplement
thereto at the date of such opinion.
(d) The Underwriters shall have received an opinion, dated the
Closing Date, of Shearman & Sterling, counsel for the Underwriters, with respect
to the issuance and sale of the Securities, the Registration Statement and the
Prospectus, and such other related matters as the Underwriters may reasonably
require, and the Company shall have furnished to such counsel such documents as
they may reasonably request for the purpose of enabling them to pass upon such
matters. In rendering such opinion, such counsel may rely as to matters of fact,
to the extent such counsel deems proper, on certificates of responsible officers
of the Company and public officials to the extent satisfactory in form and scope
to such counsel.
References to the Registration Statement and the Prospectus in
this paragraph (d) shall include any amendment or supplement thereto at the date
of such opinion.
(e) The Underwriters shall have received from Deloitte &
Touche LLP a letter or letters dated, respectively, the date hereof and the
Closing Date, in form and substance satisfactory to the Underwriters, to the
effect that:
(i) they are independent accountants with respect to the
Company and its consolidated subsidiaries within the meaning of the
Act, the Exchange Act and the applicable rules and regulations
thereunder;
(ii) in their opinion, the audited consolidated financial
statements and schedules audited by them and included in the
Registration Statement and the Prospectus comply in form in all
material respects with the applicable accounting requirements of the
Act, the Exchange Act and the related published rules and regulations
thereunder;
(iii) on the basis of their limited review in accordance with
standards established by the American Institute of Certified Public
Accountants of any interim unaudited consolidated condensed financial
statements of the Company and its consolidated subsidiaries as
indicated in their report included in the Registration Statement and
the Prospectus, carrying out certain specified procedures (which do not
constitute an examination made in accordance with generally accepted
auditing standards) that would not necessarily reveal matters of
significance with respect to the comments set forth in this paragraph
(iii), a reading of the minute books of the shareholders, the board of
directors and any committees thereof of the Company and each of its
consolidated subsidiaries, and inquiries of certain officials of the
Company
<PAGE> 22
22
and its consolidated subsidiaries who have responsibility for financial
and accounting matters, nothing came to their attention that caused
them to believe that:
(A) the unaudited consolidated condensed financial
statements of the Company and its consolidated subsidiaries
included in the Registration Statement and the Prospectus do
not comply in form in all material respects with the
applicable accounting requirements of the Act and the related
published rules and regulations thereunder or are not in
conformity with generally accepted accounting principles
applied on a basis substantially consistent with that of the
audited consolidated financial statements included in the
Registration Statement and the Prospectus; and
(B) at a specific date not more than five business
days prior to the date of such letter, there were any changes
in the capital stock or long-term debt of the Company and its
consolidated subsidiaries or any decreases in net current
assets or stockholders' equity of the Company and its
consolidated subsidiaries, in each case compared with amounts
shown on the September 30, 1996 unaudited consolidated balance
sheet included in the Registration Statement and the
Prospectus, or for the period from October 1, 1996 to January
27, 1996 to such specified date there were any decreases, as
compared with the corresponding period in the preceding year
in finance and other income, earnings from continuing
operations, or total or per share amounts of net earnings of
the Company and its consolidated subsidiaries, except in all
instances for changes, decreases or increases set forth in
such letter; and
(iv) they have carried out certain specified procedures, not
constituting an audit, with respect to certain amounts, percentages and
financial information that are derived from the general accounting
records of the Company and its consolidated subsidiaries and are
included in the Registration Statement and the Prospectus under the
captions set forth in such letter and in Exhibit 11 to the Registration
Statement, and have compared such amounts, percentages and financial
information with such records of the Company and its consolidated
subsidiaries and with information derived from such records and have
found them to be in agreement, excluding any questions of legal
interpretation.
In the event that the letters referred to above set forth any
such changes, decreases or increases, it shall be a further condition to the
obligations of the Underwriters that (A) such letters shall be accompanied by a
written explanation of the Company as to the significance thereof, unless the
Representatives deem such explanation unnecessary, and (B) such changes,
decreases or increases do not, in the sole judgment of the Representatives, make
it impractical or inadvisable to proceed with the purchase and delivery of the
Securities as contemplated by the Registration Statement, as amended as of the
date hereof.
<PAGE> 23
23
References to the Registration Statement and the Prospectus in
this paragraph (e) with respect to either letter referred to above shall include
any amendment or supplement thereto at the date of such letter.
(f) The Underwriters shall have received a certificate, dated
the Closing Date, of the principal executive officer and the principal financial
and accounting officer of the Company to the effect that:
(i) the representations and warranties of the Company in this
Agreement are true and correct as if made on and as of the Closing
Date, the Registration Statement, as amended as of the Closing Date,
does not include any untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein not
misleading, and the Prospectus, as amended or supplemented as of the
Closing Date, does not include any untrue statement of a material fact
or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading; and the Company has performed all covenants
and agreements and satisfied all conditions on its part to be performed
or satisfied at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement or any amendment thereto has been issued, and no
proceedings for that purpose have been instituted or threatened or, to
the best of the Company's knowledge, are contemplated by the
Commission; and
(iii) subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus,
neither the Company nor any of its subsidiaries have sustained any
material loss or interference with their respective businesses or
properties from fire, flood, hurricane, accident or other calamity,
whether or not covered by insurance, or from any labor dispute or any
legal or governmental proceeding, and there has not been any material
adverse change, or any development involving a prospective material
adverse change, in the condition (financial or otherwise), management,
business prospects, net worth or results of operations of the Company
or any of its subsidiaries, except in each case as described in or
contemplated by the Prospectus (exclusive of any amendment or
supplement thereto).
(g) On or before the Closing Date, the Underwriters and
counsel for the Underwriters shall have received such further certificates,
documents or other information as they may have reasonably requested from the
Company.
(h) Prior to the commencement of the offering of the
Securities, the Securities shall have been approved for listing on the NYSE.
<PAGE> 24
24
All opinions, certificates, letters and documents delivered
pursuant to this Agreement will comply with the provisions hereof only if they
are reasonably satisfactory in all material respects to the Underwriters and
counsel for the Underwriters. The Company shall furnish to the Underwriters such
conformed copies of such opinions, certificates, letters and documents in such
quantities as the Underwriters and counsel for the Underwriters shall reasonably
request.
9. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of Section 15 of the Act or Section
20 of the Exchange Act against any losses, claims, damages or liabilities, joint
or several, to which such Underwriter or such controlling person may become
subject under the Act, the Exchange Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon:
(i) any untrue statement or alleged untrue statement made by
the Company in Section 3 of this Agreement,
(ii) any untrue statement or alleged untrue statement of any
material fact contained in (A) the Registration Statement or any
amendment thereto, any Preliminary Prospectus or the Prospectus or any
amendment or supplement thereto or (B) any application or other
document, or any amendment or supplement thereto, executed by the
Company or based upon written information furnished by or on behalf of
the Company filed in any jurisdiction in order to qualify the
Securities under the securities or blue sky laws thereof or filed with
the Commission or any securities association or securities exchange
(each an "Application"),
(iii) the omission or alleged omission to state in the
Registration Statement or any amendment thereto, any Preliminary
Prospectus or the Prospectus or any amendment or supplement thereto, or
any Application a material fact required to be stated therein or
necessary to make the statements therein not misleading or
(iv) any untrue statement or alleged untrue statement of any
material fact contained in any audio or visual materials used in
connection with the marketing of the Securities, including without
limitation, slides, videos, films and tape recordings,
and will reimburse, as incurred, each Underwriter and each such controlling
person for any legal or other expenses reasonably incurred by such Underwriter
or such controlling person in connection with investigating, defending against
or appearing as a third-party witness in connection with any such loss, claim,
damage, liability or action; provided, however, that the Company will not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon any untrue statement or alleged untrue
statement or
<PAGE> 25
25
omission or alleged omission made in the Registration Statement or any amendment
thereto, any Preliminary Prospectus, the Prospectus or any amendment or
supplement thereto or any Application in reliance upon and in conformity with
written information furnished to the Company by such Underwriter through the
Representatives specifically for use therein. This indemnity agreement will be
in addition to any liability which the Company may otherwise have. The Company
will not, without the prior written consent of the Underwriter or Underwriters
purchasing, in the aggregate, more than fifty percent (50%) of the Securities,
settle or compromise or consent to the entry of any judgment in any pending or
threatened claim, action, suit or proceeding in respect of which indemnification
may be sought hereunder (whether or not any such Underwriter or any person who
controls any such Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act is a party to such claim, action, suit or
proceeding), unless such settlement, compromise or consent includes an
unconditional release of all of the Underwriters and such controlling persons
from all liability arising out of such claim, action, suit or proceeding.
(b) Each Underwriter, severally and not jointly, will
indemnify and hold harmless the Company, each of its directors, each of its
officers who signed the Registration Statement, and each person, if any, who
controls the Company within the meaning of Section 15 of the Act or Section 20
of the Exchange Act against any losses, claims, damages or liabilities to which
the Company, any such director, officer or controlling person may become subject
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon (i)
any untrue statement or alleged untrue statement of any material fact contained
in the Registration Statement or any amendment thereto, any Preliminary
Prospectus or Prospectus or any amendment or supplement thereto, or any
Application or (ii) the omission or alleged omission to state therein a material
fact required to be stated in the Registration Statement or any amendment
thereto, any Preliminary Prospectus or the Prospectus or any amendment or
supplement thereto, or any Application or necessary to make the statements
therein not misleading, in each case to the extent, but only to the extent, that
such untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written information
furnished to the Company by such Underwriter through the Representatives
specifically for use therein; and, subject to the limitation set forth
immediately preceding this clause, will reimburse, as incurred, any legal or
other expenses reasonably incurred by the Company or any such director, officer
or controlling person in connection with investigating or defending any such
loss, claim, damage, liability or any action in respect thereof. This indemnity
agreement will be in addition to any liability which such Underwriter may
otherwise have.
(c) Promptly after receipt by an indemnified party under this
Section 9 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 9, notify the indemnifying party of the commencement thereof;
but the omission so to notify the
<PAGE> 26
26
indemnifying party will not relieve it from any liability which it may have to
any indemnified party otherwise than under this Section 9. In case any such
action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party; provided, however,
that if the defendants in any such action include both the indemnified party and
the indemnifying party and the indemnified party shall have reasonably concluded
that there may be one or more legal defenses available to it and/or other
indemnified parties which are different from or additional to those available to
the indemnifying party, the indemnifying party shall not have the right to
direct the defense of such action on behalf of such indemnified party or parties
and such indemnified party or parties shall have the right to select separate
counsel to defend such action on behalf of such indemnified party or parties.
After notice from the indemnifying party to such indemnified party of its
election to assume the defense thereof and approval by such indemnified party of
counsel appointed to defend such action, the indemnifying party will not be
liable to such indemnified party under this Section 9 for any legal or other
expenses, other than reasonable costs of investigation, subsequently incurred by
such indemnified party in connection with the defense thereof, unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the next preceding sentence (it being understood, however, that in
connection with such action the indemnifying party shall not be liable for the
expenses of more than one separate counsel (in addition to local counsel) in any
one action or separate but substantially similar actions in the same
jurisdiction arising out of the same general allegations or circumstances,
designated by the Underwriters in the case of paragraph (a) of this Section 9,
representing the indemnified parties under such paragraph (a) who are parties to
such action or actions) or (ii) the indemnifying party does not promptly retain
counsel satisfactory to the indemnified party or (iii) the indemnifying party
has authorized the employment of counsel for the indemnified party at the
expense of the indemnifying party. After such notice from the indemnifying party
to such indemnified party, the indemnifying party will not be liable for the
costs and expenses of any settlement of such action effected by such indemnified
party without the consent of the indemnifying party.
(d) In circumstances in which the indemnity agreement provided
for in the preceding paragraphs of this Section 9 is unavailable or
insufficient, for any reason, to hold harmless an indemnified party in respect
of any losses, claims, damages or liabilities (or actions in respect thereof),
each indemnifying party, in order to provide for just and equitable
contribution, shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages or liabilities (or actions in
respect thereof) in such proportion as is appropriate to reflect (i) the
relative benefits received by the indemnifying party or parties on the one hand
and the indemnified party on the other from the offering of the Securities or
(ii) if the allocation provided by the foregoing clause (i) is not permitted by
applicable law, not only such relative benefits but also the relative fault of
<PAGE> 27
27
the indemnifying party or parties on the one hand and the indemnified party on
the other in connection with the statements or omissions or alleged statements
or omissions that resulted in such losses, claims, damages or liabilities (or
actions in respect thereof), as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion
as the total proceeds from the offering (before deducting expenses) received by
the Company bear to the total underwriting discounts and commissions received by
the Underwriters. The relative fault of the parties shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or the Underwriters, the parties'
relative intents, knowledge, access to information and opportunity to correct or
prevent such statement or omission, and any other equitable considerations
appropriate in the circumstances. The Company and the Underwriters agree that it
would not be equitable if the amount of such contribution were determined by pro
rata or per capita allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation that does not take
into account the equitable considerations referred to above in this paragraph
(d). Notwithstanding any other provision of this paragraph (d), no Underwriter
shall be obligated to make contributions hereunder that in the aggregate exceed
the total public offering price of the Securities purchased by such Underwriter
under this Agreement, less the aggregate amount of any damages that such
Underwriter has otherwise been required to pay in respect of the same or any
substantially similar claim, and no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute hereunder are
several in proportion to their respective underwriting obligations and not
joint, and contributions among Underwriters shall be governed by the provisions
of the Prudential Securities Incorporated Master Agreement Among Underwriters.
For purposes of this paragraph (d), each person, if any, who controls an
Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act shall have the same rights to contribution as such Underwriter, and
each director of the Company, each officer of the Company who signed the
Registration Statement and each person, if any, who controls the Company within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act, shall
have the same rights to contribution as the Company.
(e) The parties to this Agreement hereby acknowledge that they
are sophisticated business persons who were represented by counsel during the
negotiations regarding the provisions of this Agreement, including, without
limitation, the provisions of Sections 7(b), 7(c) and 7(d) hereof and this
Section 9, and are fully informed regarding said provisions. They further
acknowledge that the provisions of Sections 7(b), 7(c) and 7(d) hereof and this
Section 9 fairly allocate the risks in light of the ability of the parties to
investigate the Company and its business in order to assure that adequate
disclosure is made in the Registration Statement and Prospectus as required by
the Act. The parties are advised
<PAGE> 28
28
that federal or state policy, as interpreted by the courts in certain
jurisdictions, may be contrary to certain provisions of Sections 7(b), 7(c) and
7(d) hereof and this Section 9, and the parties hereto hereby expressly waive
and relinquish any right or ability to assert such public policy as a defense to
a claim under Sections 7(b), 7(c) and 7(d) hereof or this Section 9 and further
agree not to attempt to assert any such defense.
10. Default of Underwriters. If one or more Underwriters
default in their obligations to purchase Securities hereunder and the aggregate
principal amount of such Securities that such defaulting Underwriter or
Underwriters agree but failed to purchase is ten percent or less of the
aggregate principal amount of Securities to be purchased by all of the
Underwriters at such time hereunder, the other Underwriters may make
arrangements satisfactory to the Underwriters for the purchase of such
Securities by other persons (who may include one or more of the non-defaulting
Underwriters, including the Underwriters), but if no such arrangements are made
by the Closing Date, the other Underwriters shall be obligated severally in
proportion to their respective commitments hereunder to purchase the Securities
that such defaulting Underwriter or Underwriters agreed but failed to purchase.
If one or more Underwriters so default with respect to an aggregate principal
amount of Securities that is more than ten percent of the aggregate principal
amount of Securities to be purchased by all of the Underwriters at such time
hereunder, and if arrangements satisfactory to the Underwriters are not made
within 36 hours after such default for the purchase by other persons (who may
include one or more of the non-defaulting Underwriters, including the
Underwriters), of the Securities with respect to which such default occurs, this
Agreement will terminate without liability on the part of any non-defaulting
Underwriter or the Company other than as provided in Section 11 hereof. In the
event of any default by one or more Underwriters as described in this Section
10, the Underwriters shall have the right to postpone the Closing Date
established as provided in Section 4 hereof for not more than seven business
days in order that any necessary changes may be made in the arrangements or
documents for the purchase and delivery of the Securities. As used in this
Agreement, the term "Underwriter" includes any person substituted for an
Underwriter under this Section 10. Nothing herein shall relieve any defaulting
Underwriter from liability for its default.
11. Survival. The respective representations, warranties,
agreements, covenants, indemnities and other statements of the Company, its
officers, and the several Underwriters set forth in this Agreement or made by or
on behalf of them, respectively, pursuant to this Agreement shall remain in full
force and effect, regardless of (i) any investigation made by or on behalf of
the Company, any of its officers or directors, any Underwriter or any
controlling person referred to in Section 9 hereof and (ii) delivery of and
payment for the Securities. The respective agreements, covenants, indemnities
and other statements set forth in Sections 6 and 9 hereof shall remain in full
force and effect, regardless of any termination or cancellation of this
Agreement.
<PAGE> 29
29
12. Termination. (a) This agreement may be terminated with
respect to the securities in the sole discretion of the Representatives by
notice to the Company given prior to the Closing Date, in the event that the
Company shall have failed, refused or been unable to perform all obligations and
satisfy all conditions on its part to be performed or satisfied hereunder at or
prior thereto or, if at or prior to the Closing Date,
(i) the Company or any of its subsidiaries shall have, in the
sole judgment of the Underwriters, sustained any material loss or
interference with their respective businesses or properties from fire,
flood, hurricane, accident or other calamity, whether or not covered by
insurance, or from any labor dispute or any legal or governmental
proceeding or there shall have been any material adverse change, or any
development involving a prospective material adverse change (including
without limitation a change in management or control of the Company),
in the condition (financial or otherwise), business prospects, net
worth or results of operations of the Company and its subsidiaries,
except in each case as described in or contemplated by the Prospectus
(exclusive of any amendment or supplement thereto);
(ii) trading in the Company's Common Stock shall have been
suspended by the Commission or the New York Stock Exchange or trading
in securities generally on the New York Stock Exchange or Nasdaq
National Market shall have been suspended or minimum or maximum prices
shall have been established on either such exchange or market system;
(iii) a banking moratorium shall have been declared by New
York or United States authorities; or
(iv) there shall have been (A) an outbreak or escalation of
hostilities between the United States and any foreign power, (B) an
outbreak or escalation of any other insurrection or armed conflict
involving the United States or (C) any other calamity or crisis or
material adverse change in general economic, political or financial
conditions having an effect on the financial markets or the market for
the Securities that, in the sole judgment of the Underwriters, makes it
impractical or inadvisable to proceed with the public offering or the
delivery of the Securities as contemplated by the Registration
Statement, as amended as of the date hereof.
(b) Termination of this Agreement pursuant to this Section 12
shall be without liability of any party to any other party except as provided in
Section 11 hereof.
13. Information Supplied by Underwriters. The statements set
forth in the last paragraph on the front cover page of the Prospectus and under
the heading "Underwriting" in the Preliminary Prospectus or the Prospectus (to
the extent such statements relate to the Underwriters) constitute the only
information furnished by any
<PAGE> 30
30
Underwriter to the Company for the purposes of Sections 3(a) and 9 hereof. The
Underwriters confirm that such statements (to such extent) are correct.
14. Notices. All communications hereunder shall be in writing
and, if sent to any of the Underwriters, shall be delivered to sent by mail,
telex or facsimile transmission and confirmed in writing to Prudential
Securities Incorporated, One New York Plaza, New York, New York 10292,
Attention: High Yield Securities Department; and if sent to the Company, shall
be delivered or sent by mail, telex or facsimile transmission and confirmed in
writing to the Company at DVI, Inc., 500 Hyde Park, Doylestown, PA 18901,
Attention: Chief Financial Officer (facsimile number (215) 345-4428), with a
copy to Rogers & Wells, 200 Park Avenue, New York, NY 10166-0153, Attention:
John A. Healy (facsimile number (212) 878-8375).
15. Successors. This Agreement shall inure to the benefit of
and shall be binding upon the several Underwriters, the Company and their
respective successors and legal representatives, and nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any other
person any legal or equitable right, remedy or claim under or in respect of this
Agreement, or any provisions herein contained, this Agreement and all conditions
and provisions hereof being intended to be and being for the sole and exclusive
benefit of such persons and for the benefit of no other person except that (i)
the indemnities of the Company contained in Section 9 of this Agreement shall
also be for the benefit of any person or persons who control any Underwriter
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act
and (ii) the indemnities of the Underwriters contained in Section 9 of this
Agreement shall also be for the benefit of the directors of the Company, the
officers of the Company who have signed the Registration Statement and any
person or persons who control the Company within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act. No purchaser of Securities from any
Underwriter shall be deemed a successor because of such purchase.
16. Applicable Law. The validity and interpretation of this
Agreement, and the terms and conditions set forth herein, shall be governed by
and construed in accordance with the laws of the State of New York, without
giving effect to any provisions relating to conflicts of laws.
17. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
<PAGE> 31
If the foregoing correctly sets forth our understanding,
please indicate your acceptance thereof in the space provided below for that
purpose, whereupon this letter shall constitute an agreement binding the Company
and each of the several Underwriters.
Very truly yours,
DVI, INC.
By: /s/ Steve R. Garfinkel
------------------------------------
Name: Steve R. Garfinkel
Title: Executive Vice President and
Chief Financial Officer
The foregoing Agreement is hereby confirmed
and accepted as of the
date first above written.
PRUDENTIAL SECURITIES INCORPORATED
CIBC WOOD GUNDY SECURITIES CORP.
By: PRUDENTIAL SECURITIES INCORPORATED
By: /s/ Steve Benfield
----------------------------------
Name: Steve Benfield
Title: Managing Director
For itself and on behalf of the
Underwriters
<PAGE> 32
SCHEDULE 1
UNDERWRITERS
<TABLE>
<CAPTION>
Principal Amount at
Underwriter Maturity
- ----------- -------------------
<S> <C>
Prudential Securities Incorporated............... $ 60,000,000
CIBC Wood Gundy Securities Corp.................. 40,000,000
-------------------
Total............................................ $ 100,000.000
===================
</TABLE>
<PAGE> 33
SCHEDULE 2
SUBSIDIARIES
DVI FINANCIAL SERVICES INC.
DVI LEASE FINANCE CORPORATION II
DVI RECEIVABLES CORP. 1993-A
DVI RECEIVABLES CORP. II
DVI RECEIVABLES CORP. III
DVI RECEIVABLES CORP.
DVI SUBORDINATED SECURITIES CORPORATION
DVI LEASE FINANCE CORP. III
DVI RECEIVABLES CORP. IV
DVI INTERNATIONAL INC.
DVI FINANCIAL SERVICES (AUSTRALIA), LIMITED
DVI HEALTHCARE OPERATIONS, INC.
DVI BUSINESS CREDIT CORPORATION
DVI BUSINESS CREDIT RECEIVABLES CORP.
DVI BUSINESS CREDIT RECEIVABLES CORP. II
<PAGE> 1
- --------------------------------------------------------------------------------
DVI, INC.,
Issuer
TO
First Trust National Association,
Trustee
----------
INDENTURE
Dated as of January 27, 1997
----------
Debt Securities
<PAGE> 2
DVI, INC.
RECONCILIATION AND TIE BETWEEN TRUST INDENTURE ACT
OF 1939 AND INDENTURE, DATED AS OF JANUARY __, 1997
<TABLE>
<CAPTION>
TRUST INDENTURE
ACT SECTION INDENTURE SECTION
<S> <C> <C>
Section 310(a)(1) ................................... 607(A)
(a)(2) ................................... 607(a)
(b) ................................... 607(b), 608
Section 312(c) ................................... 701
Section 314(a) ................................... 703
(a)(4) ................................... 1004
(c)(1) ................................... 102
(c)(2) ................................... 102
(e) ................................... 102
Section 315(b) ................................... 601
Section 316(a)(last
sentence) ................................... 101 ("Outstanding")
(a)(1)(A) ................................... 502, 512
(a)(1)(B) ................................... 513
(b) ................................... 508
(c) ................................... 104(e)
Section 317(a)(1) ................................... 503
(a)(2) ................................... 504
(b) ................................... 1003
Section 318(a) ................................... 111
</TABLE>
- --------
Note: This reconciliation and tie shall not, for any purpose, be deemed to be
a part of the Indenture.
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
PARTIES...................................................................................................... 1
RECITALS OF THE COMPANY...................................................................................... 1
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. Definitions............................................................................... 1
Act .................................................................................. 2
Affiliate .................................................................................. 2
Authenticating Agent .................................................................................. 2
Authorized Newspaper .................................................................................. 2
Bearer Security .................................................................................. 2
Board of Directors .................................................................................. 2
Board Resolution .................................................................................. 3
Business Day .................................................................................. 3
Capital Stock .................................................................................. 3
Capitalized Lease Obligation............................................................................ 3
CEDEL S.A. .................................................................................. 3
Closing Date .................................................................................. 3
Commission .................................................................................. 3
Common Depositary .................................................................................. 3
Company .................................................................................. 3
Company Request .................................................................................. 3
Consolidated Net Worth.................................................................................. 4
Conversion Date .................................................................................. 4
Conversion Event .................................................................................. 4
Corporate Trust Office.................................................................................. 4
corporation .................................................................................. 4
coupon .................................................................................. 4
Currency .................................................................................. 4
Debt .................................................................................. 4
Default .................................................................................. 5
</TABLE>
- --------
Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
<PAGE> 4
ii
<TABLE>
<CAPTION>
PAGE
<S> <C>
Defaulted Interest ..................................................................................... 5
Disqualified Stock ..................................................................................... 5
Dollar or $ ..................................................................................... 5
Dollar Equivalent of the Currency Unit..................................................................... 5
Dollar Equivalent of the Foreign Currency.................................................................. 5
ECU ..................................................................................... 5
Election Date ..................................................................................... 6
Euroclear ..................................................................................... 6
European Communities ..................................................................................... 6
European Monetary System................................................................................... 6
Event of Default ..................................................................................... 6
Exchange Date ..................................................................................... 6
Exchange Rate Agent ..................................................................................... 6
Exchange Rate Officers' Certificate........................................................................ 6
Federal Bankruptcy Code.................................................................................... 6
Foreign Currency ..................................................................................... 6
Government Obligations..................................................................................... 7
Holder ..................................................................................... 7
Indenture ..................................................................................... 7
Indexed Security ..................................................................................... 7
interest ..................................................................................... 8
Interest Payment Date ..................................................................................... 8
Lien ..................................................................................... 8
Market Exchange Rate ..................................................................................... 8
Maturity ..................................................................................... 9
Officers' Certificate ..................................................................................... 9
Opinion of Counsel ..................................................................................... 9
Original Issue Discount Security........................................................................... 9
Outstanding ..................................................................................... 9
Paying Agent ..................................................................................... 10
Person ..................................................................................... 11
Place of Payment ..................................................................................... 11
Predecessor Security ..................................................................................... 11
Redemption Date ..................................................................................... 11
Redemption Price ..................................................................................... 11
Registered Security ..................................................................................... 11
Regular Record Date ..................................................................................... 11
Repayment Date ..................................................................................... 11
Repayment Price ..................................................................................... 11
Responsible Officer ..................................................................................... 11
</TABLE>
<PAGE> 5
iii
<TABLE>
<CAPTION>
PAGE
<S> <C>
Restricted Securities ..................................................................................... 12
Restricted Subsidiary ..................................................................................... 12
Securities ..................................................................................... 12
Security Register and Security Registrar................................................................... 12
Significant Subsidiary..................................................................................... 12
Special Record Date ..................................................................................... 12
Stated Maturity ..................................................................................... 12
Subsidiary ..................................................................................... 13
Trust Indenture Act or TIA................................................................................. 13
Trustee ..................................................................................... 13
United States ..................................................................................... 13
United States person ..................................................................................... 13
Unrestricted Subsidiary.................................................................................... 13
Valuation Date ..................................................................................... 13
Vice President ..................................................................................... 13
Voting Stock ..................................................................................... 13
Yield to Maturity ..................................................................................... 14
SECTION 102. Compliance Certificates and Opinions......................................................... 14
SECTION 103. Form of Documents Delivered to Trustee....................................................... 15
SECTION 104. Acts of Holders.............................................................................. 15
SECTION 105. Notices, etc. to Trustee and Company......................................................... 17
SECTION 106. Notice to Holders; Waiver.................................................................... 17
SECTION 107. Effect of Headings and Table of Contents..................................................... 19
SECTION 108. Successors and Assigns....................................................................... 19
SECTION 109. Separability Clause.......................................................................... 19
SECTION 110. Benefits of Indenture........................................................................ 19
SECTION 111. Governing Law................................................................................ 19
SECTION 112. Legal Holidays............................................................................... 19
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally.............................................................................. 20
SECTION 202. Form of Trustee's Certificate of Authentication.............................................. 21
SECTION 203. Securities Issuable in Global Form........................................................... 21
</TABLE>
<PAGE> 6
iv
<TABLE>
<CAPTION>
PAGE
ARTICLE THREE
THE SECURITIES
<S> <C>
SECTION 301. Amount Unlimited; Issuable in Series......................................................... 22
SECTION 302. Denominations................................................................................ 26
SECTION 303. Execution, Authentication, Delivery and Dating............................................... 26
SECTION 304. Temporary Securities......................................................................... 29
SECTION 305. Registration, Registration of Transfer and Exchange.......................................... 31
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities............................................. 34
SECTION 307. Payment of Interest; Interest Rights Preserved; Optional Interest
Reset................................................................................ 36
SECTION 308. Optional Extension of Stated Maturity........................................................ 39
SECTION 309. Persons Deemed Owners........................................................................ 40
SECTION 310. Cancellation................................................................................. 40
SECTION 311. Computation of Interest...................................................................... 41
SECTION 312. Currency and Manner of Payments in Respect of Securities..................................... 41
SECTION 313. Appointment and Resignation of Successor Exchange Rate Agent................................. 45
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture...................................................... 46
SECTION 402. Application of Trust Money................................................................... 47
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default............................................................................ 48
SECTION 502. Acceleration of Maturity; Rescission and Annulment........................................... 49
SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee.............................. 50
SECTION 504. Trustee May File Proofs of Claim............................................................. 51
SECTION 505. Trustee May Enforce Claims Without Possession of Securities.................................. 52
SECTION 506. Application of Money Collected............................................................... 52
SECTION 507. Limitation on Suits.......................................................................... 53
SECTION 508. Unconditional Right of Holders to Receive Principal, Premium and
Interest............................................................................. 54
SECTION 509. Restoration of Rights and Remedies........................................................... 54
</TABLE>
<PAGE> 7
v
<TABLE>
<CAPTION>
PAGE
<S> <C>
SECTION 510. Rights and Remedies Cumulative............................................................... 54
SECTION 511. Delay or Omission Not Waiver................................................................. 55
SECTION 512. Control by Holders........................................................................... 55
SECTION 513. Waiver of Past Defaults...................................................................... 55
SECTION 514. Waiver of Stay or Extension Laws............................................................. 56
ARTICLE SIX
THE TRUSTEE
SECTION 601. Notice of Defaults........................................................................... 56
SECTION 602. Certain Rights of Trustee.................................................................... 57
SECTION 603. Trustee Not Responsible for Recitals or Issuance of Securities............................... 58
SECTION 604. May Hold Securities.......................................................................... 58
SECTION 605. Money Held in Trust.......................................................................... 59
SECTION 606. Compensation and Reimbursement............................................................... 59
SECTION 607. Corporate Trustee Required; Eligibility; Conflicting Interests............................... 60
SECTION 608. Resignation and Removal; Appointment of Successor............................................ 60
SECTION 609. Acceptance of Appointment by Successor....................................................... 62
SECTION 610. Merger, Conversion, Consolidation or Succession to Business.................................. 63
SECTION 611. Appointment of Authenticating Agent.......................................................... 64
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Disclosure of Names and Addresses of Holders................................................. 65
SECTION 702. Reports by Trustee........................................................................... 66
SECTION 703. Reports by Company........................................................................... 66
ARTICLE EIGHT
CONSOLIDATION, MERGER, AND SALE OF ASSETS
SECTION 801. Company May Consolidate, etc., Only on Certain Terms......................................... 67
SECTION 802. Successor Person Substituted................................................................. 68
</TABLE>
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<TABLE>
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ARTICLE NINE
SUPPLEMENTAL INDENTURES
<S> <C>
SECTION 901. Supplemental Indentures Without Consent of Holders........................................... 68
SECTION 902. Supplemental Indentures with Consent of Holders.............................................. 70
SECTION 903. Execution of Supplemental Indentures......................................................... 71
SECTION 904. Effect of Supplemental Indentures............................................................ 71
SECTION 905. Conformity with Trust Indenture Act.......................................................... 71
SECTION 906. Reference in Securities to Supplemental Indentures........................................... 71
SECTION 907. Notice of Supplemental Indentures............................................................ 72
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium, if Any, and Interest......................................... 72
SECTION 1002. Maintenance of Office or Agency............................................................. 72
SECTION 1003. Money for Securities Payments to Be Held in Trust........................................... 74
SECTION 1004. Statement as to Compliance.................................................................. 76
SECTION 1005. Payment of Taxes and Other Claims........................................................... 76
SECTION 1006. Corporate Existence......................................................................... 76
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Applicability of Article.................................................................... 76
SECTION 1102. Election to Redeem; Notice to Trustee....................................................... 77
SECTION 1103. Selection by Trustee of Securities to Be Redeemed........................................... 77
SECTION 1104. Notice of Redemption........................................................................ 77
SECTION 1105. Deposit of Redemption Price................................................................. 79
SECTION 1106. Securities Payable on Redemption Date....................................................... 79
SECTION 1107. Securities Redeemed in Part................................................................. 80
ARTICLE TWELVE
SINKING FUNDS
SECTION 1201. Applicability of Article.................................................................... 80
</TABLE>
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<TABLE>
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<S> <C>
SECTION 1202. Satisfaction of Sinking Fund Payments with Securities....................................... 81
SECTION 1203. Redemption of Securities for Sinking Fund................................................... 81
ARTICLE THIRTEEN
REPAYMENT AT OPTION OF HOLDERS
SECTION 1301. Applicability of Article.................................................................... 82
SECTION 1302. Repayment of Securities..................................................................... 83
SECTION 1303. Exercise of Option.......................................................................... 83
SECTION 1304. When Securities Presented for Repayment Become Due and Payable.............................. 84
SECTION 1305. Securities Repaid in Part................................................................... 85
ARTICLE FOURTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1401. Company's Option to Effect Defeasance or Covenant Defeasance................................ 85
SECTION 1402. Defeasance and Discharge.................................................................... 85
SECTION 1403. Covenant Defeasance......................................................................... 86
SECTION 1404. Conditions to Defeasance or Covenant Defeasance............................................. 86
SECTION 1405. Deposited Money and Government Obligations to Be Held in Trust;
Other Miscellaneous Provisions....................................................... 88
SECTION 1406. Reinstatement............................................................................... 89
ARTICLE FIFTEEN
MEETINGS OF HOLDERS OF SECURITIES
SECTION 1501. Purposes for Which Meetings May Be Called................................................... 90
SECTION 1502. Call, Notice and Place of Meetings.......................................................... 90
SECTION 1503. Persons Entitled to Vote at Meetings........................................................ 90
SECTION 1504. Quorum; Action.............................................................................. 91
SECTION 1505. Determination of Voting Rights; Conduct and Adjournment of
Meetings............................................................................. 92
SECTION 1506. Counting Votes and Recording Action of Meetings............................................. 93
TESTIMONIUM..................................................................................................... 101
SIGNATURES AND SEALS............................................................................................ 101
</TABLE>
<PAGE> 10
viii
PAGE
FORMS OF CERTIFICATION EXHIBIT A
<PAGE> 11
INDENTURE, dated as of January 27, 1997, between DVI, Inc., a
corporation duly organized and existing under the laws of the State of Delaware
(herein called the "Company"), having its principal office at 500 Hyde Park,
Doylestown, Pennsylvania, and First Trust National Association, a national
banking association, Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of its unsecured
debentures, notes or other evidences of indebtedness (herein called the
"Securities"), which may be convertible into or exchangeable for any securities
of the Company, to be issued in one or more series as in this Indenture
provided.
This Indenture is subject to the provisions of the Trust
Indenture Act of 1939, as amended, that are required to be part of this
Indenture and shall, to the extent applicable, be governed by such provisions.
All things necessary to make this Indenture a valid agreement
of the Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of
the Securities by the Holders thereof, it is mutually covenanted and agreed, for
the equal and proportionate benefit of all Holders of the Securities or of
series thereof, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. Definitions.
For all purposes of this Indenture, except as otherwise
expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the
singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the
meanings assigned to them therein, and the terms "cash transaction" and
"self-liquidating paper", as used in TIA
<PAGE> 12
2
Section 311, shall have the meanings assigned to them in the rules of
the Commission adopted under the Trust Indenture Act;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted
accounting principles, and, except as otherwise herein expressly
provided, the term "generally accepted accounting principles" with
respect to any computation required or permitted hereunder shall mean
such accounting principles as are generally accepted at the date of
such computation; and
(4) 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.
Certain terms, used principally in Article Three, are defined
in that Article.
"Act", when used with respect to any Holder, has the meaning
specified in Section 104.
"Affiliate" means, with respect to any specified Person, any
other Person directly or indirectly controlling or controlled by or under direct
or indirect common control with such specified Person. For the purposes of this
definition, "control" when used with respect to any specified Person means the
power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Authenticating Agent" means any Person appointed by the
Trustee to act on behalf of the Trustee pursuant to Section 611 to authenticate
Securities.
"Authorized Newspaper" means a newspaper, in the English
language or in an official language of the country of publication, customarily
published on each Business Day, whether or not published on Saturdays, Sundays
or holidays, and of general circulation in each place in connection with which
the term is used or in the financial community of each such place. Where
successive publications are required to be made in Authorized Newspapers, the
successive publications may be made in the same or in different newspapers in
the same city meeting the foregoing requirements and in each case on any
Business Day.
"Bearer Security" means any Security except a Registered
Security.
"Board of Directors" means either the board of directors of
the Company or any duly authorized committee of that board.
<PAGE> 13
3
"Board Resolution" means a copy of a resolution certified by
the Secretary or an Assistant Secretary of the Company to have been duly adopted
by the Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Business Day", when used with respect to any Place of Payment
or any other particular location referred to in this Indenture or in the
Securities, means, unless otherwise specified with respect to any Securities
pursuant to Section 301, each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in that Place of Payment or
other location are authorized or obligated by law or executive order to close.
"Capital Stock" of any Person means any and all shares,
interests, partnership interests, participations, rights in or other equivalents
(however designated) of such Person's equity interest (however designated).
"Capitalized Lease Obligation" means, with respect to any
Person, an obligation incurred or assumed under or in connection with any
capital lease of real or personal property that, in accordance with GAAP, has
been recorded as a capitalized lease.
"CEDEL S.A." means Centrale de Livraison de Valeurs
Mobilieres, S.A., or its successor.
"Closing Date" means, with respect to any Securities, the date
on which such Securities are originally issued under the Indenture.
"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 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 at such time.
"Common Depositary" has the meaning specified in Section 304.
"Company" means the Person named as the "Company" in the first
paragraph of this Indenture until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request
or order signed in the name of the Company by its Chairman, its President, any
Vice President, its Treasurer or an Assistant Treasurer, and delivered to the
Trustee.
<PAGE> 14
4
"Consolidated Net Worth" means, at any date of determination,
stockholders' equity of the Company and its Restricted Subsidiaries as set forth
on the most recently available quarterly or annual consolidated balance sheet of
the Company and its Restricted Subsidiaries, less any amounts attributable to
Disqualified Stock, the cost of treasury stock and the principal amount of any
promissory notes receivable from the sale of the Capital Stock of the Company or
any of its Restricted Subsidiaries, and less to the extent included in
calculating such stockholder's equity of the Company and its Restricted
Subsidiaries, the stockholders' equity attributable to Unrestricted
Subsidiaries, each item to be determined in conformity with GAAP (excluding the
effects of foreign currency adjustments under Financial Accounting Standards
Board Statement of Financial Accounting Standards No. 52).
"Conversion Date" has the meaning specified in Section 312(d).
"Conversion Event" means the cessation of use of (i) a Foreign
Currency both by the government of the country which issued such Currency and by
a central bank or other public institution of or within the international
banking community for the settlement of transactions, (ii) the ECU both within
the European Monetary System and for the settlement of transactions by public
institutions of or within the European Communities or (iii) any currency unit
(or composite currency) other than the ECU for the purposes for which it was
established.
"Corporate Trust Office" means the office of the Trustee, at
which at any particular time its corporate trust business shall be principally
administered, which office on the date of execution of this Indenture is located
at 180 East Fifth Street, St. Paul, MN 55101.
"corporation" includes corporations, associations, companies
and business trusts.
"coupon" means any interest coupon appertaining to a Bearer
Security.
"Currency" means any currency or currencies, composite
currency or currency unit or currency units, including, without limitation, the
ECU, issued by the government of one or more countries or by any recognized
confederation or association of such governments.
"Debt" means (without duplication), with respect to any
Person, whether recourse is to all or a portion of the assets of such Person and
whether or not contingent, (a) every obligation of such Person for money
borrowed, (b) every obligation of such Person evidenced by bonds, debentures,
notes or other similar instruments, (c) every reimbursement obligation of such
Person with respect to letters of credit, bankers' acceptances or similar
facilities issued for the account of such Person, (d) every obligation of such
Person issued or
<PAGE> 15
5
assumed as the deferred purchase price of property or services, (e) Capitalized
Lease Obligations, (f) all Disqualified Stock of such Person valued at its
maximum fixed repurchase price, plus accrued and unpaid dividends, (g) all
obligations of such Person under or in respect of Hedging Obligations, and (h)
every obligation of the type referred to in clauses (a) through (g) of another
Person and all dividends of another Person the payment of which, in either case,
such Person has guaranteed. For purposes of this definition, the "maximum fixed
repurchase price" of any Disqualified Stock that does not have a fixed
repurchase price will be calculated in accordance with the terms of such
Disqualified Stock as if such Disqualified Stock were repurchased on any date on
which Debt is required to be determined pursuant to the Indenture, and if such
price is based upon, or measured by, the fair market value of such Disqualified
Stock, such fair market value will be determined in good faith by the board of
directors of the issuer of such Disqualified Stock. Notwithstanding the
foregoing, trade accounts payable and accrued liabilities arising in the
ordinary course of business and any liability for federal, state or local taxes
or other taxes owed by such Person will not be considered Debt for purposes of
this definition.
"Default" means any event which is, or after notice or passage
of time or both would be, an Event of Default.
"Defaulted Interest" has the meaning specified in Section 307.
"Disqualified Stock" means any class or series of Capital
Stock that, either by its terms, by the terms of any security into which it is
convertible or exchangeable or by contract or otherwise (i) is or upon the
happening of an event or passage of time would be, required to be redeemed prior
to the final Stated Maturity of the Notes, (ii) is redeemable at the option of
the holder thereof at any time prior to such final Stated Maturity or (iii) at
the option of the holder thereof, is convertible into or exchangeable for debt
securities at any time prior to such final Stated Maturity.
"Dollar" or "$" means a dollar or other equivalent unit in
such coin or currency of the United States of America as at the time shall be
legal tender for the payment of public and private debts.
"Dollar Equivalent of the Currency Unit" has the meaning
specified in Section 312(g).
"Dollar Equivalent of the Foreign Currency" has the meaning
specified in Section 312(f).
"ECU" means the European Currency Unit as defined and revised
from time to time by the Council of the European Communities.
<PAGE> 16
6
"Election Date" has the meaning specified in Section 312(h).
"Euroclear" means Morgan Guaranty Trust Company of New York,
Brussels Office, or its successor as operator of the Euroclear System.
"European Communities" means the European Economic Community,
the European Coal and Steel Community and the European Atomic Energy Community.
"European Monetary System" means the European Monetary System
established by the Resolution of December 5, 1978 of the Council of the European
Communities.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Date" has the meaning specified in Section 304.
"Exchange Rate Agent" means, with respect to Securities of or
within any series, unless otherwise specified with respect to any Securities
pursuant to Section 301, a New York Clearing House bank, designated pursuant to
Section 301 or Section 313.
"Exchange Rate Officers' Certificate" means a tested telex or
a certificate setting forth (i) the applicable Market Exchange Rate and (ii) the
Dollar or Foreign Currency amounts of principal (and premium, if any) and
interest, if any (on an aggregate basis and on the basis of a Security having
the lowest denomination principal amount determined in accordance with Section
302 in the relevant Currency), payable with respect to a Security of any series
on the basis of such Market Exchange Rate, sent (in the case of a telex) or
signed (in the case of a certificate) by the Chief Financial Officer or Vice
President - Chief Accounting Officer of the Company.
"Federal Bankruptcy Code" means the Bankruptcy Act of Title 11
of the United States Code, as amended from time to time.
"Foreign Currency" means any Currency other than Currency of
the United States.
"Generally Accepted Accounting Principles" or "GAAP" means
generally accepted accounting principles in the United States, consistently
applied, that are in effect on the Closing Date.
<PAGE> 17
7
"Government Obligations" means, unless otherwise specified
with respect to any series of Securities pursuant to Section 301, securities
which are (i) direct obligations of the government which issued the Currency in
which the Securities of a particular series are payable or (ii) obligations of a
Person controlled or supervised by and acting as an agency or instrumentality of
the government which issued the Currency in which the Securities of such series
are payable, the payment of which is unconditionally guaranteed by such
government, which, in either case, are full faith and credit obligations of such
government payable in such Currency and are not callable or redeemable at the
option of the issuer thereof and shall also include a depository receipt issued
by a bank or trust company as custodian with respect to any such Government
Obligation or a specific payment of interest on or principal of any such
Government Obligation held by such custodian for the account of the holder of a
depository receipt; provided that (except as required by law) such custodian is
not authorized to make any deduction from the amount payable to the holder of
such depository receipt from any amount received by the custodian in respect of
the Government Obligation or the specific payment of interest or principal of
the Government Obligation evidenced by such depository receipt.
"Holder" means, in the case of a Registered Security, the
Person in whose name a Security is registered in the Security Register and, in
the case of a Bearer Security, the bearer thereof and, when used with respect to
any coupon, shall mean the bearer thereof.
"Indenture" means this instrument as originally executed and
as it may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
and shall include the terms of particular series of Securities established as
contemplated by Section 301; provided, however, that, if at any time more than
one Person is acting as Trustee under this instrument, "Indenture" shall mean,
with respect to any one or more series of Securities for which such Person is
Trustee, this instrument as originally executed or as it may from time to time
be supplemented or amended by one or more indentures supplemental hereto entered
into pursuant to the applicable provisions hereof and shall include the terms of
particular series of Securities for which such Person is Trustee established as
contemplated by Section 301, exclusive, however, of any provisions or terms
which relate solely to other series of Securities for which such Person is not
Trustee, regardless of when such terms or provisions were adopted, and exclusive
of any provisions or terms adopted by means of one or more indentures
supplemental hereto executed and delivered after such Person had become such
Trustee but to which such Person, as such Trustee, was not a party.
"Indexed Security" means a Security the terms of which provide
that the principal amount thereof payable at Stated Maturity may be more or less
than the principal face amount thereof at original issuance.
<PAGE> 18
8
"interest", when used with respect to an Original Issue
Discount Security which by its terms bears interest only after Maturity, means
interest payable after Maturity at the rate prescribed in such Original Issue
Discount Security.
"Interest Payment Date", when used with respect to any
Security, means the Stated Maturity of an installment of interest on such
Security.
"Lien" means any mortgage, charge, pledge, lien (statutory or
otherwise), privilege, security interest, hypothecation, assignment for
security, claim, or preference or priority or other encumbrance upon or with
respect to any property of any kind, real or personal, movable or immovable, now
owned or hereafter acquired. A Person will be deemed to own subject to a Lien
any property that such Person has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, capital lease or other
title retention agreement.
"Market Exchange Rate" means, unless otherwise specified with
respect to any Securities pursuant to Section 301, (i) for any conversion
involving a currency unit on the one hand and Dollars or any Foreign Currency on
the other, the exchange rate between the relevant currency unit and Dollars or
such Foreign Currency calculated by the method specified pursuant to Section 301
for the Securities of the relevant series, (ii) for any conversion of Dollars
into any Foreign Currency, the noon (New York City time) buying rate for such
Foreign Currency for cable transfers quoted in New York City as certified for
customs purposes by the Federal Reserve Bank of New York and (iii) for any
conversion of one Foreign Currency into Dollars or another Foreign Currency, the
spot rate at noon local time in the relevant market at which, in accordance with
normal banking procedures, the Dollars or Foreign Currency into which conversion
is being made could be purchased with the Foreign Currency from which conversion
is being made from major banks located in either New York City, London or any
other principal market for Dollars or such purchased Foreign Currency, in each
case determined by the Exchange Rate Agent. Unless otherwise specified with
respect to any Securities pursuant to Section 301, in the event of the
unavailability of any of the exchange rates provided for in the foregoing
clauses (i), (ii) and (iii), the Exchange Rate Agent shall use, in its sole
discretion and without liability on its part, such quotation of the Federal
Reserve Bank of New York as of the most recent available date, or quotations
from one or more major banks in New York City, London or another principal
market for the Currency in question, or such other quotations as the Exchange
Rate Agent shall deem appropriate. Unless otherwise specified by the Exchange
Rate Agent, if there is more than one market for dealing in any Currency by
reason of foreign exchange regulations or otherwise, the market to be used in
respect of such Currency shall be that upon which a non-resident issuer of
securities designated in such Currency would purchase such Currency in order to
make payments in respect of such securities.
<PAGE> 19
9
"Maturity", when used with respect to any Security, means the
date on which the principal of such Security or an installment of principal
becomes due and payable as therein or herein provided, whether at the Stated
Maturity or by declaration of acceleration, notice of redemption, notice of
option to elect repayment or otherwise.
"Officers' Certificate" means a certificate signed by (i) the
Chairman, the Chief Executive Officer, a Vice Chairman, the President, a Vice
President, or the Treasurer of the Company and (ii) the Secretary or an
Assistant Secretary of the Company, and delivered to the Trustee; provided,
however, that such certificate may be signed by two of the officers or directors
listed in clause (i) above in lieu of being signed by one of such officers or
directors listed in clause (i) and one of the officers listed in clause (ii)
above.
"Opinion of Counsel" means a written opinion of counsel, who
may be counsel for the Company and who shall be acceptable to the Trustee. Each
such opinion shall include the statements provided for in the Trust Indenture
Act Section 314(e) to the extent applicable.
"Original Issue Discount Security" means any Security which
provides for an amount less than the principal amount thereof to be due and
payable upon a declaration of acceleration of the Maturity thereof pursuant to
Section 502.
"Outstanding", when used with respect to Securities, means, as
of the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:
(i) Securities theretofore cancelled by the Trustee or
delivered to the Trustee for cancellation;
(ii) Securities, or portions thereof, for whose payment or
redemption or repayment at the option of the Holder money in the
necessary amount has been theretofore deposited with the Trustee or any
Paying Agent (other than the Company) in trust or set aside and
segregated in trust by the Company (if the Company shall act as its own
Paying Agent) for the Holders of such Securities and any coupons
appertaining thereto; provided that, if such Securities are to be
redeemed, notice of such redemption has been duly given pursuant to
this Indenture or provision therefor satisfactory to the Trustee has
been made;
(iii) Securities, except to the extent provided in Sections
1402 and 1403, with respect to which the Company has effected
defeasance and/or covenant defeasance as provided in Article Fourteen;
and
<PAGE> 20
10
(iv) Securities which have been paid pursuant to Section 306
or in exchange for or in lieu of which other Securities have been
authenticated and delivered pursuant to this Indenture, other than any
such Securities in respect of which there shall have been presented to
the Trustee proof satisfactory to it that such Securities are held by a
bona fide purchaser in whose hands such Securities are valid
obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder or are present at
a meeting of Holders for quorum purposes, and for the purpose of making the
calculations required by TIA Section 313, (i) the principal amount of an
Original Issue Discount Security that may be counted in making such
determination or calculation and that shall be deemed to be Outstanding for such
purpose shall be equal to the amount of principal thereof that would be (or
shall have been declared to be) due and payable, at the time of such
determination, upon a declaration of acceleration of the maturity thereof
pursuant to Section 502, (ii) the principal amount of any Security denominated
in a Foreign Currency that may be counted in making such determination or
calculation and that shall be deemed Outstanding for such purpose shall be equal
to the Dollar equivalent, determined as of the date such Security is originally
issued by the Company as set forth in an Exchange Rate Officers' Certificate
delivered to the Trustee, of the principal amount (or, in the case of an
Original Issue Discount Security, the Dollar equivalent as of such date of
original issuance of the amount determined as provided in clause (i) above) of
such Security, (iii) the principal amount of any Indexed Security that may be
counted in making such determination or calculation and that shall be deemed
outstanding for such purpose shall be equal to the principal face amount of such
Indexed Security at original issuance, unless otherwise provided with respect to
such Security pursuant to Section 301, and (iv) Securities owned by the Company
or any other obligor upon the Securities or any Affiliate of the Company or of
such other obligor shall be disregarded and deemed not to be Outstanding, except
that, in determining whether the Trustee shall be protected in making such
calculation or in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Securities which the Trustee knows to
be so owned shall be so disregarded. Securities so owned which have been pledged
in good faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to such
Securities and that the pledgee is not the Company or any other obligor upon the
Securities or any Affiliate of the Company or such other obligor.
"Paying Agent" means any Person (including the Company acting
as Paying Agent) authorized by the Company to pay the principal of (or premium,
if any) or interest, if any, on any Securities on behalf of the Company.
<PAGE> 21
11
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Place of Payment" means, when used with respect to the
Securities of or within any series, the place or places where the principal of
(and premium, if any) and interest, if any, on such Securities are payable as
specified as contemplated by Sections 301 and 1002.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that evidenced
by such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 306 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security or a Security to which a
mutilated, destroyed, lost or stolen coupon appertains shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security or
the Security to which the mutilated, destroyed, lost or stolen coupon
appertains, as the case may be.
"Redemption Date", when used with respect to any Security to
be redeemed, in whole or in part, means the date fixed for such redemption by or
pursuant to this Indenture.
"Redemption Price", when used with respect to any Security to
be redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Registered Security" means any Security registered in the
Security Register.
"Regular Record Date" for the interest payable on any Interest
Payment Date on the Registered Securities of or within any series means the date
specified for that purpose as contemplated by Section 301.
"Repayment Date" means, when used with respect to any Security
to be repaid at the option of the Holder, the date fixed for such repayment
pursuant to this Indenture.
"Repayment Price" means, when used with respect to any
Security to be repaid at the option of the Holder, the price at which it is to
be repaid pursuant to this Indenture.
"Responsible Officer", when used with respect to the Trustee,
means the chairman or any vice-chairman of the board of directors, the chairman
or any vice-chairman of the executive committee of the board of directors, the
chairman of the trust committee, the president, any vice president, the
secretary, any assistant secretary, the treasurer, any
<PAGE> 22
12
assistant treasurer, the cashier, any assistant cashier, any trust officer or
assistant trust officer, the controller and any assistant controller or any
other officer of the Trustee customarily performing functions similar to those
performed by any of the above-designated officers or assigned by the Trustee to
administer corporate trust matters at its Corporate Trust Office, and also
means, with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of his knowledge of and familiarity with
the particular subject.
"Restricted Securities" has the meaning specified in the
"Limitation on Liens" covenant.
"Restricted Subsidiary" means any Subsidiary other than an
Unrestricted Subsidiary.
"Securities" has the meaning stated in the first recital of
this Indenture and more particularly means any Securities authenticated and
delivered under this Indenture; provided, however, that if at any time there is
more than one Person acting as Trustee under this Indenture, "Securities" with
respect to the Indenture as to which such Person is Trustee shall have the
meaning stated in the first recital of this Indenture and shall more
particularly mean Securities authenticated and delivered under this Indenture,
exclusive, however, of Securities of any series as to which such Person is not
Trustee.
"Security Register" and "Security Registrar" have the
respective meanings specified in Section 305.
"Significant Subsidiary" means any Restricted Subsidiary of
the Company that together with its Subsidiaries, (a) for the most recent fiscal
year of the Company, accounted for more than 10% of the consolidated net sales
of the Company and its Restricted Subsidiaries or (b) as of the end of such
fiscal year, was the owner of more than 10% of the total finance and other
income of the Company and its Restricted Subsidiaries, in the case of either (a)
or (b), as set forth on the most recently available consolidated financial
statements of the Company for such fiscal year or (c) was organized or acquired
since the end of such fiscal year and would have been a Significant Subsidiary
if it had been owned during such fiscal year.
"Special Record Date" for the payment of any Defaulted
Interest on the Registered Securities of or within any series means a date fixed
by the Trustee pursuant to Section 307.
"Stated Maturity" means, when used with respect to any
Security or any installment of interest thereon, the date specified in such
Security as the fixed date on which the principal of such Security or such
installment of interest is due and payable and, when
<PAGE> 23
13
used with respect to any other Debt, means the date specified in the instrument
governing such Debt as the fixed date on which the principal of such Debt or any
installment of interest thereon is due and payable.
"Subsidiary" means any person a majority of the equity
ownership or Voting Stock of which is at the time owned, directly or indirectly,
by the Company and/or one or more other Subsidiaries of the Company.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act
of 1939 as in force at the date as of which this Indenture was executed, except
as provided in Section 905.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this Indenture until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean or include each Person who is then a Trustee hereunder;
provided, however, that if at any time there is more than one such Person,
"Trustee" as used with respect to the Securities of any series shall mean only
the Trustee with respect to Securities of that series.
"United States" means, unless otherwise specified with respect
to any Securities pursuant to Section 301, the United States of America
(including the states and the District of Columbia), its territories, its
possessions and other areas subject to its jurisdiction.
"United States person" means, unless otherwise specified with
respect to any Securities pursuant to Section 301, an individual who is a
citizen or resident of the United States, a corporation, partnership or other
entity created or organized in or under the laws of the United States or an
estate or trust the income of which is subject to United States federal income
taxation regardless of its source.
"Unrestricted Subsidiary" means (a) any Subsidiary that is
designated by the Board of Directors as an Unrestricted Subsidiary in accordance
with the "Unrestricted Subsidiaries" covenant and (b) any Subsidiary of an
Unrestricted Subsidiary.
"Valuation Date" has the meaning specified in Section 312(c).
"Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president".
"Voting Stock" means any class or classes of Capital Stock
pursuant to which the holders thereof have the general voting power under
ordinary circumstances to elect at least a majority of the board of directors,
managers or trustees of any Person (irrespective of
<PAGE> 24
14
whether or not, at the time, stock of any other class or classes has or might
have voting power by reason of the happening of any contingency).
"Yield to Maturity" means the yield to maturity, computed at
the time of issuance of a Security (or, if applicable, at the most recent
redetermination of interest on such Security) and as set forth in such Security
in accordance with generally accepted United States bond yield computation
principles.
SECTION 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee
to take any action under any provision of this Indenture, the Company shall
furnish to the Trustee an Officers' Certificate stating that all conditions
precedent, if any, provided for in this Indenture (including any covenant
compliance with which constitutes a condition precedent) 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, if any, have been
complied with, except that in the case of any such application or request as to
which the furnishing of such documents is specifically required by any provision
of this Indenture relating to such particular application or request, no
additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
covenant or condition provided for in this Indenture shall include:
(1) a statement that each individual signing such certificate
or opinion has read such covenant or condition and the definitions
herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such individual,
he has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such covenant or condition has been complied with.
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SECTION 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
SECTION 104. Acts of Holders.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be given or taken
by Holders of the Outstanding Securities of all series or one or more series, as
the case may be, may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agents duly
appointed in writing. If Securities of a series are issuable as Bearer
Securities, any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Holders of such series may, alternatively, be embodied in and evidenced by the
record of Holders of Securities of such series voting in favor thereof, either
in person or by proxies duly appointed in writing, at any meeting of Holders of
Securities of such series duly called and held in accordance with the provisions
of Article Fifteen, or a combination of such instruments and any such record.
Except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments or record or both are delivered to
the Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments and any such record (and the action embodied therein
and evidenced thereby) are herein sometimes referred to as the "Act" of the
Holders signing such instrument or instruments or so voting at
<PAGE> 26
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any such meeting. Proof of execution of any such instrument or of a writing
appointing any such agent, or of the holding by any Person of a Security, shall
be sufficient for any purpose of this Indenture and conclusive in favor of the
Trustee and the Company, if made in the manner provided in this Section. The
record of any meeting of Holders of Securities shall be proved in the manner
provided in Section 1506.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.
(c) The principal amount and serial numbers of Registered
Securities held by any Person, and the date of holding the same, shall be proved
by the Security Register.
(d) The principal amount and serial numbers of Bearer
Securities held by any Person, and the date of holding the same, may be proved
by the production of such Bearer Securities or by a certificate executed, as
depositary, by any trust company, bank, banker or other depositary, wherever
situated, if such certificate shall be deemed by the Trustee to be satisfactory,
showing that at the date therein mentioned such Person had on deposit with such
depositary, or exhibited to it, the Bearer Securities therein described; or such
facts may be proved by the certificate or affidavit of the Person holding such
Bearer Securities, if such certificate or affidavit is deemed by the Trustee to
be satisfactory. The Trustee and the Company may assume that such ownership of
any Bearer Security continues until (1) another certificate or affidavit bearing
a later date issued in respect of the same Bearer Security is produced, or (2)
such Bearer Security is produced to the Trustee by some other Person, or (3)
such Bearer Security is surrendered in exchange for a Registered Security, or
(4) such Bearer Security is no longer Outstanding. The principal amount and
serial numbers of Bearer Securities held by any Person, and the date of holding
the same, may also be proved in any other manner that the Trustee deems
sufficient.
(e) If the Company shall solicit from the Holders of
Registered Securities any request, demand, authorization, direction, notice,
consent, waiver or other Act, the Company may, at its option, by or pursuant to
a Board Resolution, fix in advance a record date for the determination of
Holders entitled to give such request, demand, authorization, direction, notice,
consent, waiver or other Act, but the Company shall have no obligation to do so.
Notwithstanding TIA Section 316(c), such record date shall be the record date
specified in or pursuant to such Board Resolution, which shall be a date not
earlier than the
<PAGE> 27
17
date 30 days prior to the first solicitation of Holders generally in connection
therewith and not later than the date such solicitation is completed. If such a
record date is fixed, such request, demand, authorization, direction, notice,
consent, waiver or other Act may be given before or after such record date, but
only the Holders of record at the close of business on such record date shall be
deemed to be Holders for the purposes of determining whether Holders of the
requisite proportion of Outstanding Securities have authorized or agreed or
consented to such request, demand, authorization, direction, notice, consent,
waiver or other Act, and for that purpose the Outstanding Securities shall be
computed as of such record date; provided that no such authorization, agreement
or consent by the Holders on such record date shall be deemed effective unless
it shall become effective pursuant to the provisions of this Indenture not later
than eleven months after the record date.
(f) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Trustee or
the Company in reliance thereon, whether or not notation of such action is made
upon such Security.
SECTION 105. Notices, etc. to Trustee and Company.
Any request, demand, authorization, direction, notice,
consent, waiver or Act of Holders or other documents provided or permitted by
this Indenture to be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be
sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Trustee at its Corporate Trust Office,
Attention: Corporate Trust Administration Division, or
(2) the Company by the Trustee or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage
prepaid, to the Company addressed to it at the address of its principal
office specified in the first paragraph of this Indenture or at any
other address previously furnished in writing to the Trustee by the
Company.
SECTION 106. Notice to Holders; Waiver.
Where this Indenture provides for notice of any event to
Holders of Registered Securities by the Company or the Trustee, such notice
shall be sufficiently given (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to each such Holder affected by
such event, at his address as it appears in the Security Register,
<PAGE> 28
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not later than the latest date, and not earlier than the earliest date,
prescribed for the giving of such notice. In any case where notice to Holders of
Registered Securities 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 of Registered
Securities or the sufficiency of any notice to Holders of Bearer Securities
given as provided. Any notice mailed to a Holder in the manner herein prescribed
shall be conclusively deemed to have been received by such Holder, whether or
not such Holder actually receives such notice.
In case, by reason of the suspension of or irregularities in
regular mail service or by reason of any other cause, it shall be impractical to
mail notice of any event to Holders of Registered Securities 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 satisfactory to the Trustee shall be
deemed to be sufficient giving of such notice for every purpose hereunder.
Except as otherwise expressly provided herein or otherwise
specified with respect to any Securities pursuant to Section 301, where this
Indenture provides for notice to Holders of Bearer Securities of any event, such
notice shall be sufficiently given to Holders of Bearer Securities if published
in an Authorized Newspaper in The City of New York and in such other city or
cities as may be specified in such Securities on a Business Day at least twice,
the first such publication to be not earlier than the earliest date, and not
later than the latest date, prescribed for the giving of such notice. Any such
notice shall be deemed to have been given on the date of the first such
publication.
In case, by reason of the suspension of publication of any
Authorized Newspaper or Authorized Newspapers or by reason of any other cause,
it shall be impracticable to publish any notice to Holders of Bearer Securities
as provided above, then such notification to Holders of Bearer Securities as
shall be given with the approval of the Trustee shall constitute sufficient
notice to such Holders for every purpose hereunder. Neither the failure to give
notice by publication to Holders of Bearer Securities as provided above, nor any
defect in any notice so published, shall affect the sufficiency of such notice
with respect to other Holders of Bearer Securities or the sufficiency of any
notice to Holders of Registered Securities given as provided herein.
Any request, demand, authorization, direction, notice, consent
or waiver required or permitted under this Indenture shall be in the English
language, except that any published notice may be in an official language of the
country of publication.
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
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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.
SECTION 107. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.
SECTION 108. Successors and Assigns.
All covenants and agreements in this Indenture by the Company
shall bind its successors and assigns, whether so expressed or not.
SECTION 109. Separability Clause.
In case any provision in this Indenture or in any Security or
coupon shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
SECTION 110. Benefits of Indenture.
Nothing in this Indenture or in the Securities or coupons,
express or implied, shall give to any Person, other than the parties hereto, any
Authenticating Agent, any Paying Agent, any Securities Registrar and their
successors hereunder and the Holders of Securities or coupons, any benefit or
any legal or equitable right, remedy or claim under this Indenture.
SECTION 111. Governing Law.
This Indenture and the Securities and coupons shall be
governed by and construed in accordance with the law of the State of New York.
This Indenture is subject to the provisions of the Trust Indenture Act that are
required to be part of this Indenture and shall, to the extent applicable, be
governed by such provisions.
SECTION 112. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date,
sinking fund payment date or Stated Maturity or Maturity of any Security shall
not be a Business Day at any Place of Payment, then (notwithstanding any other
provision of this Indenture or of any Security or coupon other than a provision
in the Securities of any series which specifically states that such provision
shall apply in lieu of this Section), payment of principal (or premium, if any)
or interest, if any, need not be made at such Place of Payment on such date, but
may be made on the next succeeding Business Day at such Place of Payment with
<PAGE> 30
20
the same force and effect as if made on the Interest Payment Date or Redemption
Date or sinking fund payment date, or at the Stated Maturity or Maturity;
provided that no interest shall accrue for the period from and after such
Interest Payment Date, Redemption Date, sinking fund payment date, Stated
Maturity or Maturity, as the case may be.
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally.
The Registered Securities, if any, of each series and the
Bearer Securities, if any, of each series and related coupons shall be in
substantially the forms as shall be established by or pursuant to a Board
Resolution or in one or more indentures supplemental hereto, in each case with
such appropriate insertions, omissions, substitutions and other variations as
are required or permitted by this Indenture, and may have such letters, numbers
or other marks of identification and such legends or endorsements placed thereon
as may be required to comply with the rules of any securities exchange or as
may, consistently herewith, be determined by the officers executing such
Securities or coupons, as evidenced by their execution of the Securities or
coupons. If the forms of Securities or coupons of any series are established by
action taken pursuant to a Board Resolution, a copy of an appropriate record of
such action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the Company
Order contemplated by Section 303 for the authentication and delivery of such
Securities or coupons. Any portion of the text of any Security may be set forth
on the reverse thereof, with an appropriate reference thereto on the face of the
Security.
Unless otherwise specified as contemplated by Section 301,
Securities in bearer form shall have interest coupons attached.
The Trustee's certificate of authentication on all Securities
shall be in substantially the form set forth in this Article.
The definitive Securities and coupons shall be printed,
lithographed or engraved on steel-engraved borders or may be produced in any
other manner, all as determined by the officers of the Company executing such
Securities, as evidenced by their execution of such Securities or coupons.
<PAGE> 31
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SECTION 202. Form of Trustee's Certificate of Authentication.
Subject to Section 611, the Trustee's certificate of
authentication shall be in substantially the following form:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
Dated: ____________________
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
FIRST TRUST NATIONAL ASSOCIATION,
as Trustee
By _________________________________
Authorized Officer
SECTION 203. Securities Issuable in Global Form.
If Securities of or within a series are issuable in global
form, as specified as contemplated by Section 301, then, notwithstanding clause
(8) of Section 301, any such Security shall represent such of the Outstanding
Securities of such series as shall be specified therein and may provide that it
shall represent the aggregate amount of Outstanding Securities of such series
from time to time endorsed thereon and that the aggregate amount of Outstanding
Securities of such series represented thereby may from time to time be increased
or decreased to reflect exchanges. Any endorsement of a Security in global form
to reflect the amount, or any increase or decrease in the amount, of Outstanding
Securities represented thereby shall be made by the Trustee in such manner and
upon instructions given by such Person or Persons as shall be specified therein
or in the Company Order to be delivered to the Trustee pursuant to Section 303
or Section 304. Subject to the provisions of Section 303 and, if applicable,
Section 304, the Trustee shall deliver and redeliver any Security in permanent
global form in the manner and upon instructions given by the Person or Persons
specified therein or in the applicable Company Order. If a Company Order
pursuant to Section 303 or Section 304 has been, or simultaneously is,
delivered, any instructions by the Company with respect to endorsement or
delivery or redelivery of a Security in global form shall be in writing but need
not comply with Section 102 and need not be accompanied by an Opinion of
Counsel.
The provisions of the last sentence of Section 303 shall apply
to any Security represented by a Security in global form if such Security was
never issued and sold by the
<PAGE> 32
22
Company and the Company delivers to the Trustee the Security in global form
together with written instructions (which need not comply with Section 102 and
need not be accompanied by an Opinion of Counsel) with regard to the reduction
in the principal amount of Securities represented thereby, together with the
written statement contemplated by the last sentence of Section 303.
Notwithstanding the provisions of Section 307, unless
otherwise specified as contemplated by Section 301, payment of principal of (and
premium, if any) and interest, if any, on any Security in permanent global form
shall be made to the Person or Persons specified therein.
Notwithstanding the provisions of Section 309 and except as
provided in the preceding paragraph, the Company, the Trustee and any agent of
the Company and the Trustee shall treat as the Holder of such principal amount
of Outstanding Securities represented by a permanent global Security (i) in the
case of a permanent global Security in registered form, the Holder of such
permanent global Security in registered form, or (ii) in the case of a permanent
global Security in bearer form, Euroclear or CEDEL S.A.
ARTICLE THREE
THE SECURITIES
SECTION 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There
shall be established in one or more Board Resolutions or pursuant to authority
granted by one or more Board Resolutions and, subject to Section 303, set forth
in, or determined in the manner provided in, an Officers' Certificate, or
established in one or more indentures supplemental hereto, prior to the issuance
of Securities of any series, any or all of the following, as applicable (each of
which (except for the matters set forth in clauses (1), (2) and (17) below), if
so provided, may be determined from time to time by the Company with respect to
unissued Securities of the series and set forth in such Securities of the series
when issued from time to time):
(1) the title of the Securities of the series (which shall
distinguish the Securities of the series from all other series of
Securities);
<PAGE> 33
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(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 304, 305, 306, 906, 1107
or 1305);
(3) the Person to whom any interest on any Security of any
series is payable if other than the Person in whose name the Securities
of such series are registered on the Regular Record Date;
(4) the date or dates, or the method by which such date or
dates will be determined or extended, 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, or the method by which such rate or rates
shall be determined, the date or dates from which such interest shall
accrue, or the method by which such date or dates shall be determined,
the Interest Payment Dates on which such interest shall be payable and
the Regular Record Date, if any, for the interest payable on any
Registered Security on any Interest Payment Date, or the method by
which such date or dates shall be determined, and the basis upon which
interest shall be calculated if other than on the basis of a 360-day
year of twelve 30-day months;
(6) the place or places, if any, other than or in addition to
the Borough of Manhattan, The City of New York, where the principal of
(and premium, if any) and interest, if any, on Securities of the series
shall be payable, where any Registered Securities of the series may be
surrendered for registration of transfer, where Securities of the
series may be surrendered for exchange, where Securities of the series
that are convertible or exchangeable may be surrendered for conversion
or exchange, as applicable and, if different than the location
specified in Section 106, the place or places where notices or demands
to or upon the Company in respect of the Securities of the series and
this Indenture may be served;
(7) the period or periods within which, and the events upon
the occurrence of which, the price or prices at which, the Currency in
which, and other terms and conditions upon which Securities of the
series may be redeemed, in whole or in part, at the option of the
Company, if the Company is to have that option;
(8) the obligation, if any, of the Company to redeem, repay or
purchase Securities of the series pursuant to any sinking fund or
analogous provision or at the option of a Holder thereof, and the
period or periods within which, the price or prices at which, the
Currency in which, and other terms and conditions upon which
<PAGE> 34
24
Securities of the series shall be redeemed, repaid or purchased, in
whole or in part, pursuant to such obligation;
(9) if other than denominations of $1,000 and any integral
multiple thereof, the denomination or denominations in which any
Registered Securities of the series shall be issuable and, if other
than denominations of $5,000, the denomination or denominations in
which any Bearer Securities of the series shall be issuable;
(10) whether the amount of payments of principal of (or
premium, if any) or interest, if any, on the Securities of the series
may be determined with reference to an index, formula or other method
(which index, formula or method may be based, without limitation, on
one or more Currencies, commodities, equity indices or other indices),
and the manner in which such amounts shall be determined;
(11) if other than Dollars, the Currency in which payment of
the principal of (or premium, if any) or interest, if any, on the
Securities of the series shall be payable or in which the Securities of
the series shall be denominated and the particular provisions
applicable thereto in accordance with, in addition to or in lieu of any
of the provisions of Section 312;
(12) whether the principal of (or premium, if any) or
interest, if any, on the Securities of the series are to be payable, at
the election of the Company or a Holder thereof, in a Currency other
than that in which such Securities are denominated or stated to be
payable, the period or periods within which (including the Election
Date), and the terms and conditions upon which, such election may be
made, and the time and manner of determining the exchange rate between
the Currency in which such Securities are denominated or stated to be
payable and the Currency in which such Securities are to be so payable,
in each case in accordance with, in addition to or in lieu of any of
the provisions of Section 312;
(13) 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
pursuant to Section 502 or the method by which such portion shall be
determined;
(14) if the principal amount of the Securities of the series
payable at the Maturity thereof is not determinable as of any date
prior to such Maturity, the amount which shall be deemed to be the
Outstanding principal amount of the Securities of such series;
<PAGE> 35
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(15) the applicability, if any, of Sections 1402 and/or 1403
to the Securities of the series and any provisions in modification of,
in addition to or in lieu of any of the provisions of Article Fourteen
that shall be applicable to the Securities of the series;
(16) whether Securities of the series are to be issuable as
Registered Securities, Bearer Securities (with or without coupons) or
both, any restrictions applicable to the offer, sale or delivery of
Bearer Securities, whether any Securities of the series are to be
issuable initially in temporary global form and whether any Securities
of the series are to be issuable in permanent global form with or
without coupons and, if so, whether beneficial owners of interests in
any such permanent global Security may exchange such interests for
Securities of such series and of like tenor of any authorized form and
denomination and the circumstances under which any such exchanges may
occur, if other than in the manner provided in Section 305, whether
Registered Securities of the series may be exchanged for Bearer
Securities of the series (if permitted by applicable laws and
regulations), whether Bearer Securities of the series may be exchanged
for Registered Securities of such series, and the circumstances under
which and the place or places where any such exchanges may be made and
if Securities of the series are to be issuable in global form, the
identity of any initial depository therefor;
(17) any deletions from, modifications of or additions to the
Events of Default of the Company with respect to Securities of the
series, whether or not such Events of Default are consistent with the
Events of Default set forth herein;
(18) any deletions from, modifications of or additions to the
covenants with respect to Securities of the series, whether or not such
covenants are consistent with the covenants set forth herein;
(19) if the Securities of the series are to be secured; and
(20) any other terms, conditions, rights and preferences (or
limitations on such rights and preferences) relating to the series
(which terms shall not be inconsistent with the requirements of the
Trust Indenture Act or the provisions of this Indenture).
All Securities of any one series and the coupons appertaining
to any Bearer Securities of such series shall be substantially identical except,
in the case of Registered Securities, as to denomination and except as may
otherwise be provided in or pursuant to such Board Resolution (subject to
Section 303) and set forth in such Officers' Certificate or in any such
indenture supplemental hereto. Not all Securities of any one series need be
<PAGE> 36
26
issued at the same time, and, unless otherwise provided, a series may be
reopened for issuances of additional Securities of such series.
If any of the terms of the series are established by action
taken pursuant to one or more Board Resolutions, such Board Resolutions shall be
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
SECTION 302. Denominations.
The Securities of each series shall be issuable in such
denominations as shall be specified as contemplated by Section 301. With respect
to Securities of any series denominated in Dollars, in the absence of any such
provisions, the Registered Securities of such series, other than Registered
Securities issued in global form (which may be of any denomination), shall be
issuable in denominations of $1,000 and any integral multiple thereof and the
Bearer Securities of such series, other than the Bearer Securities issued in
global form (which may be of any denomination), shall be issuable in a
denomination of $5,000.
SECTION 303. Execution, Authentication, Delivery and Dating.
The Securities and any coupons appertaining thereto shall be
executed on behalf of the Company by its Chairman, its President or an Executive
Vice President, under its corporate seal reproduced thereon attested by its
Secretary or an Assistant Secretary. The signature of any of these officers on
the Securities or coupons may be the manual or facsimile signatures of the
present or any future such authorized officer and may be imprinted or otherwise
reproduced on the Securities.
Securities or coupons bearing the manual or facsimile
signatures of individuals who were at any time the proper officers of the
Company shall bind the Company, notwithstanding that such individuals or any of
them have ceased to hold such offices prior to the authentication and delivery
of such Securities or did not hold such offices at the date of such Securities
or coupons.
At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities of any series
together with any coupon appertaining thereto, executed by the Company to the
Trustee for authentication, together with a Company Order for the authentication
and delivery of such Securities, and the Trustee in accordance with such Company
Order shall authenticate and deliver such Securities; provided, however, that,
in connection with its original issuance, no Bearer Security shall be mailed or
otherwise delivered to any location in the United States; and provided further
that, unless otherwise specified with respect to any series of Securities
pursuant to Section 301, a Bearer Security may be delivered in connection with
its original issuance only if the Person entitled to receive such Bearer
Security shall have furnished a certificate in the form set forth
<PAGE> 37
27
in Exhibit A-1 to this Indenture, dated no earlier than 15 days prior to the
earlier of the date on which such Bearer Security is delivered and the date on
which any temporary Security first becomes exchangeable for such Bearer Security
in accordance with the terms of such temporary Security and this Indenture. If
any Security shall be represented by a permanent global Bearer Security, then,
for purposes of this Section and Section 304, the notation of a beneficial
owner's interest therein upon original issuance of such Security or upon
exchange of a portion of a temporary global Security shall be deemed to be
delivery in connection with its original issuance of such beneficial owner's
interest in such permanent global Security. Except as permitted by Section 306,
the Trustee shall not authenticate and deliver any Bearer Security unless all
appurtenant coupons for interest then matured have been detached and cancelled.
If not all the Securities of any series are to be issued at one time and if the
Board Resolution or supplemental indenture establishing such series shall so
permit, such Company Order may set forth procedures acceptable to the Trustee
for the issuance of such Securities and determining terms of particular
Securities of such series such as interest rate, stated maturity, date of
issuance and date from which interest shall accrue.
In authenticating such Securities, and accepting the
additional responsibilities under this Indenture in relation to such Securities,
the Trustee shall be entitled to receive, and (subject to TIA Sections 315(a)
through 315(d)) shall be fully protected in relying upon, an Opinion of Counsel
stating:
(a) that the form or forms of such Securities and any coupons
have been established in conformity with the provisions of this
Indenture;
(b) that the terms of such Securities and any coupons have
been established in conformity with the provisions of this Indenture;
(c) that such Securities, together with any coupons
appertaining thereto, when completed by appropriate insertions and
executed and delivered by the Company to the Trustee for authentication
in accordance with this Indenture, authenticated and delivered by the
Trustee in accordance with this Indenture and issued by the Company in
the manner and subject to any conditions specified in such Opinion of
Counsel, will constitute the legal, valid and binding obligations of
the Company, enforceable in accordance with their terms, subject to
applicable bankruptcy, insolvency, reorganization and other similar
laws of general applicability relating to or affecting the enforcement
of creditors' rights, to general equitable principles and to such other
qualifications as such counsel shall conclude do not materially affect
the rights of Holders of such Securities and any coupons;
(d) that all laws and requirements in respect of the execution
and delivery by the Company of such Securities, any coupons and of the
supplemental indentures, if any, have been complied with and that
authentication and delivery of such
<PAGE> 38
28
Securities and any coupons and the execution and delivery of the
supplemental indenture, if any, by the Trustee will not violate the
terms of the Indenture;
(e) that the Company has the corporate power to issue such
Securities and any coupons, and has duly taken all necessary corporate
action with respect to such issuance; and
(f) that the issuance of such Securities and any coupons will
not contravene the articles of incorporation or by-laws of the Company
or result in any violation of any of the terms or provisions of any law
or regulation or of any indenture, mortgage or other agreement known to
such Counsel by which the Company is bound.
Notwithstanding the provisions of Section 301 and of the
preceding two paragraphs, if not all the Securities of any series are to be
issued at one time, it shall not be necessary to deliver the Officers'
Certificate otherwise required pursuant to Section 301 or the Company Order and
Opinion of Counsel otherwise required pursuant to the preceding two paragraphs
prior to or at the time of issuance of each Security, but such documents shall
be delivered prior to or at the time of issuance of the first Security of such
series.
The Trustee shall not be required to authenticate and deliver
any such Securities if the issue of such Securities pursuant to this Indenture
will affect the Trustee's own rights, duties or immunities under the Securities
and this Indenture or otherwise in a manner which is not reasonably acceptable
to the Trustee.
Each Registered Security shall be dated the date of its
authentication and each Bearer Security shall be dated as of the date specified
as contemplated by Section 301.
No Security or coupon shall be entitled to any benefit under
this Indenture or be valid or obligatory for any purpose unless there appears on
such Security a certificate of authentication substantially in the form provided
for herein duly executed by the Trustee by manual signature of an authorized
signatory, and such certificate upon any Security shall be conclusive evidence,
and the only evidence, that such Security has been duly authenticated and
delivered hereunder and is entitled to the benefits of this Indenture.
Notwithstanding the foregoing, if any Security shall have been authenticated and
delivered hereunder but never issued and sold by the Company, and the Company
shall deliver such Security to the Trustee for cancellation as provided in
Section 310 together with a written statement (which need not comply with
Section 102 and need not be accompanied by an Opinion of Counsel) stating that
such Security has never been issued and sold by the Company, for all purposes of
this Indenture such Security shall be deemed never to have been authenticated
and delivered hereunder and shall never be entitled to the benefits of this
Indenture.
<PAGE> 39
29
SECTION 304. Temporary Securities.
Pending the preparation of definitive Securities of any
series, the Company may execute, and upon Company Order the Trustee shall
authenticate and deliver, temporary Securities which are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued, in registered form or, if authorized, in bearer form with one or
more coupons or without coupons, and with such appropriate insertions,
omissions, substitutions and other variations as conclusively the officers
executing such Securities may determine, as conclusively evidenced by their
execution of such Securities. Such temporary Securities may be in global form.
Except in the case of temporary Securities in global form
(which shall be exchanged in accordance with the provisions of the following
paragraphs), if temporary Securities of any series are issued, the Company will
cause definitive Securities of that series to be prepared without unreasonable
delay. After the preparation of definitive Securities of such series, the
temporary Securities of such series shall be exchangeable for definitive
Securities of such series upon surrender of the temporary Securities of such
series at the office or agency of the Company in a Place of Payment for that
series, without charge to the Holder. Upon surrender for cancellation of any one
or more temporary Securities of any series (accompanied by any unmatured coupons
appertaining thereto), the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal amount of
definitive Securities of the same series of authorized denominations; provided,
however, that no definitive Bearer Security shall be delivered in exchange for a
temporary Registered Security; and provided further that a definitive Bearer
Security shall be delivered in exchange for a temporary Bearer Security only in
compliance with the conditions set forth in Section 303. Until so exchanged the
temporary Securities of any series shall in all respects be entitled to the same
benefits under this Indenture as definitive Securities of such series.
If temporary Securities of any series are issued in global
form, any such temporary global Security shall, unless otherwise provided
therein, be delivered to the London office of a depositary or common depositary
(the "Common Depositary"), for the benefit of Euroclear and CEDEL S.A., for
credit to the respective accounts of the beneficial owners of such Securities
(or to such other accounts as they may direct).
Without unnecessary delay but in any event not later than the
date specified in, or determined pursuant to the terms of, any such temporary
global Security (the "Exchange Date"), the Company shall deliver to the Trustee
definitive Securities, in aggregate principal amount equal to the principal
amount of such temporary global Security, executed by the Company. On or after
the Exchange Date such temporary global Security shall be surrendered by the
Common Depositary to the Trustee, as the Company's agent for such
<PAGE> 40
30
purpose, to be exchanged, in whole or from time to time in part, for definitive
Securities without charge and the Trustee shall authenticate and deliver, in
exchange for each portion of such temporary global Security, an equal aggregate
principal amount of definitive Securities of the same series of authorized
denominations and of like tenor as the portion of such temporary global Security
to be exchanged. The definitive Securities to be delivered in exchange for any
such temporary global Security shall be in bearer form, registered form,
permanent global bearer form or permanent global registered form, or any
combination thereof, as specified as contemplated by Section 301, and, if any
combination thereof is so specified, as requested by the beneficial owner
thereof; provided, however, that, unless otherwise specified in such temporary
global Security, upon such presentation by the Common Depositary, such temporary
global Security is accompanied by a certificate dated the Exchange Date or a
subsequent date and signed by Euroclear as to the portion of such temporary
global Security held for its account then to be exchanged and a certificate
dated the Exchange Date or a subsequent date and signed by CEDEL S.A. as to the
portion of such temporary global Security held for its account then to be
exchanged, each in the form set forth in Exhibit A-2 to this Indenture (or in
such other form as may be established pursuant to Section 301); and provided
further that definitive Bearer Securities shall be delivered in exchange for a
portion of a temporary global Security only in compliance with the requirements
of Section 303.
Unless otherwise specified in such temporary global Security,
the interest of a beneficial owner of Securities of a series in a temporary
global Security shall be exchanged for definitive Securities of the same series
and of like tenor following the Exchange Date when the account holder instructs
Euroclear or CEDEL S.A., as the case may be, to request such exchange on his
behalf and delivers to Euroclear or CEDEL S.A., as the case may be, a
certificate in the form set forth in Exhibit A-1 to this Indenture (or in such
other form as may be established pursuant to Section 301), dated no earlier than
15 days prior to the Exchange Date, copies of which certificate shall be
available from the offices of Euroclear and CEDEL S.A., the Trustee, any
Authenticating Agent appointed for such series of Securities and each Paying
Agent. Unless otherwise specified in such temporary global Security, any such
exchange shall be made free of charge to the beneficial owners of such temporary
global Security, except that a Person receiving definitive Securities must bear
the cost of insurance, postage, transportation and the like in the event that
such Person does not take delivery of such definitive Securities in person at
the offices of Euroclear or CEDEL S.A. Definitive Securities in bearer form to
be delivered in exchange for any portion of a temporary global Security shall be
delivered only outside the United States.
Until exchanged in full as hereinabove provided, the temporary
Securities of any series shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities of the same series and of like
tenor authenticated and delivered hereunder, except that, unless otherwise
specified as contemplated by Section 301, interest payable on a temporary global
Security on an Interest Payment Date for Securities of such
<PAGE> 41
31
series occurring prior to the applicable Exchange Date shall be payable to
Euroclear and CEDEL S.A. on such Interest Payment Date upon delivery by
Euroclear and CEDEL S.A. to the Trustee of a certificate or certificates in the
form set forth in Exhibit A-2 to this Indenture (or in such other form as may be
established pursuant to Section 301), for credit without further interest
thereon on or after such Interest Payment Date to the respective accounts of the
Persons who are the beneficial owners of such temporary global Security on such
Interest Payment Date and who have each delivered to Euroclear or CEDEL S.A., as
the case may be, a certificate dated no earlier than 15 days prior to the
Interest Payment Date occurring prior to such Exchange Date in the form set
forth in Exhibit A-1 to this Indenture (or in such other form as may be
established pursuant to Section 301). Notwithstanding anything to the contrary
herein contained, the certifications made pursuant to this paragraph shall
satisfy the certification requirements of the preceding two paragraphs of this
Section and of the third paragraph of Section 303 of this Indenture and the
interests of the Persons who are the beneficial owners of the temporary global
Security with respect to which such certification was made will be exchanged for
definitive Securities of the same series and of like tenor on the Exchange Date
or the date of certification if such date occurs after the Exchange Date,
without further act or deed by such beneficial owners. Except as otherwise
provided in this paragraph, no payments of principal (or premium, if any) or
interest, if any, owing with respect to a beneficial interest in a temporary
global Security will be made unless and until such interest in such temporary
global Security shall have been exchanged for an interest in a definitive
Security. Any interest so received by Euroclear and CEDEL S.A. and not paid as
herein provided shall be returned to the Trustee immediately prior to the
expiration of two years after such Interest Payment Date in order to be repaid
to the Company in accordance with Section 1003.
SECTION 305. Registration, Registration of Transfer and
Exchange.
The Company shall cause to be kept at the Corporate Trust
Office of the Trustee a register for each series of Securities (the registers
maintained in the Corporate Trust Office of the Trustee and in any other office
or agency of the Company in a Place of Payment being herein sometimes
collectively referred to as the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Registered Securities and of transfers of Registered Securities.
The Security Register shall be in written form or any other form capable of
being converted into written form within a reasonable time. At all reasonable
times, the Security Register shall be open to inspection by the Trustee. The
Trustee is hereby initially appointed as security registrar (the "Security
Registrar") for the purpose of registering Registered Securities and transfers
of Registered Securities as herein provided.
Upon surrender for registration of transfer of any Registered
Security of any series at the office or agency in a Place of Payment for that
series, the Company shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated
<PAGE> 42
32
transferee, one or more new Registered Securities of the same series, of any
authorized denominations and of a like aggregate principal amount and tenor.
At the option of the Holder, Registered Securities of any
series may be exchanged for other Registered Securities of the same series, of
any authorized denomination and of a like aggregate principal amount, upon
surrender of the Registered Securities to be exchanged at such office or agency.
Whenever any Registered Securities are so surrendered for exchange, the Company
shall execute, and the Trustee shall authenticate and deliver, the Registered
Securities which the Holder making the exchange is entitled to receive. Unless
otherwise specified with respect to any series of Securities as contemplated by
Section 301, Bearer Securities may not be issued in exchange for Registered
Securities.
If (but only if) expressly permitted in or pursuant to the
applicable Board Resolution and (subject to Section 303) set forth in the
applicable Officers' Certificate, or in any indenture supplemental hereto,
delivered as contemplated by Section 301, at the option of the Holder, Bearer
Securities of any series may be exchanged for Registered Securities of the same
series of any authorized denomination and of a like aggregate principal amount
and tenor, upon surrender of the Bearer Securities to be exchanged at any such
office or agency, with all unmatured coupons and all matured coupons in default
thereto appertaining. If the Holder of a Bearer Security is unable to produce
any such unmatured coupon or coupons or matured coupon or coupons in default,
any such permitted exchange may be effected if the Bearer Securities are
accompanied by payment in funds acceptable to the Company in an amount equal to
the face amount of such missing coupon or coupons, or the surrender of such
missing coupon or coupons may be waived by the Company and the Trustee if there
is furnished to them such security or indemnity as they may require to save each
of them and any Paying Agent harmless. If thereafter the Holder of such Security
shall surrender to any Paying Agent any such missing coupon in respect of which
such a payment shall have been made, such Holder shall be entitled to receive
the amount of such payment; provided, however, that, except as otherwise
provided in Section 1002, interest represented by coupons shall be payable only
upon presentation and surrender of those coupons at an office or agency located
outside the United States. Notwithstanding the foregoing, in case a Bearer
Security of any series is surrendered at any such office or agency in a
permitted exchange for a Registered Security of the same series and like tenor
after the close of business at such office or agency on (i) any Regular Record
Date and before the opening of business at such office or agency on the relevant
Interest Payment Date, or (ii) any Special Record Date and before the opening of
business at such office or agency on the related proposed date for payment of
Defaulted Interest, such Bearer Security shall be surrendered without the coupon
relating to such Interest Payment Date or proposed date for payment, as the case
may be, and interest or Defaulted Interest, as the case may be, will not be
payable on such Interest Payment Date or proposed date for payment, as the case
may be, in respect of the Registered Security issued in exchange for such Bearer
Security, but will be payable only to the Holder of such coupon when due in
accordance with the provisions of this Indenture.
<PAGE> 43
33
Whenever any Securities are so surrendered for exchange, the
Company shall execute, and the Trustee shall authenticate and deliver, the
Securities which the Holder making the exchange is entitled to receive.
Notwithstanding the foregoing, except as otherwise specified
as contemplated by Section 301, any permanent global Security shall be
exchangeable only as provided in this paragraph. If any beneficial owner of an
interest in a permanent global Security is entitled to exchange such interest
for Securities of such series and of like tenor and principal amount of another
authorized form and denomination, as specified as contemplated by Section 301
and provided that any applicable notice provided in the permanent global
Security shall have been given, then without unnecessary delay but in any event
not later than the earliest date on which such interest may be so exchanged, the
Company shall deliver to the Trustee definitive Securities in aggregate
principal amount equal to the principal amount of such beneficial owner's
interest in such permanent global Security, executed by the Company. On or after
the earliest date on which such interests may be so exchanged, such permanent
global Security shall be surrendered by the Common Depositary or such other
depositary as shall be specified in the Company Order with respect thereto to
the Trustee, as the Company's agent for such purpose, to be exchanged, in whole
or from time to time in part, for definitive Securities without charge, and the
Trustee shall authenticate and deliver, in exchange for each portion of such
permanent global Security, an equal aggregate principal amount of definitive
Securities of the same series of authorized denominations and of like tenor as
the portion of such permanent global Security to be exchanged which, unless the
Securities of the series are not issuable both as Bearer Securities and as
Registered Securities, as specified as contemplated by Section 301, shall be in
the form of Bearer Securities or Registered Securities, or any combination
thereof, as shall be specified by the beneficial owner thereof; provided,
however, that no such exchanges may occur during a period beginning at the
opening of business 15 days before any selection of Securities to be redeemed
and ending on the relevant Redemption Date if the Security for which exchange is
requested may be among those selected for redemption; and provided, further,
that no Bearer Security delivered in exchange for a portion of a permanent
global Security shall be mailed or otherwise delivered to any location in the
United States. If a Registered Security is issued in exchange for any portion of
a permanent global Security after the close of business at the office or agency
where such exchange occurs on (i) any Regular Record Date and before the opening
of business at such office or agency on the relevant Interest Payment Date, or
(ii) any Special Record Date and before the opening of business at such office
or agency on the related proposed date for payment of Defaulted Interest,
interest or Defaulted Interest, as the case may be, will not be payable on such
Interest Payment Date or proposed date for payment, as the case may be, in
respect of such Registered Security, but will be payable on such Interest
Payment Date or proposed date for payment, as the case may be, only to the
Person to whom interest in respect of such portion of such permanent global
Security is payable in accordance with the provisions of this Indenture.
<PAGE> 44
34
All Securities issued upon any registration of transfer or
exchange of Securities shall be the valid obligations of the Company, evidencing
the same debt, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.
Every Registered Security presented or surrendered for
registration of transfer or for exchange shall (if so required by the Company or
the Security Registrar) be duly endorsed, or be accompanied by a written
instrument of transfer, in form satisfactory to the Company and the Security
Registrar, duly executed by the Holder thereof or his attorney duly authorized
in writing.
No service charge shall be made for any registration of
transfer or exchange of Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Securities, other
than exchanges pursuant to Section 304, 906, 1107 or 1305 not involving any
transfer.
The Company shall not be required (i) to issue, register the
transfer of or exchange Securities of any series during a period beginning at
the opening of business 15 days before the day of the selection for redemption
of Securities of that series under Section 1103 or 1203 and ending at the close
of business on (A) if Securities of the series are issuable only as Registered
Securities, the day of the mailing of the relevant notice of redemption and (B)
if Securities of the series are issuable as Bearer Securities, the day of the
first publication of the relevant notice of redemption or, if Securities of the
series are also issuable as Registered Securities and there is no publication,
the mailing of the relevant notice of redemption, or (ii) to register the
transfer of or exchange any Registered Security so selected for redemption in
whole or in part, except the unredeemed portion of any Security being redeemed
in part, or (iii) to exchange any Bearer Security so selected for redemption
except that such a Bearer Security may be exchanged for a Registered Security of
that series and like tenor; provided that such Registered Security shall be
simultaneously surrendered for redemption, or (iv) to issue, register the
transfer of or exchange any Security which has been surrendered for repayment at
the option of the Holder, except the portion, if any, of such Security not to be
so repaid.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security or a Security with a mutilated
coupon appertaining to it is surrendered to the Trustee together with, in proper
cases, such security or indemnity as may be required by the Company or the
Trustee to save each of them and any agent of either of them harmless, the
Company shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of the same series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding, with coupons
corresponding to the
<PAGE> 45
35
coupons, if any, appertaining to the surrendered Security, or, in case any such
mutilated Security or coupon has become or is about to become due and payable,
the Company in its discretion may, instead of issuing a new Security, with
coupons corresponding to the coupons, if any, appertaining to the surrendered
Security, pay such Security or coupon.
If there shall be delivered to the Company and to the Trustee
(i) evidence to their satisfaction of the destruction, loss or theft of any
Security or coupon and (ii) such security or indemnity as may be required by
them to save each of them and any agent of either of them harmless, then, in the
absence of notice to the Company or the Trustee that such Security or coupon has
been acquired by a bona fide purchaser, the Company shall execute and upon
Company Order the Trustee shall authenticate and deliver, in lieu of any such
destroyed, lost or stolen Security or in exchange for the Security for which a
destroyed, lost or stolen coupon appertains (with all appurtenant coupons not
destroyed, lost or stolen), a new Security of the same series and of like tenor
and principal amount and bearing a number not contemporaneously outstanding,
with coupons corresponding to the coupons, if any, appertaining to such
destroyed, lost or stolen Security or to the Security to which such destroyed,
lost or stolen coupon appertains.
Notwithstanding the provisions of the previous two paragraphs,
in case any such mutilated, destroyed, lost or stolen Security or coupon has
become or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Security, with coupons corresponding to the coupons, if
any, appertaining to such mutilated, destroyed, lost or stolen Security or to
the Security to which such mutilated, destroyed, lost or stolen coupon
appertains, pay such Security or coupon; provided, however, that payment of
principal of (and premium, if any) and interest, if any, on Bearer Securities
shall, except as otherwise provided in Section 1002, be payable only at an
office or agency located outside the United States and, unless otherwise
specified as contemplated by Section 301, any interest on Bearer Securities
shall be payable only upon presentation and surrender of the coupons
appertaining thereto.
Upon the issuance of any new Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security of any series with its coupons, if any,
issued pursuant to this Section in lieu of any mutilated, destroyed, lost or
stolen Security or in exchange for a Security to which a mutilated, destroyed,
lost or stolen coupon appertains, shall constitute an original additional
contractual obligation of the Company, whether or not the mutilated, destroyed,
lost or stolen Security and its coupons, if any, or the mutilated, destroyed,
lost or stolen coupon shall be at any time enforceable by anyone, and shall be
entitled to all the
<PAGE> 46
36
benefits of this Indenture equally and proportionately with any and all other
Securities of that series and their coupons, if any, duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities or
coupons.
SECTION 307. Payment of Interest; Interest Rights Preserved;
Optional Interest Reset.
(a) Unless otherwise provided as contemplated by Section 301
with respect to any series of Securities, interest, if any, on any Registered
Security which is payable, and is punctually paid or duly provided for, on any
Interest Payment Date shall be paid to the Person in whose name such Security
(or one or more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest at the office or agency of the
Company maintained for such purpose pursuant to Section 1002; provided, however,
that each installment of interest, if any, on any Registered Security may at the
Company's option be paid by (i) mailing a check for such interest, payable to or
upon the written order of the Person entitled thereto pursuant to Section 309,
to the address of such Person as it appears on the Security Register or (ii)
transfer to an account located in the United States maintained by the payee.
Unless otherwise provided as contemplated by Section 301 with
respect to the Securities of any series, payment of interest, if any, may be
made, in the case of a Bearer Security, by transfer to an account located
outside the United States maintained by the payee.
Unless otherwise provided as contemplated by Section 301,
every permanent global Security will provide that interest, if any, payable on
any Interest Payment Date will be paid to each of Euroclear and CEDEL S.A. with
respect to that portion of such permanent global Security held for its account
by the Common Depositary, for the purpose of permitting each of Euroclear and
CEDEL S.A. to credit the interest, if any, received by it in respect of such
permanent global Security to the accounts of the beneficial owners thereof.
Any interest on any Registered Security of any series which is
payable, but is not punctually paid or duly provided for, on any Interest
Payment Date shall forthwith cease to be payable to the Holder on the relevant
Regular Record Date by virtue of having been such Holder, and such defaulted
interest and, if applicable, interest on such defaulted interest (to the extent
lawful) at the rate specified in the Securities of such series (such defaulted
interest and, if applicable, interest thereon herein collectively called
"Defaulted Interest") may be paid by the Company, at its election in each case,
as provided in clause (1) or (2) below:
<PAGE> 47
37
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Registered Securities of
such series (or their respective Predecessor Securities) are registered
at the close of business on a Special Record Date for the payment of
such Defaulted Interest, which shall be fixed in the following manner.
The Company shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each Registered Security of
such series and the date of the proposed payment, and at the same time
the Company shall deposit with the Trustee an amount of money in the
Currency in which the Securities of such series are payable (except as
otherwise specified pursuant to Section 301 for the Securities of such
series and except, if applicable, as provided in Sections 312(b),
312(d) and 312(e)) equal to the aggregate amount proposed to be paid in
respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit on or prior to the date of
the proposed payment, such money when deposited to be held in trust for
the benefit of the Persons entitled to such Defaulted Interest as in
this clause provided. Thereupon the Trustee shall fix a Special Record
Date for the payment of such Defaulted Interest which shall be not more
than 15 days and not less than 10 days prior to the date of the
proposed payment and not less than 10 days after the receipt by the
Trustee of the notice of the proposed payment. The Trustee shall
promptly notify the Company of such Special Record Date and, in the
name and at the expense of the Company, shall cause notice of the
proposed payment of such Defaulted Interest and the Special Record Date
therefor to be given in the manner provided in Section 106, not less
than 10 days prior to such Special Record Date. Notice of the proposed
payment of such Defaulted Interest and the Special Record Date therefor
having been so given, such Defaulted Interest shall be paid to the
Persons in whose name the Registered Securities of such series (or
their respective Predecessor Securities) are registered at the close of
business on such Special Record Date and shall no longer be payable
pursuant to the following clause (2).
(2) The Company may make payment of any Defaulted Interest on
the Registered Securities of any series in any other lawful manner not
inconsistent with the requirements of any securities exchange on which
such Securities may be listed, and upon such notice as may be required
by such exchange, if, after notice given by the Company to the Trustee
of the proposed payment pursuant to this clause, such manner of payment
shall be deemed practicable by the Trustee.
(b) The provisions of this Section 307(b) may be made
applicable to any series of Securities pursuant to Section 301 (with such
modifications, additions or substitutions as may be specified pursuant to such
Section 301). The interest rate (or the spread or spread multiplier used to
calculate such interest rate, if applicable) on any Security of such series may
be reset by the Company on the date or dates specified on the face of such
Security (each an "Optional Reset Date"). The Company may exercise such option
with respect to such Security by notifying the Trustee of such exercise at least
50 but not more
<PAGE> 48
38
than 60 days prior to an Optional Reset Date for such Note, which such notice
shall contain such information as may be required by the Trustee to transmit the
Reset Notice as hereinafter defined. Not later than 40 days prior to each
Optional Reset Date, the Trustee shall transmit, in the manner provided for in
Section 106, to the Holder of any such Security a notice (the "Reset Notice")
indicating whether the Company has elected to reset the interest rate (or the
spread or spread multiplier used to calculate such interest rate, if
applicable), and if so (i) such new interest rate (or such new spread or spread
multiplier, if applicable) and (ii) the provisions, if any, for redemption
during the period from such Optional Reset Date to the next Optional Reset Date
or if there is no such next Optional Reset Date, to the Stated Maturity Date of
such Security (each such period a "Subsequent Interest Period"), including the
date or dates on which or the period or periods during which and the price or
prices at which such redemption may occur during the Subsequent Interest Period.
Notwithstanding the foregoing, not later than 20 days prior to
the Optional Reset Date, the Company may, at its option, revoke the interest
rate (or the spread or spread multiplier used to calculate such interest rate,
if applicable) provided for in the Reset Notice and establish an interest rate
(or a spread or spread multiplier used to calculate such interest rate, if
applicable) that is higher than the interest rate (or the spread or spread
multiplier, if applicable) provided for in the Reset Notice, for the Subsequent
Interest Period by causing the Trustee to transmit, in the manner provided for
in Section 106, notice of such higher interest rate (or such higher spread or
spread multiplier, if applicable) to the Holder of such Security. Such notice
shall be irrevocable. All Securities with respect to which the interest rate (or
the spread or spread multiplier used to calculate such interest rate, if
applicable) is reset on an Optional Reset Date, and with respect to which the
Holders of such Securities have not tendered such Securities for repayment (or
have validly revoked any such tender) pursuant to the next succeeding paragraph,
will bear such higher interest rate (or such higher spread or spread multiplier,
if applicable).
The Holder of any such Security will have the option to elect
repayment by the Company of the principal of such Security on each Optional
Reset Date at a price equal to the principal amount thereof plus interest
accrued to such Optional Reset Date. In order to obtain repayment on an Optional
Reset Date, the Holder must follow the procedures set forth in Article Thirteen
for repayment at the option of Holders except that the period for delivery or
notification to the Trustee shall be at least 25 but not more than 35 days prior
to such Optional Reset Date and except that, if the Holder has tendered any
Security for repayment pursuant to the Reset Notice, the Holder may, by written
notice to the Trustee, revoke such tender or repayment until the close of
business on the tenth day before such Optional Reset Date.
Subject to the foregoing provisions of this Section and
Section 305, each Security delivered under this Indenture upon registration of
transfer of or in exchange for or
<PAGE> 49
39
in lieu of any other Security shall carry the rights to interest accrued and
unpaid, and to accrue, which were carried by such other Security.
SECTION 308. Optional Extension of Stated Maturity.
The provisions of this Section 308 may be made applicable to
any series of Securities pursuant to Section 301 (with such modifications,
additions or substitutions as may be specified pursuant to such Section 301).
The Stated Maturity of any Security of such series may be extended at the option
of the Company for the period or periods specified on the face of such Security
(each an "Extension Period") up to but not beyond the date (the "Final
Maturity") set forth on the face of such Security. The Company may exercise such
option with respect to any Security by notifying the Trustee of such exercise at
least 50 but not more than 60 days prior to the Stated Maturity of such Security
in effect prior to the exercise of such option (the "Original Stated Maturity").
If the Company exercises such option, the Trustee shall transmit, in the manner
provided for in Section 106, to the Holder of such Security not later than 40
days prior to the Original Stated Maturity a notice (the "Extension Notice")
indicating (i) the election of the Company to extend the Stated Maturity, (ii)
the new Stated Maturity, (iii) the interest rate, if any, applicable to the
Extension Period and (iv) the provisions, if any, for redemption during such
Extension Period. Upon the Trustee's transmittal of the Extension Notice, the
Stated Maturity of such Security shall be extended automatically and, except as
modified by the Extension Notice and as described in the next paragraph, such
Security will have the same terms as prior to the transmittal of such Extension
Notice.
Notwithstanding the foregoing, not later than 20 days before
the Original Stated Maturity of such Security, the Company may, at its option,
revoke the interest rate provided for in the Extension Notice and establish a
higher interest rate for the Extension Period by causing the Trustee to
transmit, in the manner provided for in Section 106, notice of such higher
interest rate to the Holder of such Security. Such notice shall be irrevocable.
All Securities with respect to which the Stated Maturity is extended will bear
such higher interest rate.
If the Company extends the Maturity of any Security, the
Holder will have the option to elect repayment of such Security by the Company
on the Original Stated Maturity at a price equal to the principal amount
thereof, plus interest accrued to such date. In order to obtain repayment on the
Original Stated Maturity once the Company has extended the Maturity thereof, the
Holder must follow the procedures set forth in Article Thirteen for repayment at
the option of Holders, except that the period for delivery or notification to
the Trustee shall be at least 25 but not more than 35 days prior to the Original
Stated Maturity and except that, if the Holder has tendered any Security for
repayment pursuant to an Extension Notice, the Holder may by written notice to
the Trustee revoke such tender for repayment until the close of business on the
tenth day before the Original Stated Maturity.
<PAGE> 50
40
SECTION 309. Persons Deemed Owners.
Prior to due presentment of a Registered Security for
registration of transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name such Registered Security is
registered as the owner of such Registered Security for the purpose of receiving
payment of principal of (and premium, if any) and (subject to Sections 305 and
307) interest, if any, on such Security and for all other purposes whatsoever,
whether or not such Security be overdue, and none of the Company, the Trustee or
any agent of the Company or the Trustee shall be affected by notice to the
contrary.
Title to any Bearer Security and any coupons appertaining
thereto shall pass by delivery. The Company, the Trustee and any agent of the
Company or the Trustee may treat the bearer of any Bearer Security and the
bearer of any coupon as the absolute owner of such Security or coupon for the
purpose of receiving payment thereof or on account thereof and for all other
purposes whatsoever, whether or not such Security or coupons be overdue, and
none of the Company, the Trustee or any agent of the Company or the Trustee
shall be affected by notice to the contrary.
None of the Company, the Trustee, any Paying Agent or the
Security Registrar will have any responsibility or liability for any aspect of
the records relating to or payments made on account of beneficial ownership
interests of a Security in global form or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
Notwithstanding the foregoing, with respect to any global
Security, nothing herein shall prevent the Company, the Trustee, or any agent of
the Company or the Trustee, from giving effect to any written certification,
proxy or other authorization furnished by any depositary, as a Holder, with
respect to such global Security or impair, as between such depositary and owners
of beneficial interests in such global Security, the operation of customary
practices governing the exercise of the rights of such depositary (or its
nominee) as Holder of such global Security.
SECTION 310. Cancellation.
All Securities and coupons surrendered for payment,
redemption, repayment at the option of the Holder, registration of transfer or
exchange or for credit against any current or future sinking fund payment shall,
if surrendered to any Person other than the Trustee, be delivered to the
Trustee. All Securities and coupons so delivered to the Trustee shall be
promptly cancelled by it. The Company may at any time deliver to the Trustee for
cancellation any Securities previously authenticated and delivered hereunder
which the Company may have acquired in any manner whatsoever, and may deliver to
the Trustee (or to any other Person for delivery to the Trustee) for
cancellation any Securities previously
<PAGE> 51
41
authenticated hereunder which the Company has not issued and sold, and all
Securities so delivered shall be promptly cancelled by the Trustee. If the
Company shall so acquire any of the Securities, however, such acquisition shall
not operate as a redemption or satisfaction of the indebtedness represented by
such Securities unless and until the same are surrendered to the Trustee for
cancellation. No Securities shall be authenticated in lieu of or in exchange for
any Securities cancelled as provided in this Section, except as expressly
permitted by this Indenture. All cancelled Securities held by the Trustee shall
be disposed of by the Trustee in accordance with its customary procedures and
certification of their disposal delivered to the Company unless by Company Order
the Company shall direct that cancelled Securities be returned to it.
SECTION 311. Computation of Interest.
Except as otherwise specified as contemplated by Section 301
with respect to any Securities, interest, if any, on the Securities of each
series shall be computed on the basis of a 360-day year of twelve 30-day months.
SECTION 312. Currency and Manner of Payments in Respect of
Securities.
(a) With respect to Registered Securities of any series not
permitting the election provided for in paragraph (b) below or the Holders of
which have not made the election provided for in paragraph (b) below, and with
respect to Bearer Securities of any series, except as provided in paragraph (d)
below, payment of the principal of (and premium, if any) and interest, if any,
on any Registered or Bearer Security of such series will be made in the Currency
in which such Registered Security or Bearer Security, as the case may be, is
payable. The provisions of this Section 312 may be modified or superseded with
respect to any Securities pursuant to Section 301.
(b) It may be provided pursuant to Section 301 with respect to
Registered Securities of any series that Holders shall have the option, subject
to paragraphs (d) and (e) below, to receive payments of principal of (or
premium, if any) or interest, if any, on such Registered Securities in any of
the Currencies which may be designated for such election by delivering to the
Trustee a written election with signature guarantees and in the applicable form
established pursuant to Section 301, not later than the close of business on the
Election Date immediately preceding the applicable payment date. If a Holder so
elects to receive such payments in any such Currency, such election will remain
in effect for such Holder or any transferee of such Holder until changed by such
Holder or such transferee by written notice to the Trustee (but any such change
must be made not later than the close of business on the Election Date
immediately preceding the next payment date to be effective for the payment to
be made on such payment date and no such change of election may be made with
respect to payments to be made on any Registered Security of such series with
respect to which an Event of Default has occurred or with respect to which the
Company has deposited
<PAGE> 52
42
funds pursuant to Article Four or Fourteen or with respect to which a notice of
redemption has been given by the Company or a notice of option to elect
repayment has been sent by such Holder or such transferee). Any Holder of any
such Registered Security who shall not have delivered any such election to the
Trustee not later than the close of business on the applicable Election Date
will be paid the amount due on the applicable payment date in the relevant
Currency as provided in Section 312(a). The Trustee shall notify the Exchange
Rate Agent as soon as practicable after the Election Date of the aggregate
principal amount of Registered Securities for which Holders have made such
written election.
(c) Unless otherwise specified pursuant to Section 301, if the
election referred to in paragraph (b) above has been provided for pursuant to
Section 301, then, unless otherwise specified pursuant to Section 301, not later
than the fourth Business Day after the Election Date for each payment date for
Registered Securities of any series, the Exchange Rate Agent will deliver to the
Company a written notice specifying, in the Currency in which Registered
Securities of such series are payable, the respective aggregate amounts of
principal of (and premium, if any) and interest, if any, on the Registered
Securities to be paid on such payment date, specifying the amounts in such
Currency so payable in respect of the Registered Securities as to which the
Holders of Registered Securities of such series shall have elected to be paid in
another Currency as provided in paragraph (b) above. If the election referred to
in paragraph (b) above has been provided for pursuant to Section 301 and if at
least one Holder has made such election, then, unless otherwise specified
pursuant to Section 301, on the second Business Day preceding such payment date
the Company will deliver to the Trustee for such series of Registered Securities
an Exchange Rate Officers' Certificate in respect of the Dollar or Foreign
Currency payments to be made on such payment date. Unless otherwise specified
pursuant to Section 301, the Dollar or Foreign Currency amount receivable by
Holders of Registered Securities who have elected payment in a Currency as
provided in paragraph (b) above shall be determined by the Company on the basis
of the applicable Market Exchange Rate in effect on the third Business Day (the
"Valuation Date") immediately preceding each payment date, and such
determination shall be conclusive and binding for all purposes, absent manifest
error.
(d) If a Conversion Event occurs with respect to a Foreign
Currency in which any of the Securities are denominated or payable other than
pursuant to an election provided for pursuant to paragraph (b) above, then with
respect to each date for the payment of principal of (and premium, if any) and
interest, if any, on the applicable Securities denominated or payable in such
Foreign Currency occurring after the last date on which such Foreign Currency
was used (the "Conversion Date"), the Dollar shall be the Currency of payment
for use on each such payment date. Unless otherwise specified pursuant to
Section 301, the Dollar amount to be paid by the Company to the Trustee and by
the Trustee or any Paying Agent to the Holders of such Securities with respect
to such payment date shall be, in the case of a Foreign Currency other than a
currency unit, the Dollar Equivalent
<PAGE> 53
43
of the Foreign Currency or, in the case of a currency unit, the Dollar
Equivalent of the Currency Unit, in each case as determined by the Exchange Rate
Agent in the manner provided in paragraph (f) or (g) below.
(e) Unless otherwise specified pursuant to Section 301, if the
Holder of a Registered Security denominated in any Currency shall have elected
to be paid in another Currency as provided in paragraph (b) above, and a
Conversion Event occurs with respect to such elected Currency, such Holder shall
receive payment in the Currency in which payment would have been made in the
absence of such election; and if a Conversion Event occurs with respect to the
Currency in which payment would have been made in the absence of such election,
such Holder shall receive payment in Dollars as provided in paragraph (d) above.
(f) The "Dollar Equivalent of the Foreign Currency" shall be
determined by the Exchange Rate Agent and shall be obtained for each subsequent
payment date by converting the specified Foreign Currency into Dollars at the
Market Exchange Rate on the Conversion Date.
(g) The "Dollar Equivalent of the Currency Unit" shall be
determined by the Exchange Rate Agent and subject to the provisions of paragraph
(h) below shall be the sum of each amount obtained by converting the Specified
Amount of each Component Currency into Dollars at the Market Exchange Rate for
such Component Currency on the Valuation Date with respect to each payment.
(h) For purposes of this Section 312 the following terms shall
have the following meanings:
A "Component Currency" shall mean any Currency which, on the
Conversion Date, was a component currency of the relevant currency
unit, including, but not limited to, the ECU.
A "Specified Amount" of a Component Currency shall mean the
number of units of such Component Currency or fractions thereof which
were represented in the relevant currency unit, including, but not
limited to, the ECU, on the Conversion Date. If after the Conversion
Date the official unit of any Component Currency is altered by way of
combination or subdivision, the Specified Amount of such Component
Currency shall be divided or multiplied in the same proportion. If
after the Conversion Date two or more Component Currencies are
consolidated into a single currency, the respective Specified Amounts
of such Component Currencies shall be replaced by an amount in such
single Currency equal to the sum of the respective Specified Amounts of
such consolidated Component Currencies expressed in such single
Currency, and such amount shall thereafter be a Specified Amount and
such single Currency shall thereafter be a Component Currency. If after
the
<PAGE> 54
44
Conversion Date any Component Currency shall be divided into two or
more currencies, the Specified Amount of such Component Currency shall
be replaced by amounts of such two or more currencies, having an
aggregate Dollar Equivalent value at the Market Exchange Rate on the
date of such replacement equal to the Dollar Equivalent value of the
Specified Amount of such former Component Currency at the Market
Exchange Rate immediately before such division and such amounts shall
thereafter be Specified Amounts and such currencies shall thereafter be
Component Currencies. If, after the Conversion Date of the relevant
currency unit, including, but not limited to, the ECU, a Conversion
Event (other than any event referred to above in this definition of
"Specified Amount") occurs with respect to any Component Currency of
such currency unit and is continuing on the applicable Valuation Date,
the Specified Amount of such Component Currency shall, for purposes of
calculating the Dollar Equivalent of the Currency Unit, be converted
into Dollars at the Market Exchange Rate in effect on the Conversion
Date of such Component Currency.
"Election Date" shall mean the date for any series of
Registered Securities as specified pursuant to clause (13) of Section
301 by which the written election referred to in paragraph (b) above
may be made.
All decisions and determinations of the Exchange Rate Agent
regarding the Dollar Equivalent of the Foreign Currency, the Dollar Equivalent
of the Currency Unit, the Market Exchange Rate and changes in the Specified
Amounts as specified above shall be in its sole discretion and shall, in the
absence of manifest error, be conclusive for all purposes and irrevocably
binding upon the Company, the Trustee and all Holders of such Securities
denominated or payable in the relevant Currency. The Exchange Rate Agent shall
promptly give written notice to the Company and the Trustee of any such decision
or determination.
In the event that the Company determines in good faith that a
Conversion Event has occurred with respect to a Foreign Currency, the Company
will immediately give written notice thereof to the Trustee and to the Exchange
Rate Agent (and the Trustee will promptly thereafter give notice in the manner
provided for in Section 106 to the affected Holders) specifying the Conversion
Date. In the event the Company so determines that a Conversion Event has
occurred with respect to the ECU or any other currency unit in which Securities
are denominated or payable, the Company will immediately give written notice
thereof to the Trustee and to the Exchange Rate Agent (and the Trustee will
promptly thereafter give notice in the manner provided for in Section 106 to the
affected Holders) specifying the Conversion Date and the Specified Amount of
each Component Currency on the Conversion Date. In the event the Company
determines in good faith that any subsequent change in any Component Currency as
set forth in the definition of Specified Amount above has occurred, the Company
will similarly give written notice to the Trustee and the Exchange Rate Agent.
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The Trustee shall be fully justified and protected in relying
and acting upon information received by it from the Company and the Exchange
Rate Agent and shall not otherwise have any duty or obligation to determine the
accuracy or validity of such information independent of the Company or the
Exchange Rate Agent.
SECTION 313. Appointment and Resignation of Successor Exchange
Rate Agent.
(a) Unless otherwise specified pursuant to Section 301, if and
so long as the Securities of any series (i) are denominated in a Currency other
than Dollars or (ii) may be payable in a Currency other than Dollars, or so long
as it is required under any other provision of this Indenture, then the Company
will maintain with respect to each such series of Securities, or as so required,
at least one Exchange Rate Agent. The Company will cause the Exchange Rate Agent
to make the necessary foreign exchange determinations at the time and in the
manner specified pursuant to Section 301 for the purpose of determining the
applicable rate of exchange and, if applicable, for the purpose of converting
the issued Currency into the applicable payment Currency for the payment of
principal (and premium, if any) and interest, if any, pursuant to Section 312.
(b) No resignation of the Exchange Rate Agent and no
appointment of a successor Exchange Rate Agent pursuant to this Section shall
become effective until the acceptance of appointment by the successor Exchange
Rate Agent as evidenced by a written instrument delivered to the Company and the
Trustee.
(c) If the Exchange Rate Agent shall resign, be removed or
become incapable of acting, or if a vacancy shall occur in the office of the
Exchange Rate Agent for any cause with respect to the Securities of one or more
series, the Company, by or pursuant to a Board Resolution, shall promptly
appoint a successor Exchange Rate Agent or Exchange Rate Agents with respect to
the Securities of that or those series (it being understood that any such
successor Exchange Rate Agent may be appointed with respect to the Securities of
one or more or all of such series and that, unless otherwise specified pursuant
to Section 301, at any time there shall only be one Exchange Rate Agent with
respect to the Securities of any particular series that are originally issued by
the Company on the same date and that are initially denominated and/or payable
in the same Currency).
<PAGE> 56
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ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of
further effect with respect to any series of Securities specified in such
Company Request (except as to any surviving rights of registration of transfer
or exchange of Securities of such series expressly provided for herein or
pursuant hereto) and the Trustee, at the expense of the Company, shall execute
proper instruments acknowledging satisfaction and discharge of this Indenture as
to such series when
(1) either
(A) all Securities of such series theretofore
authenticated and delivered and all coupons, if any,
appertaining thereto (other than (i) coupons appertaining to
Bearer Securities surrendered for exchange for Registered
Securities and maturing after such exchange, whose surrender
is not required or has been waived as provided in Section 305,
(ii) Securities and coupons of such series which have been
destroyed, lost or stolen and which have been replaced or paid
as provided in Section 306, (iii) coupons appertaining to
Securities called for redemption and maturing after the
relevant Redemption Date, whose surrender has been waived as
provided in Section 1106, and (iv) Securities and coupons of
such series for whose payment money has theretofore been
deposited in trust with the Trustee or any Paying Agent or
segregated and held in trust by the Company and thereafter
repaid to the Company, as provided in Section 1003) have been
delivered to the Trustee for cancellation; or
(B) all Securities of such series and, in the case of
(i) or (ii) below, any coupons appertaining thereto not
theretofore delivered to the Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their
Stated Maturity within one year, or
(iii) if redeemable at the option of the
Company, are to be called for redemption within one
year under arrangements satisfactory
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to the Trustee for the giving of notice of redemption
by the Trustee in the name, and at the expense, of
the Company,
and the Company, in the case of (i), (ii) or (iii) above, has
irrevocably deposited or caused to be deposited with the
Trustee as trust funds in trust for such purpose an amount in
the Currency in which the Securities of such series are
payable, sufficient to pay and discharge the entire
indebtedness on such Securities not theretofore delivered to
the Trustee for cancellation, for principal (and premium, if
any) and interest, if any, to the date of such deposit (in the
case of Securities which have become due and payable) or to
the Stated Maturity or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums
payable hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the satisfaction and
discharge of this Indenture as to such series have been complied with.
Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Company to the Trustee under Section 606, the
obligations of the Trustee to any Authenticating Agent under Section 611 and, if
money shall have been deposited with the Trustee pursuant to subclause (B) of
clause (1) of this Section, the obligations of the Trustee under Section 402 and
the last paragraph of Section 1003 shall survive.
SECTION 402. Application of Trust Money.
Subject to the provisions of the last paragraph of Section
1003, all money deposited with the Trustee pursuant to Section 401 shall be held
in trust and applied by it, in accordance with the provisions of the Securities,
the coupons and this Indenture, to the payment, either directly or through any
Paying Agent (including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Persons entitled thereto, of the principal (and
premium, if any) and interest, if any, for whose payment such money has been
deposited with the Trustee; but such money need not be segregated from other
funds except to the extent required by law.
<PAGE> 58
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ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default.
"Event of Default", wherever used herein with respect to
Securities of any series, means any one of the following events:
(1) default in the payment of any interest on any Security of
such series when it becomes due and payable, and continuance of such
default for a period of 30 days; or
(2) default in the payment of the principal of (or premium, if
any, on) any Security of such series when due; or
(3) failure to perform or comply with the Indenture provisions
described under "Consolidation, Merger and Sale of Assets"; or
(4) default in the performance, or breach, of any covenant or
agreement of the Company in this Indenture (other than a default in the
performance, or breach, of a covenant or agreement that is specifically
dealt with therein), and continuance of such default or breach for a
period of 60 days after written notice has been given to the Company by
the Trustee or to the Company and the Trustee by the holders of at
least 25% in aggregate principal amount of all Outstanding Securities
of such series specifying such default or breach and requiring it to be
remedied and stating that such notice is a "Notice of Default"
hereunder; or
(5) (i) an event of default has occurred under any mortgage,
bond, indenture, loan agreement or other document evidencing an issue
of Debt of the Company or any Significant Subsidiary, which issue has
an aggregate outstanding principal amount of not less than $5 million,
and such default has resulted in such Debt becoming, whether by
declaration or otherwise, due and payable prior to the date on which it
would otherwise become due and payable or (ii) a default in any payment
when due at final maturity of any such Debt;
(6) failure by the Company or any of its Restricted
Subsidiaries to pay one or more final judgments the uninsured portion
of which exceeds in the aggregate $5 million, which judgment or
judgments are not paid, discharged or stayed for a period of 60 days;
<PAGE> 59
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(7) the institution by the Company of proceedings to be
adjudicated a bankrupt or insolvent, or the consent by it to the
institution of bankruptcy or insolvency proceedings against it, or the
filing by it of a petition or answer or consent seeking reorganization
or relief under the Federal Bankruptcy Code or any other applicable
federal or state law, or the consent by it to the filing of any such
petition or to the appointment of a receiver, liquidator, assignee,
trustee, sequestrator (or other similar official) of the Company or of
any substantial part of its property, or the making by it of an
assignment for the benefit of creditors, or the admission by it in
writing of its inability to pay its debts generally as they become due;
(8) the entry of a decree or order by a court having
jurisdiction in the premises adjudging the Company a bankrupt or
insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of or in respect
of the Company under the Federal Bankruptcy Code or any other
applicable federal or state law, or the consent by the Company to the
filing of any such petition or to the appointment of a receiver,
liquidator, assignee, trustee, sequestrator (or other similar official)
of the Company or of any substantial part of its property, or the
making by it of an assignment for the benefit of creditors, or the
admission by it in writing of its inability to pay its debts generally
as they become due; or
(9) any other Event of Default specified for such series.
SECTION 502. Acceleration of Maturity; Rescission and
Annulment.
If an Event of Default (other than as specified in Section
501(7) or 501(8) above) with respect to Securities of any series at the time
Outstanding occurs and is continuing, the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Outstanding Securities of that
series may declare the principal amount of all of the Securities of that series
immediately due and payable, and upon any such declaration, such principal
amount will become due and payable immediately. If an Event of Default described
in Section 502(7) or (8) occurs and is continuing, then the principal of all of
the Outstanding Securities of any series will ipso facto become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holder of Securities of such series.
At any time after a declaration of acceleration under the
Indenture, with respect to Securities of any series (or of all series, as the
case may be) has been made, but before a judgment or decree for payment of the
money due has been obtained by the Trustee, the Holders of a majority in
aggregate principal amount of the Outstanding Securities of any series, by
written notice to the Company and the Trustee, may rescind such declaration and
its consequences if
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(1) the Company has paid or deposited with the Trustee a
sum sufficient to pay in the Currency in which the Securities of such
series are payable (except as otherwise specified pursuant to Section
301 for the Securities of such series and except, if applicable, as
provided in Sections 312(b), 312(d) and 312(e)),
(A) all overdue interest, if any, on all Outstanding
Securities of that series,
(B) all unpaid principal of (and premium, if any, on)
any Outstanding Securities of any series that has become due
otherwise than by such declaration of acceleration, and
interest thereon at the rate borne by the Securities of such
series,
(C) to the extent that payment of interest is lawful,
interest upon overdue interest and overdue principal at the
rate borne by the Securities of such series, and
(D) all sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and
counsel; and
(2) all Events of Default, other than the non-payment of
amounts of principal of (or premium, if any, on) or interest on
Securities of such series that have become due solely by such
declaration of acceleration, have been cured or waived as provided in
Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for
Enforcement by Trustee.
The Company covenants that if
(1) default is made in the payment of any installment of
interest on any Security and any related coupon when such interest
becomes due and payable and such default continues for a period of 30
days, or
(2) default is made in the payment of the principal of (or
premium, if any, on) any Security at the Maturity thereof,
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then the Company will, upon demand of the Trustee, pay to the Trustee for the
benefit of the Holders of such Securities and coupons, the whole amount then due
and payable on such Securities and coupons for principal (and premium, if any)
and interest, if any, and interest on any overdue principal (and premium, if
any) and on any overdue interest, at the rate or rates prescribed therefor in
such Securities, and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.
If the Company fails to pay such amounts forthwith upon such
demand, the Trustee, in its own name as trustee of an express trust, may
institute a judicial proceeding for the collection of the sums so due and
unpaid, may prosecute such proceeding to judgment or final decree and may
enforce the same against the Company or any other obligor upon such Securities
and collect the moneys adjudged or decreed to be payable in the manner provided
by law out of the property of the Company or any other obligor upon such
Securities, wherever situated.
If an Event of Default with respect to Securities of any
series (or of all series, as the case may be) occurs and is continuing, the
Trustee may in its discretion proceed to protect and enforce its rights and the
rights of the Holders of Securities of such series (or of all series, as the
case may be) by such appropriate judicial proceedings as the Trustee shall deem
most effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.
SECTION 504. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, 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 on
the Company for the payment of overdue principal, premium, if any, or interest)
shall be entitled and empowered, by intervention in such proceeding or
otherwise,
(i) to file and prove a claim for the whole amount of
principal (and premium, if any), or such portion of the principal
amount of any series of Original Issue Discount Securities or Indexed
Securities as may be specified in the terms of such series, and
interest, if any, owing and unpaid in respect of the Securities and to
file such other papers or documents as may be necessary or advisable in
order to have the claims of the Trustee (including any claim for the
reasonable compensation,
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expenses, disbursements and advances of the Trustee, its agents and
counsel) and of the Holders allowed in such judicial proceeding, and
(ii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders, to
pay to the Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 606.
Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding.
SECTION 505. Trustee May Enforce Claims Without Possession of
Securities.
All rights of action and claims under this Indenture or the
Securities or coupons may be prosecuted and enforced by the Trustee without the
possession of any of the Securities or coupons or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name as trustee of an express trust, and any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, be for the ratable benefit of the Holders of the Securities and
coupons in respect of which such judgment has been recovered.
SECTION 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article
shall be applied in the following order, at the date or dates fixed by the
Trustee and, in case of the distribution of such money on account of principal
(or premium, if any) or interest, if any, upon presentation of the Securities or
coupons, or both, as the case may be, and the notation thereon of the payment if
only partially paid and upon surrender thereof if fully paid:
First: To the payment of all amounts due the Trustee under
Section 606;
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Second: To the payment of the amounts then due and unpaid for
principal of (and premium, if any) and interest, if any, on the
Securities and coupons in respect of which or for the benefit of which
such money has been collected, ratably, without preference or priority
of any kind, according to the amounts due and payable on such
Securities and coupons for principal (and premium, if any) and
interest, if any, respectively; and
Third: The balance, if any, to the Company.
SECTION 507. Limitation on Suits.
No Holder of any Security of any series or any related coupons
shall have any right to institute any proceeding, judicial or otherwise, with
respect to this Indenture, or for the appointment of a receiver or trustee, or
for any other remedy hereunder, unless
(1) such Holder has previously given written notice to the
Trustee of a continuing Event of Default with respect to the Securities
of that series;
(2) the Holders of not less than 25% in principal amount of
the Outstanding Securities of that series in the case of any Event of
Default described in clause (1), (2), (3), (4), (5), (6) or (9) of
Section 501, or, in the case of any Event of Default described in
clause (7) or (8) of Section 501, the Holders of not less than 25% in
principal amount of all Outstanding Securities, shall have made written
request to the Trustee to institute proceedings in respect of such
Event of Default in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(5) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders of a
majority or more in principal amount of the Outstanding Securities of
that series in the case of any Event of Default described in clause
(1), (2), (3), (4), (5), (6) or (9) of Section 501, or, in the case of
any Event of Default described in clause (7) or (8) of Section 501, by
the Holders of a majority or more in principal amount of all
Outstanding Securities;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to
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affect, disturb or prejudice the rights of any other Holders of Securities of
the same series, in the case of any Event of Default described in clause (1),
(2), (3), (4), (5), (6) or (9) of Section 501, or of Holders of all Securities
in the case of any Event of Default described in clause (7) or (8) of Section
501, or to obtain or to seek to obtain priority or preference over any other of
such Holders or to enforce any right under this Indenture, except in the manner
herein provided and for the equal and ratable benefit of all Holders of
Securities of the same series, in the case of any Event of Default described in
clause (1), (2), (3), (4), (5), (6) or (9) of Section 501, or of Holders of all
Securities in the case of any Event of Default described in clause (7) or (8) of
Section 501.
SECTION 508. Unconditional Right of Holders to Receive
Principal, Premium and Interest.
Notwithstanding any other provision in this Indenture, the
Holder of any Security shall have the right, which is absolute and
unconditional, to receive payment, as provided herein (including, if applicable,
Article Fourteen) and in such Security, of the principal of (and premium, if
any) and (subject to Section 307) interest, if any, on, such Security or payment
of such coupon on the respective Stated Maturities expressed in such Security or
coupon (or, in the case of redemption, on the Redemption Date) and to institute
suit for the enforcement of any such payment, and such rights shall not be
impaired without the consent of such Holder.
SECTION 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders of
Securities and coupons shall be restored severally and respectively to their
former positions hereunder and thereafter all rights and remedies of the Trustee
and the Holders shall continue as though no such proceeding had been instituted.
SECTION 510. Rights and Remedies Cumulative.
Except as otherwise provided in Section 306, 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.
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SECTION 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any
Security or coupon to exercise any right or remedy accruing upon any Event of
Default shall impair any such right or remedy or constitute a waiver of any such
Event of Default or an acquiescence therein. Every right and remedy given by
this Article or by law to the Trustee or to the Holders may be exercised from
time to time, and as often as may be deemed expedient, by the Trustee or by the
Holders, as the case may be.
SECTION 512. Control by Holders.
With respect to the Securities of any series, the Holders of
not less than a majority in principal amount of the Outstanding Securities of
such series shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred on the Trustee, provided that in each case
(1) such direction shall not be in conflict with any rule of
law or with this Indenture,
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction, and
(3) the Trustee need not take any action which might involve
it in personal liability or be unjustly prejudicial to the Holders of
Securities of such series not consenting.
SECTION 513. Waiver of Past Defaults.
Subject to Section 502, the Holders of not less than a
majority in principal amount of the Outstanding Securities of any series may on
behalf of the Holders of all the Securities of such series waive any past
default described in clause (1), (2), (3), (4), (5), (6) or (9) of Section 501
(or, in the case of a default described in clause (7) or (8) of Section 501, the
Holders of not less than a majority in principal amount of all Outstanding
Securities may waive any such past default), and its consequences, except a
default
(1) in respect of the payment of the principal of (or premium,
if any) or interest, if any, on any Security or any related coupon, or
(2) in respect of a covenant or provision hereof which under
Article Nine cannot be modified or amended without the consent of the
Holder of each Outstanding Security of such series affected.
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Upon any such waiver, any such default shall cease to exist,
and any Event of Default arising therefrom shall be deemed to have been cured,
for every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.
SECTION 514. Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do
so) that it will not at any time insist upon, or plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension law
wherever enacted, now or at any time hereafter in force, which may affect the
covenants or the performance of this Indenture; and the Company (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted.
ARTICLE SIX
THE TRUSTEE
SECTION 601. Notice of Defaults.
Within 90 days after the occurrence of any Default hereunder
with respect to the Securities of any series, the Trustee shall transmit in the
manner and to the extent provided in TIA Section 313(c), notice of such default
hereunder known to the Trustee, unless such Default shall have been cured or
waived; provided, however, that, except in the case of a Default in the payment
of the principal of (or premium, if any) or interest, if any, on any Security of
such series or in the payment of any sinking fund installment with respect to
Securities of 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 and/or Responsible Officers of the Trustee in good
faith determine that the withholding of such notice is in the interest of the
Holders of Securities of such series and any related coupons; and provided
further that in the case of any Default of the character specified in Section
501(4) with respect to Securities of such series, no such notice to Holders
shall be given until at least 30 days after the occurrence thereof. The Trustee
shall not be deemed to have knowledge of any Event of Default except (1) any
Default with respect to Sections 1001, 1004, 703(1) and (2), or (2) the Trustee
shall have received written notification or obtained actual knowledge.
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SECTION 602. Certain Rights of Trustee.
Subject to the provisions of TIA Sections 315(a) through
315(d):
(1) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other
paper or document believed by it to be genuine and to have been signed
or presented by the proper party or parties;
(2) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or Company Order
and any resolution of the Board of Directors may be sufficiently
evidenced by a Board Resolution;
(3) whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, the
Trustee (unless other evidence be herein specifically prescribed) may,
in the absence of bad faith on its part, rely upon an Officers'
Certificate;
(4) the Trustee may consult with counsel and the written
advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in reliance
thereon;
(5) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request
or direction of any of the Holders of Securities of any series or any
related coupons pursuant to this Indenture, unless such Holders shall
have offered to the Trustee reasonable security or indemnity against
the costs, expenses and liabilities which might be incurred by it in
compliance with such request or direction;
(6) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness
or other paper or document, but the Trustee, in its discretion, may
make such further inquiry or investigation into such facts or matters
as it may see fit, and, if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or
attorney;
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(7) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder; and
(8) the Trustee shall not be liable for any action taken,
suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon
it by this Indenture.
The Trustee shall not be required to expend or risk its own
funds or otherwise incur any financial liability in the performance of any of
its duties hereunder, or in the exercise of any of its rights or powers if it
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it.
SECTION 603. Trustee Not Responsible for Recitals or Issuance
of Securities.
The recitals contained herein and in the Securities, except
for the Trustee's certificates of authentication, and in any coupons shall be
taken as the statements of the Company, and neither the Trustee nor any
Authenticating Agent assumes any responsibility for their correctness. The
Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Securities or coupons, except that the Trustee represents
that it is duly authorized to execute and deliver this Indenture, authenticate
the Securities and perform its obligations hereunder and that the statements
made by it in a Statement of Eligibility on Form T-1 supplied to the Company are
true and accurate, subject to the qualifications set forth therein. Neither the
Trustee nor any Authenticating Agent shall be accountable for the use or
application by the Company of Securities or the proceeds thereof.
SECTION 604. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any
Security Registrar or any other agent of the Company or of the Trustee, in its
individual or any other capacity, may become the owner or pledgee of Securities
and coupons and, subject to TIA Sections 310(b) and 311, may otherwise deal with
the Company with the same rights it would have if it were not Trustee,
Authenticating Agent, Paying Agent, Security Registrar or such other agent.
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SECTION 605. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law. The Trustee
shall be under no liability for interest on any money received by it hereunder
except as otherwise agreed with the Company.
SECTION 606. Compensation and Reimbursement.
The Company agrees:
(1) to pay to the Trustee from time to time reasonable
compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture (including the
reasonable compensation and the expenses and disbursements of its
agents and counsel), except any such expense, disbursement or advance
as may be attributable to its negligence or bad faith; and
(3) to indemnify the Trustee for, and to hold it harmless
against, any loss, liability or expense incurred without negligence or
bad faith on its part, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder,
including the costs and expenses of defending itself against any claim
or liability in connection with the exercise or performance of any of
its powers or duties hereunder.
The obligations of the Company under this Section to
compensate the Trustee, to pay or reimburse the Trustee for expenses,
disbursements and advances and to indemnify and hold harmless the Trustee shall
constitute additional indebtedness hereunder and shall survive the satisfaction
and discharge of this Indenture. As security for the performance of such
obligations of the Company, the Trustee shall have a claim prior to the
Securities upon all property and funds held or collected by the Trustee as such,
except funds held in trust for the payment of principal of (or premium, if any)
or interest, if any, on particular Securities or any coupons.
When the Trustee incurs expenses or renders services in
connection with an Event of Default specified in Section 501(7) or (8), the
expenses (including reasonable charges and expenses of its counsel) of and the
compensation for such services are intended to constitute expenses of
administration under any applicable Federal or State bankruptcy, insolvency or
other similar law.
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The provisions of this Section shall survive the termination
of this Indenture.
SECTION 607. Corporate Trustee Required; Eligibility;
Conflicting Interests.
(a) There shall be at all times a Trustee hereunder which
shall be eligible to act as Trustee under TIA Section 310(a)(1) and shall have a
combined capital and surplus of at least $50 million or be a member of a bank
holding Company whose capital and surplus is $50 million. If such corporation
publishes reports of condition at least annually, pursuant to law or to the
requirements of Federal, State, territorial 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. If at any time the Trustee shall cease to be eligible in accordance
with the provisions of this Section, it shall resign immediately in the manner
and with the effect hereinafter specified in this Article.
(b) The following indentures shall be deemed to be
specifically described herein for the purposes of clause (i) of the first
proviso contained in TIA Section 310(b): (i) the indenture dated as of April 1,
1993 for DVI Lease Finance Corp. II's 5.34% Class A Lease-receivable Notes,
Series 1993-A, due 1998, (ii) the indenture dated as of December 1, 1993 for DVI
Lease Receivables Corp. 1993-A's 5.48% Lease-backed Notes, Class A and 7.76%
Lease-backed Notes, Class B, due 2002, (iii) the indenture dated as of November
14, 1996 for DVI Receivables Corp. IV's 6.20% Asset-backed Notes, Series 1996-A,
Class A-1, 6.30% Asset-backed Notes, Series 1996-A, Class A-2 and 6.60%
Asset-backed Notes, Series 1996-A, Class B, and (iv) the Pooling and Servicing
Agreement for DVI Equipment Lease Trust 1996-1's Lease-backed Certificates,
6.55% Class A Certificates and 6.81% Class B Certificates.
SECTION 608. Resignation and Removal; Appointment of
Successor.
(a) No resignation or removal of the Trustee and no
appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of Section 609.
(b) The Trustee may resign at any time with respect to the
Securities of one or more series by giving written notice thereof to the
Company. If the instrument of acceptance by a successor Trustee required by
Section 609 shall not have been delivered to the Trustee within 30 days after
the giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee with
respect to the Securities of such series.
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(c) The Trustee may be removed at any time with respect to the
Securities of any series by Act of the Holders of not less than a majority in
principal amount of the Outstanding Securities of such series, delivered to the
Trustee and to the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with the provisions of
TIA Section 310(b) after written request therefor by the Company or by
any Holder who has been a bona fide Holder of a Security for at least
six months, or
(2) the Trustee shall cease to be eligible under Section
607(a) and shall fail to resign after written request therefor by the
Company or by any Holder who has been a bona fide Holder of a Security
for at least six months, or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of its
property shall be appointed or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company, by a Board Resolution, may remove the
Trustee with respect to all Securities, or (ii) subject to TIA Section 315(e),
any Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Securities and the appointment of a successor Trustee or Trustees.
(e) If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Trustee for
any cause, with respect to the Securities of one or more series, the Company, by
a Board Resolution, shall promptly appoint a successor Trustee or Trustees with
respect to the Securities of that or those series (it being understood that any
such successor Trustee may be appointed with respect to the Securities of one or
more or all of such series and that at any time there shall be only one Trustee
with respect to the Securities of any particular series). If, within one year
after such resignation, removal or incapability, or the occurrence of such
vacancy, a successor Trustee with respect to the Securities of any series shall
be appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance
of such appointment, become the successor Trustee with respect to the Securities
of such series and to that extent supersede the successor Trustee appointed by
the Company. If no successor Trustee with respect to the Securities of any
series shall have been so appointed by the Company or the Holders and accepted
appointment in the manner hereinafter provided, any Holder who has been a bona
fide Holder of a Security of such series for at least six months may, on behalf
of himself and all others similarly situated,
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petition any court of competent jurisdiction for the appointment of a successor
Trustee with respect to the Securities of such series.
(f) The Company shall give notice of each resignation and each
removal of the Trustee with respect to the Securities of any series and each
appointment of a successor Trustee with respect to the Securities of any series
to the Holders of Securities of such series in the manner provided for in
Section 106. Each notice shall include the name of the successor Trustee with
respect to the Securities of such series and the address of its Corporate Trust
Office.
SECTION 609. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor
Trustee with respect to all Securities, every such successor Trustee so
appointed shall execute, acknowledge and deliver to the Company and to the
retiring Trustee an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Trustee shall become effective and such
successor Trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts and duties of the retiring Trustee;
but, on the request of the Company or the successor Trustee, such retiring
Trustee shall, upon payment of its charges, execute and deliver an instrument
transferring to such successor Trustee all the rights, powers and trusts of the
retiring Trustee and shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder.
(b) In case of the appointment hereunder of a successor
Trustee with respect to the Securities of one or more (but not all) series, the
Company, the retiring Trustee and each successor Trustee with respect to the
Securities of one or more series shall execute and deliver an indenture
supplemental hereto wherein each successor Trustee shall accept such appointment
and which (1) shall contain such provisions as shall be necessary or desirable
to transfer and confirm to, and to vest in, each successor Trustee all the
rights, powers, trusts and duties of the retiring Trustee with respect to the
Securities of that or those series to which the appointment of such successor
Trustee relates, (2) if the retiring Trustee is not retiring with respect to all
Securities, shall contain such provisions as shall be deemed necessary or
desirable to confirm that all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of that or those series as to
which the retiring Trustee is not retiring shall continue to be vested in the
retiring Trustee, and (3) shall add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the administration
of the trusts hereunder by more than one Trustee, it being understood that
nothing herein or in such supplemental indenture shall constitute such Trustees
co-trustees of the same trust and that each such Trustee shall be trustee of a
trust or trusts hereunder separate and apart from any trust or trusts hereunder
administered by any other such Trustee; and upon the execution and delivery of
such supplemental indenture the
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resignation or removal of the retiring Trustee shall become effective to the
extent provided therein and each such successor Trustee, without any further
act, deed or conveyance, shall become vested with all the rights, powers, trusts
and duties of the retiring Trustee with respect to the Securities of that or
those series to which the appointment of such successor Trustee relates; but, on
request of the Company or any successor Trustee, such retiring Trustee shall
duly assign, transfer and deliver to such successor Trustee all property and
money held by such retiring Trustee hereunder with respect to the Securities of
that or those series to which the appointment of such successor Trustee relates.
Whenever there is a successor Trustee with respect to one or more (but less than
all) series of securities issued pursuant to this Indenture, the terms
"Indenture" and "Securities" shall have the meanings specified in the provisos
to the respective definitions of those terms in Section 101 which contemplate
such situation.
(c) Upon request of any such successor Trustee, the Company
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Trustee all rights, powers and trusts referred
to in paragraph (a) or (b) of this Section, as the case may be.
(d) No successor Trustee shall accept its appointment unless
at the time of such acceptance such successor Trustee shall be qualified and
eligible under this Article.
SECTION 610. Merger, Conversion, Consolidation or Succession
to Business.
Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to all or substantially all the corporate
trust business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities. In
case any of the Securities shall not have been authenticated by such predecessor
Trustee, any successor Trustee may authenticate such Securities either in the
name of any predecessor hereunder or in the name of the successor Trustee. In
all such cases such certificates shall have the full force and effect which this
Indenture provides for the certificate of authentication of the Trustee;
provided, however, that the right to adopt the certificate of authentication of
any predecessor Trustee or to authenticate Securities in the name of any
predecessor Trustee shall apply only to its successor or successors by merger,
conversion or consolidation.
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SECTION 611. Appointment of Authenticating Agent.
At any time when any of the Securities remain Outstanding, the
Trustee may appoint an Authenticating Agent or Agents with respect to one or
more series of Securities which shall be authorized to act on behalf of the
Trustee to authenticate Securities of such series and the Trustee shall give
written notice of such appointment to all Holders of Securities of the series
with respect to which such Authenticating Agent will serve, in the manner
provided for in Section 106. Securities so authenticated shall be entitled to
the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder. Any such appointment
shall be evidenced by an instrument in writing signed by a Responsible Officer
of the Trustee, and a copy of such instrument shall be promptly furnished to the
Company. Wherever reference is made in this Indenture to the authentication and
delivery of Securities by the Trustee or the Trustee's certificate of
authentication, such reference shall be deemed to include authentication and
delivery on behalf of the Trustee by an Authenticating Agent and a certificate
of authentication executed on behalf of the Trustee by an Authenticating Agent.
Each Authenticating Agent shall be acceptable to the Company and shall at all
times be a corporation organized and doing business under the laws of the United
States of America, any state thereof or the District of Columbia, authorized
under such laws to act as Authenticating Agent, having a combined capital and
surplus of not less than $50 million and subject to supervision or examination
by federal or state authority. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time an Authenticating Agent shall cease to be eligible
in accordance with the provisions of this Section, it shall resign immediately
in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which such
Authenticating Agent shall be a party, or any corporation succeeding to the
corporate agency or corporate trust business of an Authenticating Agent, shall
continue to be an Authenticating Agent, provided such corporation shall be
otherwise eligible under this Section, without the execution or filing of any
paper or any further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving
written notice thereof to the Trustee and to the Company. The Trustee may at any
time terminate the agency of an Authenticating Agent by giving written notice
thereof to such Authenticating Agent and to the Company. Upon receiving such a
notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor
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Authenticating Agent which shall be acceptable to the Company and shall give
written notice of such appointment to all Holders of Securities of the series
with respect to which such Authenticating Agent will serve, in the manner
provided for in Section 106. Any successor Authenticating Agent upon acceptance
of its appointment hereunder shall become vested with all the rights, powers and
duties of its predecessor hereunder, with like effect as if originally named as
an Authenticating Agent. No successor Authenticating Agent shall be appointed
unless eligible under the provisions of this Section.
The Trustee agrees to pay to each Authenticating Agent from
time to time reasonable compensation for its services under this Section, and
the Trustee shall be entitled to be reimbursed for such payments, subject to the
provisions of Section 606.
If an appointment with respect to one or more series is made
pursuant to this Section, the Securities of such series may have endorsed
thereon, in addition to the Trustee's certificate of authentication, an
alternate certificate of authentication in the following form:
Dated: ____________________
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
FIRST TRUST NATIONAL ASSOCIATION,
as Trustee
By _______________________________
as Authenticating Agent
By _______________________________
Authorized Officer
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Disclosure of Names and Addresses of Holders.
Every Holder of Securities or coupons, by receiving and
holding the same, agrees with the Company and the Trustee that none of the
Company or the Trustee or any agent of either of them shall be held accountable
by reason of the disclosure of any such information as to the names and
addresses of the Holders in accordance with TIA Section 312, regardless of the
source from which such information was derived, and that the
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Trustee shall not be held accountable by reason of mailing any material pursuant
to a request made under TIA Section 312(b).
SECTION 702. Reports by Trustee.
Within 60 days after May 15th of each year commencing with the
first May 15th after the first issuance of Securities pursuant to this
Indenture, the Trustee shall transmit to the Holders of Securities, in the
manner and to the extent provided in TIA Section 313(c), a brief report dated as
of such May 15th if required by TIA Section 313(a).
SECTION 703. Reports by Company.
The Company shall:
(1) file with the Trustee, within 15 days after the Company is
required to file the same with the Commission, copies of the annual
reports and of the information, documents and other reports (or copies
of such portions of any of the foregoing as the Commission may from
time to time by rules and regulations prescribe) which the Company may
be required to file with the Commission pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934; or, if the
Company is not required to file information, documents or reports
pursuant to either of such Sections, then it shall file with the
Trustee and the Commission, in accordance with rules and regulations
prescribed from time to time by the Commission, such of the
supplementary and periodic information, documents and reports which may
be required pursuant to Section 13 of the Securities Exchange Act of
1934 in respect of a security listed and registered on a national
securities exchange as may be prescribed from time to time in such
rules and regulations;
(2) file with the Trustee and the Commission, in accordance
with rules and regulations prescribed from time to time by the
Commission, such additional information, documents and reports with
respect to compliance by the Company with the conditions and covenants
of this Indenture as may be required from time to time by such rules
and regulations;
(3) transmit by mail to all Holders as their names and
addresses appear in the Security Register, within 30 days after the
filing thereof with the Trustee, in the manner and to the extent
provided in TIA Section 313(c), such summaries of any information,
documents and reports required to be filed by the Company pursuant to
paragraphs (1) and (2) of this Section as may be required by rules and
regulations prescribed from time to time by the Commission;
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(4) notwithstanding anything to the contrary herein, the
Trustee shall have no duty to review such documents for purposes of
determining compliance with any provisions of this Indenture.
ARTICLE EIGHT
CONSOLIDATION, MERGER, AND SALE OF ASSETS
SECTION 801. Company May Consolidate, etc., Only on Certain
Terms.
The Company shall not consolidate with or merge into any other
Person or, directly or indirectly, convey, transfer, lease or otherwise dispose
of its properties and assets substantially as an entirety to any other Person
(in one transaction or a series of related transactions), unless:
(1) either (i) the Company is the surviving corporation or
(ii) the Person (if other than the Company) formed by such
consolidation or into which the Company is merged or the Person that
acquires by sale, assignment, transfer, lease or other disposition of
the properties and assets of the Company substantially as an entirety
(the "Surviving Entity") (A) is a corporation, partnership or trust
organized and validly existing under the laws of the United States, any
state thereof or the District of Columbia and (B) expressly assumes, by
a supplemental indenture in form satisfactory to the Trustee, all of
the Company's obligations under the Indenture and the Securities;
(2) immediately after giving effect to such transaction and
treating any obligation of the Company or a Restricted Subsidiary in
connection with or as a result of such transaction as having been
incurred as of the time of such transaction, no Default or Event of
Default has occurred and is continuing;
(3) immediately after giving effect to such transaction on a
pro forma basis, the Consolidated Net Worth of the Company (or of the
Surviving Entity if the Company is not the continuing obligor under the
Indenture) is equal to or greater than the Consolidated Net Worth of
the Company immediately prior to such transaction;
(4) immediately after giving effect to such transaction on a
pro forma basis (on the assumption that the transaction occurred at the
beginning of the most recently ended four full fiscal quarter period
for which internal financial statements are available, the Company (or
the Surviving Entity if the Company is not the continuing obligor under
the Indenture) could incur at least $1.00 of additional Debt (other
than
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Permitted Debt (as defined in the Indenture)) pursuant to the first
paragraph of any "Limitation on Debt" covenant applicable to any series
of Securities;
(5) if any of the property or assets of the Company or any of
its Restricted Subsidiaries would thereupon become subject to any Lien,
the provisions of any "Limitation on Liens" covenant applicable to any
series of Securities are complied with; and
(6) the Company delivers, or causes to be delivered, to the
Trustee, in form and substance reasonably satisfactory to the Trustee,
an Officers' Certificate and an opinion of counsel, each stating that
such transaction complies with the requirements of this Indenture.
SECTION 802. Successor Person Substituted.
Upon any consolidation or merger, or any sale, assignment,
transfer, lease or conveyance or other disposition of the properties and assets
of the Company substantially as an entirety to any Person in accordance with
Section 801, in which the Company is not the continuing obligor under the
Indenture, the Surviving Entity will succeed to and be substituted for, and may
exercise every right of the Company hereunder, and thereafter the Company will
be discharged from all its obligations and covenants hereunder and under the
Securities.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of
Holders.
Without the consent of any Holders, the Company, when
authorized by or pursuant to a Board Resolution, and the Trustee, at any time
and from time to time, may enter into one or more indentures supplemental
hereto, in form satisfactory to the Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the
Company and the assumption by any such successor of the covenants of
the Company contained herein and in the Securities; or
(2) to add to the covenants of the Company for the benefit of
the Holders of all or any series of Securities and any related coupons
(and if such covenants are to be for the benefit of less than all
series of Securities, stating that such covenants are
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being included solely for the benefit of such series) or to surrender
any right or power herein conferred upon the Company; or
(3) to add any additional Events of Default (and if such
Events of Default are to be for the benefit of less than all series of
Securities, stating that such Events of Default are being included
solely for the benefit of such series); or
(4) to add to or change any of the provisions of this
Indenture to provide that Bearer Securities may be registrable as to
principal, to change or eliminate any restrictions on the payment of
principal of or any premium or interest on Bearer Securities, to permit
Bearer Securities to be issued in exchange for Registered Securities,
to permit Bearer Securities to be issued in exchange for Bearer
Securities of other authorized denominations or to permit or facilitate
the issuance of Securities in uncertificated form; provided that any
such action shall not adversely affect the interests of the Holders of
Securities of any series or any related coupons in any material
respect; or
(5) to change or eliminate any of the provisions of this
Indenture; provided that any such change or elimination shall become
effective only when there is no Security Outstanding of any series
created prior to the execution of such supplemental indenture which is
entitled to the benefit of such provision; or
(6) to secure the Securities; or
(7) to establish the form or terms of Securities of any
series as permitted by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one
or more series and to add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Trustee,
pursuant to the requirements of Section 609(b); or
(9) to close this Indenture with respect to the
authentication and delivery of additional series of Securities, to cure
any ambiguity, to correct or supplement any provision herein which may
be inconsistent with any other provision herein, or to make any other
provisions with respect to matters or questions arising under this
Indenture; provided such action shall not adversely affect the
interests of the Holders of Securities of any series and any related
coupons in any material respect; or
(10) to supplement any of the provisions of this Indenture to
such extent as shall be necessary to permit or facilitate the
defeasance and discharge of any series of
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Securities pursuant to Sections 401, 1402 and 1403; provided that any
such action shall not adversely affect the interests of the Holders of
Securities of such series and any related coupons or any other series
of Securities in any material respect.
SECTION 902. Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than a majority in
principal amount of all Outstanding Securities of any series, by Act of said
Holders delivered to the Company and the Trustee, the Company, when authorized
by or pursuant to a Board Resolution, and the Trustee may enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Indenture which affect such series of Securities or of modifying in any
manner the rights of the Holders of Securities of such series under this
Indenture; provided, however, that no such supplemental indenture shall, without
the consent of the Holder of each Outstanding Security of such series,
(1) change the Stated Maturity of the principal of, or any
installment of interest on any Security of such series, or reduce the
principal amount thereof or the rate of interest thereon or any premium
payable on the redemption thereof, or change the coin or currency in
which any Securities of such series or any premium of the interest
thereon is payable, or impair the right to institute suit for the
enforcement of any such payment after the Stated Maturity thereof, or
(2) reduce the percentage in principal amount of the
Outstanding Securities of such series, the consent of whose Holders is
required for any such waiver of compliance with certain provisions of,
or certain defaults and their consequences provided for in this
Indenture, or
(3) modify any of the provisions of this Section, Section 513
or Section 1011, except to increase the percentage of Outstanding
Securities of such series required for such actions or to provide that
certain other provisions of this Indenture cannot be modified or waived
without the consent of the Holder of each Outstanding Security of such
series affected thereby.
A supplemental indenture which changes or eliminates any
covenant or other provision of this Indenture which has expressly been included
solely for the benefit of one or more particular series of Securities, or which
modifies the rights of the Holders of Securities of such series with respect to
such covenant or other provision, shall be deemed not to affect the rights under
this Indenture of the Holders of Securities of any other series. Any such
supplemental indenture adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture, or modifying in any manner
the rights of the Holders
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of Securities of such series, shall not affect the rights under this Indenture
of the Holders of Securities of any other series.
It shall not be necessary for any Act of Holders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such Act shall approve the substance thereof.
SECTION 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by,
any supplemental indenture permitted by this Article or the modifications
thereby of the trusts created by this Indenture, the Trustee shall be entitled
to receive, and shall be fully protected in relying upon, an Opinion of Counsel
stating that the execution of such supplemental indenture is authorized or
permitted by this Indenture. The Trustee may, but shall not be obligated to,
enter into any such supplemental indenture which affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise.
SECTION 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this
Article, this Indenture shall be modified in accordance therewith, and such
supplemental indenture shall form a part of this Indenture for all purposes; and
every Holder of Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.
SECTION 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article
shall conform to the requirements of the Trust Indenture Act as then in effect.
SECTION 906. Reference in Securities to Supplemental
Indentures.
Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and shall
if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Company shall
so determine, new Securities of any series so modified as to conform, in the
opinion of the Trustee and the Company, to any such supplemental indenture may
be prepared and executed by the Company and authenticated and delivered by the
Trustee in exchange for Outstanding Securities of such series.
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SECTION 907. Notice of Supplemental Indentures.
Promptly after the execution by the Company and the Trustee of
any supplemental indenture pursuant to the provisions of Section 902, the
Company shall give notice thereof to the Holders of each Outstanding Security
affected, in the manner provided for in Section 106, setting forth in general
terms the substance of such supplemental indenture.
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium, if Any, and
Interest.
The Company covenants and agrees for the benefit of the
Holders of each series of Securities and any related coupons that it will duly
and punctually pay the principal of (and premium, if any) and interest, if any,
on the Securities of that series in accordance with the terms of the Securities,
any coupons appertaining thereto and this Indenture. Unless otherwise specified
as contemplated by Section 301 with respect to any series of Securities, any
interest installments due on Bearer Securities on or before Maturity shall be
payable only upon presentation and surrender of the several coupons for such
interest installments as are evidenced thereby as they severally mature.
SECTION 1002. Maintenance of Office or Agency.
If the Securities of a series are issuable only as Registered
Securities, the Company will maintain in each Place of Payment for any series of
Securities an office or agency where Securities of that series may be presented
or surrendered for payment, where Securities of that series may be surrendered
for registration of transfer or exchange, where Securities of that series that
are convertible or exchangeable may be surrendered for conversion or exchange,
as applicable and where notices and demands to or upon the Company in respect of
the Securities of that series and this Indenture may be served.
If Securities of a series are issuable as Bearer Securities,
the Company will maintain (A) in The City of New York, an office or agency where
any Registered Securities of that series may be presented or surrendered for
payment, where any Registered Securities of that series may be surrendered for
registration of transfer, where Securities of that series may be surrendered for
exchange, where Securities of that series that are convertible or exchangeable
may be surrendered for conversion or exchange, as applicable, where notices and
demands to or upon the Company in respect of the Securities of that series and
this Indenture may be served and where Bearer Securities of that series and
related coupons may
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be presented or surrendered for payment in the circumstances described in the
following paragraph (and not otherwise), (B) subject to any laws or regulations
applicable thereto, in a Place of Payment for that series which is located
outside the United States, an office or agency where Securities of that series
and related coupons may be presented and surrendered for payment; provided,
however, that, if the Securities of that series are listed on any stock exchange
located outside the United States and such stock exchange shall so require, the
Company will maintain a Paying Agent for the Securities of that series in any
required city located outside the United States so long as the Securities of
that series are listed on such exchange, and (C) subject to any laws or
regulations applicable thereto, in a Place of Payment for that series located
outside the United States an office or agency where any Registered Securities of
that series may be surrendered for registration of transfer, where Securities of
that series may be surrendered for exchange, where Securities of that series
that are convertible and exchangeable may be surrendered for conversion or
exchange, as applicable and where notices and demands to or upon the Company in
respect of the Securities of that series and this Indenture may be served.
The Company will give prompt written notice to the Trustee of
the location, and any change in the location, of such office or agency. If at
any time the Company shall fail to maintain any such required office or agency
or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, except that Bearer Securities of any
series and the related coupons may be presented and surrendered for payment at
the offices specified in the Security, in London, and the Company hereby
appoints the same as its agents to receive such respective presentations,
surrenders, notices and demands.
Unless otherwise specified with respect to any Securities
pursuant to Section 301, no payment of principal, premium or interest on Bearer
Securities shall be made at any office or agency of the Company in the United
States or by check mailed to any address in the United States or by transfer to
an account maintained with a bank located in the United States; provided,
however, that, if the Securities of a series are payable in Dollars, payment of
principal of (and premium, if any) and interest, if any, on any Bearer Security
shall be made at the office of the Company's Paying Agent in The City of New
York, if (but only if) payment in Dollars of the full amount of such principal,
premium or interest, as the case may be, at all offices or agencies outside the
United States maintained for such purpose by the Company in accordance with this
Indenture is illegal or effectively precluded by exchange controls or other
similar restrictions.
The Company may also from time to time designate one or more
other offices or agencies where the Securities of one or more series may be
presented or surrendered for any or all such purposes and may from time to time
rescind any such designation; provided, however, that no such designation or
rescission shall in any manner relieve the Company of its obligation to maintain
an office or agency in accordance with the requirements set forth
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above for Securities of any series for such purposes. The Company will give
prompt written notice to the Trustee of any such designation or rescission and
of any change in the location of any such other office or agency. Unless
otherwise specified with respect to any Securities as contemplated by Section
301 with respect to a series of Securities, the Company hereby designates as a
Place of Payment for each series of Securities the office or agency of the
Company in the Borough of Manhattan, The City of New York, and initially
appoints the Trustee at its Corporate Trust Office as Paying Agent in such city
and as its agent to receive all such presentations, surrenders, notices and
demands.
Unless otherwise specified with respect to any Securities
pursuant to Section 301, if and so long as the Securities of any series (i) are
denominated in a Currency other than Dollars or (ii) may be payable in a
Currency other than Dollars, or so long as it is required under any other
provision of the Indenture, then the Company will maintain with respect to each
such series of Securities, or as so required, at least one Exchange Rate Agent.
SECTION 1003. Money for Securities Payments to Be Held in
Trust.
If the Company shall at any time act as its own Paying Agent
with respect to any series of Securities and any related coupons, it will, on or
before each due date of the principal of (or premium, if any) or interest, if
any, on any of the Securities of that series, segregate and hold in trust for
the benefit of the Persons entitled thereto a sum in the Currency in which the
Securities of such series are payable (except as otherwise specified pursuant to
Section 301 for the Securities of such series and except, if applicable, as
provided in Sections 312(b), 312(d) and 312(e)) sufficient to pay the principal
of (or premium, if any) or interest, if any, on Securities of such series so
becoming due until such sums shall be paid to such Persons or otherwise disposed
of as herein provided and will promptly notify the Trustee of its action or
failure so to act.
Whenever the Company shall have one or more Paying Agents for
any series of Securities and any related coupons, it will, prior to or on each
due date of the principal of (or premium, if any) or interest, if any, on any
Securities of that series, deposit with a Paying Agent a sum (in the Currency
described in the preceding paragraph) sufficient to pay the principal (or
premium, if any) or interest, if any, so becoming due, such sum to be held in
trust for the benefit of the Persons entitled to such principal, premium or
interest, and (unless such Paying Agent is the Trustee) the Company will
promptly notify the Trustee of its action or failure so to act.
The Company will cause each Paying Agent (other than the
Trustee) for any series of Securities to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will:
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(1) hold all sums held by it for the payment of the principal
of (and premium, if any) and interest, if any, on Securities of such
series in trust for the benefit of the Persons entitled thereto until
such sums shall be paid to such Persons or otherwise disposed of as
herein provided;
(2) give the Trustee notice of any default by the Company (or
any other obligor upon the Securities of such series) in the making of
any payment of principal of (or premium, if any) or interest, if any,
on the Securities of such series; and
(3) at any time during the continuance of any such default,
upon the written request of the Trustee, forthwith pay to the Trustee
all sums so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
sums.
Except as provided in the Securities of any series, any money
deposited with the Trustee or any Paying Agent, or then held by the Company, in
trust for the payment of the principal of (or premium, if any) or interest, if
any, on any Security of any series, or any coupon appertaining thereto, and
remaining unclaimed for two years after such principal, premium or interest has
become due and payable shall be paid to the Company on Company Request, or (if
then held by the Company) shall be discharged from such trust; and the Holder of
such Security or coupon shall thereafter, as an unsecured general creditor, look
only to the Company for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Company cause to be published once, in an Authorized
Newspaper, notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
publication, any unclaimed balance of such money then remaining will be repaid
to the Company.
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SECTION 1004. Statement as to Compliance.
The Company will deliver to the Trustee, within 120 days after
the end of each fiscal year, a brief certificate from the principal executive
officer, principal financial officer or principal accounting officer as to his
or her knowledge of the Company's compliance with all conditions and covenants
under this Indenture. For purposes of this Section 1004, such compliance shall
be determined without regard to any period of grace or requirement of notice
under this Indenture.
SECTION 1005. Payment of Taxes and Other Claims.
The Company shall pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (1) all material taxes,
assessments and governmental charges levied or imposed upon it or any Subsidiary
or upon the income, profits or property of the Company or any of its
Subsidiaries, and (2) all material lawful claims for labor, materials and
supplies which, if unpaid, might by law become a Lien upon the property of the
Company or any of its subsidiaries; provided, however, that the Company shall
not be required to pay or discharge or cause to be paid or discharged any such
tax, assessment, charge or claim whose amount, applicability or validity is
being contested in good faith by appropriate proceedings.
SECTION 1006. Corporate Existence.
Subject to Article Eight, the Company will do or cause to be
done all things necessary to preserve and keep in full force and effect its
corporate existence and the rights (charter and statutory) and franchises of the
Company and any Restricted Subsidiary; provided, however, that the Company shall
not be required to preserve any such right or franchise if the Company shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Company and its Subsidiaries as a whole.
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Applicability of Article.
Securities of any series which are redeemable before their
Stated Maturity shall be redeemable in accordance with the terms of such
Securities and (except as otherwise specified as contemplated by Section 301 for
Securities of any series) in accordance with this Article.
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SECTION 1102. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be
evidenced by or pursuant to a Board Resolution. In case of any redemption at the
election of the Company, the Company shall, at least 60 days prior to the
Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date and of
the principal amount of Securities of such series to be redeemed and shall
deliver to the Trustee such documentation and records as shall enable the
Trustee to select the Securities to be redeemed pursuant to Section 1103. In the
case of any redemption of Securities prior to the expiration of any restriction
on such redemption provided in the terms of such Securities or elsewhere in this
Indenture, the Company shall furnish the Trustee with an Officers' Certificate
evidencing compliance with such restriction.
SECTION 1103. Selection by Trustee of Securities to Be
Redeemed.
If less than all the Securities of any series are to be
redeemed, the particular Securities to be redeemed shall be selected not more
than 60 days prior to the Redemption Date by the Trustee, from the Outstanding
Securities of such series not previously called for redemption, by such method
as the Trustee shall deem fair and appropriate and which may provide for the
selection for redemption of portions of the principal of Securities of such
series; provided, however, that no such partial redemption shall reduce the
portion of the principal amount of a Security not redeemed to less than the
minimum authorized denomination for Securities of such series established
pursuant to Section 301.
The Trustee shall promptly provide the Company with a copy of
the notice notifying Holders of a Security selected for redemption and, in the
case of any Securities 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
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 1104. Notice of Redemption.
Except as otherwise specified as contemplated by Section 301,
notice of redemption shall be given in the manner provided for in Section 106
not less than 30 nor more than 60 days prior to the Redemption Date, to each
Holder of Securities to be redeemed.
All notices of redemption shall identify the Securities
(including CUSIP number, if any) to be redeemed and shall state:
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(1) the Redemption Date,
(2) the Redemption Price and the amount of
accrued interest to the Redemption Date payable as provided in
Section 1106, if any,
(3) if less than all the Outstanding Securities
of any series are to be redeemed, the identification (and, in
the case of partial redemption, the principal amounts) of the
particular Securities to be redeemed,
(4) in case any Security is to be redeemed in
part only, the notice which relates to such Security shall
state that on and after the Redemption Date, upon surrender of
such Security, the holder will receive, without charge, a new
Security or Securities of authorized denominations for the
principal amount thereof remaining unredeemed,
(5) that on the Redemption Date, the Redemption
Price and accrued interest, if any, to the Redemption Date
payable as provided in Section 1106 will become due and
payable upon each such Security, or the portion thereof, to be
redeemed and, if applicable, that interest thereon will cease
to accrue on and after said date,
(6) the Place or Places of Payment where such
Securities, together in the case of Bearer Securities with all
coupons appertaining thereto, if any, maturing after the
Redemption Date, are to be surrendered for payment of the
Redemption Price and accrued interest, if any,
(7) that the redemption is for a sinking fund,
if such is the case,
(8) that, unless otherwise specified in such
notice, Bearer Securities of any series, if any, surrendered
for redemption must be accompanied by all coupons maturing
subsequent to the Redemption Date or the amount of any such
missing coupon or coupons will be deducted from the Redemption
Price unless security or indemnity satisfactory to the
Company, the Trustee and any Paying Agent is furnished, and
(9) if Bearer Securities of any series are to be
redeemed and any Registered Securities of such series are not
to be redeemed, and if such Bearer Securities may be exchanged
for Registered Securities not subject to redemption on such
Redemption Date pursuant to Section 305 or otherwise, the last
date, as determined by the Company, on which such exchanges
may be made.
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Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the Company's
request, by the Trustee in the name and at the expense of the Company.
SECTION 1105. Deposit of Redemption Price.
Prior to any Redemption Date, the Company shall deposit with
the Trustee or with a Paying Agent (or, if the Company is acting as its own
Paying Agent, segregate and hold in trust as provided in Section 1003) an amount
of money in the Currency in which the Securities of such series are payable
(except as otherwise specified pursuant to Section 301 for the Securities of
such series and except, if applicable, as provided in Sections 312(b), 312(d)
and 312(e)) sufficient to pay the Redemption Price of, and accrued interest, if
any, on, all the Securities which are to be redeemed on that date.
SECTION 1106. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the
Securities so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price therein specified in the Currency in which the
Securities of such series are payable (except as otherwise specified pursuant to
Section 301 for the Securities of such series and except, if applicable, as
provided in Sections 312(b), 312(d) and 312(e)) (together with accrued interest,
if any, to the Redemption Date), and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest, if any) such Securities shall, if the same were interest-bearing,
cease to bear interest and the coupons for such interest appertaining to any
Bearer Securities so to be redeemed, except to the extent provided below, shall
be void. Upon surrender of any such Security for redemption in accordance with
said notice, together with all coupons, if any, appertaining thereto maturing
after the Redemption Date, such Security shall be paid by the Company at the
Redemption Price, together with accrued interest, if any, to the Redemption
Date; provided, however, that installments of interest on Bearer Securities
whose Stated Maturity is on or prior to the Redemption Date shall be payable
only at an office or agency located outside the United States (except as
otherwise provided in Section 1002) and, unless otherwise specified as
contemplated by Section 301, only upon presentation and surrender of coupons for
such interest; and provided further that installments of interest on Registered
Securities whose Stated Maturity is on or prior to the Redemption Date shall be
payable to the Holders of such Securities, or one or more Predecessor
Securities, registered as such at the close of business on the relevant Record
Dates according to their terms and the provisions of Section 307.
If any Bearer Security surrendered for redemption shall not be
accompanied by all appurtenant coupons maturing after the Redemption Date, such
Security may be paid after deducting from the Redemption Price an amount equal
to the face amount of all such missing coupons, or the surrender of such missing
coupon or coupons may be waived by the
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Company and the Trustee if there be furnished to them such security or indemnity
as they may require to save each of them and any Paying Agent harmless. If
thereafter the Holder of such Security shall surrender to the Trustee or any
Paying Agent any such missing coupon in respect of which a deduction shall have
been made from the Redemption Price, such Holder shall be entitled to receive
the amount so deducted; provided, however, that interest represented by coupons
shall be payable only at an office or agency located outside the United States
(except as otherwise provided in Section 1002) and, unless otherwise specified
as contemplated by Section 301, only upon presentation and surrender of those
coupons.
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal (and premium, if any)
shall, until paid, bear interest from the Redemption Date at the rate of
interest or Yield to Maturity (in the case of Original Issue Discount
Securities) set forth in such Security.
SECTION 1107. Securities Redeemed in Part.
Any Security which is to be redeemed only in part (pursuant to
the provisions of this Article or of Article Twelve) shall be surrendered at a
Place of Payment therefor (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or such Holder's
attorney duly authorized in writing), and the Company shall execute, and the
Trustee shall authenticate and deliver to the Holder of such Security without
service charge, a new Security or Securities of the same series, of any
authorized denomination as requested by such Holder, in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Security so surrendered.
ARTICLE TWELVE
SINKING FUNDS
SECTION 1201. Applicability of Article.
Retirements of Securities of any series pursuant to any
sinking fund shall be made in accordance with the terms of such Securities and
(except as otherwise specified as contemplated by Section 301 for Securities of
any series) in accordance with this Article.
The minimum amount of any sinking fund payment provided for by
the terms of 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 Securities of any series is herein referred to as an
"optional sinking fund payment". If provided for by the terms of Securities of
any series, the cash amount of any mandatory sinking fund payment
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may be subject to reduction as provided in Section 1202. Each sinking fund
payment shall be applied to the redemption of Securities of any series as
provided for by the terms of Securities of such series.
SECTION 1202. Satisfaction of Sinking Fund Payments with
Securities.
Subject to Section 1203, in lieu of making all or any part of
any mandatory sinking fund payment with respect to any Securities of a series in
cash, the Company may at its option (1) deliver to the Trustee Outstanding
Securities of a series (other than any previously called for redemption)
theretofore purchased or otherwise acquired by the Company together in the case
of any Bearer Securities of such series with all unmatured coupons appertaining
thereto, and/or (2) receive credit for the principal amount of Securities of
such series which have been previously delivered to the Trustee by the Company
or for Securities of such series which have been redeemed either at the election
of the Company pursuant to the terms of such Securities or through the
application of permitted optional sinking fund payments pursuant to the terms of
such Securities, in each case in satisfaction of all or any part of any
mandatory sinking fund payment with respect to the Securities of the same series
required to be made pursuant to the terms of such Securities as provided for by
the terms of such series; provided, however, that such Securities have not been
previously so credited. Such Securities shall be received and credited for such
purpose by the Trustee at the Redemption Price specified in such Securities for
redemption through operation of the sinking fund and the amount of such
mandatory sinking fund payment shall be reduced accordingly.
SECTION 1203. Redemption of Securities for Sinking Fund.
Not less than 60 days prior to each sinking fund payment date
for any series of Securities, the Company will deliver to the Trustee an
Officers' Certificate specifying the amount of the next ensuing sinking fund
payment for that series pursuant to the terms of that series, the portion
thereof, if any, which is to be satisfied by payment of cash in the Currency in
which the Securities of such series are payable (except as otherwise specified
pursuant to Section 301 for the Securities of such series and except, if
applicable, as provided in Sections 312(b), 312(d) and 312(e)) and the portion
thereof, if any, which is to be satisfied by delivering or crediting Securities
of that series pursuant to Section 1202 (which Securities will, if not
previously delivered, accompany such certificate) and whether the Company
intends to exercise its right to make a permitted optional sinking fund payment
with respect to such series. Such certificate shall be irrevocable and upon its
delivery the Company shall be obligated to make the cash payment or payments
therein referred to, if any, on or before the next succeeding sinking fund
payment date. In the case of the failure of the Company to deliver such
certificate, the sinking fund payment due on the next succeeding sinking fund
payment date for that series shall be paid entirely in cash and shall be
sufficient to redeem the principal amount of such Securities subject to a
mandatory sinking
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fund payment without the option to deliver or credit Securities as provided in
Section 1202 and without the right to make any optional sinking fund payment, if
any, with respect to such series.
Not more than 60 days before each such sinking fund payment
date the Trustee shall select the Securities to be redeemed upon such sinking
fund payment date in the manner specified in Section 1103 and cause notice of
the redemption thereof to be given in the name of and at the expense of the
Company in the manner provided in Section 1104. Such notice having been duly
given, the redemption of such Securities shall be made upon the terms and in the
manner stated in Sections 1106 and 1107.
Prior to any sinking fund payment date, the Company shall pay
to the Trustee or a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 1003) in cash a sum
equal to any interest that will accrue to the date fixed for redemption of
Securities or portions thereof to be redeemed on such sinking fund payment date
pursuant to this Section 1203.
Notwithstanding the foregoing, with respect to a sinking fund
for any series of Securities, if at any time the amount of cash to be paid into
such sinking fund on the next succeeding sinking fund payment date, together
with any unused balance of any preceding sinking fund payment or payments for
such series, does not exceed in the aggregate $100,000, the Trustee, unless
requested by the Company, shall not give the next succeeding notice of the
redemption of Securities of such series through the operation of the sinking
fund. Any such unused balance of moneys deposited in such sinking fund shall be
added to the sinking fund payment for such series to be made in cash on the next
succeeding sinking fund payment date or, at the request of the Company, shall be
applied at any time or from time to time to the purchase of Securities of such
series, by public or private purchase, in the open market or otherwise, at a
purchase price for such Securities (excluding accrued interest and brokerage
commissions, for which the Trustee or any Paying Agent will be reimbursed by the
Company) not in excess of the principal amount thereof.
ARTICLE THIRTEEN
REPAYMENT AT OPTION OF HOLDERS
SECTION 1301. Applicability of Article.
Repayment of Securities of any series before their Stated
Maturity at the option of Holders thereof shall be made in accordance with the
terms of such Securities and (except as otherwise specified as contemplated by
Section 301 for Securities of any series) in accordance with this Article.
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SECTION 1302. Repayment of Securities.
Securities of any series subject to repayment in whole or in
part at the option of the Holders thereof will, unless otherwise provided in the
terms of such Securities, be repaid at a price equal to the principal amount
thereof, together with interest, if any, thereon accrued to the Repayment Date
specified in or pursuant to the terms of such Securities. The Company covenants
that on or before the Repayment Date it will deposit with the Trustee or with a
Paying Agent (or, if the Company is acting as its own Paying Agent, segregate
and hold in trust as provided in Section 1003) an amount of money in the
Currency in which the Securities of such series are payable (except as otherwise
specified pursuant to Section 301 for the Securities of such series and except,
if applicable, as provided in Sections 312(b), 312(d) and 312(e)) sufficient to
pay the principal (or, if so provided by the terms of the Securities of any
series, a percentage of the principal) of and (except if the Repayment Date
shall be an Interest Payment Date) accrued interest, if any, on, all the
Securities or portions thereof, as the case may be, to be repaid on such date.
SECTION 1303. Exercise of Option.
Securities of any series subject to repayment at the option of
the Holders thereof will contain an "Option to Elect Repayment" form on the
reverse of such Securities. To be repaid at the option of the Holder, any
Security so providing for such repayment, with the "Option to Elect Repayment"
form on the reverse of such Security duly completed by the Holder (or by the
Holder's attorney duly authorized in writing), must be received by the Company
at the Place of Payment therefor specified in the terms of such Security (or at
such other place or places or which the Company shall from time to time notify
the Holders of such Securities) not earlier than 45 days nor later than 30 days
prior to the Repayment Date. If less than the entire principal amount of such
Security is to be repaid in accordance with the terms of such Security, the
principal amount of such Security to be repaid, in increments of the minimum
denomination for Securities of such series, and the denomination or
denominations of the Security or Securities to be issued to the Holder for the
portion of the principal amount of such Security surrendered that is not to be
repaid, must be specified. The principal amount of any Security providing for
repayment at the option of the Holder thereof may not be repaid in part if,
following such repayment, the unpaid principal amount of such Security would be
less than the minimum authorized denomination of Securities of the series of
which such Security to be repaid is a part. Except as otherwise may be provided
by the terms of any Security providing for repayment at the option of the Holder
thereof, exercise of the repayment option by the Holder shall be irrevocable
unless waived by the Company.
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SECTION 1304. When Securities Presented for Repayment Become
Due and Payable.
If Securities of any series providing for repayment at the
option of the Holders thereof shall have been surrendered as provided in this
Article and as provided by or pursuant to the terms of such Securities, such
Securities or the portions thereof, as the case may be, to be repaid shall
become due and payable and shall be paid by the Company on the Repayment Date
therein specified, and on and after such Repayment Date (unless the Company
shall default in the payment of such Securities on such Repayment Date) such
Securities shall, if the same were interest-bearing, cease to bear interest and
the coupons for such interest appertaining to any Bearer Securities so to be
repaid, except to the extent provided below, shall be void. Upon surrender of
any such Security for repayment in accordance with such provisions, together
with all coupons, if any, appertaining thereto maturing after the Repayment
Date, the principal amount of such Security so to be repaid shall be paid by the
Company, together with accrued interest, if any, to the Repayment Date;
provided, however, that coupons whose Stated Maturity is on or prior to the
Repayment Date shall be payable only at an office or agency located outside the
United States (except as otherwise provided in Section 1002) and, unless
otherwise specified pursuant to Section 301, only upon presentation and
surrender of such coupons; and provided further that, in the case of Registered
Securities, installments of interest, if any, whose Stated Maturity is on or
prior to the Repayment Date shall be payable to the Holders of such Securities,
or one or more Predecessor Securities, registered as such at the close of
business on the relevant Record Dates according to their terms and the
provisions of Section 307.
If any Bearer Security surrendered for repayment shall not be
accompanied by all appurtenant coupons maturing after the Repayment Date, such
Security may be paid after deducting from the amount payable therefor as
provided in Section 1302 an amount equal to the face amount of all such missing
coupons, or the surrender of such missing coupon or coupons may be waived by the
Company and the Trustee if there be furnished to them such security or indemnity
as they may require to save each of them and any Paying Agent harmless. If
thereafter the Holder of such Security shall surrender to the Trustee or any
Paying Agent any such missing coupon in respect of which a deduction shall have
been made as provided in the preceding sentence, such Holder shall be entitled
to receive the amount so deducted; provided, however, that interest represented
by coupons shall be payable only at an office or agency located outside the
United States (except as otherwise provided in Section 1002) and, unless
otherwise specified as contemplated by Section 301, only upon presentation and
surrender of those coupons.
If the principal amount of any Security surrendered for
repayment shall not be so repaid upon surrender thereof, such principal amount
(together with interest, if any, thereon accrued to such Repayment Date) shall,
until paid, bear interest from the Repayment
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Date at the rate of interest or Yield to Maturity (in the case of Original Issue
Discount Securities) set forth in such Security.
SECTION 1305. Securities Repaid in Part.
Upon surrender of any Registered Security which is to be
repaid in part only, the Company shall execute and the Trustee shall
authenticate and deliver to the Holder of such Security, without service charge
and at the expense of the Company, a new Registered Security or Securities of
the same series, of any authorized denomination specified by the Holder, in an
aggregate principal amount equal to and in exchange for the portion of the
principal of such Security so surrendered which is not to be repaid.
ARTICLE FOURTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1401. Company's Option to Effect Defeasance or
Covenant Defeasance.
Except as otherwise specified as contemplated by Section 301
for Securities of any series, the provisions of this Article Fourteen shall
apply to each series of Securities, and the Company may, at its option, effect
defeasance of the Securities of or within a series under Section 1402, or
covenant defeasance of or within a series under Section 1403 in accordance with
the terms of such Securities and in accordance with this Article.
SECTION 1402. Defeasance and Discharge.
Upon the Company's exercise of the above option applicable to
this Section with respect to any Securities of or within a series, the Company
shall be deemed to have been discharged from its obligations with respect to
such Outstanding Securities and any related coupons on the date the conditions
set forth in Section 1404 are satisfied (hereinafter, "defeasance"). For this
purpose, such defeasance means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by such Outstanding Securities
and any related coupons, which shall thereafter be deemed to be "Outstanding"
only for the purposes of Section 1405 and the other Sections of this Indenture
referred to in (A) and (B) below, and to have satisfied all its other
obligations under such Securities and any related coupons and this Indenture
insofar as such Securities and any related coupons are concerned (and the
Trustee, at the expense of the Company, shall execute proper instruments
acknowledging the same), except for the following which shall survive until
otherwise terminated or discharged hereunder: (A) the rights of Holders of such
Outstanding Securities and any related coupons to receive, solely from the trust
fund described in Section 1404 and
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as more fully set forth in such Section, payments in respect of the principal of
(and premium, if any) and interest, if any, on such Securities and any related
coupons when such payments are due, (B) the Company's obligations with respect
to such Securities under Sections 304, 305, 306, 1002 and 1003, (C) the rights,
powers, trusts, duties and immunities of the Trustee hereunder and (D) this
Article Fourteen. Subject to compliance with this Article Fourteen, the Company
may exercise its option under this Section 1402 notwithstanding the prior
exercise of its option under Section 1403 with respect to such Securities and
any related coupons.
SECTION 1403. Covenant Defeasance.
Upon the Company's exercise of the above option applicable to
this Section with respect to any Securities of or within a series, the Company
shall be released from its obligations under Sections 1005 and 1006 and, if
specified pursuant to Section 301, its obligations under any other covenant,
with respect to such Outstanding Securities and any related coupons on and after
the date the conditions set forth in Section 1404 are satisfied (hereinafter,
"covenant defeasance"), and such Securities and any related coupons shall
thereafter be deemed not to be "Outstanding" for the purposes of any direction,
waiver, consent or declaration or Act of Holders (and the consequences of any
thereof) in connection with such covenants, but shall continue to be deemed
"Outstanding" for all other purposes hereunder. For this purpose, such covenant
defeasance means that, with respect to such Outstanding Securities and any
related coupons, the Company may omit to comply with and shall have no liability
in respect of any term, condition or limitation set forth in any such covenant,
whether directly or indirectly, by reason of any reference elsewhere herein to
any such covenant or by reason of reference in any such covenant to any other
provision herein or in any other document and such omission to comply shall not
constitute a Default or an Event of Default under Section 501(4) or Section
501(8) or otherwise, as the case may be, but, except as specified above, the
remainder of this Indenture and such Securities and any related coupons shall be
unaffected thereby.
SECTION 1404. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to application of either
Section 1402 or Section 1403 to any Outstanding Securities of or within a series
and any related coupons:
(1) The Company shall irrevocably have deposited or
caused to be deposited with the Trustee (or another trustee satisfying
the requirements of Section 607 who shall agree to comply with the
provisions of this Article Fourteen applicable to it) as trust funds in
trust for the purpose of making the following payments, specifically
pledged as security for, and dedicated solely to, the benefit of the
Holders of such Securities and any related coupons, (A) an amount (in
such Currency in which such Securities and any related coupons are then
specified as
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payable at Stated Maturity), or (B) Government Obligations applicable
to such Securities (determined on the basis of the Currency in which
such Securities are then specified as payable at Stated Maturity) which
through the scheduled payment of principal and interest in respect
thereof in accordance with their terms will provide, not later than one
day before the due date of any payment of principal of and premium, if
any, and interest, if any, under such Securities and any related
coupons, money in an amount, or (C) a combination thereof, sufficient,
in the opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to
the Trustee, to pay and discharge, and which shall be applied by the
Trustee (or other qualifying trustee) to pay and discharge, (i) the
principal of (and premium, if any) and interest, if any, on such
Outstanding Securities and any related coupons on the Stated Maturity
(or Redemption Date, if applicable) of such principal (and premium, if
any) or installment of interest, if any, and (ii) any mandatory sinking
fund payments or analogous payments applicable to such Outstanding
Securities and any related coupons on the day on which such payments
are due and payable in accordance with the terms of this Indenture and
of such Securities and any related coupons; provided that the Trustee
shall have been irrevocably instructed to apply such money or the
proceeds of such Government Obligations to said payments with respect
to such Securities and any related coupons. Before such a deposit, the
Company may give to the Trustee, in accordance with Section 1102
hereof, a notice of its election to redeem all or any portion of such
Outstanding Securities at a future date in accordance with the terms of
the Securities of such series and Article Eleven hereof, which notice
shall be irrevocable. Such irrevocable redemption notice, if given,
shall be given effect in applying the foregoing.
(2) No Default or Event of Default with respect to such
Securities or any related coupons shall have occurred and be continuing
on the date of such deposit or, insofar as paragraphs (5) and (6) of
Section 501 are concerned, 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).
(3) Such defeasance or covenant defeasance shall not
result in a breach or violation of, or constitute a default under, this
Indenture or any other material agreement or instrument to which the
Company is a party or by which it is bound.
(4) In the case of an election under Section 1402, the
Company shall have delivered to the Trustee an Opinion of Counsel
stating that (x) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling, or (y) since the
date of execution of this Indenture, there has been a change in the
applicable federal income tax law, in either case to the effect that,
and based thereon such opinion shall confirm that, the Holders of such
Outstanding Securities and any
<PAGE> 98
88
related coupons will not recognize income, gain or loss for federal
income tax purposes as a result of such 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 defeasance had not
occurred.
(5) In the case of an election under Section 1403, the
Company shall have delivered to the Trustee an Opinion of Counsel to
the effect that the Holders of such Outstanding Securities and any
related coupons 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.
(6) Notwithstanding any other provisions of this Section,
such defeasance or covenant defeasance shall be effected in compliance
with any additional or substitute terms, conditions or limitations in
connection therewith pursuant to Section 301.
(7) The Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for relating to either the defeasance
under Section 1402 or the covenant defeasance under Section 1403 (as
the case may be) have been complied with.
SECTION 1405. Deposited Money and Government Obligations to Be
Held in Trust; Other Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section
1003, all money and Government Obligations (or other property as may be provided
pursuant to Section 301) (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee, collectively for purposes of this Section
1405, the "Trustee") pursuant to Section 1404 in respect of such Outstanding
Securities and any related coupons shall be held in trust and applied by the
Trustee, in accordance with the provisions of such Securities and any related
coupons and this Indenture, to the payment, either directly or through any
Paying Agent (including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Holders of such Securities and any related coupons
of all sums due and to become due thereon in respect of principal (and premium,
if any) and interest, if any, but such money need not be segregated from other
funds except to the extent required by law.
Unless otherwise specified with respect to any Security
pursuant to Section 301, if, after a deposit referred to in Section 1404(1) has
been made, (a) the Holder of a Security in respect of which such deposit was
made is entitled to, and does, elect pursuant to Section 312(b) or the terms of
such Security to receive payment in a Currency
<PAGE> 99
89
other than that in which the deposit pursuant to Section 1404(1) has been made
in respect of such Security, or (b) a Conversion Event occurs as contemplated in
Section 312(d) or 312(e) or by the terms of any Security in respect of which the
deposit pursuant to Section 1404(1) has been made, the indebtedness represented
by such Security and any related coupons shall be deemed to have been, and will
be, fully discharged and satisfied through the payment of the principal of (and
premium, if any) and interest, if any, on such Security as they become due out
of the proceeds yielded by converting (from time to time as specified below in
the case of any such election) the amount or other property deposited in respect
of such Security into the Currency in which such Security becomes payable as a
result of such election or Conversion Event based on the applicable Market
Exchange Rate for such Currency in effect on the third Business Day prior to
each payment date, except, with respect to a Conversion Event, for such Currency
in effect (as nearly as feasible) at the time of the Conversion Event.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the Government
Obligations deposited pursuant to Section 1404 or the principal and interest
received in respect thereof other than any such tax, fee or other charge which
by law is for the account of the Holders of such Outstanding Securities and any
related coupons.
Anything in this Article Fourteen to the contrary
notwithstanding, the Trustee shall deliver or pay to the Company from time to
time upon Company Request any money or Government Obligations (or other property
and any proceeds therefrom) held by it as provided in Section 1404 which, in the
opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, are in
excess of the amount thereof which would then be required to be deposited to
effect an equivalent defeasance or covenant defeasance, as applicable, in
accordance with this Article.
SECTION 1406. Reinstatement.
If the Trustee or any Paying Agent is unable to apply any
money in accordance with Section 1405 by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, then the Company's obligations under this Indenture and such
Securities and any related coupons shall be revived and reinstated as though no
deposit had occurred pursuant to Section 1402 or 1403, as the case may be, until
such time as the Trustee or Paying Agent is permitted to apply all such money in
accordance with Section 1405; provided, however, that if the Company makes any
payment of principal of (or premium, if any) or interest, if any, on any such
Security or any related coupon following the reinstatement of its obligations,
the Company shall be subrogated to the rights of the Holders of such Securities
and any related coupons to receive such payment from the money held by the
Trustee or Paying Agent.
<PAGE> 100
90
ARTICLE FIFTEEN
MEETINGS OF HOLDERS OF SECURITIES
SECTION 1501. Purposes for Which Meetings May Be Called.
If Securities of a series are issuable as Bearer Securities, a
meeting of Holders of Securities of such series may be called at any time and
from time to time pursuant to this Article to make, give or take any request,
demand, authorization, direction, notice, consent, waiver or other action
provided by this Indenture to be made, given or taken by Holders of Securities
of such series.
SECTION 1502. Call, Notice and Place of Meetings.
(a) The Trustee may at any time call a meeting of Holders
of Securities of any series for any purpose specified in Section 1501, to be
held at such time and at such place in The City of New York or in London as the
Trustee shall determine. Notice of every meeting of Holders of Securities of any
series, setting forth the time and the place of such meeting and in general
terms the action proposed to be taken at such meeting, shall be given, in the
manner provided for in Section 106, not less than 21 nor more than 180 days
prior to the date fixed for the meeting.
(b) In case at any time the Company, pursuant to a Board
Resolution, or the Holders of at least 10% in principal amount of the
Outstanding Securities of any series shall have requested the Trustee to call a
meeting of the Holders of Securities of such series for any purpose specified in
Section 1501, by written request setting forth in reasonable detail the action
proposed to be taken at the meeting, and the Trustee shall not have made the
first publication of the notice of such meeting within 21 days after receipt of
such request or shall not thereafter proceed to cause the meeting to be held as
provided herein, then the Company or the Holders of Securities of such series in
the amount above specified, as the case may be, may determine the time and the
place in The City of New York or in London for such meeting and may call such
meeting for such purposes by giving notice thereof as provided in paragraph (a)
of this Section.
SECTION 1503. Persons Entitled to Vote at Meetings.
To be entitled to vote at any meeting of Holders of Securities
of any series, a Person shall be (1) a Holder of one or more Outstanding
Securities of such series, or (2) a Person appointed by an instrument in writing
as proxy for a Holder or Holders of one or more Outstanding Securities of such
series by such Holder of Holders. The only Persons who shall be entitled to be
present or to speak at any meeting of Holders of Securities of any
<PAGE> 101
91
series shall be the Person entitled to vote at such meeting and their counsel,
any representatives of the Trustee and its counsel and any representatives of
the Company and its counsel.
SECTION 1504. Quorum; Action.
The Persons entitled to vote a majority in principal amount of
the Outstanding Securities of a series shall constitute a quorum for a meeting
of Holders of Securities of such series; provided, however, that, if any action
is to be taken at such meeting with respect to a consent or waiver which this
Indenture expressly provides may be given by the Holders of not less than a
specified percentage in principal amount of the Outstanding Securities of a
series, the Persons entitled to vote such specified percentage in principal
amount of the Outstanding Securities of such series shall constitute a quorum.
In the absence of a quorum within 30 minutes of the time appointed for any such
meeting, the meeting shall, if convened at the request of Holders of Securities
of such series, be dissolved. In any other case the meeting may be adjourned for
a period of not less than 10 days as determined by the chairman of the meeting
prior to the adjournment of such meeting. In the absence of a quorum at any such
adjourned meeting, such adjourned meeting may be further adjourned for a period
of not less than 10 days as determined by the chairman of the meeting prior to
the adjournment of such adjourned meeting. Notice of the reconvening of any
adjourned meeting shall be given as provided in Section 1502(a), except that
such notice need be given only once not less than five days prior to the date on
which the meeting is scheduled to be reconvened. Notice of the reconvening of
any adjourned meeting shall state expressly the percentage, as provided above,
of the principal amount of the Outstanding Securities of such series which shall
constitute a quorum.
Subject to the foregoing, at the reconvening of any meeting
adjourned for lack of a quorum the Persons entitled to vote 25% in principal
amount of the Outstanding Securities at the time shall constitute a quorum for
the taking of any action set forth in the notice of the original meeting.
Except as limited by the proviso to Section 902, any
resolution presented to a meeting or adjourned meeting duly reconvened at which
a quorum is present as aforesaid may be adopted by the affirmative vote of the
Holders of not less than a majority in principal amount of the Outstanding
Securities of such series; provided, however, that, except as limited by the
proviso to Section 902, any resolution with respect to any request, demand,
authorization, direction, notice, consent, waiver or other action which this
Indenture expressly provides may be made, given or taken by the Holders of a
specified percentage, which is less than a majority, in principal amount of the
Outstanding Securities of a series may be adopted at a meeting or an adjourned
meeting duly reconvened and at which a quorum is present as aforesaid by the
affirmative vote of the Holders of not less than such specified percentage in
principal amount of the Outstanding Securities of such series.
<PAGE> 102
92
Any resolution passed or decision taken at any meeting of
Holders of Securities of any series duly held in accordance with this Section
shall be binding on all the Holders of Securities of such series and the related
coupons, whether or not present or represented at the meeting.
Notwithstanding the foregoing provisions of this Section 1504,
if any action is to be taken at a meeting of Holders of Securities of any series
with respect to any request, demand, authorization, direction, notice, consent,
waiver or other action that this Indenture expressly provides may be made, given
or taken by the Holders of a specified percentage in principal amount of all
Outstanding Securities affected thereby, or of the Holders of such series and
one or more additional series:
(i) there shall be no minimum quorum requirement for such
meeting; and
(ii) the principal amount of the Outstanding Securities of
such series that vote in favor of such request, demand, authorization,
direction, notice, consent, waiver or other action shall be taken into
account in determining whether such request, demand, authorization,
direction, notice, consent, waiver or other action has been made, given
or taken under this Indenture.
SECTION 1505. Determination of Voting Rights; Conduct and
Adjournment of Meetings.
(a) Notwithstanding any provisions of this Indenture, the
Trustee may make such reasonable regulations as it may deem advisable for any
meeting of Holders of Securities of a series in regard to proof of the holding
of Securities of such series and of the appointment of proxies and in regard to
the appointment and duties of inspectors of votes, the submission and
examination of proxies, certificates and other evidence of the right to vote,
and such other matters concerning the conduct of the meeting as its shall deem
appropriate. Except as otherwise permitted or required by any such regulations,
the holding of Securities shall be proved in the manner specified in Section 104
and the appointment of any proxy shall be proved in the manner specified in
Section 104 or by having the signature of the person executing the proxy
witnessed or guaranteed by any trust company, bank or banker authorized by
Section 104 to certify to the holding of Bearer Securities. Such regulations may
provide that written instruments appointing proxies, regular on their face, may
be presumed valid and genuine without the proof specified in Section 104 or
other proof.
(b) The Trustee shall, by an instrument in writing
appoint a temporary chairman of the meeting, unless the meeting shall have been
called by the Company or by Holders of Securities as provided in Section
1502(b), in which case the Company or the Holders of Securities of the series
calling the meeting, as the case may be, shall in like
<PAGE> 103
93
manner appoint a temporary chairman. A permanent chairman and a permanent
secretary of the meeting shall be elected by vote of the Persons entitled to
vote a majority in principal amount of the Outstanding Securities of such series
represented at the meeting.
(c) At any meeting each Holder of a Security of such
series or proxy shall be entitled to one vote for each $1,000 principal amount
of Outstanding Securities of such series held or represented by him (determined
as specified in the definition of "Outstanding" in Section 101); provided,
however, that no vote shall be cast or counted at any meeting in respect of any
Security challenged as not Outstanding and ruled by the chairman of the meeting
to be not Outstanding. The chairman of the meeting shall have no right to vote,
except as a Holder of a Security of such series or proxy.
(d) Any meeting of Holders of Securities of any series
duly called pursuant to Section 1502 at which a quorum is present may be
adjourned from time to time by Persons entitled to vote a majority in principal
amount of the Outstanding Securities of such series represented at the meeting;
and the meeting may be held as so adjourned without further notice.
SECTION 1506. Counting Votes and Recording Action of Meetings.
The vote upon any resolution submitted to any meeting of
Holders of Securities of any series shall be by written ballots on which shall
be subscribed the signatures of the Holders of Securities of such series or of
their representatives by proxy and the principal amounts and serial numbers of
the Outstanding Securities of such series held or represented by them. The
permanent chairman of the meeting shall appoint two inspectors of votes who
shall count all votes cast at the meeting for or against any resolution and who
shall make and file with the secretary of the meeting their verified written
reports in duplicate of all votes cast at the meeting. A record, at least in
duplicate, of the proceedings of each meeting of Holders of Securities of any
series shall be prepared by the Secretary of the meeting and there shall be
attached to said record the original reports of the inspectors of votes on any
vote by ballot taken thereat and affidavits by one or more persons having
knowledge of the facts setting forth a copy of the notice of the meeting and
showing that said notice was given as provided in Section 1502 and, if
applicable, Section 1504. Each copy shall be signed and verified by the
affidavits of the permanent chairman and secretary of the meeting and one such
copy shall be delivered to the Company, and another to the Trustee to be
preserved by the Trustee, the latter to have attached thereto the ballots voted
at the meeting. Any record so signed and verified shall be conclusive evidence
of the matters therein stated.
This Indenture may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same Indenture.
<PAGE> 104
94
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
DVI, INC.
By: /s/ Steven R. Garfinkel
__________________________
Name: Steven R. Garfinkel
Title: Executive Vice President and
Chief Financial Officer
[Seal]
Attest:
FIRST TRUST NATIONAL ASSOCIATION
By: /s/ Edward F. Kachinski
__________________________
Name: Edward F. Kachinski
Title: Vice President
[Seal]
Attest:
<PAGE> 105
EXHIBIT A
FORMS OF CERTIFICATION
EXHIBIT A-1
FORM OF CERTIFICATE TO BE GIVEN BY
PERSON ENTITLED TO RECEIVE BEARER SECURITY
OR TO OBTAIN INTEREST PAYABLE PRIOR
TO THE EXCHANGE DATE
CERTIFICATE
[Insert title or sufficient description
of Securities to be delivered]
This is to certify that as of the date hereof, and except as
set forth below, the above-captioned Securities held by you for our account (i)
are owned by person(s) that are not citizens or residents of the United States,
domestic partnerships, domestic corporations or any estate or trust the income
of which is subject to United States federal income taxation regardless of its
source ("United States persons(s)"), (ii) are owned by United States person(s)
that are (a) foreign branches of United States financial institutions (financial
institutions, as defined in United States Treasury Regulations Section
2.165-12(c)(1)(v) are herein referred to as "financial institutions") purchasing
for their own account or for resale, or (b) United States person(s) who acquired
the Securities through foreign branches of United States financial institutions
and who hold the Securities through such United States financial institutions on
the date hereof (and in either case (a) or (b), each such United States
financial institution hereby agrees, on its own behalf or through its agent,
that you may advise DVI, Inc. or its agent that such financial institution will
comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the United
States Internal Revenue Code of 1986, as amended, and the regulations
thereunder), or (iii) are owned by United States or foreign financial
institution(s) for purposes of resale during the restricted period (as defined
in United States Treasury Regulations Section 1.163-5(c)(2)(i)(D)(7)), and, in
addition, if the owner is a United States or foreign financial institution
described in clause (iii) above (whether or not also described in clause (i) or
(ii)), this is to further certify that such financial institution has not
acquired the Securities for purposes of resale directly or indirectly to a
United States person or to a person within the United States or its possessions.
As used herein, "United States" means the United States of
America (including the states and the District of Columbia); and its
"possessions" include Puerto Rico, the U.S. Virgin Islands, Guam, American
Samoa, Wake Island and the Northern Mariana Islands.
A-1-1
<PAGE> 106
We undertake to advise you promptly by tested telex on or
prior to the date on which you intend to submit your certification relating to
the above-captioned Securities held by you for our account in accordance with
your Operating Procedures if any applicable statement herein is not correct on
such date, and in the absence of any such notification it may be assumed that
this certification applies as of such date.
This certificate excepts and does not relate to
[U.S.$]__________ of such interest in the above-captioned Securities in respect
of which we are not able to certify and as to which we understand an exchange
for an interest in a Permanent Global Security or an exchange for and delivery
of definitive Securities (or, if relevant, collection of any interest) cannot be
made until we do so certify.
We understand that this certificate may be required in
connection with certain tax legislation in the United States. If administrative
or legal proceedings are commenced or threatened in connection with which this
certificate is or would be relevant, we irrevocably authorize you to produce
this certificate or a copy thereof to any interested party in such proceedings.
Dated:
[To be dated no earlier than the
15th day prior to (i) the Exchange
Date or (ii) the relevant Interest
Payment Date occurring prior to the
Exchange Date, as applicable]
[Name of Person Making Certification]
________________________________________
(Authorized Signatory)
Name:
Title:
A-1-2
<PAGE> 107
EXHIBIT A-2
FORM OF CERTIFICATE TO BE GIVEN BY EUROCLEAR
AND CEDEL S.A. IN
CONNECTION WITH THE EXCHANGE OF A PORTION OF A
TEMPORARY GLOBAL SECURITY OR TO OBTAIN INTEREST
PAYABLE PRIOR TO THE EXCHANGE DATE
CERTIFICATE
[Insert title or sufficient description
of Securities to be delivered]
This is to certify that based solely on written certifications
that we have received in writing, by tested telex or by electronic transmission
from each of the persons appearing in our records as persons entitled to a
portion of the principal amount set forth below (our "Member Organizations")
substantially in the form attached hereto, as of the date hereof,
[U.S.$]__________ principal amount of the above-captioned Securities (i) is
owned by person(s) that are not citizens or residents of the United States,
domestic partnerships, domestic corporations or any estate or trust the income
of which is subject to United States Federal income taxation regardless of its
source ("United States person(s)"), (ii) is owned by United States person(s)
that are (a) foreign branches of United States financial institutions (financial
institutions, as defined in U.S. Treasury Regulations Section 1.165-12(c)(1)(v)
are herein referred to as "financial institutions") purchasing for their own
account or for resale, or (b) United States person(s) who acquired the
Securities through foreign branches of United States financial institutions and
who hold the Securities through such United States financial institutions on the
date hereof (and in either case (a) or (b), each such financial institution has
agreed, on its own behalf or through its agent, that we may advise DVI, Inc. or
its agent that such financial institution will comply with the requirements of
Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as
amended, and the regulations thereunder), or (iii) is owned by United States or
foreign financial institution(s) for purposes of resale during the restricted
period (as defined in United States Treasury Regulations Section
1.163-5(c)(2)(i)(D)(7)) and, to the further effect, that financial institutions
described in clause (iii) above (whether or not also described in clause (i) or
(ii)) have certified that they have not acquired the Securities for purposes of
resale directly or indirectly to a United States person or to a person within
the United States or its possessions.
As used herein, "United States" means the United States of
America (including the states and the District of Columbia); and its
"possessions" include Puerto Rico, the U.S. Virgin Islands, Guam, American
Samoa, Wake Island and the Northern Mariana Islands.
A-2-1
<PAGE> 108
We further certify that (i) we are not making available
herewith for exchange (or, if relevant, collection of any interest) any portion
of the temporary global Security representing the above-captioned Securities
excepted in the above-referenced certificates of Member Organizations and (ii)
as of the date hereof we have not received any notification from any of our
Member Organizations to the effect that the statements made by such Member
Organizations with respect to any portion of the part submitted herewith for
exchange (or, if relevant, collection of any interest) are no longer true and
cannot be relied upon as of the date hereof.
We understand that this certification is required in
connection with certain tax legislation in the United States. If administrative
or legal proceedings are commenced or threatened in connection with which this
certificate is or would be relevant, we irrevocably authorize you to produce
this certificate or a copy thereof to any interested party in such proceedings.
Dated:
[To be dated no earlier than the
Exchange Date or the relevant
Interest Payment Date occurring
prior to the Exchange Date, as
applicable]
[MORGAN GUARANTY TRUST
COMPANY OF NEW YORK, BRUSSELS
OFFICE, as Operator of the Euroclear
System]
[CEDEL S.A.]
By_________________________________
A-2-2
<PAGE> 1
DVI, INC.,
Issuer
to
FIRST TRUST NATIONAL ASSOCIATION,
Trustee
--------------------------
FIRST SUPPLEMENTAL INDENTURE
Dated as of January 30, 1997
to
DEBT SECURITIES INDENTURE
Dated as of January 27, 1997.
--------------------------
<PAGE> 2
FIRST SUPPLEMENTAL INDENTURE, dated as of January 30, 1997,
between DVI, Inc., a Delaware corporation, and First Trust National Association,
a national banking association, trustee (the "Trustee") under the Debt
Securities Indenture dated as of January 27, 1997 (the "Indenture").
RECITALS
Section 901(2) of the Indenture permits supplements thereto
without the consent of Holders of Securities to add to the covenants of the
Company for the benefit of all or any series of Securities and Section 902(7) of
the Indenture permits supplements thereto to establish the form or terms of
Securities of any series as permitted by Sections 201 and 301; and
The Company wishes to establish the form and terms of its 9 7/8%
Senior Notes due 2004 (the "Notes") and to add to the Indenture certain
covenants of the Company only for the benefit of the Holders of the Notes.
NOW THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE WITNESSETH:
ARTICLE ONE
THE NOTES
SECTION 1.01. Creation of the Debt Securities. In accordance with
Section 301 of the Indenture, the Company hereby creates the Notes as a series
of its Securities issued pursuant to the Indenture. The Notes shall be issued in
an aggregate principal amount not to exceed $100,000,000.
SECTION 1.02. Form of the Debt Securities. The Notes shall be
represented by a single fully-registered global note in book-entry form (the
"Global Note") which shall be deposited with, or on behalf of, The Depository
Trust Company, New York, New York ("DTC") and registered in the name of the
nominee of DTC. The Notes shall be in the form of Exhibit A attached hereto. So
long as DTC, or its nominee, is the registered owner of a Global Note, DTC or
its nominee, as the case may be, shall be considered the sole owner or Holder of
the Notes represented by such Global Note for all purposes under the Indenture.
Ownership of beneficial interests in the Global Notes shall be shown on, and
transfers thereof shall be effected only through, records maintained by DTC
(with respect to beneficial interests of participants or persons that hold
interests through participants) or by participants or persons that hold
interests through participants (with respect to beneficial interests of
beneficial owners).
<PAGE> 3
SECTION 1.03. Terms and Conditions of the Debt Securities. The Notes
shall be governed by all the terms and conditions of the Indenture, as
supplemented by this First Supplemental Indenture, and in particular, the
following provisions shall be terms of the Notes:
(a) Redemption. The Notes shall be redeemable at the election of the
Company, as a whole or from time to time in part, at any time on or after
February 1, 2002, on not less than 30 nor more than 60 days' prior notice at the
Redemption Prices (expressed as percentages of principal amount) set forth
below, together with accrued interest, if any, to the Redemption Date, if
redeemed during the 12-month period beginning on February 1 of the years
indicated below (subject to the right if Holders of record on the relevant
record date to receive interest due on an Interest Payment Date):
<TABLE>
<CAPTION>
Year Redemption Price
---- ----------------
<S> <C>
2002 102.821
2003 101.411
</TABLE>
and thereafter at 100% of the principal amount, together with accrued interest,
if any, to the Redemption Date.
If less than all the Notes are to be redeemed, the particular Notes to
be redeemed shall be selected not more than 60 days prior to the Redemption Date
by the Trustee by such method as the Trustee deems fair and appropriate.
(b) Payment of Principal and Interest. Settlement for the Notes shall
be made in immediately available funds. All payments of principal and interest
shall be made by the Company in immediately available funds. The Notes shall
trade in the Same-Day Funds Settlement System of the DTC until Maturity, and
secondary market trading activity for the Notes shall settle in immediately
available funds.
(c) Applicability of Defeasance or Covenant Defeasance. The provisions
of Article 14 of the Indenture shall apply to the Notes.
ARTICLE TWO
DEFINITIONS
SECTION 201. For purposes of this First Supplemental Indenture,
all terms used herein, unless otherwise defined, shall have the meanings
assigned to them in the Indenture. Except as the context otherwise requires,
references to the "Indenture" are to the Indenture as amended and supplemented
hereby.
<PAGE> 4
3
SECTION 202. Section 101 of the Indenture is hereby amended by deleting
the definitions of "Closing Date," "Debt," "Maturity" and "Qualified Equity
Interest" therein contained and by adding thereto the definitions of "Acquired
Debt," "Asset Sale," "Average Life," "Change of Control," "Consolidated Adjusted
Net Income," "Consolidated Leverage Ratio," "Disinterested Director," "Excess
Spread," "Excess Spread Receivables," "guarantee," "Hedging Obligations,"
"Investment," "Net Cash Proceeds," "Permitted Investments," "Permitted Joint
Ventures," "Permitted Warehouse Debt," "Preferred Stock," "Qualified Equity
Interest," "Qualified Stock," "Receivables," "Subordinated Debt," "Unrestricted
Subsidiary," "Warehouse Debt" and "Warehouse Facility" set forth below:
"Acquired Debt" means Debt of a Person (a) existing at the time
such Person is merged with or into the Company or becomes a Subsidiary
or (b) assumed in connection with the acquisition of assets from such
Person.
"Asset Sale" means any sale, issuance, conveyance, transfer, lease
or other disposition (including, without limitation, by way of merger
or consolidation) (collectively, a "transfer") by the Company or a
Restricted Subsidiary, directly or indirectly, in one or a series of
related transactions, to any Person other than the Company or a
Restricted Subsidiary of (a) any Capital Stock of any Restricted
Subsidiary, (b) all or substantially all of the properties and assets
of the Company and its Restricted Subsidiaries representing a division
or line of business, (c) any other properties or assets of the Company
or any Restricted Subsidiary, other than transactions in the ordinary
course of business or (d) any Excess Spread Receivables. For the
purposes of this definition, the term "Asset Sale" does not include any
transfer of properties or assets (i) that is governed by the provisions
of the Indenture described under "Consolidation, Merger and Sale of
Assets", (ii) between or among the Company and its Restricted
Subsidiaries pursuant to transactions that do not violate any other
provision of the Indenture, (iii) to an Unrestricted Subsidiary, if
permitted under the "Limitation on Restricted Payments" covenant, or
(iv) the gross proceeds of which do not exceed $1 million for any
particular item. For purposes of this definition, the term "ordinary
course of business" shall include, without limitation, (x) dispositions
of collateral acquired by the Company through foreclosure or otherwise
and (y) disposals of Receivables through securitization, whole loan
sales or other similar transactions.
"Average Life" means, as of the date of determination with respect
to any Debt or Disqualified Stock, the quotient obtained by dividing
(a) the sum of the products of (i) the number of years from the date of
determination to the date or dates of each successive scheduled
principal or liquidation value payment of such Debt or Disqualified
Stock, respectively, multiplied by (ii) the amount of each such
principal or liquidation value payment by (b) the sum of all such
principal or liquidation value payments.
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"Change of Control" means the occurrence of any of the following
events:
(a) any Person or "group" (as such term is used in Sections 13(d)
and 14(d) of the Exchange Act) is or becomes the "beneficial owner" (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a
Person shall be deemed to have "beneficial ownership" of all securities
that such Person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), directly or
indirectly, of more than 50% of the Voting Stock of the Company;
(b) during any consecutive two-year period, individuals who at the
beginning of such period constituted the Board of Directors of the
Company (together with any new directors whose election to such Board
of Directors, or whose nomination for election by the stockholders of
the Company, was approved by a vote of 66-2/3% of the directors then
still in office who were either directors at the beginning of such
period or whose election or nomination for election was previously so
approved) cease for any reason to constitute a majority of the Board of
Directors of the Company then in office; or
(c) the Company is liquidated or dissolved or adopts a plan of
liquidation or dissolution.
"Closing Date" means the date on which the Notes are originally issued
under the Indenture.
"Consolidated Adjusted Net Income" means, for any period, the net
income (or net loss) of the Company and its Restricted Subsidiaries for such
period as determined on a consolidated basis in accordance with GAAP, adjusted
to the extent included in calculating such net income or loss by excluding (a)
any net after-tax extraordinary gains or losses (less all fees and expenses
relating thereto), (b) any net after-tax gains or losses (less all fees and
expenses relating thereto) attributable to Asset Sales, (c) the portion of net
income (or loss) of any Person (other than the Company or a Restricted
Subsidiary), including Unrestricted Subsidiaries, in which the Company or any
Restricted Subsidiary has an ownership interest, except to the extent of the
amount of dividends or other distributions actually paid to the Company or any
Restricted Subsidiary in cash during such period, (d) the net income (or loss)
of any Person combined with the Company or any Restricted Subsidiary on a
"pooling of interests" basis attributable to any period prior to the date of
combination and (e) the net income (but not the net loss) of any Restricted
Subsidiary to the extent that the declaration or payment of dividends or similar
distributions by such Restricted Subsidiary is at the date of determination
restricted, directly or indirectly, except to
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the extent that such net income could be paid to the Company or a Restricted
Subsidiary thereof by loans, advances, intercompany transfers, principal
repayments or otherwise.
"Consolidated Leverage Ratio" means, at any date of determination, the
ratio of (i) the aggregate amount of all Debt of the Company and its Restricted
Subsidiaries at such date on a consolidated basis, excluding (A) Permitted
Warehouse Debt and (B) Hedging Obligations permitted to be incurred pursuant to
clause (v) of Section 1007 to (ii) the Consolidated Net Worth of the Company at
such date.
"Debt" means (without duplication), with respect to any Person, whether
recourse is to all or a portion of the assets of such Person and whether or not
contingent, (a) every obligation of such Person for money borrowed, (b) every
obligation of such Person evidenced by bonds, debentures, notes or other similar
instruments, (c) every reimbursement obligation of such Person with respect to
letters of credit, bankers' acceptances or similar facilities issued for the
account of such Person, (d) every obligation of such Person issued or assumed as
the deferred purchase price of property or services, (e) Capitalized Lease
Obligations, (f) all Disqualified Stock of such Person valued at its maximum
fixed repurchase price, plus accrued and unpaid dividends, (g) all obligations
of such Person under or in respect of Hedging Obligations, and (h) every
obligation (to the extent guaranteed by such Person) of the type referred to in
clauses (a) through (g) of another Person and all dividends of another Person
the payment of which, in either case, such Person has guaranteed. For purposes
of this definition, the "maximum fixed repurchase price" of any Disqualified
Stock that does not have a fixed repurchase price shall be calculated in
accordance with the terms of such Disqualified Stock as if such Disqualified
Stock were repurchased on any date on which Debt is required to be determined
pursuant to the Indenture, and if such price is based upon, or measured by, the
fair market value of such Disqualified Stock, such fair market value shall be
determined in good faith by the board of directors of the issuer of such
Disqualified Stock. Notwithstanding the foregoing, trade accounts payable and
accrued liabilities arising in the ordinary course of business and any liability
for federal, state or local taxes or other taxes owed by such Person shall not
be treated as Debt for purposes of this definition. Furthermore, any securities
issued in a securitization by a special purpose owner trust or other entity
formed by or on behalf of a Person and to which Receivables have been sold or
otherwise transferred by or on behalf of such Person or its Subsidiaries shall
not be treated as Debt of such Person or its Subsidiaries for purposes of this
definition, regardless of whether such securities are treated as indebtedness
for tax or accounting purposes; provided, however, that any guarantee by the
Company or a Restricted Subsidiary (other than such special purpose owner trust
or similar entity) of indebtedness arising in connection with such
securitization shall be treated as Debt for purposes of this definition.
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"Disinterested Director" means, with respect to any transaction or
series of transactions in respect of which the Board of Directors is required to
deliver a resolution of the Board of Directors under the Indenture, a member of
the Board of Directors who does not have any material direct or indirect
financial interest in or with respect to such transaction or series of
transactions (other than by ownership of securities issued by the Company).
"Excess Spread" means, over the life of a "pool" of Receivables that
have been sold by the Company or a Restricted Subsidiary to a trust or other
Person in a securitization or sale, the rights retained by the Company or its
Restricted Subsidiaries at or subsequent to the closing of such securitization
or sale with respect to such "pool", including any rights to receive cash flows
attributable to such pool and any servicing rights retained.
"Excess Spread Receivables" of the Company or a Restricted Subsidiary
means the right to Excess Spread capitalized on the Company's consolidated
balance sheet (the amount of which shall be the present value of the Excess
Spread, calculated in accordance with GAAP).
"guarantee" means, as applied to any obligation, (a) a guarantee (other
than by endorsement of negotiable instruments for collection in the ordinary
course of business), direct or indirect, in any manner, of any part or all of
such obligation and (b) an agreement, direct or indirect, contingent or
otherwise, the practical effect of which is to assure in any way the payment or
performance (or payment of damages in the event of non-performance) of all or
any part of such obligation, including, without limitation, the payment of
amounts drawn down under letters of credit. For purposes of this definition, the
following actions, taken by any Person in connection with a disposition or
permanent funding of Receivables through a securitization, whole loan sale or
other similar transaction, shall not constitute a guarantee by that Person: (i)
the furnishing of collateral or credit enhancement, whether in the form of cash,
marketable securities, Excess Spread Receivables or otherwise; (ii) the
acquisition and ownership of a subordinated or junior class of equity or debt
securities issued in a securitization; or (iii) the provision of customary
representations and warranties regarding the documentation of and credit
underwriting practices followed with respect to, the Receivables being disposed
of or funded.
"Hedging Obligations" means the obligations of any Person under (i)
interest rate swap agreements, interest rate cap agreements and interest rate
collar agreements and (ii) other agreements or arrangements designed to protect
such Person against fluctuations in interest rates or the value of foreign
currencies.
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"Investment" means, (i) directly or indirectly, any advance, loan or
other extension of credit (including, without limitation, by way of guarantee or
similar arrangement) or capital contribution to, the purchase of any stock,
bonds, notes, debentures or other securities of, or the acquisition, by purchase
or otherwise, of all or substantially all of the business or assets or stock or
other evidence of beneficial ownership of, any Person or the making of any
investment in any Person, (ii) the designation of any Restricted Subsidiary as
an Unrestricted Subsidiary and (iii) the transfer of any assets or properties
from the Company or a Restricted Subsidiary to any Unrestricted Subsidiary,
other than the transfer of assets or properties made in the ordinary course of
business. Investments exclude extensions of trade credit on commercially
reasonable terms in accordance with normal trade practices.
"Maturity" means, with respect to any Note, the date on which any
principal of such Note becomes due and payable as therein or in the Indenture
provided, whether at the Stated Maturity with respect to such principal or by
declaration of acceleration, call for redemption, purchase or otherwise.
"Net Cash Proceeds" means, with respect to any Asset Sale, the proceeds
thereof in the form of cash or cash equivalents, including payments in respect
of deferred payment obligations when received in the form of, or stock or other
assets when disposed for, cash or cash equivalents (except to the extent that
such obligations are financed or sold with recourse to the Company or any
Restricted Subsidiary), net of (a) brokerage commissions and other fees and
expenses (including fees and expenses of legal counsel and investment banks)
related to such Asset Sale, (b) provisions for all taxes payable as a result of
such Asset Sale, (c) payments made to retire Debt where payment of such Debt is
secured by the assets that are the subject of such Asset Sale, (d) amounts
required to be paid to any Person (other than the Company or any Restricted
Subsidiary) owning a beneficial interest in the assets that are subject to the
Asset Sale and (e) appropriate amounts to be provided by the Company or any
Restricted Subsidiary, as the case may be, as a reserve required in accordance
with GAAP against any liabilities associated with such Asset Sale and retained
by the seller after such Asset Sale, including pension and other post-employment
benefit liabilities, liabilities related to environmental matters and
liabilities under any indemnification obligations associated with such Asset
Sale.
"Permitted Investments" means any of the following:
(a) Investments in (i) securities with a maturity of 180 days or
less issued or directly and fully guaranteed or insured by the United
States or any agency or instrumentality thereof (provided that the full
faith and credit of the United States is pledged in support thereof);
(ii) certificates of deposit or acceptances with a maturity of 180 days
or less of any financial institution that
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is a member of the Federal Reserve System having combined capital and
surplus of not less than $500 million; and (iii) commercial paper with
a maturity of 180 days or less issued by a corporation that is not an
Affiliate of the Company and is organized under the laws of any state
of the United States or the District of Columbia and having the highest
rating obtainable from Moody's Investors Service, Inc. or Standard &
Poor's Ratings Services;
(b) the application, directly or indirectly of up to $5 million of
the net proceeds from the sale of the Notes to an Investment in a
Permitted Joint Venture doing business in Latin America;
(c) Investments by the Company or any Restricted Subsidiary in
another Person, if as a result of such Investment (i) such other Person
becomes a Restricted Subsidiary or (ii) such other Person is merged or
consolidated with or into, or transfers or conveys all or substantially
all of its assets to, the Company or a Restricted Subsidiary;
(d) Investments by the Company or any of the Restricted
Subsidiaries in any of the other of them;
(e) Investments in Receivables or assets owned or used in the
ordinary course of business;
(f) Investments in existence on the Closing Date and any renewals,
extensions, substitutions, refinancing or replacements of any such
Investments to the extent they do not require an increase in the amount
of such Investment;
(g) promissory notes received as a result of Asset Sales permitted
under Section 1010;
(h) Excess Spread Receivables arising from the securitization or
sale of Receivables by the Company or any of its Restricted
Subsidiaries;
(i) Investments comprised of promissory notes, stock, obligations
or securities received in the ordinary course of business in settlement
of debts owing to the Company or any of its Restricted Subsidiaries, or
on sales of assets acquired through foreclosure or similar
transactions;
(j) other Investments in Permitted Joint Ventures that do not
exceed $20 million at any time outstanding; and
<PAGE> 10
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(k) Loans or other extensions of credit from the Company or a
Restricted Subsidiary to a Permitted Joint Venture for the purpose of
providing liquidity to such Permitted Joint Venture to allow it to
originate or acquire Receivables in the ordinary course, provided that
the Company or the Restricted Subsidiary has effective operational
control of such Permitted Joint Venture.
"Permitted Joint Venture" means any joint venture between the Company
or one of its Restricted Subsidiaries and any other Person, which is primarily
engaged in the business of originating, purchasing, brokering and marketing,
pooling, selling, securitizing or servicing medical equipment loan receivables
or medical receivables.
"Permitted Warehouse Debt" means all Warehouse Debt outstanding from
time to time; provided, however, that (i) the Warehouse Debt shall be deemed to
be Permitted Warehouse Debt only to the extent that the assets to which such
Warehouse Debt relates are expected by the Company to be permanently funded
through a securitization or sale transaction and (ii) such Warehouse Debt shall
be deemed to be Permitted Warehouse Debt only to the extent of the realizable
value of the Receivables to which such Warehouse Debt relates and that were not
originated or acquired by the Company more than 364 days prior to the date of
determination (such realizable value to be determined in good faith by the Board
of Directors of the Company) if that value is less than the amount of the
Warehouse Debt..
"Preferred Stock" means, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated) of
such Person's preferred or preference stock, whether now outstanding or issued
after the initial issuance of the Notes, and including, without limitation, all
classes and series of preferred or preference stock of such Person.
"Qualified Equity Interest" means any Qualified Stock and all warrants,
options or other rights to acquire Qualified Stock (but excluding any debt
security that is convertible into or exchangeable for Capital Stock).
"Qualified Stock" of any Person means any and all Capital Stock of such
Person, other than Disqualified Stock.
"Receivables" means consumer and commercial loans, leases and
receivables purchased or originated by the Company or any Restricted Subsidiary
in the ordinary course of business; provided, however, that, for purposes of
determining the amount of a Receivable at any time, such amount shall be
determined in accordance with GAAP, consistently applied, as of the most recent
practicable date.
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"Subordinated Debt" means Debt of the Company that is subordinated
in right of payment to the Notes.
"Unrestricted Subsidiary" means (a) any Subsidiary that is
designated by the Board of Directors as an Unrestricted Subsidiary in
accordance with Section 1015 and (b) any Subsidiary of an Unrestricted
Subsidiary.
"Warehouse Debt" means Debt incurred by the Company or a
Restricted Subsidiary under a Warehouse Facility. Warehouse Debt under
any Warehouse Facility shall be deemed to equal the principal amount of
such Debt or, if less, the book value of the Receivables pledged under
such Warehouse Facility to secure such Warehouse Debt.
"Warehouse Facility" means any funding arrangement with a
financial institution or other lender or purchaser a principal purpose
of which is to finance the purchase or origination of Receivables by
the Company or one or more of its Restricted Subsidiaries for the
purpose of pooling such Receivables prior to securitization or sale in
the ordinary course of business, including purchase and sale facilities
pursuant to which the Company or a Restricted Subsidiary sells
Receivables to a financial institution and retains a right of first
refusal upon the subsequent resale of such Receivables by such
financial institution.
ARTICLE THREE
ADDITIONAL COVENANTS
SECTION 301. For the benefit of the holders of all Notes, Article
Ten of the Indenture shall be amended by adding the following covenants:
SECTION 1007. Limitation on Debt.
The Company shall not, and shall not permit any Restricted
Subsidiary to, create, issue, assume, guarantee or in any manner become
directly or indirectly liable for the payment of, or otherwise incur
(collectively, "incur"), any Debt (including Acquired Debt and the
issuance of Disqualified Stock), except that the Company may incur Debt
or issue Disqualified Stock if, on the date of such incurrence or
issuance and after giving effect thereto, the Consolidated Leverage
Ratio does not exceed 2.0 to 1.0.
Notwithstanding the foregoing, the Company may, and may
permit its Restricted Subsidiaries to, incur the following Debt
("Permitted Debt"):
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(i) Permitted Warehouse Debt of the Company or any Restricted
Subsidiary;
(ii) Debt of the Company or any Restricted Subsidiary
outstanding on the Closing Date;
(iii) Debt owed by the Company to any Restricted Subsidiary or
owed by any Restricted Subsidiary to the Company or any other
Restricted Subsidiary (provided that such Debt is held by the Company
or such Restricted Subsidiary);
(iv) Debt represented by the Notes and any guarantees thereof by
Restricted Subsidiaries;
(v) Debt of the Company or any Restricted Subsidiary in respect
of Hedging Obligations incurred in the ordinary course of business;
(vi) either (A) Capitalized Lease Obligations of the Company or
any Restricted Subsidiary or (B) Debt under purchase money mortgages or
secured by purchase money security interests so long as (x) such Debt
is not secured by any property or assets of the Company or any
Restricted Subsidiary other than the property and assets so acquired
and (y) such Debt is created within 60 days of the acquisition of the
related property; provided that the aggregate amount of Debt under
clauses (A) and (B) does not exceed in the aggregate $5 million at any
one time outstanding;
(vii) Debt of the Company or any Restricted Subsidiary consisting
of guarantees, indemnities or obligations in respect of purchase price
adjustments in connection with the acquisition or disposition of
assets, including, without limitation, shares of Capital Stock;
(viii) Acquired Debt of a Person, other than Debt incurred in
connection with, or in contemplation of, such Person becoming a
Restricted Subsidiary or the acquisition of assets from such Person, as
the case may be, provided that the Company on a pro forma basis could
incur $1.00 of additional Debt (other than Permitted Debt) pursuant to
the first paragraph of this Section;
(ix) Debt of the Company, not permitted by any other clause of
this definition, in an aggregate principal amount not to exceed $20
million at any one time outstanding;
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(x) Debt incurred under one or more working capital facilities
in an amount not to exceed $10 million at any one time outstanding;
(xi) Debt of the Company or any Restricted Subsidiary, which Debt
is in the form of a guarantee and is incurred in connection with a
securitization or sale of Receivables; provided, that the Company has
concluded (as determined in good faith by the Board of Directors of the
Company) that the incurrence of such Debt is necessary to obtain an
investment grade rating for other Debt issued in connection with such
securitization or sale of Receivables; and
(xii) any renewals, extensions, substitutions, refinancings or
replacements (each, for purposes of this clause, a "refinancing") of
any outstanding Debt, other than Debt incurred pursuant to clause (i),
(vi), (ix), (x) or (xi) of this definition, including any successive
refinancings thereof, so long as (A) any such new Debt is in a
principal amount that does not exceed the principal amount so
refinanced, plus the amount of any premium required to be paid in
connection with such refinancing pursuant to the terms of the Debt
refinanced or the amount of any premium reasonably determined by the
Company as necessary to accomplish such refinancing, plus the amount of
the expenses of the Company incurred in connection with such
refinancing, (B) in the case of any refinancing of Subordinated Debt,
such new Debt is made subordinate to the Notes at least to the same
extent as the Debt being refinanced and (C) such refinancing Debt does
not have an Average Life less than the Average Life of the Debt being
refinanced and does not have a final scheduled maturity earlier than
the final scheduled maturity, or permit redemption at the option of the
holder earlier than the earliest date of redemption at the option of
the holder, of the Debt being refinanced.
SECTION 1008. Limitation on Restricted Payments.
The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, take any of the following actions:
(a) declare or pay any dividend on, or make any distribution to
holders of, any shares of the Capital Stock of the Company or any
Restricted Subsidiary (other than dividends or distributions payable
solely in Qualified Equity Interests and other than dividends or
distributions by a Restricted Subsidiary payable to the Company or
another Restricted Subsidiary);
(b) purchase, redeem or otherwise acquire or retire for value,
directly or indirectly, any shares of Capital Stock of the Company or
any
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Restricted Subsidiary, or any options, warrants or other rights to
acquire such shares of Capital Stock (other than any such Capital Stock
owned by the Company or any of its Restricted Subsidiaries);
(c) make any principal payment on, or repurchase, redeem, defease
or otherwise acquire or retire for value, prior to any scheduled
principal payment, sinking fund payment or maturity, any Subordinated
Debt; and
(d) make any Investment (other than a Permitted Investment) in
any Person
(such payments or other actions described in (but not excluded from)
clauses (a) through (d) being referred to as "Restricted Payments"),
unless at the time of, and immediately after giving effect to, the
proposed Restricted Payment:
(i) no Default or Event of Default has occurred and is
continuing,
(ii) the Company could incur at least $1.00 of additional
Debt (other than Permitted Debt) pursuant to the first paragraph
of Section 1007 and
(iii) the aggregate amount of all Restricted Payments made
after the Closing Date does not exceed the sum of:
(A) 25% of the aggregate Consolidated Adjusted Net
Income of the Company during the period (taken as one
accounting period) from the first day of the Company's fiscal
quarter during which the Closing Date occurred to the last
day of the Company's most recently ended fiscal quarter for
which internal financial statements are available at the time
of such proposed Restricted Payment (or, if such aggregate
cumulative Consolidated Adjusted Net Income is a loss, minus
100% of such amount), plus
(B) the aggregate net proceeds including the fair
market value of property other than cash (as determined by
the Board of Directors, whose good faith determination shall
be conclusive), received by the Company after the initial
issuance of the Notes from the issuance or sale (other than
to a Subsidiary) of Qualified Equity Interests of the
Company; plus
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(C) the aggregate net proceeds including the fair
market value of property other than cash (as determined by
the Board of Directors, whose good faith determination shall
be conclusive), received by the Company after the initial
issuance of the Notes from the issuance or sale (other than
to a Restricted Subsidiary) of debt securities or
Disqualified Stock that have been converted into or exchanged
for Qualified Stock of the Company, together with the
aggregate net cash proceeds received by the Company at the
time of such conversion or exchange.
Notwithstanding the foregoing, the Company and its Restricted
Subsidiaries may take the following actions, so long as (with respect to clauses
(e), (f) and (g) below) no Default or Event of Default has occurred and is
continuing or would occur:
(a) the payment of any dividend within 60 days after the date of
declaration thereof, if at the declaration date such payment would not
have been prohibited by the foregoing provision;
(b) the repurchase, redemption or other acquisition or retirement
for value of any shares of Capital Stock of the Company, in exchange
for, or out of the net cash proceeds of a substantially concurrent
issuance and sale (other than to a Subsidiary) of Qualified Equity
Interests of the Company;
(c) the purchase, redemption, defeasance or other acquisition or
retirement for value of any Subordinated Debt in exchange for, or out
of the net cash proceeds of a substantially concurrent issuance and
sale (other than to a Subsidiary) of Qualified Equity Interests of the
Company;
(d) the purchase, redemption, defeasance or other acquisition or
retirement for value of Subordinated Debt in exchange for, or out of
the net cash proceeds of a substantially concurrent issuance or sale
(other than to a Subsidiary) of, Subordinated Debt, so long as the
Company or a Restricted Subsidiary would be permitted to refinance such
original Subordinated Debt with such new Subordinated Debt pursuant to
clause (xii) of the definition of Permitted Debt;
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(e) the repurchase of any Subordinated Debt at a purchase price
not greater than 101% of the principal amount of such Subordinated Debt
in the event of a change of control in accordance with provisions
similar to Section 1009, provided that, prior to or simultaneously with
such repurchase, the Company has made the Change of Control Offer as
provided in Section 1009 with respect to the Notes and has repurchased
all Notes validly tendered for payment in connection with such Change
of Control Offer;
(f) loans or advances to officers, directors and employees of the
Company or any of its Restricted Subsidiaries made in the ordinary
course of business after the Closing Date in an amount not to exceed $1
million in the aggregate at any one time outstanding;
(g) Investments by the Company or a Restricted Subsidiary in
another Person made with, or out of the net cash proceeds of, a
substantially concurrent issuance and sale (other than to a Subsidiary)
of Qualified Stock of the Company; and
(h) the making of an Investment in a Permitted Joint Venture so
long as the aggregate amount of all such Investments pursuant to this
clause (h) made after the Closing Date does not exceed the difference
between (A) 25% of the aggregate Consolidated Adjusted Net Income
(without giving effect to clause (e) of the definition thereof) of the
Company during the period (taken as one accounting period) from the
first day of the Company's fiscal quarter during which the Closing Date
occurred to the last day of the Company's most recently ended fiscal
quarter for which internal financial statements are available at the
time of such proposed Investment, minus (B) the aggregate amount of all
Restricted Payments made after the Closing Date in reliance on the
foregoing clause (iii)(A); provided, that, at the time of, and
immediately after giving effect to, the proposed Investment in a
Permitted Joint Venture pursuant to this clause (h), the Company could
incur at least $1.00 of additional Debt (other than Permitted Debt)
pursuant to the first paragraph of Section 1007.
The actions described in clauses (b), (c), (e), (f), (g) and (h)
of this paragraph shall be Restricted Payments that shall be permitted to be
taken in accordance with this paragraph but shall reduce the amount that would
otherwise be available for Restricted Payments under clause (iii) of the first
paragraph of this Section and the actions described in clauses (a) and (d) of
this paragraph shall be Restricted Payments that shall be permitted to be taken
in accordance with this
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paragraph and shall not reduce the amount that would otherwise be available for
Restricted Payments under clause (iii) of the first paragraph of this Section.
For the purpose of making any calculations under this Indenture
(i) if a Restricted Subsidiary is designated an Unrestricted Subsidiary, the
Company shall be deemed to have made an Investment in an amount equal to the
fair market value of the net assets of such Restricted Subsidiary at the time of
such designation as determined by the Board of Directors of the Company, whose
good faith determination shall be conclusive, (ii) any property transferred to
or from an Unrestricted Subsidiary shall be valued at fair market value at the
time of such transfer, as determined by the Board of Directors of the Company,
whose good faith determination shall be conclusive and (iii) subject to the
foregoing, the amount of any Restricted Payment, if other than cash, shall be
determined by the Board of Directors of the Company, whose good faith
determination shall be conclusive.
If the aggregate amount of all Restricted Payments calculated
under the foregoing provision includes an Investment in an Unrestricted
Subsidiary or other Person that thereafter becomes a Restricted Subsidiary, the
aggregate amount of all Restricted Payments calculated under the foregoing
provision shall be reduced by the lesser of (x) the net asset value of such
Subsidiary at the time it becomes a Restricted Subsidiary and (y) the initial
amount of such Investment.
If an Investment resulted in the making of a Restricted Payment,
the aggregate amount of all Restricted Payments calculated under the foregoing
provision shall be reduced by the amount of any net reduction in such Investment
(resulting from the payment of interest or dividends, loan repayment, transfer
of assets or otherwise), to the extent such net reduction is not included in the
Company's Consolidated Adjusted Net Income; provided that the total amount by
which the aggregate amount of all Restricted Payments may be reduced may not
exceed the lesser of (x) the cash proceeds received by the Company and its
Restricted Subsidiaries in connection with such net reduction and (y) the
initial amount of such Investment.
In computing Consolidated Adjusted Net Income of the Company under
the foregoing clause (iii)(A), (i) the Company may use audited financial
statements for the portions of the relevant period for which audited financial
statements are available on the date of determination and unaudited financial
statements and other current financial data based on the books and records of
the Company for the remaining portion of such period and (ii) the Company shall
be permitted to rely in good faith on the financial statements and other
financial data derived from the books and records of the Company that are
available on the date of determination. If the Company makes a Restricted
Payment that, at the time of the making of such
<PAGE> 18
17
Restricted Payment, would in the good faith determination of the Company be
permitted under the requirements of this Indenture, such Restricted Payment
shall be deemed to have been made in compliance with this Indenture
notwithstanding any subsequent adjustments made in good faith to the Company's
financial statements affecting Consolidated Adjusted Net Income of the Company
for any period.
SECTION 1009. Purchase of Notes upon a Change of Control.
If a Change of Control occurs at any time, then each holder of
Notes shall have the right to require that the Company purchase such holder's
Notes, in whole or in part in integral multiples of $1,000, at a purchase price
in cash equal to 101% of the principal amount of such Notes, plus accrued and
unpaid interest, if any, to the date of purchase, pursuant to the offer
described below (the "Change of Control Offer") and the other procedures set
forth in this Indenture.
Within 30 days following any Change of Control, the Company shall
notify the Trustee thereof and give written notice of such Change of Control to
each holder of Notes by first-class mail, postage prepaid, at its address
appearing in the Security Register, stating, among other things, (i) the
purchase price and the purchase date, which shall be a Business Day no earlier
than 30 days nor later than 60 days from the date such notice is mailed or such
later date as is necessary to comply with requirements under the Exchange Act;
(ii) that any Note not tendered shall continue to accrue interest; (iii) that,
unless the Company defaults in the payment of the purchase price, any Notes
accepted for payment pursuant to the Change of Control Offer shall cease to
accrue interest after the Change of Control purchase date; and (iv) certain
other procedures that a holder of Notes must follow to accept a Change of
Control Offer or to withdraw such acceptance.
The Company shall comply with the applicable tender offer rules
including Rule l4e-l under the Exchange Act, and any other applicable securities
laws and regulations in connection with a Change of Control Offer.
The Company shall not, and shall not permit any Restricted
Subsidiary to, create any restriction (other than restrictions existing under
Debt as in effect on the Closing Date or in refinancings of such Debt) that
would materially impair the ability of the Company to make a Change of Control
Offer to purchase the Notes or, if such Change of Control Offer is made, to pay
for the Notes tendered for purchase.
SECTION 1010. Limitation on Certain Asset Sales.
(a) The Company shall not, and shall not permit any Restricted
Subsidiary to, engage in any Asset Sale unless (i) the consideration
received by
<PAGE> 19
18
the Company or such Restricted Subsidiary for such Asset Sale is not
less than the fair market value of the assets sold (as determined by
the Board of Directors of the Company, whose good faith determination
shall be conclusive) and (ii) the consideration received by the Company
or the relevant Restricted Subsidiary in respect of such Asset Sale
consists of at least 85% cash or cash equivalents.
(b) If the Company or any Restricted Subsidiary engages in an
Asset Sale, the Company may, at its option, within 12 months after such
Asset Sale, (i) apply all or a portion of such Net Cash Proceeds to the
repayment of senior Debt of the Company or a Restricted Subsidiary or
(ii) invest (or enter into a legally binding agreement to invest) all
or a portion of such Net Cash Proceeds in properties and assets to
replace the properties and assets that were the subject of the Asset
Sale or in properties and assets that shall be used in businesses of
the Company or its Restricted Subsidiaries, as the case may be,
existing on the Closing Date, or in Permitted Joint Ventures. If any
such legally binding agreement to invest such Net Cash Proceeds is
terminated, the Company may, within 90 days of such termination or
within 12 months of such Asset Sale, whichever is later, invest such
Net Cash Proceeds as provided in clause (i) or (ii) (without regard to
the parenthetical contained in such clause (ii)) above. The amount of
such Net Cash Proceeds not so used as set forth above in this paragraph
(b) constitutes "Excess Proceeds".
(c) When the aggregate amount of Excess Proceeds exceeds $5
million the Company shall, within 30 days thereafter, make an offer to
purchase from all holders of Notes, on a pro rata basis, in accordance
with the procedures set forth in this Indenture, the maximum principal
amount (expressed as a multiple of $1,000) of Notes that may be
purchased with the Excess Proceeds, at a purchase price in cash equal
to 100% of the principal amount thereof, plus accrued interest, if any,
to the date such offer to purchase is consummated. To the extent that
the aggregate principal amount of Notes tendered pursuant to such offer
to purchase is less than the Excess Proceeds, the Company may use such
deficiency for general corporate purposes. If the aggregate principal
amount of Notes validly tendered and not withdrawn by holders thereof
exceeds the Excess Proceeds, the Notes to be purchased shall be
selected on a pro rata basis. Upon completion of such offer to
purchase, the amount of Excess Proceeds shall be reset to zero.
SECTION 1011. Limitation on Transactions with Affiliates.
The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, enter into or suffer to exist any
transaction with, or for the
<PAGE> 20
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benefit of, any Affiliate of the Company or any beneficial owner of 5% or more
of any class of the Capital Stock of the Company at any time outstanding
("Interested Persons"), unless (a) such transaction is on terms that are no less
favorable to the Company or such Restricted Subsidiary, as the case may be, than
those that could have been obtained in an arm's length transaction with third
parties who are not Interested Persons and (b) either (i) with respect to any
transaction or series of transactions involving aggregate payments in excess of
$1 million, but less than $5 million, the Company delivers an officers'
certificate to the Trustee certifying that such transaction or transactions
comply with clause (a) above or (ii) with respect to a transaction or series of
transactions involving aggregate payments equal to or greater than $5 million,
such transaction or transactions have been approved by the Board of Directors
(including a majority of the Disinterested Directors) of the Company or the
Company has obtained a written opinion from a nationally recognized investment
banking firm to the effect that such transaction or transactions are fair to the
Company or such Restricted Subsidiary from a financial point of view.
The foregoing covenant shall not restrict
(A) transactions among the Company and/or its Restricted
Subsidiaries;
(B) the Company from paying reasonable and customary regular
compensation and fees to directors of the Company or any Restricted
Subsidiary who are not employees of the Company or any Restricted
Subsidiary; and
(C) the application, directly or indirectly, of up to $5 million
of the net proceeds from the sale of the Notes to fund the Company's
Investment in a Permitted Joint Venture doing business in Latin
America.
SECTION 1012. Limitation on Dividends and Other Payment
Restrictions Affecting Restricted Subsidiaries.
The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any consensual encumbrance or restriction of any kind
on the ability of any Restricted Subsidiary to (a) pay dividends, in cash or
otherwise, or make any other distributions on or in respect of its Capital
Stock, (b) pay any Debt owed to the Company or any other Restricted Subsidiary,
(c) make loans or advances to the Company or any other Restricted Subsidiary,
(d) transfer any of its properties or assets to the Company or any other
Restricted Subsidiary or (e) guarantee any Debt of
<PAGE> 21
20
the Company or any other Restricted Subsidiary, except for such encumbrances or
restrictions existing under or by reason of:
(i) any agreement in effect on the Closing Date;
(ii) customary non-assignment provisions of any lease governing a
leasehold interest of the Company or any Restricted Subsidiary;
(iii) the refinancing or successive refinancings of Debt incurred
under the agreements in effect on the Closing Date, so long as such
encumbrances or restrictions are no less favorable to the Company or
any Restricted Subsidiary than those contained in such original
agreement;
(iv) Warehouse Facilities and other credit facilities, provided,
however, that the terms and conditions of any such encumbrances or
restrictions are not materially more restrictive in the aggregate than
those contained in the revolving credit agreement with a syndicate of
banks and Fleet Bank, National Association, as agent, dated March 28,
1995, in effect on the Closing Date in the judgment of the Board of
Directors of the Company as evidenced by a resolution of the Board of
Directors of the Company and filed with the Trustee; or
(v) any agreement or other instrument of a Person acquired by the
Company or any Restricted Subsidiary in existence at the time of such
acquisition (but not created in contemplation thereof), which
encumbrance or restriction is not applicable to any Person, or the
properties or assets of any Person, other than the Person, or the
property or assets of the Person, so acquired.
SECTION 1013. Limitation on Issuances and Sales of Capital Stock
of Restricted Subsidiaries.
The Company (a) shall not permit any Restricted Subsidiary to
issue any Capital Stock (other than to the Company or a Restricted Subsidiary)
and (b) shall not permit any Person (other than the Company or a Restricted
Subsidiary) to own any Capital Stock of any Restricted Subsidiary; provided,
however, that this Section shall not prohibit (i) the sale or other disposition
of all, but not less than all, of the issued and outstanding Capital Stock of a
Restricted Subsidiary owned by the Company and its Restricted Subsidiaries in
compliance with the other provisions of this Indenture or (ii) the ownership by
directors of director's qualifying shares or the ownership by foreign nationals
of Capital Stock of any Restricted Subsidiary, to the extent mandated by
applicable law.
<PAGE> 22
21
SECTION 1014. Limitation on Guarantees of Debt by Restricted
Subsidiaries.
The Company shall not permit any Restricted Subsidiary, directly
or indirectly, to guarantee, assume or in any other manner become liable for the
payment of any Debt of the Company or any Debt of any other Restricted
Subsidiary, unless (a) such Restricted Subsidiary simultaneously executes and
delivers a supplemental indenture providing for a guarantee of payment of the
Notes by such Restricted Subsidiary and (b) with respect to any guarantee of
Subordinated Debt by a Restricted Subsidiary, any such guarantee is subordinated
to such Restricted Subsidiary's guarantee with respect to the Notes at least to
the same extent as such Subordinated Debt is subordinated to the Notes, provided
that the foregoing provision shall not be applicable to any guarantee by any
Restricted Subsidiary that existed at the time such Person became a Restricted
Subsidiary and was not incurred in connection with, or in contemplation of, such
Person becoming a Restricted Subsidiary.
Any guarantee by a Restricted Subsidiary of the Notes pursuant to
the preceding paragraph shall provide by its terms that it shall be
automatically and unconditionally released and discharged upon (i) any sale,
exchange or transfer to any Person not an Affiliate of the Company of all of the
Company's and the Restricted Subsidiaries' Capital Stock in, or all or
substantially all the assets of, such Restricted Subsidiary (which sale,
exchange or transfer is not prohibited by this Indenture) or (ii) the release or
discharge of the guarantee that resulted in the creation of such guarantee of
the Notes, except a discharge or release by or as a result of payment under such
guarantee.
SECTION 1015. Unrestricted Subsidiaries.
(a) The Board of Directors of the Company may designate any
Subsidiary (including any newly acquired or newly formed Subsidiary) to
be an Unrestricted Subsidiary so long as (i) neither the Company nor
any Restricted Subsidiary is directly or indirectly liable for any Debt
of such Subsidiary, (ii) no default with respect to any Debt of such
Subsidiary would permit (upon notice, lapse of time or otherwise) any
holder of any other Debt of the Company or any Restricted Subsidiary to
declare a default on such other Debt or cause the payment thereof to be
accelerated or payable prior to its stated maturity, (iii) any
Investment in such Subsidiary made as a result of designating such
Subsidiary an Unrestricted Subsidiary shall not violate the provisions
of Section 1008, (iv) neither the Company nor any Restricted Subsidiary
has a contract, agreement, arrangement, understanding or obligation of
any kind, whether written or oral, with such Subsidiary other than
those
<PAGE> 23
22
that might be obtained at the time from Persons who are not Affiliates
of the Company and (v) neither the Company nor any Restricted
Subsidiary has any obligation to subscribe for additional shares of
Capital Stock or other equity interest in such Subsidiary, or to
maintain or preserve such Subsidiary's financial condition or to cause
such Subsidiary to achieve certain levels of operating results.
Notwithstanding the foregoing, the Company may not designate DVI
Business Credit Corporation or DVI Financial Services Inc. as an
Unrestricted Subsidiary and may not sell, transfer or otherwise dispose
of any properties or assets of DVI Business Credit Corporation or DVI
Financial Services Inc. to an Unrestricted Subsidiary, other than in
the ordinary course of business.
(b) The Board of Directors of the Company may designate any
Unrestricted Subsidiary as a Restricted Subsidiary; provided that such
designation shall be deemed to be an incurrence of Debt by a Restricted
Subsidiary of any outstanding Debt of such Unrestricted Subsidiary and
such designation shall only be permitted if (i) such Debt is permitted
under Section 1007 and (ii) no Default or Event of Default shall have
occurred and be continuing following such designation.
SECTION 1016. Limitation on Liens.
The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, create, incur, assume or suffer to exist
any Lien of any kind on or with respect to any of its property or assets,
including any shares of stock or indebtedness of any Restricted Subsidiary,
whether owned at the Closing Date or thereafter acquired, or any income, profits
or proceeds therefrom, or assign or otherwise convey any right to receive income
thereon, unless (a) in the case of any Lien securing Subordinated Debt, the
Notes are secured by a Lien on such property, assets or proceeds that is senior
in priority to such Lien and (b) in the case of any other Lien, the Notes are
equally and ratably secured with the obligation or liability secured by such
Lien.
Notwithstanding the foregoing, the Company may, and may permit any
Restricted Subsidiary to, incur the following Liens ("Permitted Liens"):
(i) Liens on property or assets securing Permitted Warehouse Debt
of the Company or any Restricted Subsidiary, other than Liens on Excess
Spread Receivables related to such Permitted Warehouse Debt not created
in favor of the lenders under the related Warehouse Facility;
<PAGE> 24
23
(ii) Liens incurred in connection with a securitization or sale
of Receivables, other than Liens on Excess Spread Receivables related
to such securitization or sale transaction that were not created at the
time of such securitization or sale transaction;
(iii) Liens existing as of the Closing Date;
(iv) Liens on any property or assets of a Restricted Subsidiary
granted in favor of the Company or any Restricted Subsidiary;
(v) Liens securing the Notes;
(vi) Liens representing the interest or title of lessors under
Capitalized Lease Obligations or Liens securing purchase money
mortgages or purchase money security interests, so long as the
aggregate amount secured by such Liens does not exceed the amount
permitted by clause (vi) of the definition of "Permitted Debt";
(vii) Liens securing Acquired Debt created prior to (and not in
connection with or in contemplation of) the incurrence of such Debt by
the Company or any Restricted Subsidiary; provided that such Lien does
not extend to any property or assets of the Company or any Restricted
Subsidiary other than the property and assets acquired in connection
with the incurrence of such Acquired Debt;
(viii) Liens (other than on any Excess Spread Receivables)
securing obligations under Hedging Obligations permitted to be incurred
pursuant to clause (v) of the definition of "Permitted Debt";
(ix) statutory Liens or landlords', carriers', warehouseman's,
mechanics', suppliers', materialmen's, repairmen's or other like Liens
arising in the ordinary course of business with respect to (A) amounts
not yet delinquent or (B) amounts being contested in good faith by
appropriate proceedings or (C) an aggregate amount at any one time not
in excess of $1 million;
(x) Liens for taxes, assessments, government charges or claims
that are being contested in good faith by appropriate proceedings
promptly instituted and diligently conducted;
(xi) Liens incurred or deposits made to secure the performance
of tenders, bids, leases, statutory obligations, surety and appeal
bonds,
<PAGE> 25
24
government contracts, performance bonds and other obligations of a like
nature incurred in the ordinary course of business (other than
contracts for the payment of money);
(xii) easements, rights-of-way, restrictions and other similar
charges or encumbrances not interfering in any material respect with
the business of the Company or any Restricted Subsidiary incurred in
the ordinary course of business;
(xiii) Liens arising by reason of any judgment, decree or order of
any court, so long as such Lien is adequately bonded and any
appropriate legal proceedings that may have been duly initiated for the
review of such judgment, decree or order have not been finally
terminated or the period within which such proceedings may be initiated
has not expired;
(xiv) Liens securing reimbursement obligations with respect to
letters of credit that encumber documents and other property relating
to such letters of credit and the products and proceeds thereof;
(xv) Liens in favor of customs and revenue authorities arising
as a matter of law to secure payment of customs duties in connection
with the importation of goods; and
(xvi) any extension, renewal or replacement, in whole or in part,
of any Lien described in the foregoing clauses (i) through (xv);
provided that any such extension, renewal or replacement is no more
restrictive in any material respect than the Lien so extended, renewed
or replaced and does not extend to any additional property or assets.
SECTION 1017. Limitation on Investment Company Status.
The Company shall not take any action, or otherwise permit to
exist any circumstance, that would require the Company or any of its
Subsidiaries to register as an "investment company" under the Investment Company
Act of 1940, as amended.
SECTION 1018. Maintenance of Properties.
The Company shall cause all material properties owned by or leased
to it or any Restricted Subsidiary of the Company and necessary in the conduct
of its business or the business of such Restricted Subsidiary to be maintained
and kept in normal condition, repair and working order, ordinary wear and tear
excepted;
<PAGE> 26
25
provided that nothing in this Section shall prevent the Company or any
Restricted Subsidiary of the Company from discontinuing the use, operation or
maintenance of any of such properties, or disposing of any of them, if such
discontinuance or disposal is, in the judgment of the Board of Directors of the
Company or the Restricted Subsidiary concerned, or of any officer (or other
agent employed by the Company or any Restricted Subsidiary of the Company) of
the Company or such Restricted Subsidiary having managerial responsibility for
any such property, desirable in the conduct of the business of the Company or
any Restricted Subsidiary of the Company and if such discontinuance or disposal
is not adverse in any material respect to the Holders.
The Company shall provide or cause to be provided, for itself and
any Restricted Subsidiaries of the Company, insurance (including appropriate
self-insurance) against loss or damage of the kinds customarily insured against
by corporations similarly situated and owning like properties in the same
general areas in which the Company or such Restricted Subsidiaries operate.
SECTION 1019. Provision of Financial Statements.
(a) The Company shall supply without cost to each Holder of the
Securities of any series, and file with the Trustee (if not otherwise
filed with the Trustee pursuant to Section 703) within 15 days after
the Company is required to file the same with the Commission, copies of
the annual reports and quarterly reports and of the information,
documents and other reports which the Company may be required to file
with the Commission pursuant to Section 13(a), 13(c) or 15(d) of the
Securities Exchange Act of 1934.
(b) If the Company is not required to file with the Commission
such reports and other information referred to in Section 1012(a), the
Company shall furnish without cost to each Holder of the Securities and
file with the Trustee (i) within 140 days after the end of each fiscal
year, annual reports containing the information required to be
contained in Items 1, 2, 3, 6, 7, 8 and 9 of Form 10-K promulgated
under the Securities Exchange Act of 1934, or substantially the same
information required to be contained in comparable items of any
successor form, and (ii) within 75 days after the end of each of the
first three fiscal quarters of each fiscal year, quarterly reports
containing the information required to be contained in Form 10-Q
promulgated under the Securities Exchange Act of 1934, or substantially
the same information required to be contained in any successor form.
<PAGE> 27
26
SECTION 1020. Reports.
The Company shall be required to file on a timely basis with the
Commission, to the extent such filings are accepted by the Commission and
whether or not the Company has a class of securities registered under the
Exchange Act, the annual reports, quarterly reports and other documents that the
Company would be required to file if it were subject to Section 13 or 15(d) of
the Exchange Act. The Company shall also be required (a) to file with the
Trustee, and provide to each holder of Notes, without cost to such holder,
copies of such reports and documents within 15 days after the date on which the
Company files such reports and documents with the Commission or the date on
which the Company would be required to file such reports and documents if the
Company were so required and (b) if filing such reports and documents with the
Commission is not accepted by the Commission or is prohibited under the Exchange
Act, to supply at the Company's cost copies of such reports and documents to any
prospective holder of Notes promptly upon written request.
SECTION 1021. Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with any
covenant or condition set forth in Sections 1007 through 1016 and 1018 through
1020 with respect to Securities of any series if, before or after the time for
such compliance, the Holders of a majority in aggregate principal amount of all
Outstanding Securities of the series shall, by Act of such Holders, waive such
compliance in such instance or generally waive compliance with such covenant or
condition, but no such waiver shall extend to or affect such covenant or
condition except to the extent so expressly waived, and, until such waiver shall
become effective, the obligations of the Company and the duties of the Trustee
in respect of any such covenant or condition shall remain in full force and
effect.
ARTICLE FOUR
FURTHER AMENDMENT
SECTION 401. SECTION 1403 of the Indenture is deleted and replaced
by the following:
SECTION 1403. Covenant Defeasance.
Upon the Company's exercise of the above option applicable to this
Section with respect to any Securities of or within a series, the Company shall
be
<PAGE> 28
27
released from its obligations under Sections 1007 through 1016 and 1018 through
1020 and, if specified pursuant to Section 301, its obligations under any other
covenant, with respect to such Outstanding Securities and any related coupons on
and after the date the conditions set forth in Section 1404 are satisfied
(hereinafter, "covenant defeasance"), and such Securities and any related
coupons shall thereafter be deemed not to be "Outstanding" for the purposes of
any direction, waiver, consent or declaration or Act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "Outstanding" for all other purposes hereunder. For this
purpose, such covenant defeasance means that, with respect to such Outstanding
Securities and any related coupons, the Company may omit to comply with and
shall have no liability in respect of any term, condition or limitation set
forth in any such covenant, whether directly or indirectly, by reason of any
reference elsewhere herein to any such covenant or by reason of reference in any
such covenant to any other provision herein or in any other document and such
omission to comply shall not constitute a Default or an Event of Default under
Section 501(4) or Section 501(8) or otherwise, as the case may be, but, except
as specified above, the remainder of this Indenture and such Securities and any
related coupons shall be unaffected thereby.
ARTICLE FIVE
MISCELLANEOUS PROVISIONS
SECTION 501. This First Supplemental Indenture shall be deemed to
be a contract made under the laws of the State of New York and for all purposes
shall be construed in accordance with the laws of the State of New York. The
terms and conditions of this First Supplemental Indenture shall be, and be
deemed to be, part of the terms and conditions of the Indenture for any and all
purposes applicable to the Notes, in accordance with the terms and provisions of
Section 901 of the Indenture. Other than as amended and supplemented by this
First Supplemental Indenture, the Indenture is in all respects ratified and
confirmed.
SECTION 502. The Trustee hereby accepts this First Supplemental
Indenture and agrees to perform the same upon the terms and conditions set forth
in the Indenture.
SECTION 503. This First Supplemental 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.
<PAGE> 29
28
IN WITNESS WHEREOF, the parties hereto have caused this First
Supplemental Indenture to be duly executed all as of the day and year first
above written.
DVI, INC.
By: /s/ Steven R. Garfinkel
_____________________________
Name: Steven R. Garfinkel
Title: Executive Vice President and
Chief Financial Officer
FIRST TRUST NATIONAL ASSOCIATION
By: /s/ Edward F. Kachinski
_____________________________
Name: Edward F. Kachinski
Title: Vice President
<PAGE> 30
EXHIBIT A
FORM OF NOTE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"),
TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
DVI, INC.
9 7/8% Senior Notes due 2004
CUSIP NO. 233343AB8
No. 1 $ 100,000,000
DVI, Inc., a Delaware corporation (herein called the "Company",
which term includes any successor entity under the Indenture hereinafter
referred to), for value received, hereby promises to pay to Cede & Co. or
registered assigns the principal sum of ONE HUNDRED MILLION DOLLARS on February
1, 2004, at the office or agency of the Company referred to below, and to pay
interest thereon on August 1, 1997 and semiannually thereafter, on February 1
and August 1 in each year, from January 30, 1997 or from the most recent
Interest Payment Date to which interest has been paid or duly provided for, at
the rate of 9 7/8% per annum, until the principal hereof is paid or duly
provided for, and (to the extent lawful) to pay on demand interest on any
overdue interest at the rate borne by the Securities from the date of the
Interest Payment Date on which such overdue interest becomes payable to the date
payment of such interest has been made or duly provided for. The interest so
payable, and punctually paid or duly provided for, on any Interest Payment Date
shall, as provided in such Indenture, be paid to the Person in whose name this
Security is registered at the close of business on the Regular Record Date for
such interest, which shall be the January 15 or July 15 (whether or not a
Business Day), as the case may be, next preceding such Interest Payment Date.
Any such interest not so punctually paid or duly provided for, and interest on
such defaulted interest at the interest rate borne by the Securities, to the
extent lawful, shall forthwith cease to be payable to the Holder on such Regular
Record Date, and may be paid to the Person in whose name this Security (or one
or more Predecessor Securities) is registered at the close of business on a
Special Record Date
<PAGE> 31
30
for the payment of such Defaulted Interest to be fixed by the Trustee, notice
whereof shall be given to Holders of Securities not less than 10 days prior to
such Special Record Date, or may be paid at any time in any other lawful manner
not inconsistent with the requirements of any securities exchange on which the
Securities may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in said Indenture. Payment of the principal
of (and premium, if any) and interest on this Security shall be made at the
office or agency of the Company maintained for that purpose in The City of New
York, or at such other office or agency of the Company as may be maintained for
such purpose, in such coin or currency of the United States of America as at the
time of payment is legal tender for payment of public and private debts;
provided, however, that payment of interest may be made at the option of the
Company by check mailed to the address of the Person entitled thereto as such
address shall appear on the Security Register.
Reference is hereby made to the further provisions of this Security set forth on
the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been duly executed by the
Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.
<PAGE> 32
IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed under its corporate seal.
DVI, INC.
By: _______________________________
Attest:
________________________________
Authorized Signatory
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities referred to in the within-mentioned Indenture.
FIRST TRUST NATIONAL ASSOCIATION
as Trustee
By: ____________________________
Authorized Signatory
Dated: ___________________
<PAGE> 33
32
[FORM OF REVERSE OF SECURITY]
This Security is one of a duly authorized issue of securities of
the Company designated as its 9 7/8% Senior Notes due 2004 (herein called the
"Securities"), limited (except as otherwise provided in the Indenture referred
to below) in aggregate principal amount to $100,000,000 which may be issued in
one or more series under an indenture (herein called the "Indenture") dated as
of January 27, 1997, between the Company and First Trust National Association,
trustee (herein called the "Trustee", which term includes any successor trustee
under the Indenture with respect to the series of which this Security is a part)
as supplemented by the First Supplemental Indenture dated as of January 30, 1997
between the Company and the Trustee (together the "Indenture"), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties, obligations
and immunities thereunder of the Company, the Trustee and the Holders of the
Securities, and of the terms upon which the Securities are, and are to be,
authenticated and delivered.
The Securities shall be redeemable at the election of the Company,
as a whole or from time to time in part, at any time on or after February 1,
2002, on or not less than 30 nor more than 60 days' prior notice at the
redemption prices (expressed as percentages of principal amount) set forth
below, together with accrued interest, if any, to the Redemption Date, if
redeemed during the 12-month period beginning on February 1 of the years
indicated below (subject to the right of Holders of record on the relevant
record date to receive interest due on an Interest Payment Date):
<TABLE>
<CAPTION>
Redemption
Year Price
---- ----------
<S> <C>
2002........................................ 102.821%
2003........................................ 101.411%
</TABLE>
and thereafter at 100% of the principal amount, together with accrued interest,
if any, to the Redemption Date.
If less than all of the Securities are to be redeemed, the
particular Securities to be redeemed shall be selected not more than 60 days
prior to the Redemption Date by the Trustee by such method as the Trustee deems
fair and appropriate.
If an Event of Default shall occur and be continuing, the
principal of all the Securities may be declared due and payable in the manner
and with the effect provided in the Indenture.
<PAGE> 34
33
The Indenture contains provisions for defeasance at any time of
(a) the entire indebtedness of the Company on this Security and (b) certain
restrictive covenants and the related Defaults and Events of Default, upon
compliance by the Company with certain conditions set forth therein, which
provisions apply to this Security.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of each series affected
under the Indenture at any time by the Company and the Trustee with the consent
of the Holders of a majority in aggregate principal amount of the Securities of
such series at the time Outstanding. The Indenture also contains provisions
permitting the Holders of specified percentages in aggregate principal amount of
the Securities of each series at the time Outstanding, on behalf of the Holders
of all the Securities of such series, to waive compliance by the Company with
certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by or on behalf of
the Holder of this Security shall be conclusive and binding upon such Holder and
upon all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof whether
or not notation of such consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of (and
premium, if any) and interest on this Security at the times, place, and rate,
and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable on the Security
Register of the Company, upon surrender of this Security for registration of
transfer at the office or agency of the Company maintained for such purpose in
The City of New York, duly endorsed by, or accompanied by a written instrument
of transfer in form satisfactory to the Company and the Security Registrar duly
executed by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities, of authorized denominations and for the
same aggregate principal amount, shall be issued to the designated transferee or
transferees.
The Securities are issuable only in registered form, without
coupons in denominations of $1,000 and any integral multiple thereof. No service
charge shall be made for any registration of transfer or exchange or redemption
of Securities, but the Company may require payment in certain circumstances of a
sum sufficient to cover any tax or governmental charges that may be imposed in
connection therewith.
Prior to the time of due presentment of this Security for
registration of transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name this Security is registered as
the owner hereof for all purposes,
<PAGE> 35
34
whether or not this Security be overdue, and neither the Company, the Trustee
nor any agent shall be affected by notice to the contrary.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
The following abbreviations, when used in the inscription on the
face of this Security, 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)
TEN ENT - as tenants by the entireties under Uniform Gifts to Minors
Act....................................
(State)
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.
<PAGE> 36
35
ASSIGNMENT FORM
To assign this Security, fill in the form below:
(I) or (we) assign and transfer this Security to
________________________________________________________________________________
(Insert assignee's social security or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint_________________________________________________________
agent to transfer this Security on the books of the Company. The agent may
substitute another to act for him.
Date: __________________ Signature:____________________________________________
(sign exactly as name appears on the other
side of this Security)
Signature guaranteed by: _________________________________
<PAGE> 1
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"),
TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
DVI, INC.
9 7/8% Senior Notes due 2004
CUSIP NO. 233343AB8
No. 1 $ 100,000,000
DVI, Inc., a Delaware corporation (herein called the
"Company", which term includes any successor entity under the Indenture
hereinafter referred to), for value received, hereby promises to pay to Cede &
Co. or registered assigns the principal sum of ONE HUNDRED MILLION DOLLARS on
February 1, 2004, at the office or agency of the Company referred to below, and
to pay interest thereon on August 1, 1997 and semiannually thereafter, on
February 1 and August 1 in each year, from January 30, 1997 or from the most
recent Interest Payment Date to which interest has been paid or duly provided
for, at the rate of 97/8% per annum, until the principal hereof is paid or duly
provided for, and (to the extent lawful) to pay on demand interest on any
overdue interest at the rate borne by the Securities from the date of the
Interest Payment Date on which such overdue interest becomes payable to the date
payment of such interest has been made or duly provided for. The interest so
payable, and punctually paid or duly provided for, on any Interest Payment Date
will, as provided in such Indenture, be paid to the Person in whose name this
Security is registered at the close of business on the Regular Record Date for
such interest, which shall be the January 15 or July 15 (whether or not a
Business Day), as the case may be, next preceding such Interest Payment Date.
Any such interest not so punctually paid or duly provided for, and interest on
such defaulted interest at the interest rate borne by the Securities, to the
extent lawful, shall forthwith cease to be payable to the Holder on such Regular
Record Date, and may be paid to the Person in whose name this Security (or one
or more Predecessor Securities) is registered at the close of business on a
Special Record Date for the payment of such Defaulted Interest to be fixed by
the Trustee, notice whereof shall be given to Holders of Securities not less
than 10 days prior to such Special Record Date, or may be paid at any time in
any other lawful manner not inconsistent with the requirements of
<PAGE> 2
2
any securities exchange on which the Securities may be listed, and upon such
notice as may be required by such exchange, all as more fully provided in said
Indenture. Payment of the principal of (and premium, if any) and interest on
this Security will be made at the office or agency of the Company maintained for
that purpose in The City of New York, or at such other office or agency of the
Company as may be maintained for such purpose, in such coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts; provided, however, that payment of interest may be
made at the option of the Company by check mailed to the address of the Person
entitled thereto as such address shall appear on the Security Register.
Reference is hereby made to the further provisions of this Security set forth on
the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been duly executed by the
Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.
<PAGE> 3
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed under its corporate seal.
DVI, INC.
By: _______________________________
Attest:
___________________________________
Authorized Signatory
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities referred to in the
within-mentioned Indenture.
FIRST TRUST NATIONAL ASSOCIATION
as Trustee
By: ______________________________
Authorized Signatory
Dated: ___________________
<PAGE> 4
[FORM OF REVERSE OF SECURITY]
This Security is one of a duly authorized issue of securities
of the Company designated as its 97/8% Senior Notes due 2004 (herein called the
"Securities"), limited (except as otherwise provided in the Indenture referred
to below) in aggregate principal amount to $100,000,000 which may be issued in
one or more series under an indenture (herein called the "Indenture") dated as
of January 27, 1997, between the Company and First Trust National Association,
trustee (herein called the "Trustee", which term includes any successor trustee
under the Indenture with respect to the series of which this Security is a part)
as supplemented by the First Supplemental Indenture dated as of January 30, 1997
between the Company and the Trustee (together the "Indenture"), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties, obligations
and immunities thereunder of the Company, the Trustee and the Holders of the
Securities, and of the terms upon which the Securities are, and are to be,
authenticated and delivered.
The Securities will be redeemable at the election of the
Company, as a whole or from time to time in part, at any time on or after
February 1, 2002, on or not less than 30 nor more than 60 days' prior notice at
the redemption prices (expressed as percentages of principal amount) set forth
below, together with accrued interest, if any, to the Redemption Date, if
redeemed during the 12-month period beginning on February 1 of the years
indicated below (subject to the right of Holders of record on the relevant
record date to receive interest due on an Interest Payment Date):
<TABLE>
<CAPTION>
Redemption
Year Price
- ---- -----------
<S> <C>
2002 ......................................................... 102.821%
2003 ......................................................... 101.411%
</TABLE>
and thereafter at 100% of the principal amount, together with accrued interest,
if any, to the Redemption Date.
If less than all of the Securities are to be redeemed, the
particular Securities to be redeemed will be selected not more than 60 days
prior to the Redemption Date by the Trustee by such method as the Trustee deems
fair and appropriate.
If an Event of Default shall occur and be continuing, the
principal of all the Securities may be declared due and payable in the manner
and with the effect provided in the Indenture.
<PAGE> 5
5
The Indenture contains provisions for defeasance at any time
of (a) the entire indebtedness of the Company on this Security and (b) certain
restrictive covenants and the related Defaults and Events of Default, upon
compliance by the Company with certain conditions set forth therein, which
provisions apply to this Security.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of each series affected
under the Indenture at any time by the Company and the Trustee with the consent
of the Holders of a majority in aggregate principal amount of the Securities of
such series at the time Outstanding. The Indenture also contains provisions
permitting the Holders of specified percentages in aggregate principal amount of
the Securities of each series at the time Outstanding, on behalf of the Holders
of all the Securities of such series, to waive compliance by the Company with
certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by or on behalf of
the Holder of this Security shall be conclusive and binding upon such Holder and
upon all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof whether
or not notation of such consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of (and
premium, if any) and interest on this Security at the times, place, and rate,
and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registrable on
the Security Register of the Company, upon surrender of this Security for
registration of transfer at the office or agency of the Company maintained for
such purpose in The City of New York, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities, of authorized
denominations and for the same aggregate principal amount, will be issued to the
designated transferee or transferees.
The Securities are issuable only in registered form, without
coupons in denominations of $1,000 and any integral multiple thereof. No service
charge shall be made for any registration of transfer or exchange or redemption
of Securities, but the Company may require payment in certain circumstances of a
sum sufficient to cover any tax or governmental charges that may be imposed in
connection therewith.
Prior to the time of due presentment of this Security for
registration of transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name this Security is registered as
the owner hereof for all purposes,
<PAGE> 6
6
whether or not this Security be overdue, and neither the Company, the Trustee
nor any agent shall be affected by notice to the contrary.
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
The following abbreviations, when used in the inscription on
the face of this Security, shall be construed as though they were written out in
full according to applicable laws or regulations:
<TABLE>
<S> <C> <C>
TEN COM - as tenants in common UNIF GIFT MIN ACT - ................Custodian.............
(Cust.) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to Minors
Act.......................................................
(State)
JT TEN - as joint tenants with right of
survivorship and not as tenants
in common
</TABLE>
Additional abbreviations may also be used though not in the
above list.
<PAGE> 7
7
ASSIGNMENT FORM
To assign this Security, fill in the form below:
(I) or (we) assign and transfer this Security to
- --------------------------------------------------------------------------------
(Insert assignee's social security or tax I.D. no.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint
--------------------------------------------------------
agent to transfer this Security on the books of the Company. The agent may
substitute another to act for him.
Date: Signature:
----------- ------------------------------------------------------
(sign exactly as name appears on the other side of this
Security)
Signature guaranteed by:
------------------------------------
