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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 27, 1999
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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BAKER HUGHES INCORPORATED
(Exact name of registrant as specified in its charter)
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DELAWARE 3900 ESSEX LANE, SUITE 1200 76-0207995
(State of incorporation) HOUSTON, TEXAS 77027-5177 (I.R.S. Employer Identification
(713) 439-8600 No.)
(Address, including zip code, and
telephone
number, including area code, of
registrant's
principal executive offices)
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LAWRENCE O'DONNELL, III
VICE PRESIDENT AND GENERAL COUNSEL
BAKER HUGHES INCORPORATED
3900 ESSEX LANE, SUITE 1200
HOUSTON, TEXAS 77027-5177
(713) 439-8600
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Copies to:
J. DAVID KIRKLAND, JR.
BAKER & BOTTS, L.L.P.
3000 ONE SHELL PLAZA
910 LOUISIANA
HOUSTON, TEXAS 77002-4995
(713) 229-1101
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are to be offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, as amended (the "Securities Act"), other than securities offered only in
connection with dividend or interest reinvestment plans, check the following
box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
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PROPOSED MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF SECURITIES TO BE REGISTERED AGGREGATE OFFERING PRICE(1) REGISTRATION FEE
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Debt Securities(2)..........................................
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Preferred Stock, par value $1.00 per share(2)...............
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Common Stock, par value $1.00 per share(2)..................
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Warrants(2).................................................
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Total.............................................. $1,000,000,000 $278,000(3)
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(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(o) under the Securities Act. In no event will the
aggregate initial offering price of all securities issued from time to time
pursuant to this Registration Statement exceed $1,000,000,000 or the
equivalent thereof in foreign currencies, foreign currency units or
composite currencies. If any Debt Securities are issued at an original issue
discount, then the offering price shall be in such greater principal amount
as shall result in an aggregate initial offering price of up to
$1,000,000,000 or the equivalent thereof in foreign currencies, foreign
currency units or composite currencies, less the dollar amount of any
securities previously issued hereunder. Any securities registered hereunder
may be sold separately or as units with other securities registered
hereunder.
(2) There is also being registered hereunder an indeterminate principal amount
of Debt Securities, an indeterminate number of shares of Preferred Stock and
Common Stock and an indeterminate number of Warrants as may be issuable upon
conversion, redemption, exchange or exercise of the Debt Securities,
Preferred Stock or Warrants registered hereunder, including any applicable
antidilution provisions.
(3) Pursuant to Rule 429 under the Securities Act, the Registrant hereby
transfers an aggregate of $53,457 in filing fees paid in connection with
$171,065,187 aggregate initial offering price of securities that were
registered on Registration Statements of the Registrant on Form S-3
(Registration Nos. 33-46224 and 33-61304) but were not sold. Accordingly, a
filing fee in the amount of $224,543 is being paid in connection herewith.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT, OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE
ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY
DETERMINE.
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THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
SUBJECT TO COMPLETION, DATED SEPTEMBER 27, 1999
PROSPECTUS
[BAKER HUGHES LOGO]
BAKER HUGHES INCORPORATED
3900 Essex Lane
Suite 1200
Houston, Texas 77027-5177
(713) 439-8600
$1,000,000,000
DEBT SECURITIES
PREFERRED STOCK
COMMON STOCK
WARRANTS
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We will provide the specific terms of the securities in supplements to this
prospectus.
You should read this prospectus and any supplement carefully before you invest.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED WHETHER
THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this prospectus is , 1999.
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TABLE OF CONTENTS
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About This Prospectus....................................... 2
Where You Can Find More Information......................... 2
Forward-Looking Information................................. 4
About Baker Hughes Incorporated............................. 4
Use of Proceeds............................................. 4
Ratio of Earnings to Fixed Charges.......................... 5
Description of Debt Securities.............................. 5
Description of Capital Stock................................ 14
Description of Warrants..................................... 17
Plan of Distribution........................................ 18
Legal Opinions.............................................. 20
Experts..................................................... 20
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ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we have filed with
the Securities and Exchange Commission using a "shelf" registration process.
Using this process, we may offer the securities described in this prospectus in
one or more offerings with a total initial offering price of up to
$1,000,000,000. This prospectus provides you with a general description of the
securities we may offer. Each time we use this prospectus to offer securities,
we will provide a prospectus supplement and, if applicable, a pricing supplement
that will describe the specific terms of that offering. The prospectus
supplement and any pricing supplement may also add, update or change the
information in this prospectus. Please carefully read this prospectus, the
prospectus supplement and any pricing supplement, in addition to the information
contained in the documents we refer to under the heading "Where You Can Find
More Information."
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You can read and copy any materials we file with the
SEC at the SEC's public reference room at 450 Fifth Street, N.W., Washington,
D.C. 20549. You can obtain information about the operation of the SEC's public
reference room by calling the SEC at 1-800-SEC-0330. The SEC also maintains a
Web site that contains information we file electronically with the SEC, which
you can access over the Internet at http://www.sec.gov. You can obtain
information about us at the offices of the New York Stock Exchange, 20 Broad
Street, New York, New York 10005 and the Pacific Exchange, 301 Pine Street, San
Francisco, California 94104 or 233 South Beaudry Avenue, Los Angeles, California
90012.
This prospectus is part of a registration statement we have filed with the
SEC relating to the securities we may offer. As permitted by SEC rules, this
prospectus does not contain all of the information we have included in the
registration statement and the accompanying exhibits and schedules we file with
the SEC. You may refer to the registration statement, the exhibits and schedules
for more information about us and our securities. The registration statement,
exhibits and schedules are available at the SEC's public reference room or
through its Web site.
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We are incorporating by reference information we file with the SEC, which
means that we are disclosing important information to you by referring you to
those documents. The information we incorporate by reference is an important
part of this prospectus, and later information that we file with the SEC
automatically will update and supersede this information. We incorporate by
reference the documents listed below and any future filings we make with the SEC
under Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934
until we sell all the securities:
- our annual report on Form 10-K for the year ended December 31, 1998, as
amended by our annual report on Form 10-K/A dated July 19, 1999
- our quarterly report on Form 10-Q for the quarterly period ended March
31, 1999, as amended by our quarterly report on Form 10-Q/A dated July
19, 1999, and our quarterly report on Form 10-Q for the quarterly period
ended June 30, 1999
- our current report on Form 8-K dated May 21, 1999
You may request a copy of these filings (other than an exhibit to those
filings unless we have specifically incorporated that exhibit by reference into
the filing), at no cost, by writing or telephoning us at the following address:
Baker Hughes Incorporated
3900 Essex Lane
Houston, Texas 77027-5177
Attention: Linda J. Smith
Corporate Secretary
Telephone: (713) 439-8600
YOU SHOULD RELY ONLY ON THE INFORMATION WE HAVE PROVIDED OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS AND THE ACCOMPANYING PROSPECTUS SUPPLEMENT. WE HAVE
NOT AUTHORIZED ANY PERSON (INCLUDING ANY SALESMAN OR BROKER) TO PROVIDE
INFORMATION OTHER THAN THAT PROVIDED IN THIS PROSPECTUS AND THE ACCOMPANYING
PROSPECTUS SUPPLEMENT. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH
DIFFERENT INFORMATION. WE ARE NOT MAKING AN OFFER OF THESE SECURITIES IN ANY
JURISDICTION WHERE THE OFFER IS NOT PERMITTED. YOU SHOULD ASSUME THAT THE
INFORMATION IN THIS PROSPECTUS OR THE ACCOMPANYING PROSPECTUS SUPPLEMENT IS
ACCURATE ONLY AS OF THE DATE ON THE FRONT OF THE DOCUMENT AND THAT ANY
INFORMATION WE HAVE INCORPORATED BY REFERENCE IS ACCURATE ONLY AS OF THE DATE OF
THE DOCUMENT INCORPORATED BY REFERENCE.
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FORWARD-LOOKING INFORMATION
This prospectus, including the information we incorporate by reference,
includes forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
You can identify our forward-looking statements by the words "anticipate,"
"believe," "expect," "plan," "intend," "estimate," "project," "budget,"
"forecast," "will," "could," "should," "may" and similar expressions. We caution
you that our actual results may differ materially from those anticipated or
projected in our forward-looking statements. Any differences could result from a
variety of factors, including the following:
- prices of and demand for crude oil and natural gas
- the level of petroleum industry exploration and production activity and
expenditures
- drilling activity
- the effect of competition
- world economic conditions
- weather
- the legislative environment in the United States and other countries
- OPEC policy
- conflict in the Middle East and other major petroleum producing or
consuming regions
- the development of technology that affects overall finding and
development costs
- the condition of the capital and equity markets
ABOUT BAKER HUGHES INCORPORATED
We are a leading supplier of products, services and systems to the
worldwide oil and gas industry and a leading supplier of products, services and
systems to industries throughout the world that use separation processes in
manufacturing and water and wastewater treatment. In August 1998, we completed
our acquisition of Western Atlas Inc. Through our eight oilfield service
companies, including those acquired as part of Western Atlas, we provide
equipment, products and services that our customers use to explore for oil and
gas or drill, complete and produce oil and gas wells. Our process equipment
company provides equipment and services that our customers use to separate
liquids from liquids or liquids from solids in a number of applications,
including industrial and municipal water and wastewater treatment and oil, gas,
mineral, food, chemical, pharmaceutical, pulp and paper and other industrial,
manufacturing or mining processing.
USE OF PROCEEDS
Unless we inform you otherwise in the prospectus supplement, we expect to
use the net proceeds from the sale of securities for general corporate purposes.
These purposes may include:
- acquisitions
- working capital
- capital expenditures
- repayment of debt and
- repurchases and redemptions of securities
Pending any specific application, we may initially invest funds in short-term
marketable securities or apply them to the reduction of short-term indebtedness.
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RATIO OF EARNINGS TO FIXED CHARGES
We have presented in the table below our historical consolidated ratio of
earnings to fixed charges for the periods shown.
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SIX MONTHS YEAR THREE MONTHS YEAR ENDED SEPTEMBER 30,
ENDED ENDED ENDED -----------------------------
JUNE 30, 1999 DECEMBER 31, 1998 DECEMBER 31, 1997 1997 1996 1995 1994
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2.19x -- 5.57x 3.45x 4.30x 3.44x 3.04x
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We have computed the historical ratios of earnings to fixed charges by
dividing earnings by fixed charges. For this purpose, earnings consist of income
before income taxes and extraordinary items, adjusted for fixed charges,
capitalized interest and amortization of capitalized interest. Fixed charges
consist of interest expense, capitalized interest and one-third of annual rental
expense, which has been deemed to represent the interest factor.
For the year ended December 31, 1998, earnings were inadequate to cover
fixed charges by $500.4 million. During the year ended December 31, 1998, we (1)
provided reserves and recorded write-downs reflected in costs of revenues
aggregating $305.0 million; (2) recorded selling, general and administrative
expenses relating to reserves, accruals and the loss on the sale of assets
aggregating $68.7 million; (3) recorded merger-related costs in connection with
the Western Atlas merger of $219.1 million; and (4) recognized unusual charges
aggregating $215.8 million.
We had no preferred stock outstanding for any period presented, and
accordingly, the ratio of earnings to combined fixed charges and preferred stock
dividends is the same as the ratio of earnings to fixed charges.
DESCRIPTION OF DEBT SECURITIES
The debt securities covered by this prospectus will be our general
unsecured obligations. The debt securities will be either senior debt securities
or subordinated debt securities. We will issue senior debt securities under an
indenture dated as of May 15, 1991 between us and Citibank, N.A., as successor
trustee to Morgan Guaranty Trust Company of New York. We will issue subordinated
debt securities under an indenture between us and a trustee that we will name in
the prospectus supplement. The indenture for the senior debt securities and the
indenture for the subordinated debt securities will be substantially identical,
except for provisions relating to subordination and covenants. We sometimes call
the senior indenture and the subordinated indenture the indentures.
We have summarized material provisions of the indentures and the debt
securities below. This summary is not complete. We have filed the senior
indenture and the form of subordinated indenture with the SEC as exhibits to the
registration statement, and you should read the indentures for provisions that
may be important to you. Please read "Where You Can Find More Information."
In this summary description of the debt securities, all references to us
mean Baker Hughes Incorporated only, unless we state otherwise or the context
clearly indicates otherwise.
RANKING
The senior debt securities will constitute senior debt and will rank
equally with all of our unsecured and unsubordinated debt. The subordinated debt
securities will be subordinated to, and thus have a junior position to, the
senior debt securities and all of our other senior debt. Neither indenture
limits the amount of debt that we may issue under that indenture or the amount
of other unsecured debt or securities that we or any of our subsidiaries may
issue. We may issue debt securities under either indenture from time to time in
one or more series, each in an amount we authorize prior to issuance. Our 5.80%
Notes due 2003, 8% Notes due 2004, Liquid Yield Option Notes(TM) due 2008, 6%
Notes due 2009, 6 1/4% Notes due 2009 and 6 7/8% Notes due 2029 are outstanding
under the senior indenture.
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We currently conduct substantially all our operations through subsidiaries,
and substantially all of our operating income and cash flow are generated by our
subsidiaries. As a result, distributions or advances from our subsidiaries are
the principal source of funds necessary to meet our debt service obligations.
Contractual provisions or laws, as well as our subsidiaries' financial condition
and operating requirements, may limit our ability to obtain cash from our
subsidiaries that we require to pay our debt service obligations, including
payments on the debt securities. In addition, holders of the debt securities
will have a junior position to the claims of creditors of our subsidiaries on
their assets and earnings.
Other than the restrictions in the senior indenture we have described below
under "Restrictive Covenants," the indentures and the debt securities do not
contain any covenants or other provisions designed to protect holders of the
debt securities in the event of a highly leveraged transaction. The indentures
and the debt securities also do not contain provisions that give holders of the
debt securities the right to require us to repurchase their securities in the
event of a decline in our credit rating resulting from a takeover,
recapitalization or similar restructuring or otherwise.
TERMS
The prospectus supplement relating to any series of debt securities we are
offering will include specific terms relating to that offering. These terms will
include some or all of the following:
- whether the debt securities are senior or subordinated debt securities
- the title of the debt securities
- the total principal amount of the debt securities
- whether we will issue the debt securities in individual certificates to
each holder in registered or bearer form, or in the form of temporary or
permanent global securities held by a depository on behalf of holders
- if we issue the debt securities in the form of bearer securities, any
applicable restrictions on those securities and any terms for the
exchange of those securities for registered securities
- the prices at which we will issue the debt securities
- the date or dates on which the principal of and any premium on the debt
securities will be payable
- any interest rate, the date from which interest will accrue, interest
payment dates, record dates for interest payments and the manner of
paying interest
- whether and under what circumstances we will pay any additional amounts
on the debt securities
- the place or places where payments on the debt securities will be payable
- any optional redemption provisions
- any sinking fund or other provisions that would obligate us to redeem,
purchase or repay debt securities
- the denominations in which we will issue the debt securities
- whether payments on the debt securities will be payable in foreign
currency or currencies, including composite currencies, whether payments
will be payable by reference to any index, and any provisions relating to
payment in a form other than that stated in the debt securities
- the portion of the principal amount of debt securities that will be
payable if the maturity is accelerated, if other than the entire
principal amount
- any additional means of defeasance of the debt securities, any additional
conditions or limitations to defeasance of the debt securities or any
changes to those conditions or limitations
- any changes or additions to events of default or covenants
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- any restrictions or other provisions relating to the transfer or exchange
of debt securities
- any terms for the conversion or exchange of the debt securities for other
securities of us or any other entity
We may sell the debt securities at a discount, which may be substantial,
below their stated principal amount. These debt securities may bear no interest
or interest at a rate that at the time of issuance is below market rates. We
will describe in the prospectus supplement any material U.S. federal income tax
consequences applicable to those securities.
If we sell any of the debt securities for any foreign currency or currency
unit or if payments on the debt securities are payable in any foreign currency
or currency unit, we will describe in the prospectus supplement the
restrictions, elections, tax consequences, specific terms and other information
relating to those debt securities and the foreign currency or currency unit.
SUBORDINATION
Under the subordinated indenture, payment of the principal, interest and
any premium on the subordinated debt securities will generally be subordinated
and junior in right of payment to the prior payment in full of all Senior Debt.
Unless we inform you otherwise in the prospectus supplement, we may not make any
payment of principal of, interest on or any premium on the subordinated debt
securities if:
- we fail to pay the principal, interest, premium or any other amounts on
any Senior Debt when due or
- we default in performing any other covenant (a "covenant default") in any
Senior Debt that we have designated if the covenant default allows the
holders of that Senior Debt to accelerate the maturity of the Senior Debt
they hold
Unless we inform you otherwise in the prospectus supplement, a covenant
default will prevent us from paying the subordinated debt securities only for up
to 179 days after holders of the Senior Debt give the trustee for the
subordinated debt securities notice of the covenant default.
The subordination does not affect our obligation, which is absolute and
unconditional, to pay, when due, the principal of and any premium and interest
on the subordinated debt securities. In addition, the subordination does not
prevent the occurrence of any default under the subordinated indenture.
The subordinated indenture will not limit the amount of Senior Debt that we
may incur. As a result of the subordination of the subordinated debt securities,
if we became insolvent, holders of subordinated debt securities may receive less
on a proportionate basis than other creditors.
Unless we inform you otherwise in the prospectus supplement, "Senior Debt"
will mean all indebtedness, including guarantees, of Baker Hughes, unless the
indebtedness states that it is not senior to the subordinated debt securities or
our other junior debt.
RESTRICTIVE COVENANTS
We have agreed to two principal restrictions on our activities for the
benefit of holders of the senior debt securities. Unless waived or amended, the
restrictive covenants summarized below will apply to a series of senior debt
securities as long as any of those debt securities are outstanding, unless the
prospectus supplement for the series states otherwise. We have used in this
summary description capitalized terms that we have defined below under
"-- Glossary." In this description of the covenants only, all references to us
mean Baker Hughes Incorporated and its subsidiaries, unless the context clearly
indicates otherwise.
Limitation on Liens
We have agreed that we will issue, assume, guarantee or suffer to exist any
debt for money borrowed secured by lien upon any of our properties or upon any
shares of stock or indebtedness of our subsidiaries
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only if we secure the senior debt securities equally and ratably with or prior
to the debt secured by the lien. This covenant has exceptions that permit:
(a) liens on any property we acquire, construct or improve after May
15, 1991 that are created within 180 days after the acquisition, the
completion of construction or the commencement of commercial operation of
the property to secure or provide for the payment of the purchase price of
the property or the cost of the construction or improvement; in the case of
construction or improvement, the exception permits liens on property
previously owned by us only if the property is unimproved real property on
which the property being constructed or the improvement is located
(b) liens on property existing at the time we acquire the property or
liens outstanding at the time any corporation becomes a subsidiary, but
only to the extent that the lien applies to property either:
- owned by that corporation at the time it becomes a subsidiary or
- acquired by that corporation from a third party after the
corporation becomes a subsidiary
(c) intercompany liens
(d) liens in favor of a governmental entity either:
- to secure payments under any contract or statute or
- to secure indebtedness incurred to finance the purchase price or
the cost of constructing or improving the property subject to
the lien, including liens securing pollution control or
industrial revenue bonds or similar indebtedness
(e) any extensions, renewals or replacements of the above-described
liens if both
- the amount of debt secured by the new lien does not exceed the
amount of debt refinanced and
- the new lien is limited to all or a part of the property, plus
any improvements, secured by the original lien
In addition, without securing the senior debt securities as described
above, we may issue, assume or guarantee secured debt that this covenant would
otherwise restrict in an aggregate amount that, when added to all of our other
secured debt that this covenant would otherwise restrict and to outstanding
Attributable Debt for Sale and Lease-Back Transactions, does not exceed a basket
equal to 10% of Consolidated Net Worth as of a date within 90 days before the
proposed transaction. When calculating this aggregate amount, we exclude from
the calculation Attributable Debt for Sale and Lease-Back Transactions the
proceeds of which we have used to retire debt as described in clause (b) below
under "-- Limitation on Sale and Lease-Back Transactions."
Limitation on Sale and Lease-Back Transactions
We have agreed that we will enter into a Sale and Lease-Back Transaction
only if one of the following applies:
(a) we could incur debt in an amount at least equal to the
Attributable Debt for that Sale and Lease-Back Transaction and, without
violating the "Limitation on Liens" covenant, could secure that debt by a
lien on the property to be leased without equally and ratably securing the
senior debt securities or
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(b) within 90 days of the effective date of the Sale and Lease-Back
Transaction, we apply an amount equal to the net proceeds from the sale of
the property so leased to the voluntary retirement of either:
- senior debt securities or
- any of our Funded Debt that is not subordinated to the senior debt
securities
This covenant does not apply to any Sale and Lease-Back Transaction entered
into in connection with an industrial revenue bond or pollution control
financing or any intercompany Sale and Lease-Back Transaction. When calculating
the amount of Attributable Debt, we will exclude any Attributable Debt for these
Sale and Lease-Back Transactions.
Glossary
"Attributable Debt" means the present value of the net rental payments
during the remaining term of the lease included in the Sale and Lease-Back
Transaction. To determine the present value, we use a discount rate equal to the
lease rate implicit in the Sale and Lease-Back Transaction.
"Consolidated Net Worth" means the amount of total stockholders' equity
shown in our most recent consolidated statement of financial position.
The term "debt" means all indebtedness for borrowed money.
"Funded Debt" means all debt that matures on or is extendible or renewable
to a date more than 12 months after the date of the creation of the debt.
"Sale and Lease-Back Transaction" means any arrangement with anyone under
which we lease for a term of more than three years any property that we have or
will sell or transfer to that person. This term excludes leases of property we
acquire or place in service within 180 days prior to the arrangement.
In this description of the covenants only, a subsidiary is a corporation of
which we own more than 50% of the outstanding voting stock, either directly or
indirectly. Voting stock is stock that ordinarily has voting power for the
election of directors, whether at all times or only so long as no senior class
of stock has such voting power by reason of any contingency.
CONSOLIDATION, MERGER AND SALE OF ASSETS
The indentures generally permit a consolidation or merger between us and
another entity. They also permit the sale by us of all or substantially all of
our assets. We have agreed, however, that we will consolidate with or merge into
any entity or transfer or dispose of all or substantially all of our assets to
any entity only if all of the following are satisfied:
(a) the resulting entity is organized and existing under the laws of
any domestic jurisdiction and assumes the due and punctual payments on the
debt securities and the performance of our covenants under the indentures
(b) immediately after giving effect to the transaction, no event of
default, and no event that, after notice or lapse of time, would become an
event of default, would occur and be continuing
(c) if as a result of the transaction our property or assets become
subject to a lien not permitted by the covenant described above under
"Restrictive Covenants -- Limitation on Liens," we or the resulting entity
secures the senior debt securities as described in that section
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EVENTS OF DEFAULT
Unless we inform you otherwise in the prospectus supplement, the following
events are events of default with respect to a series of debt securities:
- our failure to pay interest on any debt security of that series for 30
days
- our failure to pay principal of or any premium on any debt security of
that series when due
- our failure to make any sinking fund payment for any debt security of
that series when due
- our failure to perform any of our other covenants in that indenture,
other than a covenant included in the indenture solely for the benefit of
another series of debt securities, continued for 90 days after written
notice by the trustee or by the holders of at least 25% in principal
amount of the outstanding debt securities of that series
- certain events involving bankruptcy, insolvency or reorganization of
Baker Hughes Incorporated
A default under one series of debt securities will not necessarily be a
default under another series. The trustee may withhold notice to the holders of
the debt securities of any default or event of default, except in any payment on
the debt securities, if the trustee considers it in the interest of the holders
of the debt securities to do so.
If an event of default for any series of debt securities occurs and is
continuing, either the trustee or the holders of at least 25% in principal
amount of the outstanding debt securities of that series by notice as provided
in the indenture may require us to pay the principal amount of all debt
securities of that series immediately. The holders of a majority in principal
amount of the outstanding debt securities of that series may in some cases
rescind and annul that acceleration.
A holder of a debt security of any series may pursue any remedy under the
indenture only if:
- the holder has previously given written notice to the trustee of a
continuing event of default with respect to that series of debt
securities
- the holders of not less than 25% in principal amount of the outstanding
debt securities of that series have made written request to the trustee
to institute proceedings in its own name
- the holder has offered the trustee reasonable indemnity
- the trustee has failed to act within 60 days after receipt of the notice
and indemnity and
- during that 60-day period, the holders of a majority in principal amount
of the outstanding debt securities of that series have given no direction
inconsistent with the request
This provision does not, however, affect the right of a holder of any debt
security to sue for the enforcement of any overdue payment.
In most cases, the trustee will be under no obligation to exercise any of
its rights or powers under the indenture at the request or direction of any of
the holders, unless those holders have offered to the trustee reasonable
indemnity. Subject to this provision for indemnification, the holders of a
majority in principal amount of the outstanding debt securities of any series
may direct the time, method and place of:
- conducting any proceeding for any remedy available to the trustee
- exercising any trust or power conferred on the trustee with respect to
the debt securities of that series
Each indenture requires us to furnish to the trustee annually a statement
as to our performance of certain of our obligations under the indenture and as
to any default in performance.
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DEFEASANCE
When we use the term defeasance, we mean discharge from some or all of our
obligations under an indenture. If we deposit with the trustee funds or U.S.
government securities sufficient to make payments on the debt securities of a
series on the dates those payments are due and payable, then, at our option,
either of the following will occur:
- we will be discharged from our obligations with respect to the debt
securities of that series ("legal defeasance and discharge") or
- we will no longer have any obligation to comply with any restrictive
covenants relating to the debt securities of that series, the related
events of default will no longer apply to us, but our other obligations
under the indenture and the debt securities of that series, including our
obligation to make payments on the debt securities, will survive
("covenant defeasance")
If we elect legal defeasance and discharge of a series of debt securities,
the holders of the debt securities of that series will not be entitled to the
benefits of the indenture, except for our obligations relating to:
- temporary debt securities and exchange of those debt securities
- registration of transfer or exchange of debt securities of that series
- replacement of stolen, lost or mutilated debt securities of that series
- maintenance of paying agencies and
- holding of monies for payment in trust
Holders of debt securities of that series would be entitled to look only to the
trust fund for payments on their debt securities until maturity.
Unless we inform you otherwise in the prospectus supplement, we will be
required to deliver to the trustee an opinion of counsel that the deposit and
related defeasance would not cause the holders of the debt securities to
recognize income, gain or loss for federal income tax purposes and that the
holders would 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 the deposit and
related defeasance had not occurred. If we elect legal defeasance and discharge,
that opinion of counsel must be based upon a ruling from the United States
Internal Revenue Service or a change in law to that effect.
Under current United States federal income tax law, legal defeasance and
discharge would likely be treated as a taxable exchange of debt securities to be
defeased for interests in the defeasance trust. As a consequence, a United
States holder would recognize gain or loss equal to the difference between the
holder's cost or other tax basis for the debt securities and the value of the
holder's interest in the defeasance trust, and thereafter would be required to
include in income a share of the income, gain or loss of the defeasance trust.
Under current United States federal income tax law, covenant defeasance would
not be treated as a taxable exchange of such debt securities.
PAYMENT AND PAYING AGENTS
Unless we inform you otherwise in the prospectus supplement, we will make
payments on the debt securities in U.S. dollars at the office of the trustee and
any paying agents we designate from time to time. We will make all payments by
wire transfer for debt securities held in book-entry form. For debt securities
not held in book-entry form, we may make, at our option, interest payments by
wire transfer or by check mailed to the person entitled to the payment as it
appears on the security register and will make principal payments upon surrender
of the debt securities at the corporate trust offices of the trustee or a paying
agent in New York, New York. We will make interest payments to the person in
whose name the debt security is registered at the close of business on the
record date for the interest payment.
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Unless we inform you otherwise in the prospectus supplement, the corporate
trust office of the trustee in New York, New York will be designated as a paying
agent for payments on the debt securities. We may at any time designate
additional paying agents, rescind the designation of any paying agent or approve
a change in the office through which any paying agent acts. We will, however, be
required to maintain a paying agent in each place of payment for a series of
debt securities.
All monies we pay to a paying agent for payments on any debt security that
remain unclaimed for two years after the payments become due and payable will be
repaid to us, subject to applicable escheat laws. After repayment to us, the
holder of that debt security must look only to us for payment.
MODIFICATION AND WAIVER
We may modify or amend each indenture if the holders of a majority in
principal amount of the outstanding debt securities of all series issued under
the indenture affected by the modification or amendment consent to it. Without
the consent of each outstanding debt security affected, however, no modification
may:
- change the stated maturity of the principal of or any installment of
principal of or interest on any debt security
- reduce the principal amount of, the interest rate on or the premium
payable upon redemption of any debt security
- change the redemption date for any debt security
- change our obligation, if any, to pay additional amounts
- reduce the principal amount of an original discount debt security payable
upon acceleration of maturity
- change the coin or currency in which any debt security or any premium or
interest on any debt security is payable
- change the redemption right of any holder
- impair the right to institute suit for the enforcement of any payment on
any debt security
- reduce the percentage in principal amount of outstanding debt securities
of any series necessary to modify the indenture, to waive compliance with
certain provisions of the indenture or to waive certain defaults
- reduce quorum or voting requirements
- change our obligation to maintain an office or agency in the places and
for the purposes required by the indenture
- modify any of the above provisions
We may modify or amend the indenture without the consent of any holders of
the debt securities in certain circumstances, including:
- to provide for the assumption of our obligations under the indenture and
the debt securities by a successor upon any merger, consolidation or
asset transfer
- to add covenants and events of default or to surrender any rights we have
under the indenture
- to make any change that does not adversely affect any outstanding debt
securities of a series in any material respect
- to secure the senior debt securities as described above under
"Restrictive Covenants -- Limitation on Liens"
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- to provide for successor trustees
- to cure any ambiguity, omission, defect or inconsistency
The holders of a majority in principal amount of the outstanding debt
securities of any series may waive past defaults under the indenture and
compliance by us with our covenants described above under "Restrictive
Covenants" with respect to the debt securities of that series only. Those
holders may not, however, waive any default in any payment on any debt security
of that series or compliance with a provision that cannot be modified or amended
without the consent of each holder affected.
FORM, EXCHANGE, REGISTRATION AND TRANSFER
Unless we inform you otherwise in the prospectus supplement, we will issue
the debt securities in registered form, without coupons, in denominations of
$1,000 and integral multiples.
Debt securities of any series will be exchangeable for other debt
securities of the same series, the same total principal amount and the same
terms but in different authorized denominations in accordance with the
indenture. Holders may present debt securities for registration of transfer at
the office of the security registrar or any transfer agent we designate. The
security registrar or transfer agent will effect the transfer or exchange when
it is satisfied with the documents of title and identity of the person making
the request. We will not charge a service charge for any registration of
transfer or exchange of the debt securities. We may, however, require the
payment of any tax or other governmental charge payable for that registration.
We will appoint the trustee under each indenture as security registrar for
the debt securities issued under that indenture. We are required to maintain an
office or agency for transfers and exchanges in each place of payment. We may at
any time designate additional transfer agents for any series of debt securities.
In the case of any redemption in part, we will not be required:
- to issue, register the transfer of or exchange debt securities of a
series either during a period beginning 15 business days prior to the
selection of debt securities of that series for redemption and ending on
the close of business on the day of mailing of the relevant notice of
redemption or
- to register the transfer of or exchange any debt security, or portion of
any debt security, called for redemption, except the unredeemed portion
of any debt security we are redeeming in part
BOOK-ENTRY DEBT SECURITIES
We may issue the debt securities of a series in the form of one or more
global debt securities that would be deposited with a depositary or its nominee
identified in the prospectus supplement. We may issue global debt securities in
either temporary or permanent form. We will describe in the prospectus
supplement the terms of any depositary arrangement and the rights and
limitations of owners of beneficial interests in any global debt security.
REPLACEMENT OF DEBT SECURITIES
We will replace any mutilated debt security at the holder's expense upon
surrender of the debt security to the trustee. We will replace debt securities
that become destroyed, stolen or lost at the holder's expense upon delivery to
the trustee of the debt security or evidence of destruction, loss or theft
satisfactory to us and the trustee. In the case of a destroyed, lost or stolen
debt security, we may require an indemnity satisfactory to the trustee and to us
at the holder's expense before we issue a replacement debt security.
GOVERNING LAW
New York law will govern each indenture and the debt securities.
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THE TRUSTEES
Citibank, N.A. is the trustee under the senior indenture. We maintain
banking relationships in the ordinary course of business with the senior trustee
and its affiliates. We will name the subordinated trustee in the prospectus
supplement.
If an event of default occurs and is continuing, the trustee will be
required to use the degree of care and skill of a prudent man in the conduct of
his own affairs. The trustee will become obligated to exercise any of its powers
under the indenture at the request of any of the holders of any debt securities
only after those holders have offered the trustee indemnity reasonably
satisfactory to it.
If the trustee becomes one of our creditors, it will be subject to
limitations in the indenture on its rights to obtain payment of claims or to
realize on certain property received for any claim, as security or otherwise.
The trustee is permitted to engage in other transactions with us. If, however,
it acquires any conflicting interest, it must eliminate that conflict or resign
within 90 days after ascertaining that it has a conflicting interest and after
the occurrence of a default under the indenture, unless the default has been
cured, waived or otherwise eliminated within the 90-day period.
DESCRIPTION OF CAPITAL STOCK
Our authorized capital stock consists of:
- 750,000,000 shares of common stock, par value $1.00 per share
- 15,000,000 shares of preferred stock, par value $1.00 per share, issuable
in series
COMMON STOCK
Common stockholders are entitled to one vote for each share held on all
matters submitted to them. The common stock does not have cumulative voting
rights, meaning that the holders of a majority of the shares of common stock
voting for the election of directors can elect all the directors if they choose
to do so.
Each share of common stock is entitled to participate equally in dividends
as and when declared by our board of directors. The payment of dividends on our
common stock may be limited by obligations we may have to holders of any
preferred stock.
If we liquidate or dissolve our business, the holders of common stock will
share ratably in the distribution of assets available for distribution to
stockholders after creditors are paid and preferred stockholders receive their
distributions. The shares of common stock have no preemptive rights and are not
convertible, redeemable or assessable or entitled to the benefits of any sinking
fund.
All issued and outstanding shares of common stock are fully paid and
nonassessable. Any shares of common stock we offer under this prospectus will be
fully paid and nonassessable.
The common stock is listed on the New York Stock Exchange, the Pacific
Exchange and the Swiss Exchange and trades under the symbol "BHI."
PREFERRED STOCK
Our board of directors can, without action by stockholders, issue one or
more series of preferred stock. The board can determine for each series the
number of shares, designation, relative voting rights, dividend rates,
liquidation and other rights, preferences and limitations. In some cases, the
issuance of preferred stock could delay or discourage a change in control of us.
We have summarized material provisions of the preferred stock in this
section. This summary is not complete. We will file the form of the preferred
stock with the SEC before we issue any of it, and you should read it for
provisions that may be important to you.
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The prospectus supplement relating to any series of preferred stock we are
offering will include specific terms relating to the offering. These terms will
include some or all of the following:
- the title of the preferred stock
- the maximum number of shares of the series
- the dividend rate or the method of calculating the dividend, the date
from which dividends will accrue and whether dividends will be cumulative
- any liquidation preference
- any optional redemption provisions
- any sinking fund or other provisions that would obligate us to redeem or
purchase the preferred stock
- any terms for the conversion or exchange of the preferred stock for other
securities of us or any other entity
- any voting rights
- any other preferences and relative, participating, optional or other
special rights or any qualifications, limitations or restrictions on the
rights of the shares
Any shares of preferred stock we issue will be fully paid and
nonassessable.
ANTI-TAKEOVER PROVISIONS
The provisions of Delaware law and our restated certificate of
incorporation and by-laws we summarize below may have an anti-takeover effect
and may delay, defer or prevent a tender offer or takeover attempt that a
stockholder might consider in his or her best interest, including those attempts
that might result in a premium over the market price for the common stock.
Staggered Board of Directors
Our board of directors is divided into three classes that are elected for
staggered three-year terms. The classification of the board of directors has the
effect of requiring at least two annual stockholder meetings, instead of one, to
effect a change in control of the board of directors. Holders of a majority of
the shares of common stock entitled to vote in the election of directors may
remove a director for cause, but stockholders may not remove any director
without cause.
Fair Price Provision
Our restated certificate of incorporation contains a fair price provision.
Mergers, consolidations and other business combinations involving us and a
"related person" require the approval of holders of at least 75% of our
outstanding voting stock, including at least 66 2/3% of our outstanding voting
stock not owned by the related person. Related persons include the holder of 10%
or more of our outstanding voting stock and any affiliate of that holder.
The 66 2/3% voting requirement does not apply, however, if the holders of
at least 90% of the outstanding voting stock approve the business combination.
In addition, the 75% voting requirement does not apply if either:
- the related person's acquisition of voting stock or the business
combination is approved in advance of that person's becoming a 10%
stockholder by not less than 75% of our directors then holding office or
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- the following conditions are met:
- the transaction is a merger or consolidation proposed to occur within
one year and the price to be paid to common stockholders is at least as
high as the highest price per share paid by the related person in
acquiring any of its shares
- the consideration to be paid is cash or the same form of consideration
paid by the related person to acquire a majority of its shares
- between the date of the acquisition by the related person of 10% of our
outstanding voting stock and the transaction, (a) we have not failed to
declare and pay preferred stock dividends nor reduced common stock
dividends, except as approved by a majority of unaffiliated directors,
(b) the related person has not acquired more voting stock and (c) we
have provided no benefit to the related person through loans or other
financial assistance or through tax credits or other tax advantages and
- a proxy statement has been mailed to stockholders at least 30 days prior
to the closing of the transaction for the purpose of soliciting
stockholder approval
Stockholder Proposals and Director Nominations
Our stockholders can submit stockholder proposals and nominate candidates
for our board of directors if the stockholders follow advance notice procedures
described in our by-laws.
To nominate directors, stockholders must submit a written notice between
120 and 150 days before the first anniversary of the date of our proxy statement
for the previous year's annual stockholders' meeting. The notice must include
the name and address of the stockholder, the class and number of shares owned by
the stockholder, information about the nominee required by the SEC and the
written consent of the nominee to serve as a director. Our board of directors
may require the nominee to furnish the same information as is required in the
stockholders' notice that pertains to the nominee.
Stockholder proposals must be submitted not less than 120 days before the
first anniversary of the date of our proxy statement for the previous year's
annual stockholders' meeting. The notice must include a description of the
proposal, the reasons for bringing the proposal before the meeting, the name and
address of the stockholder, the class and number of shares owned by the
stockholder and any material interest of the stockholder in the proposal.
In each case, if we did not hold an annual meeting in the previous year or
if we have changed the date of the annual meeting by more than 30 days from the
date contemplated in the previous year's proxy statement, stockholders must
submit the notice not later than 10 days after the day we mail notice of or
otherwise make public the new date of the annual meeting.
Director nominations and stockholder proposals that are late or that do not
include all required information may be rejected. This could prevent
stockholders from bringing certain matters before an annual meeting, including
making nominations for directors.
Delaware Anti-takeover Statute
We are a Delaware corporation and are subject to Section 203 of the
Delaware General Corporation Law. In general, Section 203 prevents us from
engaging in a business combination with an "interested stockholder" (generally,
a person owning 15% or more of our outstanding voting stock) for three years
following the time that person becomes a 15% stockholder unless one of the
following is satisfied:
- before that person became a 15% stockholder, our board of directors
approved the transaction in which the stockholder became a 15%
stockholder or approved the business combination
- upon completion of the transaction that resulted in the stockholder's
becoming a 15% stockholder, the stockholder owns at least 85% of our
voting stock outstanding at the time the transaction began (excluding
stock held by directors who are also officers and by employee stock plans
that do not
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provide employees with the right to determine confidentially whether
shares held subject to the plan will be tendered in a tender or exchange
offer) or
- after the transaction in which that person became a 15% stockholder, the
business combination is approved by our board of directors and authorized
at a stockholders' meeting by at least two-thirds of the outstanding
voting stock not owned by the 15% stockholder
Under Section 203, these restrictions also do not apply to certain business
combinations proposed by a 15% stockholder following the disclosure of an
extraordinary transaction with a person who was not a 15% stockholder during the
previous three years or who became a 15% stockholder with the approval of a
majority of our directors. This exception applies only if the extraordinary
transaction is approved or not opposed by a majority of our directors who were
directors before any person became a 15% stockholder in the previous three
years, or the successors of these directors.
Other Provisions
Our restated certificate of incorporation also provides that:
- stockholders may act only at an annual or special meeting and not by
written consent
- special meetings of stockholders can be called only by our board of
directors
- a 75% vote of the outstanding voting stock is required for the
stockholders to amend the by-laws and
- a 75% vote of the outstanding voting stock is required to amend the
restated certificate of incorporation with respect to certain matters,
including those described in the first two bullet points above and the
75% voting requirement required for business combinations described under
"-- Fair Price Provision"
TRANSFER AGENT AND REGISTRAR
ChaseMellon Shareholder Services, L.L.C. is our transfer agent and
registrar.
DESCRIPTION OF WARRANTS
We may issue warrants to purchase debt securities, common stock, preferred
stock or other securities. We may issue warrants independently or together with
other securities. Warrants sold with other securities may be attached to or
separate from the other securities. We will issue warrants under one or more
warrant agreements between us and a warrant agent that we will name in the
prospectus supplement.
We have summarized material provisions of the warrants and the warrant
agreements below. This summary is not complete. We will file the form of any
warrant agreement with the SEC, and you should read the warrant agreement for
provisions that may be important to you.
The prospectus supplement relating to any warrants we are offering will
include specific terms relating to the offering. These terms will include some
or all of the following:
- the title of the warrants
- the aggregate number of warrants offered
- the designation, number and terms of the debt securities, common stock,
preferred stock or other securities purchasable upon exercise of the
warrants, and procedures by which those numbers may be adjusted
- the exercise price of the warrants
- the dates or periods during which the warrants are exercisable
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- the designation and terms of any securities with which the warrants are
issued
- if the warrants are issued as a unit with another security, the date on
and after which the warrants and the other security will be separately
transferable
- if the exercise price is not payable in U.S. dollars, the foreign
currency, currency unit or composite currency in which the exercise price
is denominated
- any minimum or maximum amount of warrants that may be exercised at any
one time
- any terms, procedures and limitations relating to the transferability,
exchange or exercise of the warrants
Warrant certificates will be exchangeable for new warrant certificates of
different denominations at the office indicated in the prospectus supplement.
Prior to the exercise of their warrants, holders of warrants will not have any
of the rights of holders of the securities subject to the warrants.
MODIFICATIONS
We may amend the warrant agreements and the warrants without the consent of
the holders of the warrants to cure any ambiguity, to cure, correct or
supplement any defective or inconsistent provision, or in any other manner that
will not materially and adversely affect the interests of holders of outstanding
warrants.
We may also modify or amend certain other terms of the warrant agreements
and the warrants with the consent of the holders of not less than a majority in
number of the then outstanding unexercised warrants affected. Without the
consent of the holders affected, however, no modification or amendment may:
- shorten the period of time during which the warrants may be exercised or
- otherwise materially and adversely affect the exercise rights of the
holders of the warrants
ENFORCEABILITY OF RIGHTS
The warrant agent will act solely as our agent. The warrant agent will not
have any duty or responsibility if we default under the warrant agreements or
the warrant certificates. A warrant holder may, without the consent of the
warrant agent, enforce by appropriate legal action on its own behalf the
holder's right to exercise the holder's warrants.
PLAN OF DISTRIBUTION
We may sell the offered securities in and outside the United States (a)
through underwriters or dealers, (b) directly to purchasers or (c) through
agents. The prospectus supplement will include the following information:
- the terms of the offering
- the names of any underwriters or agents
- the purchase price of the securities from us
- the net proceeds to us from the sale of securities
- any delayed delivery arrangements
- any underwriting discounts, commissions and other items constituting
underwriters' compensation
- any initial public offering price
- any discounts or concessions allowed or reallowed or paid to dealers
- any commissions paid to agents
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SALE THROUGH UNDERWRITERS OR DEALERS
If we use underwriters in the sale, the underwriters will acquire the
securities for their own account. The underwriters may resell the securities
from time to time in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices determined
at the time of sale. Underwriters may offer securities to the public either
through underwriting syndicates represented by one or more managing underwriters
or directly by one or more firms acting as underwriters. Unless we inform you
otherwise in the prospectus supplement, the obligations of the underwriters to
purchase the securities will be subject to certain conditions, and the
underwriters will be obligated to purchase all the offered securities if they
purchase any of them. The underwriters may change from time to time any initial
public offering price and any discounts or concessions allowed or reallowed or
paid to dealers.
During and after an offering through underwriters, the underwriters may
purchase and sell the securities in the open market. These transactions may
include overallotment and stabilizing transactions and purchases to cover
syndicate short positions created in connection with the offering. The
underwriters also may impose a penalty bid, which means that selling concessions
allowed to syndicate members or other broker-dealers for the offered securities
sold for their account may be reclaimed by the syndicate if the offered
securities are repurchased by the syndicate in stabilizing or covering
transactions. These activities may stabilize, maintain or otherwise affect the
market price of the offered securities, which may be higher than the price that
might otherwise prevail in the open market. If commenced, the underwriters may
discontinue these activities at any time.
If we use dealers in the sale of securities, we will sell the securities to
them as principals. They may then resell those securities to the public at
varying prices determined by the dealers at the time of resale. We will include
in the prospectus supplement the names of the dealers and the terms of the
transaction.
DIRECT SALES AND SALES THROUGH AGENTS
We may sell the securities directly. In this case, no underwriters or
agents would be involved. We may also sell the securities through agents we
designate from time to time. In the prospectus supplement, we will name any
agent involved in the offer or sale of the offered securities, and we will
describe any commissions payable by us to the agent. Unless we inform you
otherwise in the prospectus supplement, any agent will agree to use its
reasonable best efforts to solicit purchases for the period of its appointment.
We may sell the securities directly to institutional investors or others
who may be deemed to be underwriters within the meaning of the Securities Act of
1933 with respect to any sale of those securities. We will describe the terms of
any such sales in the prospectus supplement.
DELAYED DELIVERY CONTRACTS
If we so indicate in the prospectus supplement, we may authorize agents,
underwriters or dealers to solicit offers from certain types of institutions to
purchase securities from us at the public offering price under delayed delivery
contracts. These contracts would provide for payment and delivery on a specified
date in the future. The contracts would be subject only to those conditions
described in the prospectus supplement. The prospectus supplement will describe
the commission payable for solicitation of those contracts.
GENERAL INFORMATION
We may have agreements with the agents, dealers and underwriters to
indemnify them against certain civil liabilities, including liabilities under
the Securities Act of 1933, or to contribute with respect to payments that the
agents, dealers or underwriters may be required to make. Agents, dealers and
underwriters may be customers of, engage in transactions with or perform
services for us in the ordinary course of their businesses.
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LEGAL OPINIONS
Lawrence O'Donnell, III, our Vice President and General Counsel, or another
of our lawyers, and Baker & Botts, L.L.P., Houston, Texas, our outside counsel,
or another of our outside counsel, will issue opinions about the legality of the
offered securities for us. Any underwriters will be advised about other issues
relating to any offering by their own legal counsel.
Mr. O'Donnell beneficially owns shares of common stock and also has options
to purchase shares of common stock. Under our by-laws, we are required to
indemnify Mr. O'Donnell to the full extent permitted by Delaware law against any
expenses actually and reasonably incurred by him in connection with any action,
suit or proceeding in which he is made a party by reason of his being one of our
officers, including in connection with rendering professional legal services. We
also maintain directors' and officers' liability insurance under which Mr.
O'Donnell is insured against certain expenses and liabilities.
EXPERTS
The consolidated financial statements and the related financial statement
schedule incorporated in this prospectus by reference from the annual report of
Baker Hughes Incorporated on Form 10-K for the year ended December 31, 1998, as
amended, have been audited by Deloitte & Touche LLP, independent auditors, as
stated in their report (which report expresses an unqualified opinion and
includes an explanatory paragraph relating to the change in the method of
accounting for impairment of long-lived assets to be disposed of to conform to
Statement of Financial Accounting Standard No. 121), which is incorporated in
this prospectus by reference and has been so incorporated in reliance upon the
report of such firm given upon their authority as experts in accounting and
auditing.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth expenses payable by Baker Hughes
Incorporated (the "Company") in connection with the issuance and distribution of
the securities being registered. All the amounts shown are estimates, except the
registration fee.
<TABLE>
<S> <C>
Registration Fee............................................ $224,543
Printing and Engraving Expenses............................. *
Legal Fees and Expenses..................................... *
Accounting Fees and Expenses................................ *
Fees and Expenses of Trustee and Counsel.................... *
Rating Agency Fees.......................................... *
Miscellaneous Expenses...................................... *
--------
Total............................................. $ *
========
</TABLE>
- ---------------
* To be provided by amendment.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company's Restated Certificate of Incorporation contains a provision
that eliminates the personal liability of a director to the Company and its
stockholders for monetary damages for breach of his fiduciary duty as a director
to the extent currently allowed under the Delaware General Corporation Law. If a
director were to breach such duty in performing his duties as a director,
neither the Company nor its stockholders could recover monetary damages from the
director, and the only course of action available to the Company's stockholders
would be equitable remedies, such as an action to enjoin or rescind a
transaction involving a breach of fiduciary duty. To the extent certain claims
against directors are limited to equitable remedies, the provision in the
Company's Restated Certificate of Incorporation may reduce the likelihood of
derivative litigation and may discourage stockholders or management from
initiating litigation against directors for breach of their fiduciary duty.
Additionally, equitable remedies may not be effective in many situations. If a
stockholder's only remedy is to enjoin the completion of the Board of Directors'
action, this remedy would be ineffective if the stockholder does not become
aware of a transaction or event until after it has been completed. In such a
situation, it is possible that the stockholders and the Company would have no
effective remedy against the directors. Under the Company's Restated Certificate
of Incorporation, liability for monetary damages remains for (a) any breach of
the duty of loyalty to the Company or its stockholders, (b) acts or omissions
not in good faith or which involve intentional misconduct or a knowing violation
of law, (c) payment of an improper dividend or improper repurchase of the
Company's stock under Section 174 of the Delaware General Corporation Law, or
(d) any transaction from which the director derived an improper personal
benefit. The Company's Restated Certificate of Incorporation further provides
that in the event the Delaware General Corporation Law is amended to allow the
further elimination or limitation of the liability of directors, then the
liability of the Company's directors shall be limited or eliminated to the
fullest extent permitted by the amended Delaware General Corporation Law.
Under Article III of the Company's By-laws as currently in effect and an
indemnification agreement with the Company's officers and directors (the
"Indemnification Agreement"), each person who is or was a director or officer of
the Company or a subsidiary of the Company, or who serves or served any other
enterprise or organization at the request of the Company or a subsidiary of the
Company, shall be indemnified by the Company to the full extent permitted by the
Delaware General Corporation Law.
Under such law, to the extent that such person is successful on the merits
in defense of a suit or proceeding brought against him by reason of the fact
that he is or was a director or officer of the
II-1
<PAGE> 23
Company, or serves or served any other enterprise or organization at the request
of the Company, he shall be indemnified against expenses (including attorneys'
fees) actually and reasonably incurred in connection with such action.
Under such law, if unsuccessful in defense of a third-party civil suit or a
criminal suit, or if such suit is settled, such a person shall be indemnified
against both (a) expenses, including attorneys' fees, and (b) judgments, fines
and amounts paid in settlement if he acted in good faith and in a manner he
reasonably believed to be in, or not opposed to, the best interests of the
Company, and, with respect to any criminal action, had no reasonable cause to
believe his conduct was unlawful.
If unsuccessful in defense of a suit brought by or in the right of the
Company, or if such a suit is settled, such a person shall be indemnified under
such law only against expenses (including attorneys' fees) actually and
reasonably incurred in the defense or settlement of such suit if he acted in
good faith and in a manner he reasonably believed to be in, or not opposed to,
the best interests of the Company, except that if such person is adjudged to be
liable in such a suit for negligence or misconduct in the performance of his
duty to the Company, he cannot be made whole for expenses unless the court
determines that he is fairly and reasonably entitled to indemnity for such
expenses.
The Indemnification Agreement provides directors and officers with specific
contractual assurance that indemnification and advancement of expenses will be
available to them regardless of any amendments to or revocation of the
indemnification provisions of the Company's By-laws. The Indemnification
Agreement provides for indemnification of directors and officers against both
stockholder derivative claims and third-party claims. Sections 145(a) and 145(b)
of the Delaware General Corporation Law, which grant corporations the power to
indemnify directors and officers, specifically authorize lesser indemnification
in connection with derivative claims than in connection with third-party claims.
The distinction is that Section 145(a), concerning third-party claims,
authorizes expenses and judgments and amounts paid in settlement (as is provided
in the Indemnification Agreement), but Section 145(b), concerning derivative
suits, generally authorizes only indemnification of expenses. However, Section
145(f) expressly provides that the indemnification and advancement of expenses
provided by or granted pursuant to the subsections of Section 145 shall not be
exclusive of any other rights to which those seeking indemnification or
advancement of expenses may be entitled under any agreement. No Delaware case
directly answers the question whether Delaware's public policy would support
this aspect of the Indemnification Agreement under the authority of Section
145(f), or would cause its invalidation because it does not conform to the
distinctions contained in Sections 145(a) and 145(b).
Pursuant to the Indemnification Agreement, the Company has agreed to
provide, at all times during the two-year period following a "change in control"
(as defined in the Indemnification Agreement) of the Company, irrevocable
letters of credit in an aggregate amount not less than $25,000,000 for the
benefit of the officers and directors of the Company to secure its obligations
under the Indemnification Agreement.
Delaware corporations also are authorized to obtain insurance to protect
officers and directors from certain liabilities, including liabilities against
which the corporation cannot indemnify its directors and officers. The Company
currently has in effect a directors' and officers' liability insurance policy.
ITEM 16. EXHIBITS.*
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
----------- -----------
<C> <S>
4.1 Restated Certificate of Incorporation of the Company (filed
as Exhibit 3.1 to the Annual Report of the Company on Form
10-K for the year ended December 31, 1998 (SEC file no.
1-9397) and incorporated herein by reference).
4.2 Certificate of Amendment to Restated Certificate of
Incorporation of the Company.
4.3 By-Laws of the Company (filed as Exhibit 3(ii) to the
Quarterly Report of the Company on Form 10-Q for the
quarterly period ended March 31, 1999 (SEC file no. 1-9397)
and incorporated herein by reference).
</TABLE>
II-2
<PAGE> 24
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
----------- -----------
<C> <S>
4.4 Indenture dated as of May 15, 1991 between the Company and
Citibank, N.A., as successor trustee to Morgan Guaranty
Trust Company of New York (the "Senior Indenture") (filed as
Exhibit 4.1 to the Registration Statement of the Company on
Form S-3 (Registration No. 33-39520) and incorporated herein
by reference).
4.5 Form of Indenture relating to subordinated debt securities
(the "Subordinated Indenture").
**5.1 Opinion of Baker & Botts, L.L.P. with respect to legality of
securities offered hereby.
12.1 Computation of ratio of earnings to fixed charges.
23.1 Consent of Deloitte & Touche LLP.
**23.2 Consent of Baker & Botts, L.L.P. (contained in Exhibit 5.1).
24.1 Powers of Attorney (included as part of the signature page
of this Registration Statement).
**25.1 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939, as amended, of Citibank, N.A., as
successor trustee to Morgan Guaranty Trust Company of New
York, as trustee under the Senior Indenture, on Form T-1.
</TABLE>
- ---------------
* The Company will file as an exhibit to a Current Report on Form 8-K (i) any
underwriting agreement relating to securities offered hereby, (ii) the
instruments setting forth the terms of any debt securities, preferred stock
or warrants, (iii) any required opinion of counsel to the Company as to
certain tax matters relative to securities offered hereby and (iv) the
Statement of Eligibility and Qualification under the Trust Indenture Act of
1939, as amended, of the trustee under the Subordinated Indenture, on Form
T-1.
** To be filed by amendment.
ITEM 17. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) of the Securities Act of
1933 if, in the aggregate, the changes in volume and price represent no
more than a 20% change in the maximum aggregate offering price set forth
in the "Calculation of Registration Fee" table in the effective
Registration Statement; and
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement
or any material change to such information in the Registration
Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the registration statement is on Form S-3 or Form S-8 and the information
required to be included in a post-effective amendment by those paragraphs
is contained in periodic reports filed by the registrant pursuant to
II-3
<PAGE> 25
section 13 or section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
(d) The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act of 1933 shall be deemed to be part
of this registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
(e) The undersigned registrant hereby undertakes to file an application for
the purpose of determining the eligibility of the trustee under the Subordinated
Indenture to act under subsection (a) of Section 310 of the Trust Indenture Act
of 1939 (the "Act") in accordance with the rules and regulations prescribed by
the Commission under Section 305(b)(2) of the Act.
II-4
<PAGE> 26
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Lawrence O'Donnell, III and Max L. Lukens, and
each of them, each of whom may act without joinder of the other, his or her true
and lawful attorney-in-fact and agent, with full power of substitution and
resubstitution, for him or her and in his or her name, place and stead, in any
and all capacities, to sign any or all pre- and post-effective amendments to
this Registration Statement, including without limitation any registration
statement of the type contemplated by Rule 462(b) under the Securities Act of
1933, and to file the same, with all exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
in and about the premises, as fully as to all intents and purposes as he or she
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, and each of them, or the substitute or substitutes
of any or all of them, may lawfully do or cause to be done by virtue hereof.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the City of Houston, State of Texas, on September 27, 1999.
BAKER HUGHES INCORPORATED
By: /s/ LAWRENCE O'DONNELL, III
----------------------------------
Lawrence O'Donnell, III
Vice President and General Counsel
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ MAX L. LUKENS Chairman of the Board, September 27, 1999
- ----------------------------------------------------- President, Chief Executive
Max L. Lukens Officer and Director
(principal executive
officer)
/s/ G. S. FINLEY Senior Vice President -- September 27, 1999
- ----------------------------------------------------- Finance and Administration
G. S. Finley and Chief Financial Officer
(principal financial and
accounting officer)
/s/ LESTER M. ALBERTHAL, JR. Director September 27, 1999
- -----------------------------------------------------
Lester M. Alberthal, Jr.
</TABLE>
II-5
<PAGE> 27
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ VICTOR G. BEGHINI Director September 27, 1999
- -----------------------------------------------------
Victor G. Beghini
/s/ ALTON J. BRANN Director September 27, 1999
- -----------------------------------------------------
Alton J. Brann
/s/ JOSEPH T. CASEY Director September 27, 1999
- -----------------------------------------------------
Joseph T. Casey
/s/ EUNICE M. FILTER Director September 27, 1999
- -----------------------------------------------------
Eunice M. Filter
/s/ JOE B. FOSTER Director September 27, 1999
- -----------------------------------------------------
Joe B. Foster
/s/ CLAIRE W. GARGALLI Director September 27, 1999
- -----------------------------------------------------
Claire W. Gargalli
/s/ RICHARD D. KINDER Director September 27, 1999
- -----------------------------------------------------
Richard D. Kinder
/s/ JAMES F. MCCALL Director September 27, 1999
- -----------------------------------------------------
James F. McCall
/s/ H. JOHN RILEY, JR. Director September 27, 1999
- -----------------------------------------------------
H. John Riley, Jr.
/s/ JOHN R. RUSSELL Director September 27, 1999
- -----------------------------------------------------
John R. Russell
/s/ CHARLES L. WATSON Director September 27, 1999
- -----------------------------------------------------
Charles L. Watson
/s/ MAX P. WATSON, JR. Director September 27, 1999
- -----------------------------------------------------
Max P. Watson, Jr.
</TABLE>
II-6
<PAGE> 28
INDEX TO EXHIBITS*
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
----------- -----------
<C> <S>
4.1 Restated Certificate of Incorporation of the Company (filed
as Exhibit 3.1 to the Annual Report of the Company on Form
10-K for the year ended December 31, 1998 (SEC file no.
1-9397) and incorporated herein by reference).
4.2 Certificate of Amendment to Restated Certificate of
Incorporation of the Company.
4.3 By-Laws of the Company (filed as Exhibit 3(ii) to the
Quarterly Report of the Company on Form 10-Q for the
quarterly period ended March 31, 1999 (SEC file no. 1-9397)
and incorporated herein by reference).
4.4 Indenture dated as of May 15, 1991 between the Company and
Citibank, N.A., as successor trustee to Morgan Guaranty
Trust Company of New York (the "Senior Indenture") (filed as
Exhibit 4.1 to the Registration Statement of the Company on
Form S-3 (Registration No. 33-39520) and incorporated herein
by reference).
4.5 Form of Indenture relating to subordinated debt securities
(the "Subordinated Indenture").
**5.1 Opinion of Baker & Botts, L.L.P. with respect to legality of
securities offered hereby.
12.1 Computation of ratio of earnings to fixed charges.
23.1 Consent of Deloitte & Touche LLP.
**23.2 Consent of Baker & Botts, L.L.P. (contained in Exhibit 5.1).
24.1 Powers of Attorney (included as part of the signature page
of this Registration Statement).
**25.1 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939, as amended, of Citibank, N.A., as
successor trustee to Morgan Guaranty Trust Company of New
York, as trustee under the Senior Indenture, on Form T-1.
</TABLE>
- ---------------
* The Company will file as an exhibit to a Current Report on Form 8-K (i) any
underwriting agreement relating to securities offered hereby, (ii) the
instruments setting forth the terms of any debt securities, preferred stock
or warrants, (iii) any required opinion of counsel to the Company as to
certain tax matters relative to securities offered hereby and (iv) the
Statement of Eligibility and Qualification under the Trust Indenture Act of
1939, as amended, of the trustee under the Subordinated Indenture, on Form
T-1.
** To be filed by amendment.
<PAGE> 1
EXHIBIT 4.2
CERTIFICATE OF AMENDMENT
OF
RESTATED CERTIFICATE OF INCORPORATION
OF
BAKER HUGHES INCORPORATED
Baker Hughes Incorporated (the "Corporation"), a corporation duly
organized and existing under the General Corporation Law of the State of
Delaware (the "DGCL"), does hereby certify that:
FIRST: Article FOURTH of the Corporation's Restated Certificate of
Incorporation is amended to read in its entirety as follows:
"The total number of shares of stock which the Corporation shall have
the authority to issue is 765,000,000 shares of capital stock
consisting of 15,000,000 shares of preferred stock, par value $1.00 per
share (the "Preferred Stock"), and 750,000,000 shares of common stock,
par value $1.00 per share (the "Common Stock")."
SECOND: The foregoing amendment to the Corporation's Restated
Certificate of Incorporation was unanimously adopted by the Corporation's Board
of Directors at a meeting duly called and held on March 3, 1999 and by the
holders of a majority of the outstanding shares of the Corporation's capital
stock at a meeting duly called and held on April 28, 1999, all in accordance
with the provisions of Section 242 of the DGCL.
IN WITNESS WHEREOF, the undersigned has caused this Certificate to be
executed in its name and on its behalf by its duly authorized officer on this
3rd day of May, 1999.
BAKER HUGHES INCORPORATED
By: /s/ LINDA J. SMITH
------------------------------------
Linda J. Smith
Secretary
<PAGE> 1
EXHIBIT 4.5
================================================================================
BAKER HUGHES INCORPORATED
and
------------------,
Trustee
-----------------------------------------------------
INDENTURE
Dated as of
---------- ---, ----
SUBORDINATED DEBT SECURITIES
================================================================================
<PAGE> 2
BAKER HUGHES INCORPORATED
RECONCILIATION AND TIE BETWEEN TRUST INDENTURE ACT OF 1939
AND INDENTURE DATED AS OF ___________
------------------------------------
<TABLE>
<CAPTION>
Section of
Trust Indenture Section(s) of
Act of 1939 Indenture
--------------- -------------
<S> <C>
Section 310 (a)(1)................................. 609
(a)(2)................................. 609
(a)(3)................................. Not Applicable
(a)(4)................................. Not Applicable
(b).................................... 608, 610
Section 311 (a).................................... 613
(b).................................... 613
(c).................................... Not Applicable
Section 312 (a).................................... 701, 702(a)
(b).................................... 702(b)
(c).................................... 702(c)
Section 313 (a).................................... 703(a)
(b).................................... 703(b)
(c).................................... 703(c)
(d).................................... 703(d)
Section 314 (a).................................... 704
(b).................................... Not Applicable
(c)(1)................................. 102
(c)(2)................................. 102
(c)(3)................................. Not Applicable
(d).................................... Not Applicable
(e).................................... 102
Section 315 (a).................................... 601(a)
(b).................................... 602
(c).................................... 601(b)
(d).................................... 601(c)
(d)(1)................................. 601(a)
(d)(2)................................. 601(c)(2)
(d)(3)................................. 601(c)(3)
(e).................................... 514
Section 316 (a)(1)(A).............................. 502, 512
(a)(1)(B).............................. 513
(a)(2)................................. Not Applicable
(a)(last sentence)..................... 101
(b).................................... 508
Section 317 (a)(1)................................. 503
(a)(2)................................. 504
(b).................................... 1003
Section 318 (a).................................... 107
</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
----
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
<S> <C>
SECTION 101. Definitions.....................................................1
SECTION 102. Compliance Certificates and Opinions............................9
SECTION 103. Form of Documents Delivered to Trustee..........................9
SECTION 104. Acts of Holders................................................10
SECTION 105. Notices, etc., to Trustee and Company..........................12
SECTION 106. Notice to Holders of Securities; Waiver........................12
SECTION 107. Conflict with Trust Indenture Act..............................13
SECTION 108. Effect of Headings and Table of Contents.......................13
SECTION 109. Successors and Assigns.........................................13
SECTION 110. Separability Clause............................................14
SECTION 111. Benefits of Indenture..........................................14
SECTION 112. Governing Law..................................................14
SECTION 113. Legal Holidays.................................................14
SECTION 114. Language of Notices, Etc.......................................14
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally................................................14
SECTION 202. Form of Trustee's Certificate of Authentication................15
SECTION 203. Securities in Global Form......................................15
SECTION 204. Form of Legend for Book-Entry Securities.......................16
ARTICLE THREE
THE SECURITIES
SECTION 301. Amount Unlimited; Issuable in Series...........................16
SECTION 302. Denominations..................................................19
SECTION 303. Execution, Authentication, Delivery and Dating.................19
SECTION 304. Temporary Securities...........................................21
SECTION 305. Registration, Registration of Transfer and Exchange............24
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities and Coupons...27
SECTION 307. Payment of Interest; Interest Rights Preserved.................28
SECTION 308. Persons Deemed Owners..........................................29
</TABLE>
<PAGE> 4
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
SECTION 309. Cancellation...................................................29
SECTION 310. Computation of Interest........................................30
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture........................30
SECTION 402. Application of Trust Money.....................................31
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default..............................................32
SECTION 502. Acceleration of Maturity; Recission and Annulment..............33
SECTION 503. Collection of Indebtedness and Suits for Enforcement by
Trustee........................................................34
SECTION 504. Trustee May File Proofs of Claim...............................35
SECTION 505. Trustee May Enforce Claims Without Possession of Securities
or Coupons.....................................................35
SECTION 506. Application of Money Collected.................................36
SECTION 507. Limitation on Suits............................................37
SECTION 508. Unconditional Right of Holders to Receive Principal, Premium
and Interest...................................................37
SECTION 509. Restoration of Rights and Remedies.............................38
SECTION 510. Rights and Remedies Cumulative.................................38
SECTION 511. Delay or Omission Not Waiver...................................38
SECTION 512. Control by Holders of Securities...............................38
SECTION 513. Waiver of Past Defaults........................................39
SECTION 514. Undertaking for Costs..........................................39
SECTION 515. Waiver of Stay or Extension Laws...............................39
ARTICLE SIX
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities............................40
SECTION 602. Notice of Defaults.............................................41
SECTION 603. Certain Rights of Trustee......................................41
SECTION 604. Not Responsible for Recitals or Issuance of Securities.........42
SECTION 605. May Hold Securities............................................42
SECTION 606. Money Held in Trust............................................42
SECTION 607. Compensation and Reimbursement.................................43
SECTION 608. Disqualification; Conflicting Interests........................43
SECTION 609. Corporate Trustee Required; Eligibility........................44
SECTION 610. Resignation and Removal; Appointment of Successor..............44
SECTION 611. Acceptance of Appointment by Successor.........................46
</TABLE>
<PAGE> 5
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
SECTION 612. Merger, Conversion, Consolidation or Succession to Business....47
SECTION 613. Preferential Collection of Claims Against Company..............47
SECTION 614. Appointment of Authenticating Agent............................47
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders......49
SECTION 702. Preservation of Information; Communications to Holders.........49
SECTION 703. Reports by Trustee.............................................50
SECTION 704. Reports by Company.............................................51
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms...........51
SECTION 802. Successor Corporation Substituted..............................52
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders.............52
SECTION 902. Supplemental Indentures With Consent of Holders................53
SECTION 903. Execution of Supplemental Indentures...........................54
SECTION 904. Effect of Supplemental Indentures..............................55
SECTION 905. Conformity with Trust Indenture Act............................55
SECTION 906. Reference in Securities to Supplemental Indentures.............55
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium and Interest....................55
SECTION 1002. Maintenance of Office or Agency...............................55
SECTION 1003. Money for Securities Payments to Be Held in Trust.............57
SECTION 1004. Additional Amounts............................................58
SECTION 1005. Purchase of Securities by Company or Subsidiary...............59
SECTION 1006. Waiver of Certain Covenants...................................59
</TABLE>
<PAGE> 6
<TABLE>
PAGE
----
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
<S> <C>
SECTION 1101. Applicability of Article......................................59
SECTION 1102. Election to Redeem; Notice to Trustee........................59
SECTION 1103. Selection of Securities to Be Redeemed........................60
SECTION 1104. Notice of Redemption..........................................60
SECTION 1105. Deposit of Redemption Price...................................61
SECTION 1106. Securities Payable on Redemption Date.........................61
SECTION 1107. Securities Redeemed in Part...................................62
ARTICLE TWELVE
SINKING FUND
SECTION 1201. Applicability of Article......................................62
SECTION 1202. Satisfaction of Sinking Fund Payments with Securities.........63
SECTION 1203. Redemption of Securities for Sinking Fund.....................63
ARTICLE THIRTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1301. Company's Option to Effect Defeasance or Covenant Defeasance..63
SECTION 1302. Defeasance and Discharge......................................63
SECTION 1303. Covenant Defeasance...........................................64
SECTION 1304. Conditions to Defeasance or Covenant Defeasance...............64
SECTION 1305. Deposited Money and U.S. Government Obligations to be Held
in Trust; Other Miscellaneous Provisions......................66
SECTION 1306. Reinstatement.................................................66
ARTICLE FOURTEEN
SUBORDINATION
SECTION 1401. Securities Subordinated to Senior Indebtedness................67
SECTION 1402. No Payment on Securities in Certain Circumstances.............67
SECTION 1403. Securities Subordinated to Prior Payment of All Senior
Indebtedness on Dissolution, Liquidation or Reorganization....68
SECTION 1404. Subrogation to Rights of Holders of Senior Indebtedness.......69
SECTION 1405. Obligations of the Company Unconditional......................70
SECTION 1406. Trustee Entitled to Assume Payments Not Prohibited in Absence
of Notice.....................................................70
SECTION 1407. Application by Trustee of Amounts Deposited with It...........70
</TABLE>
<PAGE> 7
<TABLE>
<CAPTION>
PAGE
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<S> <C>
SECTION 1408. Subordination Rights Not Impaired by Acts or Omissions of the
Company or Holders of Senior Indebtedness.....................71
SECTION 1409. Trustee to Effectuate Subordination of Securities.............71
SECTION 1410. Right of Trustee to Hold Senior Indebtedness..................72
SECTION 1411. Article Fourteen Not to Prevent Events of Default.............72
SECTION 1412. No Fiduciary Duty of Trustee to Holders of Senior
Indebtedness..................................................72
SECTION 1413. Article Applicable to Paying Agent............................72
ARTICLE FIFTEEN
MEETINGS OF HOLDERS OF SECURITIES
SECTION 1501. Purposes for Which Meetings May be Called.....................72
SECTION 1502. Call, Notice and Place of Meetings............................73
SECTION 1503. Persons Entitled to Vote at Meetings..........................73
SECTION 1504. Quorum; Action................................................73
SECTION 1505. Determination of Voting Rights; Conduct and Adjournment of
Meetings......................................................74
SECTION 1506. Counting Votes and Recording Action of Meetings...............75
</TABLE>
<PAGE> 8
INDENTURE, dated as of ___________ ___, ____, between Baker
Hughes Incorporated, a corporation duly organized and existing under the laws
of the State of Delaware (herein called the "Company"), and ________________, a
__________________, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of its unsecured
subordinated debentures, notes or other evidences of indebtedness (herein
called the "Securities"), to be issued in one or more series as in this
Indenture provided.
All things necessary to make this Indenture a valid agreement
of the Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of
the Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities or of a series thereof,
as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101. Definitions.
For all purposes of this Indenture, except as otherwise
expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the
singular;
(2) all other terms used herein which are defined in the
Trust Indenture Act, either directly or by reference therein, have the
meanings assigned to them therein;
(3) all accounting terms not otherwise defined herein have
the meanings assigned to them in accordance with generally accepted
accounting principles, and, except as otherwise herein expressly
provided, the term "generally accepted accounting principles" or
"GAAP" with respect to any computation required or permitted hereunder
shall mean such accounting principles as are generally accepted in the
United States of America at the date of such computation; and
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(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 Articles Six, Ten and
Thirteen, are defined in those Articles.
"Act" when used with respect to any Holder of a Security has
the meaning specified in Section 104.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Authenticating Agent" means any Person authorized by the
Trustee pursuant to Section 614 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"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 the place in connection with which
the term is used or in the financial community of 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 in the form established
pursuant to Section 201 which is payable to bearer, including, without
limitation, a Security in temporary or permanent global bearer form.
"Board of Directors" means either the board of directors of
the Company or any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by
the Secretary or an Assistant Secretary of the Company to have been duly
adopted by the Board of Directors and to be in full force and effect on the
date of such certification, and delivered to the Trustee.
"Book-Entry Security" means a Security bearing the legend
specified in Section 204, evidencing all or part of a series of Securities,
issued to the Depository for such series or its nominee, and registered in the
name of such Depository or nominee. Book-Entry Securities shall not be deemed
to be securities in global form for purposes of Sections 201 and 203 and
Article Three of this Indenture.
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<PAGE> 10
"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 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,
except as may otherwise be provided with respect to Securities of any given
series.
"Capital Stock" means, with respect to any corporation, any
and all shares, interests, rights to purchase (other than convertible or
exchangeable Indebtedness), warrants, options, participations or other
equivalents of or interests (however designated) in stock issued by that
corporation.
"Capitalized Lease Obligation" of any Person means any
obligation of such Person to pay rent or other amounts under a lease of
property, real or personal, that is required to be capitalized for financial
reporting purposes in accordance with GAAP; and the amount of such obligation
shall be the capitalized amount thereof determined in accordance with GAAP.
"Certification Date" means with respect to Securities of any
series (i) if Bearer Securities of such series are not to be initially
represented by a temporary global Security, the date of delivery of the
definitive Bearer Security and (ii) if Bearer Securities of such series are
initially represented by a temporary global Security, the earlier of (A) the
Exchange Date with respect to Securities of such series and (B) if the first
Interest Payment Date with respect to Securities of such series is prior to
such Exchange Date, such Interest Payment Date.
"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 instrument such Commission
is not existing and performing the duties now assigned to it under the Trust
Indenture Act, then the body performing such duties at such time.
"Common Depositary" has the meaning specified in Section 304.
"Company" means the Person named as the "Company" in the
first paragraph of this instrument until a successor person shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor person.
"Company Request" or "Company Order" means a written request
or order signed in the name of the Company by its Chairman of the Board, its
President or a Vice President, and by its Treasurer, an Assistant Treasurer,
its Secretary or an Assistant Secretary, and delivered to the Trustee.
"Corporate Trust Office" means the principal office of the
Trustee in New York, New York, at which at any particular time its corporate
trust business shall be administered.
"corporation" includes corporations, associations, companies
and business trusts.
"coupon" means any interest coupon appertaining to a Bearer
Security.
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<PAGE> 11
"Defaulted Interest" has the meaning specified in Section 307.
"Depository" means, with respect to the Securities of any
series issuable or issued in whole or in part in the form of one or more
Book-Entry Securities, the clearing agency registered under the Securities
Exchange Act of 1934, as amended, specified for that purpose as contemplated by
Section 301.
"Designated Senior Indebtedness," unless otherwise provided
with respect to the Securities of a series as contemplated by Section 301,
means any Senior Indebtedness that (i) in the instrument evidencing the same or
the assumption or guarantee thereof (or related documents to which the Company
is a party) is expressly designated as "Designated Senior Indebtedness" for
purposes of this Indenture and (ii) satisfies such other conditions as may be
provided with respect to the Securities of such series; provided that such
instruments or documents may place limitations and conditions on the right of
such Senior Indebtedness to exercise the rights of Designated Senior
Indebtedness.
"Disqualified Capital Stock" means, when used with respect to
the Securities of any series, (a) except as set forth in (b), with respect to
any Person, Capital Stock of such Person that, by its terms or by the terms of
any security into which it is convertible, exercisable or exchangeable, is, or
upon the happening of an event or the passage of time would be, required to be
redeemed or repurchased (including at the option of the holder thereof) by such
Person or any Subsidiary of such Person, in whole or in part, on or prior to
the Stated Maturity of the Securities of such series, and (b) with respect to
any Subsidiary of such Person (including with respect to any Subsidiary of the
Company), any Capital Stock other than any common stock with no preference,
privileges, or redemption or repayment provisions.
"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.
"Euro-clear" means the operator of the Euro-clear System.
"Event of Default" has the meaning specified in Section 501.
"Holder," when used with respect to any Security, means in
the case of a Registered Security the Person in whose name the 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, means the bearer
thereof.
"Indebtedness" of any Person means, without duplication, (i)
all indebtedness of such Person for borrowed money (whether or not the recourse
of the lender is to the whole of the assets of such Person or only to a portion
thereof), (ii) all obligations of such Person evidenced by bonds, debentures,
notes or other similar instruments, (iii) all obligations of such Person in
respect of letters of credit or other similar instruments (or reimbursement
obligations with respect thereto), other than standby letters of credit,
performance bonds and other obligations issued by or for the account of such
Person in the ordinary course of business, to the extent not drawn or, to the
extent drawn, if
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<PAGE> 12
such drawing is reimbursed not later than the third Business Day following
demand for reimbursement, (iv) all obligations of such Person to pay the
deferred and unpaid purchase price of property or services, except trade
payables and accrued expenses incurred in the ordinary course of business, (v)
all Capitalized Lease Obligations of such Person, (vi) all Indebtedness of
others secured by a lien on any asset of such Person, whether or not such
Indebtedness is assumed by such Person (provided that if the obligations so
secured have not been assumed in full by such Person or are not otherwise such
Person's legal liability in full, then such obligations shall be deemed to be
in an amount equal to the greater of (a) the lesser of (1) the full amount of
such obligations and (2) the fair market value of such assets, as determined in
good faith by the Board of Directors of such Person, which determination shall
be evidenced by a Board Resolution, and (b) the amount of obligations as have
been assumed by such Person or which are otherwise such Person's legal
liability), and (vii) all Indebtedness of others (other than endorsements in
the ordinary course of business) guaranteed by such Person to the extent of
such guarantee.
"Indenture" means 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 established as contemplated by Section 301.
"interest," when used with respect to an Original Issue
Discount Security which by its terms bears interest only after Maturity, means
interest payable after Maturity.
"Interest Payment Date," when used with respect to any
Security, means the Stated Maturity of an installment of interest on such
Security.
"Junior security" of a Person means, when used with respect
to the Securities of any series, any Qualified Capital Stock of such Person or
any Indebtedness of such Person that is subordinated in right of payment to the
Securities of such series and has no scheduled installment of principal due, by
redemption, sinking fund payment or otherwise, on or prior to the Stated
Maturity of the Securities of such series.
"Maturity" when used with respect to any Security means the
date on which the principal of such Security or an installment of principal
becomes due and payable as therein or herein provided, whether at the Stated
Maturity or by declaration of acceleration, call for redemption or otherwise.
"Officers' Certificate" means a certificate complying with
the provisions of Section 102 signed by the Chairman of the Board, the
President or a Vice President, and by the Treasurer, an Assistant Treasurer,
the Secretary or an Assistant Secretary, of the Company, and delivered to the
Trustee.
"Opinion of Counsel" means a written opinion of counsel, who
may be an employee of or counsel for the Company.
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<PAGE> 13
"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 for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Trustee or
any Paying Agent (other than the Company) in trust or set aside and
segregated in trust by the Company (if the Company shall act as its
own Paying Agent) for the Holders of such Securities 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; and
(iii) 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 whether a
quorum is present at a meeting of Holders of Securities (i) the principal
amount of an Original Issue Discount Security that shall be deemed to be
Outstanding shall be the amount of the principal thereof that would be due and
payable as of the date of such determination upon acceleration of the Maturity
thereof pursuant to Section 502, (ii) the principal amount of a Security
denominated in a foreign currency or currencies, including composite
currencies, shall be the U.S. dollar equivalent, determined on the date of
original issuance of such Security in the manner provided as contemplated by
Section 301, of the principal amount (or, in the case of an Original Issue
Discount Security, the United States dollar equivalent on the date of original
issuance of such Security of the amount determined as provided in (i) above) of
such Security, and (iii) Securities owned by the Company or any other obligor
upon the Securities or any Affiliate of the Company or of such other obligor
shall be disregarded and deemed not to be Outstanding, except that, in
determining whether the Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, or upon
any such determination as to the presence of a quorum, only Securities which
the Trustee knows to be so owned shall be so disregarded. Securities so owned
which have been pledged in good faith may be regarded as Outstanding if the
pledgee establishes to the satisfaction of the Trustee the pledgee's right so
to act with respect to such Securities and that the pledgee is not the Company
or any other obligor upon the Securities or any Affiliate of the Company or of
such other obligor.
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<PAGE> 14
"Paying Agent" means any Person authorized by the Company to
pay the principal of (and premium, if any) or interest on any Securities on
behalf of the Company.
"Payment Default" has the meaning specified in Section
1402(a).
"Payment Notice" has the meaning specified in Section 1402(b).
"Person" means any individual, corporation, partnership,
limited liability company, joint venture, association, joint-stock company,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"Place of Payment," when used with respect to the Securities
of any series, means the place or places as specified in accordance with
Section 301 where, subject to the provisions of Section 1002, the principal of
and any premium and interest on the Securities of that series are payable.
"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.
"Qualified Capital Stock" means any Capital Stock of the
Company that is not Disqualified Capital Stock.
"Redemption Date," when used with respect to any Security to
be redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price," when used with respect to any Security to
be redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Registered Security" means any Security in the form
established pursuant to Section 201 which is registered in the Security
Register.
"Regular Record Date" for the interest payable on any
Interest Payment Date on the Registered Securities of any series means the date
specified for that purpose as contemplated by Section 301, or, if not so
specified, the last day of the calendar month preceding such Interest Payment
Date if such Interest Payment Date is the 15th day of the calendar month or the
15th day of the calendar month preceding such Interest Payment Date if such
Interest Payment Date is the first day of a calendar month, whether or not such
day shall be a Business Day.
"Responsible Officer," when used with respect to the Trustee,
means any officer of the Trustee assigned by it to administer corporate trust
matters.
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<PAGE> 15
"Securities" has the meaning stated in the first recital of
this Indenture and more particularly means any Securities authenticated and
delivered under this Indenture.
"Security Register" and "Security Registrar" have the
respective meanings specified in Section 305.
"Senior Indebtedness" of the Company, unless otherwise
provided with respect to the Securities of a series as contemplated by Section
301, means (i) all Indebtedness of the Company, whether currently outstanding
or hereafter issued, unless, by the terms of the instrument creating or
evidencing such Indebtedness, it is provided that such Indebtedness is not
superior in right of payment to the Securities or to other Indebtedness which
is pari passu with or subordinated to the Securities, and (ii) any
modifications, refunding, deferrals, renewals or extensions of any such
Indebtedness or securities, notes or other evidences of Indebtedness issued in
exchange for such Indebtedness; provided that in no event shall "Senior
Indebtedness" include (a) Indebtedness of the Company owed or owing to any
Subsidiary of the Company or any officer, director or employee of the Company
or any Subsidiary of the Company, (b) Indebtedness to trade creditors or (c)
any liability for taxes owed or owing by the Company.
"Special Record Date" for the payment of any Defaulted
Interest on the Registered Securities of any series means a date fixed by the
Trustee pursuant to Section 307.
"Stated Maturity," when used with respect to any Security or
any installment of principal thereof or interest thereon, means the date
specified in such Security or a coupon representing such installment of
interest as the fixed date on which the principal of such Security or such
installment of principal or interest is due and payable.
"Subsidiary" means a corporation more than 50% of the
outstanding voting stock of which is owned, directly or indirectly, by the
Company or by one or more other Subsidiaries, or by the Company and one or more
other Subsidiaries. For the purposes of this definition, "voting stock" means
stock which ordinarily has voting power for the election of directors, whether
at all times or only so long as no senior class of stock has such voting power
by reason of any contingency.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended by the Trust Indenture Reform Act of 1990, 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,
and if at any time there is more than one such Person, "Trustee" as used with
respect to the Securities of any series shall mean the Trustee with respect to
Securities of that series.
"United States" means the United States of America (including
the States and the District of Columbia), its territories, its possessions and
other areas subject to its jurisdiction.
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<PAGE> 16
"United States Alien" means any Person who, for United States
Federal income tax purposes, is a foreign corporation, a non-resident alien
individual, a non-resident alien fiduciary of a foreign estate or trust, or a
foreign partnership one or more of the members of which is, for United States
Federal income tax purposes, a foreign corporation, a non-resident alien
individual or a non-resident alien fiduciary of a foreign estate or trust.
"U.S. Government Obligation" has the meaning specified in
Section 1304.
"Vice President," when used with respect to the Company or
the Trustee, means any vice president, whether or not designated by a number or
a word or words added before or after the title "vice president".
SECTION 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee
to take any action under any provision of this Indenture, the Company shall
furnish to the Trustee an Officers' Certificate stating that all conditions
precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with and an Opinion of Counsel stating that in the
opinion of such Counsel all such conditions precedent, 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 condition or covenant provided for in this Indenture (other than certificates
provided pursuant to Section 704) shall include:
(1) a statement that each individual signing such certificate
or opinion has read such covenant or condition and the definitions
herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such individual,
he has made such examination or investigation as is necessary to
enable him to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
SECTION 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be
certified by, or covered by an opinion of, any specified Person, it is not
necessary that all such matters be certified by, or covered by the opinion of,
only one such Person, or that they be so certified or covered by only one
document, but one such Person may certify or give an opinion with respect to
some matters and one
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<PAGE> 17
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 may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent
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 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 and so voting at any such
meeting. Proof of execution of any such instrument or of a writing appointing
any such agent or proxy or of the holding by any Person of a Security shall be
sufficient for any purpose of this Indenture and (subject to Section 601)
conclusive in favor of the Trustee and the Company, if made in the manner
provided in this Section. The 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 his authority. The fact and date of the execution
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<PAGE> 18
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 which the Trustee deems sufficient.
(e) 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.
(f) With respect to the Securities of any series, upon
receipt by the Trustee of (i) any written notice directing the time, method or
place of conducting any proceeding or exercising any trust or power pursuant to
Section 512 with respect to Securities of such series or (ii) any written
demand, request or notice with respect to any matter on which the Holders of
Securities of such series are entitled to act under this Indenture, in each
case from Holders of less than, or proxies representing less than, the
requisite principal amount of Outstanding Securities of such series entitled to
give such demand, request or notice, the Trustee shall establish a record date
for determining Holders of Outstanding Securities of such series entitled to
join in such demand, request or notice, which record date shall be the close of
business on the day the Trustee receives such demand, request or notice. The
Holders on such record date, or their duly designated proxies, and only such
Persons, shall be entitled to join in such demand, request or notice whether or
not such Holders remain Holders after such record date; provided, however, that
unless the Holders of the requisite principal amount of Outstanding Securities
of such series shall have joined in such demand, request or notice prior to the
day which is the 90th day after such record date, such demand, request or
notice shall automatically and without further action by any Holder be
cancelled and of no further effect. Nothing in this paragraph shall prevent a
Holder, or a proxy of a Holder, from giving, (i) after the expiration of such
90-day period, a new demand, request or notice identical to a demand, request
or notice which has been cancelled pursuant to the proviso to the preceding
sentence or (ii) during any 90-day period, a new demand, request or notice
contrary to or different from such demand, request
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or notice, in either of which events a new record date shall be established
pursuant to the provisions of this Subsection (f).
(g) The Company may, but shall not be obligated to, direct
the Trustee to establish a record date specified by the Company for the purpose
of determining the Persons entitled to (i) waive any past default with respect
to the Securities of such series in accordance with Section 513 of this
Indenture, (ii) consent to any supplemental indenture in accordance with
Section 902 of this Indenture, (iii) waive any term, condition or provision of
any covenant in accordance with Section 1006 of this Indenture or (iv) take any
other action hereunder. If a record date is fixed, the Holders on such record
date, or their duly designated proxies, and only such Persons, shall be
entitled to waive any such past default, consent to any such supplemental
indenture or waive any such term, condition or provision, whether or not such
Holder remains a Holder after such record date; provided, however, that unless
such waiver or consent is obtained from the Holders, or duly designated
proxies, of the requisite principal amount of Outstanding Securities of such
series prior to the date which is the 90th day after such record date, any such
waiver or consent previously given shall automatically and without further
action by any Holder be cancelled and of no further effect.
SECTION 105. Notices, etc., to Trustee and Company.
Any request, demand, authorization, direction, notice,
consent, waiver or Act of Holders or other document provided or permitted by
this Indenture to be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be
sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Trustee at its Corporate Trust Office,
Attention: Corporate Trust Department, 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 ___________________, to the
attention of Secretary, or at any other address previously furnished
in writing to the Trustee by the Company.
SECTION 106. Notice to Holders of Securities; Waiver.
Except as otherwise expressly provided herein, where this
Indenture provides for notice to Holders of Securities of any event,
(1) such notice shall be sufficiently given to Holders of
Registered Securities if in writing and mailed, first-class postage
prepaid, to each Holder of a Registered Security affected by such
event, at the address of such Holder as it appears in the Security
Register, not later than the latest date, and not earlier than the
earliest date, prescribed for the giving of such notice; and
(2) 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
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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.
In case by reason of the suspension of regular mail service
or by reason of any other cause it shall be impracticable to give such notice
to Holders of Registered Securities by mail, then such notification as shall be
made with the approval of the Trustee shall constitute sufficient notice to
such Holders for every purpose hereunder. 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 of a
Registered Security 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 herein.
In case by the 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 any
notice to Holders of Registered Securities given as provided herein.
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 of Securities 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. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with
any provision of the Trust Indenture Act or any provision included in this
Indenture by any of the provisions of the Trust Indenture Act, such provision
of the Trust Indenture Act or included provision shall control.
SECTION 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.
SECTION 109. Successors and Assigns.
All covenants and agreements in this Indenture by the Company
shall bind its successors and assigns, whether so expressed or not.
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SECTION 110. Separability Clause.
In case any provision of this Indenture or in the Securities
or coupons shall be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
SECTION 111. Benefits of Indenture.
Nothing in this Indenture or in the Securities or coupons,
express or implied, shall give to any Person, other than the parties hereto and
their successors hereunder, the Holders of Securities and coupons and the
holders of any Senior Indebtedness, any benefit or any legal or equitable
right, remedy or claim under this Indenture.
SECTION 112. Governing Law.
This Indenture and the Securities and coupons shall be
governed by and construed in accordance with the laws of the State of New York.
SECTION 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date
or Stated Maturity of any Security shall not be a Business Day at any Place of
Payment, then (notwithstanding any other provision of this Indenture or of the
Securities 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 interest or principal (and premium, if any) need not be
made on such date, but may be made on the next succeeding Business Day at such
Place of Payment with the same force and effect as if made on the Interest
Payment Date or Redemption Date, or at the Stated Maturity, provided that no
interest shall accrue on the amount so payable for the period from and after
such Interest Payment Date, Redemption Date or Stated Maturity, as the case may
be.
SECTION 114. Language of Notices, Etc.
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.
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 coupon shall be in
substantially the form (including temporary or permanent global form) as shall
be established by or pursuant to a Board Resolution or in one or more
indentures supplemental hereto, in each case with such appropriate insertions,
omissions,
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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 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 temporary Securities of any
series are issued in global form as permitted by Section 304, the form thereof
shall be established as provided in the preceding sentence. A copy of the Board
Resolution and any action taken pursuant thereto establishing the forms of
Securities or coupons of any series (or any such temporary global Security)
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 any such temporary global Security) or coupons.
Unless otherwise specified as contemplated by Section 301,
Securities shall be issuable in registered form without coupons. Unless
otherwise specified as contemplated by Section 301, Securities in bearer form
shall have interest coupons attached.
The definitive Securities and coupons, if any, shall be
printed, lithographed or engraved on steel engraved borders or may be produced
in any other manner, all as determined by the officers executing such
Securities, as evidenced by their execution of such Securities or coupons.
SECTION 202. Form of Trustee's Certificate of Authentication.
The Trustee's certificate of authentication shall be in
substantially the following form:
"This is one of the Securities of the series designated
therein referred to in the within-mentioned Indenture.
----------------------------------,
as Trustee
By
-------------------------------
Authorized Officer."
SECTION 203. Securities in Global Form.
If Securities of a series are issuable in global form, as
specified as contemplated by Section 301, then, notwithstanding clause (10) of
Section 301 and the provisions of Section 302, 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 from time to time endorsed thereon and that the
aggregate amount of Outstanding Securities represented thereby may be reduced
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
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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 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 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 Sections 201 and 307,
unless otherwise specified as contemplated by Section 301, payment of principal
of and any premium and interest on any Security in permanent global form shall
be made to the Person or Persons specified therein.
SECTION 204. Form of Legend for Book-Entry Securities.
Any Book-Entry Security authenticated and delivered hereunder
shall bear a legend in substantially the following form:
"This Security is a Book-Entry Security within the meaning of
the Indenture hereinafter referred to and is registered in the name of
a Depository or a nominee of a Depository. This Security is
exchangeable for Securities registered in the name of a Person other
than the Depository or its nominee only in the limited circumstances
described in or pursuant to the Indenture, and no transfer of this
Security (other than a transfer of this Security as a whole by the
Depository to a nominee of the Depository or by a nominee of the
Depository to the Depository or another nominee of the Depository) may
be registered except in such limited circumstances."
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, and each
such series shall rank equally and pari passu with each other series. There
shall be established in or pursuant to a Board Resolution and, subject to
Section 303, set forth, or determined in the manner provided, in an
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Officers' Certificate or Company Order, or established in one or more
indentures supplemental hereto, prior to the issuance of Securities of any
series:
(1) the title of the Securities of the series (which shall
distinguish the Securities of the series from all other Securities);
(2) any limit upon the aggregate principal amount of the
Securities of the series which may be authenticated and delivered
under this Indenture (except for Securities authenticated and
delivered upon registration of transfer of, or in exchange for, or in
lieu of, other Securities of the series pursuant to Section 304, 305,
306, 906 or 1107 and except for any Securities which, pursuant to
Section 303, are deemed never to have been authenticated and delivered
hereunder);
(3) whether Securities of the series are to be issuable as
Registered Securities, Bearer Securities or both, 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;
(4) the person to whom any interest on any Registered
Security of the series shall be payable, if other than the Person in
whose name that Security (or one or more Predecessor Securities) is
registered at the close of business on the regular Record Date for
such interest, the manner in which, or the Person to whom, any
interest on any Bearer Security of the series shall be payable, if
otherwise than upon presentation and surrender of the coupons
appertaining thereto as they severally mature and the extent to which,
or the manner in which, any interest payable on a temporary global
Security on an Interest Payment Date will be paid if other than in the
manner provided in Section 304;
(5) the date or dates on which the principal of the
Securities of the series is payable;
(6) the rate or rates at which the Securities of the series
shall bear interest, if any, or the method by which such rate shall be
determined, the date or dates from which any such interest shall
accrue, the Interest Payment Dates on which any such interest shall be
payable, the Regular Record Date for any interest payable on any
Registered Securities on any Interest Payment Date (if other than as
set forth herein) and whether and under what circumstances additional
amounts with respect to such Securities shall be payable as set forth
in Section 1004;
(7) the place or places where, subject to the provisions of
Section 1002, the principal of and any premium and interest on
Securities of the series shall be payable, any Registered Securities
of the series may be surrendered for registration of transfer,
Securities
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of the series may be surrendered for exchange and notices and demands
to or upon the Company in respect of the Securities of the series and
this Indenture may be served;
(8) the right, if any, of the Company to redeem Securities,
in whole or in part, at its option and the period or periods within
which, the price or prices at which and the terms and conditions upon
which Securities of the series may be so redeemed;
(9) the obligation, if any, of the Company to redeem,
purchase or repay Securities of the series pursuant to any mandatory
redemption, sinking fund or analogous provisions or at the option of a
Holder thereof and the period or periods within which, the price or
prices at which and the terms and conditions upon which Securities of
the series shall be redeemed, purchased or repaid, in whole or in
part, pursuant to such obligation;
(10) the denominations in which any Registered Securities of
the series shall be issuable, if other than denominations of $1,000
and any integral multiple thereof, and the denomination or
denominations in which any Bearer Securities of the series shall be
issuable, if other than the denomination of $5,000;
(11) the currency or currencies, including composite
currencies, in which payment of the principal of and any premium and
interest on any Securities of the series shall be payable if other
than the currency of the United States of America and the manner of
determining the equivalent thereof in the currency of the United
States of America for purposes of the definition of "Outstanding" in
Section 101;
(12) if the amount of payments of principal of and any
premium or interest on any Securities of the series may be determined
with reference to an index, the manner in which such amounts shall be
determined;
(13) if other than the principal amount thereof, the portion
of the principal amount of any Securities of the series which shall be
payable upon declaration of acceleration of the Maturity thereof
pursuant to Section 502;
(14) if the principal of and any premium or interest on the
Securities of the series are to be payable, at the election of the
Company or a Holder thereof, in a currency or currencies, including
composite currencies, other than that or those in which the Securities
are stated to be payable, the currency or currencies in which payment
of the principal of and any premium and interest on Securities of such
series as to which such election is made shall be payable, and the
periods within which and the terms and conditions upon which such
election is to be made;
(15) whether the Securities of the series shall be issued
upon original issuance in whole or in part in the form of one or more
Book-Entry Securities and, in such case, (a) the Depository with
respect to such Book-Entry Security or Securities; and (b) the
circumstances under which any such Book-Entry Security may be
exchanged for Securities registered in the name of, and any transfer
of such Book-Entry Security may be registered to, a Person other than
such Depository or its nominee, if other than as set forth in Section
305;
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(16) whether either or both of the provisions of Section 1302
or 1303 are applicable to the Securities of such series, any
additional means of satisfaction and discharge pursuant to Section
1302 or 1303 and any additional conditions to the provisions of
Section 1302 or 1303;
(17) any other Events of Default or covenants with respect to
the Securities of such series, or any deletions or modifications to
the Events of Default or covenants set forth herein with respect to
the Securities of such series;
(18) any modifications to, or qualifications contemplated by,
the definition of "Designated Senior Indebtedness," any modifications
to the definition of "Senior Indebtedness" or any modifications to
Article Fourteen or the other provisions regarding subordination with
respect to the Securities of such series; and
(19) any other terms of the series (which terms shall not be
inconsistent with 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 the Board Resolution referred to
above and (subject to Section 303) set forth, or determined in the manner
provided, in the Officers' Certificate referred to above or in any such
indenture supplemental hereto.
If any of the terms of the series are established by action
taken pursuant to a Board Resolution, a copy of an appropriate record of such
action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the
Officers' Certificate setting forth the terms of the series.
The Securities shall be subordinated in right of payment to
Senior Indebtedness as provided in Article Fourteen.
SECTION 302. Denominations.
Unless otherwise provided as contemplated by Section 301 with
respect to any series of Securities, any Registered Securities of a series
shall be issuable in denominations of $1,000 and any integral multiple thereof
and any Bearer Securities of a series shall be issuable in the denomination of
$5,000.
SECTION 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by
its Chairman of the Board, its Vice Chairman of the Board, its President or one
of its Vice Presidents, under its corporate seal reproduced thereon attested by
its Secretary or one of its Assistant Secretaries. The signature of any of
these officers on the Securities may be manual or facsimile. Coupons shall bear
the facsimile signature of the Treasurer or any Assistant Treasurer of the
Company.
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Securities and 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.
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 coupons 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 the Company Order shall authenticate and deliver such Securities;
provided, however, that, unless otherwise provided with respect to a series, 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 provided with respect to a series, 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 in Exhibit A to this Indenture, dated no
earlier than the Certification Date, or such other form of certification as
shall contain such information as may then be required by U.S. federal income
tax law or as shall be otherwise provided with respect to a series. 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 delivered 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.
In authenticating Securities, the Trustee shall be entitled
to receive, and (subject to Section 601) shall be fully protected in relying
upon, an Opinion of Counsel stating:
(a) that the forms of such Securities and coupons established
by or pursuant to Board Resolution as contemplated by Section 201 have
been established in conformity with the provisions of this Indenture;
(b) if the terms of such Securities and any coupons have been
established by or pursuant to Board Resolution as permitted by Section
301, that such terms have been established in conformity with the
provisions of this Indenture; and
(c) that such Securities, together with any coupons
appertaining thereto, when authenticated and delivered by the Trustee
and issued by the Company in the manner and subject to any conditions
specified in such Opinion of Counsel, will constitute valid and
legally binding obligations of the Company enforceable in accordance
with their terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.
Such Opinion of Counsel shall also cover such other matters as the Trustee may
reasonably request.
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The Trustee shall not be required to authenticate such
Securities the forms or terms of which have been established by or pursuant to
a Board Resolution if the issue of such Securities pursuant to this Indenture
will affect the Trustee's own rights, duties or immunities under the Securities
and this Indenture or otherwise in a manner which is not reasonably acceptable
to the Trustee.
Notwithstanding the provisions of Section 301 and of the two
preceding paragraphs, if all Securities of a series are not to be originally
issued at one time, it shall not be necessary to deliver the Officers'
Certificate otherwise required pursuant to Section 301 or the Company Order and
Opinion of Counsel otherwise required pursuant to such preceding paragraphs at
or prior to the time of authentication of each Security of such series if such
documents are delivered at or prior to the authentication upon issuance of the
first Security of such series to be issued and such documents reasonably
contemplate subsequent such issuances.
After the original issuance of the first Security of such
series to be issued, any separate request by the Company that the Trustee
authenticate Securities of such series for original issuance will be deemed to
be a certification by the Company that it is in compliance with all conditions
precedent provided for in this Indenture relating to the authentication and
delivery of such Securities.
Each Registered Security shall be dated the date of its
authentication; and each Bearer Security shall be dated as of the date of
original issuance of the first Security of such series to be issued.
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, or the Security to which such coupon appertains, a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any
security shall be conclusive evidence, and the only evidence, that such
Security has been duly authenticated and delivered hereunder. Notwithstanding
the foregoing, if any Security shall have been authenticated and delivered
hereunder but never issued and sold by the Company, and the Company shall
deliver such Security to the Trustee for cancellation as provided in Section
309 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.
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 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 the officers executing such
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Securities may determine, as evidenced by their execution of such Securities.
In the case of any series issuable as Bearer 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 maintained pursuant to Section
1002 in a Place of Payment for such series for the purpose of exchanges of
Securities of such 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
aggregate principal amount of definitive Securities of the same series and of
like tenor of authorized denominations; provided, however, that no definitive
Bearer Security shall be issued 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.
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 Euro-clear 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 of a series (the "Exchange Date"), the Company shall deliver to
the Trustee definitive Securities of that series 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 purpose, to be exchanged, in whole or from time to time in part, for
definitive Securities of that series without charge and the Trustee shall
authenticate and deliver, in exchange for each portion of such temporary global
Security, a like 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; provided, however, that, unless
otherwise specified in such temporary global Security, upon such presentation
by the Common Depositary, such temporary global Security shall be accompanied
by a certificate dated the Exchange Date or a subsequent date and signed by
Euro-clear 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 B to this Indenture, or such other form of certification as
shall contain such information as may then be required by U.S. federal income
tax law or as shall be otherwise provided with respect to a series. 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
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combination thereof is so specified, as requested by the beneficial owner
thereof; provided, however, that no definitive Bearer Security or permanent
global Security shall be delivered in exchange for a temporary Bearer Security
except in compliance with the conditions set forth in Section 303.
Unless otherwise specified in the temporary global Security,
the interest of a beneficial owner of Securities of a series in a temporary
global Security shall be exchanged on the Exchange Date for definitive
Securities (and where the form of the definitive Securities is not specified by
the Holder for an interest in a permanent global Security) of the same series
and like tenor unless, on or prior to the Exchange Date, such beneficial owner
has not delivered to Euro-clear or CEDEL, S.A., as the case may be, a
certificate in the form set forth in Exhibit A to this Indenture, or such other
form of certification as shall contain such information as may then be required
by U.S. federal income tax law or as shall be otherwise provided with respect
to a series, dated no earlier than the Certification Date, copies of which
certificate shall be available from the offices of Euro-clear and CEDEL S.A.,
the Trustee, any Authenticating Agent appointed for such series of Securities
and each Paying Agent, and after the Exchange Date, the interest of a
beneficial owner of Securities of a series in a temporary global Security shall
be exchanged for definitive Securities (and where the form of the definitive
Securities is not specified by the Holder for an interest in a permanent global
Security) of the same series and of like tenor following such beneficial
owner's delivery to Euro-clear or CEDEL S.A., as the case may be, of a
certificate in the form set forth in Exhibit A to this Indenture, or such other
form of certification as shall contain such information as may then be required
by U.S. federal income tax law or as shall be otherwise provided with respect
to a series, dated no earlier than the Certification Date. Unless otherwise
specified in such temporary global Security, any 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
Euro-clear 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
series occurring before the applicable Exchange Date shall be payable to
Euro-clear and CEDEL S.A. on such Interest Payment Date upon delivery by
Euro-clear and CEDEL S.A. to the Trustee of a certificate or certificates in
the form set forth in Exhibit B to this Indenture or such other form of
certification as shall contain such information as may then be required by U.S.
federal income tax law or as shall be otherwise provided with respect to a
series for credit without further interest 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 Euro-clear or CEDEL S.A., as the case may be, a certificate in the
form set forth in Exhibit A to this Indenture; and 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
series occurring on or after the applicable Exchange Date shall be payable to
Euro-clear and CEDEL S.A. on such Interest Payment Date but shall not be
credited by Euro-clear or CEDEL S.A. to the account of any Person who is a
beneficial owner of
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such temporary global Security on such Interest Payment Date until such Person
shall exchange his interest in such temporary global Security in full as
hereinabove provided. Any interest so received by Euro-clear 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 an office or agency to
be maintained by the Company in accordance with Section 1002 a register (being
the combined register of the Security Registrar and all transfer agents
designated pursuant to Section 1002 for the purpose of registration of transfer
of Securities and 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 each series of
Registered Securities and the registration of transfers of such Registered
Securities. The Trustee is hereby appointed "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 of the Company maintained
pursuant to Section 1002 for such purpose in a Place of Payment for such
series, the Company shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new 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 denominations and of a like aggregate principal amount and
tenor, upon surrender of the Securities to be exchanged at any such office or
agency. Whenever any Securities are so surrendered for exchange, the Company
shall execute, and the Trustee shall authenticate and deliver, the Securities
which the Holder making the exchange is entitled to receive. Unless otherwise
provided with respect to any series of Securities, Bearer Securities may not be
issued in exchange for Registered Securities.
At the option of the Holder, Bearer Securities of any series
may be exchanged for Registered Securities of the same series of any authorized
denominations 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, such
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
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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 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.
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
pursuant to Section 301, any permanent global Security shall be exchangeable
only as provided in this paragraph. If the beneficial owners of interests in a
permanent global Security are entitled to exchange such interests 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,
then without unnecessary delay but in any event not later than the earliest
date on which such interests may be so exchanged, the Company shall deliver to
the Trustee definitive Securities of that series in an aggregate principal
amount equal to the principal amount of 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 from
time to time in accordance with instructions given to the Trustee and the
Common Depositary (which instructions shall be in writing but need not comply
with Section 102 or be accompanied by an Opinion of Counsel) by the Common
Depositary or such other depositary or Common 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 in part, for definitive
Securities of the same series without charge and the Trustee shall authenticate
and deliver, in exchange for each portion of such permanent global Security, a
like 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 of that series is to be redeemed and
ending on the relevant Redemption Date; 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.
Promptly following any such exchange in part, such permanent global Security
shall be returned by the Trustee to the Common Depositary or such other
depositary or Common Depositary referred to above in accordance with the
instructions of the Company referred to above. 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
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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, then
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 provisions of this Indenture.
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 exchange shall (if so required by the Company or
the Trustee or any transfer agent) be duly endorsed, or be accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar or any transfer agent 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 Section 304, 906 or 1107 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 any selection of Securities of that
series to be redeemed 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.
Notwithstanding the foregoing and except as otherwise
specified pursuant to Section 301, any Book-Entry Security shall be
exchangeable pursuant to this Section 305 or Sections 304, 906 and 1107 for
Securities registered in the name of, and a transfer of a Book-Entry Security
of any series may be registered to, any Person other than the Depository for
such Security or its nominee only if (i) such Depository notifies the Company
that it is unwilling or unable to continue as Depository for such Book-Entry
Security or if at any time such Depository ceases to be a clearing agency
registered under the Securities Exchange Act of 1934, as amended, (ii) the
Company executes and delivers to the Trustee a Company Order that such
Book-Entry Security shall be so exchangeable and the transfer thereof so
registrable or (iii) there shall have occurred and be continuing an Event of
Default, or an event which after notice of lapse of time would be an Event of
Default, with respect
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to the Securities of such series. Upon the occurrence in respect of any
Book-Entry Security of any series of any one or more of the conditions
specified in clauses (i), (ii) or (iii) of the preceding sentence or such other
conditions as may be specified, such Book-Entry Security may be exchanged for
Securities registered in the names of, and the transfer of such Book-Entry
Security may be registered to, such Persons (including Persons other than the
Depository with respect to such series and its nominees) as such Depository
shall direct. Notwithstanding any other provision of this Indenture, any
Security authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, any Book-Entry Security shall also be a Book-Entry
Security and shall bear the legend specified in Section 204 except for any
Security authenticated and delivered in exchange for, or upon registration of
transfer of, a Book-Entry Security pursuant to the preceding sentence.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities and
Coupons.
If any mutilated Security or a Security with a mutilated
coupon appertaining thereto is surrendered to the Trustee, the Company shall
execute and the Trustee shall authenticate and deliver in exchange therefor a
new Security of the same series and of like tenor and principal amount and
bearing a number not contemporaneously outstanding, with coupons corresponding
to the coupons, if any, appertaining to the surrendered Security.
If there shall be delivered to the Company and the Trustee
(i) evidence to their satisfaction of the destruction, loss or theft of any
Security 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 the Trustee shall authenticate and deliver, in lieu of any such destroyed,
lost or stolen Security or in exchange for the Security to 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.
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, pay such
Security or coupon; provided, however, that the principal of and any premium
and interest on Bearer Securities shall, except as otherwise provided in
Section 1002, be payable only at an office or agency located outside the United
States.
Upon the issuance of any new Security under this Section, the
Company may require 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 destroyed, lost or stolen
Security or in exchange for a Security to which a destroyed, lost or stolen
coupon appertains, shall constitute an original additional contractual
obligation of the Company, whether or not the destroyed, lost or stolen
Security and its coupons, if
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any, or the destroyed, lost or stolen coupons shall be at any time enforceable
by anyone, and any such new Security and coupons, if any, shall be entitled to
all the 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.
Unless otherwise provided as contemplated by Section 301 with
respect to any series of Securities, interest 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 that Security (or one or
more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest.
Any interest on any Registered Security of any series which
is payable, but is not punctually paid or duly provided for, on any Interest
Payment Date (herein called "Defaulted Interest") shall forthwith cease to be
payable to the Holder on the relevant Regular Record Date by virtue of having
been such Holder, and such Defaulted Interest may be paid by the Company, at
its election in each case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the 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 equal to the aggregate amount proposed to
be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the
date of the proposed payment, such money when deposited to be held in
trust for the benefit of the Persons entitled to such Defaulted
Interest as in this Clause provided. Thereupon the Trustee shall fix a
Special Record Date for the payment of such Defaulted Interest which
shall be not more than 15 days and not less than 10 days prior to the
date of the proposed payment and not less than 10 days after the
receipt by the Trustee of the notice of the proposed payment. The
Trustee shall promptly notify the Company of such Special Record Date
and, in the name and at the expense of the Company, shall cause notice
of the proposed payment of such Defaulted Interest and the Special
Record Date therefor to be mailed, first-class postage prepaid, to
each Holder of Registered Securities of such series at the address of
such Holder as it appears in the Security Register, not less than 10
days prior to such Special Record Date. Notice of the proposed payment
of such Defaulted Interest and the Special Record Date therefor having
been so mailed, such Defaulted Interest shall be paid to the Persons
in whose names the
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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 then listed, and upon such notice as may be
required by such exchange, if, after notice given by the Company to
the Trustee of the proposed payment pursuant to this Clause, such
manner of payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section and
Section 305, each Security delivered under this Indenture upon registration of
transfer of or in exchange for or in lieu of any other Security shall carry the
rights to interest accrued and unpaid, and to accrue, which were carried by
such other Security.
SECTION 308. Persons Deemed Owners.
Prior to due presentment of a 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 Security for the purpose of receiving payment
of principal of (and premium, if any) and (subject to Sections 305 and 307)
interest on such Security and for all other purposes whatsoever, whether or not
such Security be overdue, and neither the Company, the Trustee nor any agent of
the Company or the Trustee shall be affected by notice to the contrary.
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 coupon be overdue, and
neither the Company, the Trustee nor any agent of the Company or the Trustee
shall be affected by notice to the contrary.
Notwithstanding the foregoing, with respect to any Book-Entry
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 a Depository or impair, as between a
Depository and holders of beneficial interests in any Book-Entry Security, the
operation of customary practices governing the exercise of the rights of the
Depository (or its nominee) as Holder of such Book-Entry Security.
SECTION 309. Cancellation.
All Securities and coupons surrendered for payment,
redemption, registration of transfer or exchange or for credit against any
sinking fund payment shall, if surrendered to any Person other than the
Trustee, be delivered to the Trustee. All Registered Securities and matured
coupons so delivered shall be cancelled by the Trustee. All Bearer Securities
(which have not been
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called for redemption) and unmatured coupons so delivered shall be held by the
Trustee and, upon instruction by a Company Order, shall be cancelled or held
for reissuance. Bearer Securities (which have not been called for redemption)
and unmatured coupons held for reissuance may be reissued only in replacement
of mutilated, lost, stolen or destroyed Bearer Securities of the same series
and like tenor or the related coupons pursuant to Section 306. All Bearer
Securities and unmatured coupons held by the Trustee pending such cancellation
or reissuance shall be deemed to be delivered for cancellation for all purposes
of this Indenture and the Securities. The Company may at any time deliver to
the Trustee for cancellation any Securities previously authenticated and
delivered hereunder which the Company may have acquired in any manner
whatsoever, and may deliver to the Trustee (or to any other Person for delivery
to the Trustee) for cancellation any Securities previously authenticated
hereunder which the Company has not issued and sold, and all Securities so
delivered shall be promptly cancelled by the Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities cancelled as
provided in this Section, except as expressly permitted by this Indenture. All
cancelled Securities and coupons held by the Trustee shall be disposed in
accordance with its customary practices.
SECTION 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301
for Securities of any series, interest on the Securities of each series shall
be computed on the basis of a 360-day year of twelve 30-day months.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of
further effect (except as to any surviving rights of registration of transfer
or exchange of Securities herein expressly provided for, and any right to
receive additional amounts, as provided in Section 1004), and the Trustee, at
the expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered
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 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 for whose payment money has theretofore been
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deposited in trust or segregated and held in trust by the Company and
thereafter repaid to the Company or discharged from such trust, as
provided in Section 1003) have been delivered to the Trustee for
cancellation; or
(B) all such Securities 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) are to be called for redemption within one
year under arrangements satisfactory to the Trustee for the
giving of notice of redemption by the Trustee in the name,
and at the expense, of the Company;
and the Company, in the case of (i), (ii) or (iii) above, has
deposited or caused to be deposited with the Trustee as trust funds in
trust for the purpose an amount sufficient to pay and discharge the
entire indebtedness on such Securities and coupons not theretofore
delivered to the Trustee for cancellation, for principal (and premium,
if any) and any interest to the date of such deposit (in the case of
Securities which have become due and payable) or to the Stated
Maturity or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums
payable hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to the satisfaction
and discharge of this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Company to the Trustee under Section 607, the
obligations of the Trustee to any Authenticating Agent under Section 614 and,
if money shall have been deposited with the Trustee pursuant to clause (1)(B)
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 for whose payment such money has been
deposited with the Trustee. Money held in trust are not subject to Article
Fourteen.
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ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default.
"Event of Default," whenever used herein with respect to
Securities of any series, means any one of the following events (whatever the
reason for such Event of Default and whether it shall be occasioned by the
provisions of Article Fourteen or be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order, rule or
regulation of any administrative or governmental body), unless it is either
inapplicable to a particular series of Securities or it is specifically deleted
or modified in or pursuant to the terms of such series or in the form of
Security for such series:
(1) default in the payment of any interest upon any Security
of that series when it becomes due and payable, and continuance of
such default for a period of 30 days; or
(2) default in the payment of the principal of (or premium,
if any, on) any Security of that series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when
and as due by the terms of a Security of that series; or
(4) default in the performance, or breach, of any covenant or
warranty of the Company in this Indenture (other than a covenant or
warranty a default in whose performance or whose breach is elsewhere
in this Section specifically dealt with or which has expressly been
included in this Indenture solely for the benefit of series of
Securities other than that series), and continuance of such default or
breach for a period of 90 days after there has been given, by
registered or certified mail, to the Company by the Trustee or to the
Company and the Trustee by the Holders of at least 25% in principal
amount of the Outstanding Securities of that series a written notice
specifying such default or breach and requiring it to be remedied and
stating that such notice is a "Notice of Default" hereunder; or
(5) the entry by a court having jurisdiction of (A) a decree
or order for relief against the Company in an involuntary case or
proceeding under any Bankruptcy Law (as defined below) or (B) a decree
or order appointing a custodian, receiver, liquidator, assignee,
trustee, sequestrator or other similar official of the Company or of
any substantial part of its property under any Bankruptcy Law, or
ordering the liquidation of its affairs, and the continuance of any
such decree or order for relief or any such other decree or order
unstayed and in effect for a period of 60 consecutive days; or
(6) the commencement by the Company of a voluntary case or
proceeding under any applicable Bankruptcy Law or the consent by the
Company to the entry of a decree or order for relief in respect of the
Company in an involuntary case or proceeding under any applicable
Bankruptcy Law or to the commencement of any such case or proceeding
against
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it, or the filing by the Company of a petition or answer or consent
seeking reorganization or relief under any applicable Bankruptcy Law,
or the consent by the Company to the filing of such petition or the
appointment of or taking possession by a custodian, receiver,
liquidator, assignee, trustee, sequestrator or 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 taking of
corporate action by the Company in furtherance of any such action; or
(7) any other Event of Default provided with respect to
Securities of that series.
For purposes of this Section 501, "Bankruptcy Law" means
Title 11, United States Code, or any similar federal or state law for the
relief of debtors.
Notwithstanding the foregoing provisions of this Section 501,
if the principal of, or premium, if any, or any interest on, any Security is
payable in a currency or currencies (including a composite currency) other than
Dollars and such currency (or currencies) is (or are) not available to the
Company for making payment thereof due to the imposition of exchange controls
or other circumstances beyond the control of the Company, the Company will be
entitled to satisfy its obligations to Holders of the Securities by making such
payment in Dollars in an amount equal to the Dollar equivalent of the amount
payable in such other currency, as determined by the Trustee by reference to
the noon buying rate in The City of New York for cable transfers for such
currency ("Exchange Rate"), as such Exchange Rate is reported or otherwise made
available by the Federal Reserve Bank of New York on the date of such payment,
or, if such rate is not then available, on the basis of the most recently
available Exchange Rate. Notwithstanding the foregoing provisions of this
Section 501, any payment made under such circumstances in Dollars where the
required payment is in a currency other than Dollars will not constitute an
Event of Default under this Indenture.
SECTION 502. Acceleration of Maturity; Recission and Annulment.
If an Event of Default with respect to Securities of any
series at the time Outstanding occurs and is continuing, then in every such
case the Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Securities of that series may declare the principal amount (or, if
any of the Securities of that series are Original Issue Discount Securities,
such portion of the principal amount of such Securities as may be specified in
the terms thereof) of all of the Securities of that series to be due and
payable immediately, by a notice in writing to the Company (and to the Trustee
if given by Holders), and upon any such declaration such principal amount (or
specified amount) shall become immediately due and payable.
At any time after such a declaration of acceleration with
respect to Securities of any series has been made and before a judgment or
decree for payment of the money due has been obtained by the Trustee as
hereinafter in this Article provided, the Holders of a majority in principal
amount of the Outstanding Securities of that series, by written notice to the
Company and the Trustee, may rescind and annul such declaration and its
consequences if
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay
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(A) all overdue interest on all Securities of that
series,
(B) the principal of (and premium, if any, on) any
Securities of that series which have become due otherwise
than by such declaration of acceleration and any interest
thereon at the rate or rates prescribed therefor in such
Securities,
(C) to the extent that payment of such interest is
lawful, interest upon overdue interest at the rate or rates
prescribed therefor in such Securities, and
(D) all sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and
counsel; and
(2) all Events of Default with respect to Securities of that
series, other than the non-payment of the principal of Securities of
that series which have become due solely by such declaration of
acceleration, have been cured or waived as provided in Section 513.
No such recission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for Enforcement by
Trustee.
The Company covenants that if
(1) default is made in the payment of any interest on any
Security when such interest becomes due and payable and such default
continues for a period of 30 days, or
(2) default is made in the payment of the principal of (or
premium, if any, on) any Security at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities and coupons, the whole amount then due and payable
on such Securities and coupons for principal and any premium and interest and,
to the extent that payment of such interest shall be legally enforceable,
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 and 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 occurs and is continuing, the Trustee may in its discretion proceed to
protect and enforce its rights and the rights
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of the Holders of Securities of such series and any related coupons 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 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 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 any premium and interest 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, expenses,
disbursements and advances of the Trustee, its agents and counsel) and
of the Holders of Securities and coupons 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 of Securities and coupons 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 of Securities and coupons, to pay to the Trustee any
amount due it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 607.
Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
of a Security or coupon any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or coupons or the rights of any Holder
thereof or to authorize the Trustee to vote in respect of the claim of any
Holder of a Security or coupon in any such proceeding.
SECTION 505. Trustee May Enforce Claims Without Possession of
Securities or Coupons.
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 reasonable
compensation, expenses, disbursements
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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.
Subject to Article Fourteen, any money collected by the
Trustee pursuant to this Article shall be applied in the following order, at
the date or dates fixed by the Trustee and, in case of the distribution of such
money on account of principal or any premium or interest, upon presentation of
the Securities 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 607; and
SECOND: To the payment of the amounts then due and unpaid for
principal of and any premium and interest 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 any premium and interest, respectively.
In any case in which Securities are Outstanding that are
denominated in more than one currency and the Trustee is directed to make
ratable payments under this Section to Holders of such Securities, the Trustee
shall calculate the amount of such payments as follows: (i) as of the day the
Trustee collects an amount under this Article, the Trustee shall, as to each
Holder of a Security to whom an amount is due and payable under this Section
that is denominated in a foreign currency, determine that amount in Dollars
that would be obtained for the amount owing such Holder, using the rate of
exchange at which in accordance with normal banking procedures the Trustee
could purchase in The City of New York Dollars with such amount owing; (ii)
calculate the sum of all Dollar amounts determined under (i) and add thereto
any amounts due and payable in Dollars; and (iii) using the individual amounts
determined in (i) or any individual amounts due and payable in Dollars, as the
case may be, as a numerator and the sum calculated in (ii) as a denominator,
calculate as to each Holder of a Security to whom an amount is owed under this
Section the fraction of the amount collected under this Article payable to such
Holder. Any expenses incurred by the Trustee in actually converting amounts
owing Holders of Securities denominated in a currency other than that in which
any amount is collected under this Article shall be likewise (in accordance
with this paragraph) borne ratably by all Holders of Securities to whom amounts
are payable under this Section.
To the fullest extent allowed under applicable law, if for
the purpose of obtaining judgment against the Company in any court it is
necessary to convert the sum due in respect of the principal of, or premium, if
any, or interest on, the Securities of any series (the "Required Currency")
into a currency in which a judgment will be rendered (the "Judgement
Currency"), the rate of exchange used shall be the rate at which in accordance
with normal banking procedures the Trustee could purchase in The City of New
York the Required Currency with the Judgment Currency on the New York Business
Day next preceding that on which final judgment is given. Neither the Company
nor the Trustee shall be liable for any shortfall nor shall it benefit from any
windfall in payments to Holders of Securities under this Section caused by a
change in exchange rates between the time the
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amount of a judgment against it is calculated as above and the time the Trustee
converts the Judgment Currency into the Required Currency to make payments
under this Section to Holders of Securities, but payment of such judgment shall
discharge all amounts owed by the Company on the claim or claims underlying
such judgment.
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 shall have made written
request to the Trustee to institute proceedings in respect of such
Event of Default in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(5) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders of
a majority in principal amount of the Outstanding Securities of that
series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all such
Holders.
SECTION 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest.
Notwithstanding any other provision in this Indenture, the
Holder of any Security or coupon shall have the right, which is absolute and
unconditional, to receive payment of the principal of and any premium and
(subject to Sections 305 and 307) any interest on such Security or payment of
such coupon on the Stated Maturity or 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.
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SECTION 509. Restoration of Rights and Remedies.
If the Trustee or any Holder of a Security or coupon 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 with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities or coupons in the
last paragraph of 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.
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 of Securities or
coupons may be exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the Holders of Securities or coupons, as the
case may be.
SECTION 512. Control by Holders of Securities.
The Holders of a majority in principal amount of the
Outstanding Securities of any series shall have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred on the Trustee, with
respect to the Securities of such series, provided that
(1) such direction shall not be in conflict with any rule of
law or with this Indenture,
(2) the Trustee may take any other action deemed proper by
the Trustee which is not inconsistent with such direction, and
(3) the Trustee shall not be obligated to take any action
unduly prejudicial to Holders not joining in such direction or
involving the Trustee in personal liability.
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SECTION 513. Waiver of Past Defaults.
The Holders of 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 and any related coupons waive any past default
hereunder with respect to the Securities of such series and its consequences,
except a default
(1) in the payment of the principal of or any premium or
interest on any Security of such series, or
(2) in respect of a covenant or provision hereof which under
Article Nine cannot be modified or amended without the consent of the
Holder of each Outstanding Security of such series affected.
Upon any such waiver, such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.
SECTION 514. Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any
Security or coupon by his acceptance thereof shall be deemed to have agreed,
that any court may in its discretion require, in any suit for the enforcement
of any right or remedy under this Indenture, or in any suit against the Trustee
for any action taken, suffered or omitted by it as Trustee, the filing by any
party litigant in such suit of an undertaking to pay the costs of such suit,
and that such court may in its discretion assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in such suit, having due
regard to the merits and good faith of the claims or defenses made by such
party litigant; but the provisions of this Section shall not apply to any suit
instituted by the Company, to any suit instituted by the Trustee, to any suit
instituted by any Holder, or group of Holders, holding in the aggregate more
than 10% in principal amount of the Outstanding Securities of any series, or to
any suit instituted by any Holder of any Security or coupon for the enforcement
of the payment of the principal of or any premium or interest on any Security
or the payment of any coupon on or after the Stated Maturity or Maturities
expressed in such Security or coupon (or, in the case of redemption, on or
after the Redemption Date).
SECTION 515. 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 to 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.
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ARTICLE SIX
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities.
(a) Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties
and only such duties as are specifically set forth in this
Indenture, and no implied covenants or obligations shall be
read into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture;
but in the case of any such certificates or opinions which by
any provision hereof are specifically required to be
furnished to the Trustee, the Trustee shall be under a duty
to examine the same to determine whether or not they conform
to the requirements of this Indenture.
(b) In case an Event of Default has occurred and is
continuing, the Trustee shall exercise such of the rights and powers
vested in it by this Indenture, and use the same degree of care and
skill in their exercise, as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs.
(c) No provision of this Indenture shall be construed to
relieve the Trustee from liability for its own negligent action, its
own negligent failure to act, or its own willful misconduct, except
that
(1) this Subsection shall not be construed to limit
the effect of Subsection (a) of this Section;
(2) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer or
Responsible Officers, unless it shall be proved that the
Trustee was negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith
in accordance with the direction of the Holders of a majority
in principal amount of the Outstanding Securities of any
series relating to the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee,
under this Indenture with respect to the Securities of such
series; and
(4) no provision of this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur
any financial liability in the performance of any of its
duties hereunder, or in the exercise of any of its rights or
powers, if it shall have
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reasonable grounds for believing that repayment of such funds
or adequate indemnity against such risk or liability is not
reasonably assured to it.
(d) Whether or not therein expressly so provided, every
provision of this Indenture relating to the conduct or affecting the
liability or of affording protection to the Trustee shall be subject
to the provisions of this Section.
The foregoing provisions of this Section 601 and Section 603
are in furtherance of and subject to Sections 315 and 316 of the Trust
Indenture Act.
SECTION 602. 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 Section 703(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 any premium or interest 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 or Responsible Officers of the Trustee in good faith determine
that the withholding of such notice is in the interests of the Holders of
Securities of such series, 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. For the purpose of this Section, the term
"default" means any event which is, or after notice or lapse of time or both
would become, an Event of Default with respect to Securities of such series.
SECTION 603. Certain Rights of Trustee.
Subject to the provision of Section 601:
(a) 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 or other paper or document believed by it
to be genuine and to have been signed or presented by the proper party
or parties;
(b) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or Company Order
or as otherwise expressly provided herein and any resolution of the
Board of Directors may be sufficiently evidenced by a Board
Resolution;
(c) 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;
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(d) 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;
(e) 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;
(f) 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 or paper or document, but the
Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if
the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and
premises of the Company, personally or by agent or attorney; and
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder.
SECTION 604. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except
the Trustee's certificates of authentication, and in any coupons shall be taken
as the statements of the Company, and the Trustee or any Authenticating Agent
assumes no responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this Indenture or of the
Securities or coupons. The Trustee or any Authenticating Agent shall not be
accountable for the use or application by the Company of Securities or the
proceeds thereof.
SECTION 605. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any
Security Registrar or any other agent of the Company, in its individual or any
other capacity, may become the owner or pledgee of Securities and coupons and,
subject to Sections 608 and 613, may otherwise deal with the Company with the
same rights it would have if it were not Trustee, Authenticating Agent, Paying
Agent, Security Registrar or such other agent.
SECTION 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law. The Trustee
shall be under no liability for interest on any money received by it hereunder
except as otherwise agreed with the Company.
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SECTION 607. Compensation and Reimbursement.
The Company agrees
(1) to pay to the Trustee from time to time reasonable
compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture (including the
reasonable compensation and the expenses and disbursements of its
agents and counsel), except to the extent any such expense,
disbursement or advance as may be attributable to its negligence or
bad faith; and
(3) to indemnify and defend the Trustee for, and to hold it
harmless against, any loss, liability or expense, except to the extent
any such loss, liability or expense may be attributable to its
negligence or bad faith, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder or the
performance of its duties 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.
As security for the performance of the obligations of the
Company under this Section the Trustee shall have a lien 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, premium, if
any, or interest on a particular Securities.
The "Trustee" as used in this Section 607 shall include any
predecessor Trustee, but the negligence or bad faith of any Trustee shall not
affect the rights of any other Trustee hereunder.
SECTION 608. Disqualification; Conflicting Interests.
(a) If the Trustee has or shall acquire any conflicting
interest, as defined in this Section, with respect to the Securities of any
series, then, within 90 days after ascertaining that it has such conflicting
interest and if the default, as defined in this Section, to which such
conflicting interest relates has not been cured or duly waived or otherwise
eliminated before the end of such 90-day period, it shall either eliminate such
conflicting interest or, except as otherwise provided in Subsection (d) of this
Section, resign with respect to the Securities of that series in the manner and
with the effect specified in Section 310(b) of the Trust Indenture Act.
(b) In the event that the Trustee shall fail to comply with
the provisions of Subsection (a) of this Section with respect to the Securities
of any series, the Trustee shall, within 10 days after the expiration of such
90-day period, transmit in the manner and to the extent provided in Section
703(c), by mail to all Holders of Securities of that series, as their names and
addresses
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appear in the Security Register, notice of such failure, except as provided in
Section 310(b) of the Trust Indenture Act.
(c) For the purposes of this Section, the term "conflicting
interest" and "default" shall have the meaning specified in Section 310(b) of
the Trust Indenture Act and the Trustee shall comply with Section 310(b) of the
Trust Indenture Act.
(d) Except in the event of a default that is a default in the
payment of the principal of or interest on any Security of any series, or a
default in the deposit of any sinking fund or purchase fund payment with
respect to the Securities of any series, the Trustee shall not be required to
resign as provided by this Section if the Trustee shall have sustained the
burden of proving, on application to the Commission and after opportunity for
hearing thereon, that
(i) the default with respect to the Securities of any series
may be cured or waived during a reasonable period and under the
procedures described in such application, and
(ii) a stay of the Trustee's duty to resign will not be
inconsistent with the interests of Holders of Securities.
The filing of such an application shall automatically stay the performance of
the Trustee's duty to resign until the Commission orders otherwise.
SECTION 609. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall
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 exercise corporate trust powers and subject to supervision
or examination by Federal or State authority and having an office or agency in
the Borough of Manhattan, The City of New York, or a corporation or other
Person permitted to act as Trustee by the Commission. The Trustee shall have a
combined capital and surplus of at least $50,000,000. If such corporation or
other Person 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 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. No obligor upon any Securities issued under this Indenture or
person directly or indirectly controlling, controlled by or under common
control with such obligor shall serve as Trustee under this Indenture.
SECTION 610. 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 611.
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(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 611 shall not have been delivered to the Trustee within 30 days after
the giving of such notice of resignation, the resigning Trustee may petition
any court of competent jurisdiction for the appointment of a successor Trustee
with respect to the Securities of such series.
(c) The Trustee may be removed at any time with respect to
the Securities of any series by Act of the Holders of a majority in principal
amount of the Outstanding Securities of such series, delivered to the Trustee
and to the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 608(a)
after written request therefor by the Company or by any Holder of a
Security who has been a bona fide Holder of a Security for at least
six months, or
(2) the Trustee shall cease to be eligible under Section 609
and shall fail to resign after written request therefor by the Company
or by any such Holder, or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of
its property shall be appointed or any public officer shall take
charge or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation,
then, in any case, (i) the Company by a Board Resolution may remove the Trustee
with respect to all Securities, or (ii) subject to Section 514, any Holder of a
Security 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 the 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 and
shall comply with the applicable requirements of Section 611. If, within one
year after such resignation, removal or incapability, or the occurrence of such
vacancy, a successor Trustee with respect to the Securities of any series shall
be appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its
acceptance of such appointment in accordance with the applicable requirements
of Section 611, become the successor Trustee with respect to the Securities of
such series and to that extent supersede the successor Trustee appointed by the
Company. If no successor Trustee with respect to the Securities of any series
shall have been so appointed by the Company or the Holders of Securities of
such series and accepted appointment in the manner required by Section 611, any
Holder of a Security who has been a bona fide Holder of a Security of such
series for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a
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successor Trustee with respect to the Securities of such series. Such court may
thereupon, after such notice, if any, as it may deem proper, appoint a
successor Trustee.
(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 in the manner provided in Section 106. Each notice shall include the
name of the successor Trustee with respect to the Securities of such series and
the address of its Corporate Trust Office.
SECTION 611. Acceptance of Appointment by Successor.
(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 further act, deed or conveyance, shall become vested
with all the rights, powers, trusts and duties of the retiring Trustee, with
like effect as if originally named Trustee hereunder; 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 hereof 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 as co-trustees of the same trust and that each such
Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee; and upon
the execution and delivery of such supplemental indenture the resignation or
removal of the retiring Trustee shall become effective to the extent provided
therein and each such successor Trustee, without any further act, deed or
conveyance, shall become vested with all 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
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by such retiring Trustee hereunder with respect to the Securities of that or
those series to which the appointment of such successor Trustee relates.
(c) Upon request of any successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts
referred to in 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 612. Merger, Conversion, Consolidation or Succession to
Business.
Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to all or substantially all the corporate
trust business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
SECTION 613. Preferential Collection of Claims Against Company.
The Trustee shall comply with Section 311(a) of the Trust
Indenture Act, excluding any creditor relationship described in Section 311(b)
of the Trust Indenture Act. A Trustee who has resigned or been removed shall be
subject to Section 311(a) of the Trust Indenture Act to the extent indicated
therein.
SECTION 614. Appointment of Authenticating Agent.
The Trustee may, by an instrument in writing, appoint an
Authenticating Agent or Agents with respect to one or more series of Securities
which shall be authorized to act on behalf of the Trustee to authenticate
Securities of such series issued upon original issue or upon exchange,
registration of transfer or partial redemption thereof or pursuant to Section
306, and Securities so authenticated shall be entitled to the benefit of this
Indenture and shall be valid and obligatory for all purposes as if
authenticated by the Trustee hereunder. Wherever reference is made in this
Indenture to the authentication and delivery of Securities by the Trustee or
the Trustee's certificate of authentication, such reference shall be deemed to
include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and shall at all times be a corporation organized and
doing business under the laws of the United States of America, any State
thereof or the District of Columbia, or in the case of any Authenticating Agent
with respect to Securities issuable as Bearer Securities, under the laws of any
country in which such Bearer Securities may be offered, authorized under such
laws to act as
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Authenticating Agent, having a combined capital and surplus of not less than
$50,000,000 or equivalent amount expressed in a foreign currency and subject to
supervision or examination by Federal or State authority or authority of such
country. If such Authenticating Agent publishes reports of condition at least
annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section, the combined
capital and surplus of such Authenticating Agent shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published. If at any time an Authenticating Agent shall cease to
be eligible in accordance with the provisions of this Section, such
Authenticating Agent shall resign immediately in the manner and with the effect
specified in this Section.
Any corporation into which an Authenticating Agent may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which such
Authenticating Agent shall be a party, or any corporation succeeding to the
corporate agency or corporate trust business of an Authenticating Agent, shall
continue to be an Authenticating Agent, provided such corporation shall be
otherwise eligible under this Section, without the execution or filing of any
paper or any further act on the part of the Trustee or the Authenticating
Agent.
An Authenticating Agent may, and if it shall cease to be
eligible shall, resign at any time by giving written notice thereof to the
Trustee and to the Company. The Trustee may at any time terminate the agency of
an Authenticating Agent by giving written notice thereof to such Authenticating
Agent and to the Company. Upon receiving such a notice of resignation or upon
such a termination, or in case at any time such Authenticating Agent shall
cease to be eligible in accordance with the provisions of this Section, the
Trustee may appoint a successor Authenticating Agent which shall be acceptable
to the Company and shall mail written notice of such appointment by first-class
mail, postage prepaid, to all Holders of Registered Securities, if any, of the
series with respect to which such Authenticating Agent will serve, as their
names and addresses appear in the Security Register. 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 payment subject to the
provisions of Section 607.
If an appointment with respect to one or more series is made
pursuant to this Section, the Securities of such series may have been endorsed
thereon, in addition to the Trustee's certificate of authentication, an
alternative certificate of authentication in the following form:
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This is one of the Securities of the series designated
therein referred to in the within-mentioned Indenture.
-----------------------------------,
as Trustee
By
---------------------------
As Authenticating Agent
By
---------------------------
Authorized Officer
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses of
Holders.
With respect to each series of Securities, the Company will
furnish or cause to be furnished to the Trustee
(a) semi-annually, not more than 15 days after each Regular
Record Date relating to such series (or, if there is no Regular Record
Date relating to such series, on January 15 and July 15) all
information in the possession or control of the Company or any of its
Paying Agents other than the Trustee, in such form as the Trustee may
reasonably require, of the names and addresses of the Holders as of
such Regular Record Date (or such other date), and
(b) at such other times as the Trustee may request in
writing, within 30 days after the receipt by the Company of any such
request, a list of similar form and content as of a date not more than
15 days prior to the time such list is furnished;
excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.
SECTION 702. Preservation of Information; Communications to Holders.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders of each series (i)
contained in the most recent list furnished to the Trustee as provided in
Section 701, (ii) received by the Trustee in its capacity as Security
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Registrar or Paying Agent or (iii) filed with it during the two preceding years
pursuant to Section 703(c)(2). The Trustee may destroy any list furnished to it
as provided in Section 701 upon receipt of a new list so furnished with respect
to such series, and may destroy not earlier than two years after filing any
information filed with it pursuant to Section 703(c)(2).
(b) Holders of Securities may communicate pursuant to Section
312(b) of the Trust Indenture Act with other Holders with respect to their
rights under this Indenture or under the Securities.
(c) Every Holder of Securities or coupons, by receiving and
holding the same, agrees with the Company and the Trustee that neither the
Company nor the Trustee nor any agent of either of them shall be held
accountable by reason of the disclosure of any such information as to the names
and addresses of the Holders in accordance with Section 702(b), regardless of
the source from which such information was derived, and that the Trustee shall
not be held accountable by reason of mailing any material pursuant to a request
made under Section 702(b).
SECTION 703. Reports by Trustee.
(a) Within 60 days after September 30 of each year commencing
with the year 1991, the Trustee shall, if required by Section 313(a) of the
Trust Indenture Act, transmit to Holders a brief report dated as of such
September 30 that complies with Section 313(a) of the Trust Indenture Act.
(b) The Trustee shall comply with Section 313(b) of the Trust
Indenture Act.
(c) Reports pursuant to this Section shall be transmitted by
mail:
(1) to all Holders of Registered Securities, as the
names and addresses of such Holders appear in the Security
Register;
(2) to such Holders of Bearer Securities as have,
within the two years preceding such transmission, filed their
names and addresses with the Trustee for that purpose; and
(3) except in the case of reports pursuant to
Subsection (b) of this Section, to each Holder of a Security
whose name and address is preserved at the time by the
Trustee, as provided in Section 702(a).
(d) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock exchange upon
which the Securities are listed, with the Commission and with the Company. The
Company will notify the Trustee when the Securities are listed on any stock
exchange.
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SECTION 704. 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 and otherwise
comply with Sections 314(a)(1)-(3) of the Trust Indenture Act; and
(2) furnish to the Trustee on the 31st day of January of each
year a Security is Outstanding, a brief certificate of the Company's
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 the Indenture. For
purposes of this paragraph, such compliance shall be determined
without regard to any period of grace or requirement of notice
provided under the Indenture.
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any
other Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, and the Company shall not permit
any Person to consolidate with or merge into the Company or convey, transfer or
lease its properties and assets substantially as an entirety to the Company,
unless:
(1) in case the Company shall consolidate with or merge into
another Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, the Person formed by such
consolidation or into which the Company is merged or the Person which
acquires by conveyance or transfer, or which leases, the properties
and assets of the Company substantially as an entirety shall be a
corporation, partnership or trust organized and existing under the
laws of the United States of America, any State thereof or the
District of Columbia and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the
principal of (and premium, if any) and interest on all the Securities
and the performance of every covenant of this Indenture on the part of
the Company to be performed or observed;
(2) immediately after giving effect to such transaction, no
Event of Default, and no event which, after notice or lapse of time or
both, would become an Event of Default, shall have happened and be
continuing; and
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(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, transfer or lease and, if a
supplemental indenture is required in connection with such
transaction, such supplemental indenture comply with this Article and
that all conditions precedent herein provided for relating to such
transaction have been complied with.
SECTION 802. Successor Corporation Substituted.
Upon any consolidation with or merger or any conveyance,
transfer or lease of the properties and assets of the Company substantially as
an entirety to any Person in accordance with Section 801, the successor Person
formed by such consolidation or into which the Company is merged or to which
such conveyance, transfer or lease is made shall succeed to, and be substituted
for, and may exercise every right and power of, the Company under this
Indenture with the same effect as if such successor Person had been named as
the Company herein, and thereafter, except in the case of a lease to another
Person, the predecessor corporation shall be relieved of all obligations and
covenants under this Indenture and the Securities and coupons.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders of Securities or coupons,
the Company, when authorized by a Board Resolution, and the Trustee, at any
time and from time to time, may enter into one or more indentures supplemental
hereto, in form satisfactory to the Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the
Company and the assumption by any such successor of the covenants of
the Company herein and in the Securities pursuant to Article Eight; or
(2) to add to the covenants of the Company for the benefit of
the Holders of all or any series of Securities (and if such covenants
are to be for the benefit of less than all series of Securities,
stating that such covenants are expressly being included solely for
the benefit of such series) or to surrender any right or power herein
conferred upon the Company; or
(3) to add any additional Events of Default with respect to
all or any series of Securities (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 expressly being included solely for the
benefit of such series); or
(4) to add to or change any of the provisions of this
Indenture to 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
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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 if any such change or elimination shall
adversely affect the interest of Holders of Securities of any series
or any coupons appertaining thereto in any material respect, such
change or elimination shall become effective with respect to such
series only when there is no Security of such series Outstanding; or
(6) to provide any security for any series of Securities or
to add guarantees of any series of Securities; or
(7) to establish the form or terms of Securities of any
series and any related coupons as permitted by Sections 201 and 301;
or
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one
or more series and to add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Trustee,
pursuant to the requirements of Section 611(b); or
(9) to cure any ambiguity, to correct or supplement any
provision herein or in any supplemental indenture which may be
defective or inconsistent with any other provision herein or in any
supplemental indenture, or to make any other provisions with respect
to matters or questions arising under this Indenture; provided, that
such action shall not adversely affect the interests of the Holders of
Securities of any series or any related coupons in any material
respect.
SECTION 902. Supplemental Indentures With Consent of Holders.
With the consent of the Holders of a majority in principal
amount of the Outstanding Securities of all affected by such supplemental
indenture, by Act of said Holders delivered to the Company and the Trustee, the
Company, when authorized by a Board Resolution, and the Trustee may enter into
an indenture or indentures supplemental hereto for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Indenture or of modifying in any manner the rights of the Holders of
Securities of such series and any related coupons under this Indenture;
provided, however, that no such supplemental indenture shall, without the
consent of the Holder of each Outstanding Security affected thereby,
(1) change the Stated Maturity of the principal of, or any
installment of principal of or interest on, any Security, or reduce
the principal amount thereof or the rate of interest thereon or any
premium payable upon the redemption thereof, or change the redemption
date thereof, or change any obligation of the Company to pay
additional amounts pursuant to
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Section 1004 (except as contemplated by Section 801(1) and permitted
by Section 901(1)), or reduce the amount of the principal of an
Original Issue Discount Security that would be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to
Section 502 or change the coin or currency in which any Security or
any premium or interest thereon is payable, or change any right of
redemption, purchase or repayment by the Company at the option of the
Holder, or impair the right to institute suit for the enforcement of
any such payment on or after the Stated Maturity thereof (or, in the
case of redemption, on or after the Redemption Date), or modify the
provisions of this Indenture with respect to the subordination of any
Security in a manner adverse to the Holder thereof; or
(2) reduce the percentage in principal amount of the
Outstanding Securities of any series, the consent of whose Holders is
required for any such supplemental indenture, or the consent of whose
Holders is required for any waiver (of compliance with certain
provisions of this Indenture or certain defaults hereunder and their
consequences) provided for in this Indenture, or reduce the
requirements of Section 1504 for quorum or voting; or
(3) change any obligation of the Company to maintain an
office or agency in the places and for the purposes specified in
Section 1002; or
(4) modify any of the provisions of this Section, Section 513
or Section 1006 except to increase any such percentage or to provide
that certain other provisions of this Indenture cannot be modified or
waived without the consent of the Holder of each Outstanding Security
affected thereby; provided, however, that this clause shall not be
deemed to require the consent of any Holder of a Security or coupon
with respect to changes in the references to "the Trustee" and
concomitant changes in this Section and Section 1006 or the deletion
of this provision, in accordance with the requirements of Section
611(b) and 901(8).
An amendment under this Section may not make any change that
adversely affects the rights under Article Fourteen of any holder of an issue
of Senior Indebtedness unless the holders of the issue pursuant to its terms
consent to the change.
A supplemental indenture which changes or eliminates any
covenant or other provision of this Indenture which has expressly been included
solely for the benefit of one or more particular series of Securities, or which
modifies the rights of the Holders of Securities of such series with respect to
such covenant or other provision, shall be deemed not to affect the rights
under this Indenture of the Holders of Securities of any other series.
It shall not be necessary for any Act of Holders of
Securities 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
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Trustee shall be entitled to receive and (subject to Section 601) shall be
fully protected in relying upon, an Opinion of Counsel stating that the
execution of such supplemental indenture is authorized or permitted by this
Indenture. The Trustee may, but shall not be obligated to, enter into any such
supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
SECTION 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this
Article, this Indenture shall be modified in accordance therewith, and such
supplemental indenture shall form a part of this Indenture for all purposes;
and every Holder of Securities theretofore or thereafter authenticated and
delivered hereunder and of any coupons appertaining thereto 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.
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of each
series of Securities that it will duly and punctually pay the principal of and
any premium and interest on the Securities of that series in accordance with
the terms of the Securities, any coupons appertaining thereto and this
Indenture. Unless otherwise specified as contemplated by Section 301 with
respect to any series of Securities, any interest 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 Securities of a series are issuable only as Registered
Securities, the Company will maintain in each Place of Payment for such series
an office or agency where Securities of that series
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may be presented or surrendered for payment, where Securities of that series
may be surrendered for registration of transfer or exchange and where notices
and demands to or upon the Company in respect of the Securities of that series
and this Indenture may be served. If Securities of a series are issuable as
Bearer Securities, the Company will maintain (A) in the Borough of Manhattan,
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 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 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 (including payment of any additional amounts payable on
Securities of that series pursuant to Section 1004); provided, however, that if
the Securities of that series are listed on the International Stock Exchange of
the United Kingdom and the Republic of Ireland Limited, the Luxembourg Stock
Exchange or any other 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 London, Luxembourg or any other required city
located outside the United States, as the case may be, 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 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 and prompt notices to the Holders as provided in Section
106 of the location, and any change in the location, of any such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency in respect of any series of Securities or shall fail to
furnish the Trustee with the address thereof, such presentations and surrenders
of Securities of that series may be made and notices and demands may be made or
served at the Corporate Trust Office of the Trustee, except that Bearer
Securities of that series and related coupons may be presented and surrendered
for payment (including payment of any additional amounts payable on Bearer
Securities of that series pursuant to Section 1004) at the offices of any
Paying Agent for such series located outside the United States, and the Company
hereby appoints the same as its agents to receive such respective
presentations, surrenders, notices and demands.
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 denominated and payable in
Dollars, payment in principal of and any premium and interest on any Bearer
Security (including any additional amounts payable on Securities of such series
pursuant to Section 1004) shall be made at the office of the Company's Paying
Agent in the Borough of Manhattan, The City of New York, if (but only if)
payment in Dollars of the full amount of such principal, premium, interest or
additional amounts, as the case may be, at all offices or agencies outside the
United States maintained for the purpose by the Company in accordance with this
Indenture is illegal or effectively precluded by exchange controls or other
similar restrictions.
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The Company may also from time to time designate one or more
other offices or agencies where Securities of one or more series may be
presented or surrendered for any or all such purposes and may from time to time
rescind such designations; provided, however, that no such designation or
rescission shall in any manner relieve the Company of its obligation to
maintain an office or agency in accordance with the requirements set forth
above for Securities of any series for such purposes. The Company will give
prompt written notice to the Trustee and the Holders of any such designation or
rescission and of any other change in the location of any such other office or
agency.
SECTION 1003. Money for Securities Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent
with respect to any series of Securities, it will, on or before each due date
of the principal of and any premium or interest on any of the Securities of
that series, segregate and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay the principal and any premium or
interest so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and will promptly notify the Trustee
of its election or failure to so act.
Whenever the Company shall have one or more Paying Agents for
any series of Securities, it will, on or prior to each due date of the
principal of and any premium or interest on any Securities of that series,
deposit with a Paying Agent a sum sufficient to pay the principal and any
premium or interest 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 to so act.
The Company will cause each Paying Agent for any series of
Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with Trustee, subject to the
provisions of this Section, that such Paying Agent will:
(1) hold all sums held by it for the payment of the principal
of and any premium or interest on Securities of that 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 that series) in the making of
any payment of principal of and any premium or interest on the
Securities of that 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 such sums were held by the
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Company or such Paying Agent; and, upon such payment by any Paying Agent to the
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of and any
premium or interest on any Security of any series and remaining unclaimed for
two years after such principal and any premium or interest has become due and
payable shall be paid to the Company on Company Request (unless otherwise
required by mandatory provisions of the applicable escheat or abandoned or
unclaimed property law), or (if then held by the Company) shall be discharged
from such trust; and the Holder of such Security or any coupon appertaining
thereto shall (unless otherwise required by mandatory provisions of applicable
escheat or abandoned or unclaimed property law) 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 in each Place of Payment, notice
that such money remains unclaimed and that, after a date specified therein,
which shall not be less than 30 days from the date of such publication, any
unclaimed balance of such money then remaining will be repaid to the Company.
SECTION 1004. Additional Amounts.
If the Securities of a series provide for the payment of
additional amounts, the Company will pay the Holder of any Security of such
series or any coupon appertaining thereto additional amounts as provided
therein. Whenever in this Indenture there is mentioned, in any context, the
payment of the principal of or any premium or interest on, or in respect of,
any Security of any series or payment of any related coupon or the net proceeds
received on the sale or exchange of any Security of any series, such mention
shall be deemed to include mention of the payment of additional amounts
provided for in this Section to the extent that, in such context, additional
amounts are, were or would be payable in respect thereof pursuant to the
provisions of this Section and express mention of the payment of additional
amounts (if applicable) in any provisions hereof shall not be construed as
excluding additional amounts in those provisions hereof where such express
mention is not made.
If the Securities of a series provide for the payment of
additional amounts, at least 10 days prior to the first Interest Payment Date
with respect to that series of Securities (or if the Securities of that series
will not bear interest prior to Maturity, the first day on which a payment of
principal and any premium is made), and at least 10 days prior to each date of
payment of principal and any premium or interest if there has been any change
with respect to the matters set forth in the below-mentioned Officers'
Certificate, the Company will furnish the Trustee and the Company's principal
Paying Agent or Paying Agents, if other than the Trustee, with an Officers'
Certificate instructing the Trustee and such Paying Agent or Paying Agents
whether such payment of principal of and any premium or interest on the
Securities of that series shall be made to Holders of Securities of that series
or any related coupons who are United States Aliens without withholding for or
on account of any tax, assessment or other governmental charge described in the
Securities of that series. If any such withholding shall be required to be
withheld on such payments to such Holders
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of Securities or coupons, the Company will pay to the Trustee or such Paying
Agent the additional amounts required by this Section. The Company covenants to
indemnify the Trustee and any Paying Agent for, and to hold them harmless
against, any loss, liability or expense reasonably incurred without negligence
or bad faith on their part arising out of or, in connection with actions taken
or omitted by any of them in reliance on any Officers' Certificate furnished
pursuant to this Section.
SECTION 1005. Purchase of Securities by Company or Subsidiary.
If and so long as the Securities of a series are listed on
The Stock Exchange of the United Kingdom and the Republic of Ireland and such
stock exchange shall so require, the Company will not, and will not permit any
of its Subsidiaries to, purchase any Securities of that series by private
treaty at a price (exclusive of expenses and accrued interest) which exceeds
120% of the mean of the nominal quotations of the Securities of that series as
shown in The Stock Exchange Daily Official List for the last trading day
preceding the date of purchase.
SECTION 1006. Waiver of Certain Covenants.
The Company may omit in any particular instance to comply
with any term, provision or condition set forth in Section 1005 or any covenant
added for the benefit of any series of Securities as contemplated by Section
301 (unless otherwise specified pursuant to Section 301) with respect to the
Securities of any series if before the time for such compliance the Holders of
a majority in principal amount of the Outstanding Securities of such series
shall, by Act of such Holders, either waive such compliance in such instance or
generally waive compliance with such term, provision or condition, but no such
waiver shall extend to or affect such term, provision or condition except to
the extent so expressly waived, and, until such waiver shall become effective,
the obligations of the Company and the duties of the Trustee in respect of any
such term, provision or condition shall remain in full force and effect.
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Applicability of Article.
Securities of any series which are redeemable before their
Stated Maturity shall be redeemable in accordance with their terms and (except
as otherwise specified as contemplated by Section 301 for Securities of any
series) in accordance with this Article.
SECTION 1102. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be
evidenced by a Board Resolution. In the case of any redemption at the election
of the Company of less than all the Securities of any series, 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 in its sole
discretion), notify the Trustee of such Redemption Date, of the principal
amount of Securities of such series to be redeemed and, if applicable, of the
tenor of the Securities of such series to be redeemed. In the case
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of any redemption of Securities (i) prior to the expiration of any restriction
on such redemption provided in the terms of such Securities or elsewhere in
this Indenture, or (ii) pursuant to an election of the Company which is subject
to a condition specified in the terms of such Securities, the Company shall
furnish the Trustee with an Officers' Certificate evidencing compliance with
such restriction or condition.
SECTION 1103. Selection of Securities to Be Redeemed.
If less than all the Securities of any series are to be
redeemed (unless all of the Securities of such series of a specified tenor 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
lot or by such other method as the Trustee shall deem fair and appropriate and
which may provide for the selection for redemption of portions (equal to the
minimum authorized denomination for Securities of that series or any integral
multiple thereof) of the principal amount of Registered Securities of such
series of a denomination larger than the minimum authorized denomination for
Securities of that series or of the principal amount of global Securities of
such series. If less than all of the Securities of such series and of a
specified tenor 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
Company or the Trustee, from the Outstanding Securities of such series and
specified tenor not previously called for redemption in accordance with the
preceding sentence.
The Trustee shall promptly notify the Company in writing of
the Securities selected for redemption 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 Securities redeemed or to be redeemed only in
part, to the portion of the principal amount of such Securities which has been
or is to be redeemed.
SECTION 1104. Notice of Redemption.
Notice of redemption shall be given in the manner provided in
Section 106 to the Holders of Securities to be redeemed not less than 30 nor
more than 60 days prior to the Redemption Date.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price, and interest, 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 of any Securities, the principal amounts) of the particular
Securities to be redeemed, and that on and after the Redemption Date,
upon
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surrender of the Securities, new Securities of such series in
principal amount equal to the unredeemed part thereof will be issued,
(4) that on the Redemption Date the Redemption Price, and
interest, if any, will become due and payable upon each such Security
to be redeemed and, if applicable, that interest thereon will cease to
accrue on and after said date,
(5) the place or places where 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
(6) that the redemption is for a sinking fund, if such is the
case.
Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the Company's
request, by the Trustee in the name and at the expense of the Company.
SECTION 1105. Deposit of Redemption Price.
On or prior to any Redemption Date, the Company shall deposit
with the Trustee or with a Paying Agent (or, if the Company is acting as its
own Paying Agent, segregate and hold in trust as provided in Section 1003) an
amount of money sufficient to pay the Redemption Price of, and (except if the
Redemption Date shall be an Interest Payment Date) accrued interest on, all the
Securities which are to be redeemed on that date.
SECTION 1106. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the
Securities so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price therein specified, and from and after such date
(unless the Company shall default in the payment of the Redemption Price and
accrued interest) such Securities shall cease to bear interest 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 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 unless
otherwise specified as contemplated by Section 301, 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.
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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 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 any premium shall,
until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Security.
SECTION 1107. Securities Redeemed in Part.
Any Registered Security which is to be redeemed only in part
shall be surrendered at a Place of Payment thereof (with, if the Company or the
Trustee so requires, due endorsement by, or a written instrument of transfer in
form satisfactory to the Company and the Trustee duly executed by, the Holder
thereof or his attorney duly authorized in writing), and the Company shall
execute, and the Trustee shall authenticate and deliver to the Holder of such
Security without service charge, a new Registered Security or Securities of the
same series and of like tenor, of any authorized denomination as requested by
such Holder, in aggregate principal amount equal to and in exchange for the
unredeemed portion of the principal of the Security so surrendered.
ARTICLE TWELVE
SINKING FUND
SECTION 1201. Applicability of Article.
The provisions of this Article shall be applicable to any
sinking fund for the retirement of Securities of a series except as otherwise
specified as contemplated by Section 301 for Securities of such series.
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". Unless otherwise provided by the terms of
Securities of any series, the cash amount of any sinking fund payment shall 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.
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SECTION 1202. Satisfaction of Sinking Fund Payments with Securities.
The Company (1) may deliver Outstanding Securities of a
series (other than any previously called for redemption), together in the case
of any Bearer Securities of such series with all unmatured coupons appertaining
thereto, and (2) may apply as a credit Securities of a series which have been
redeemed either at the election of the Company pursuant to the terms of such
Securities or through the application of permitted optional sinking fund
payments pursuant to the terms of such Securities, in each case in satisfaction
of all or any part of any sinking fund payment with respect to the Securities
of such series required to be made pursuant to the terms of such Securities as
provided for by the terms of such series; provided 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 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 delivering and crediting
Securities of that series pursuant to Section 1202 and will also deliver to the
Trustee any Securities to be so credited. Not less than 45 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.
ARTICLE THIRTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1301. Company's Option to Effect Defeasance or Covenant
Defeasance.
If specified to be applicable with respect to Securities of a
series pursuant to Section 301, the Company may at its option by Board
Resolution, at any time, elect to have either Section 1302 or Section 1303
applied to the Outstanding Securities of any series upon compliance with the
conditions set forth below in this Article Thirteen.
SECTION 1302. Defeasance and Discharge.
Upon the Company's exercise of the option provided in Section
1301 applicable to this Section, the Company shall be deemed to have been
discharged from its obligations with respect to the Outstanding Securities of
any series on the 91st day after the conditions set forth below 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 the Outstanding
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Securities of such series and to have satisfied all its other obligations under
the Securities of such series and this Indenture insofar as the Securities of
such series 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 the Securities of such series to
receive, solely from the trust fund described in Section 1304 and as more fully
set forth in such Section, payments in respect of the principal of and any
premium and interest on the Securities of such series when such payments are
due, (B) the Company's obligations with respect to such Securities under
Section 304, 305, 306, 1002, 1003 and 1004, (C) the rights, powers, trusts,
duties and immunities of the Trustee hereunder, including, without limitation,
Section 607 and (D) this Article Thirteen. Subject to compliance with this
Article Thirteen, the Company may exercise its option under this Section 1302
notwithstanding the prior exercise of its option under Section 1303.
SECTION 1303. Covenant Defeasance.
Upon the Company's exercise of the option provided in Section
1301 applicable to this Section, (i) the Company shall be released from its
obligations with respect to the Securities of such series under Section 1005
and Section 801, and (ii) the occurrence of an event specified in Sections
501(3), (4) or (7) (unless otherwise specified pursuant to Section 301) shall
not be deemed to be an Event of Default on and after the date the conditions
set forth below are satisfied (hereinafter, "covenant defeasance"), but the
remainder of this Indenture and such Securities shall be unaffected thereby.
SECTION 1304. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to application of
either Section 1302 or Section 1303 to the then Outstanding Securities of any
series:
(1) The Company shall irrevocably have deposited or caused to
be deposited with the Trustee (or another trustee satisfying the
requirements of Section 609 who shall agree to comply with the
provisions of this Article Thirteen 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 the Securities of such series, (A) money in an amount, or
(B) U.S. Government Obligations which through the scheduled payment of
principal and interest in respect thereof in accordance with their
terms will provide, not later than one day before the due date of any
payment, money in an amount, or (C) a combination thereof, sufficient,
in any case, 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, the principal of (premium, if any) and each installment
of interest on the Securities and any coupons appertaining thereto on
the Stated Maturity of such principal or installment of interest in
accordance with the terms of this Indenture and of the Securities of
such series. For this purpose, "U.S. Government Obligations" means
securities that are (x) direct obligations of the United States of
America for the payment of which its full faith and credit is pledged
or (y) obligations of a Person controlled or supervised by and acting
as an agency or instrumentality of the United States of America the
payment of which is
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unconditionally guaranteed as a full faith and credit obligation by
the United States of America, which, in either case, are not callable
or redeemable at the option of the issuer thereof.
(2) In the case of an election under Section 1302, 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 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 Holder of the Outstanding
Securities of such series will not recognize income, gain or loss for
Federal income tax purposes as a result of such deposit, defeasance
and discharge and will be subject to Federal income tax on the same
amount, in the same manner and at the same times as would have been
the case if such deposit, defeasance and discharge had not occurred.
(3) In the case of an election under Section 1303, the
Company shall have delivered to the Trustee an Opinion of Counsel to
the effect that the Holders of the Outstanding Securities of such
series will not recognize income, gain or loss for Federal income tax
purposes as a result of such deposit and covenant defeasance and will
be subject to Federal income tax on the same amount, in the same
manner and at the same times as would have been the case if such
deposit and covenant defeasance had not occurred.
(4) No Event of Default or event which with notice or lapse
of time or both would become an Event of Default with respect to the
Securities of such series shall have occurred and be continuing on the
date of such deposit or, insofar as subsections 501(5) and (6) are
concerned, at any time during the period ending on the 121st day after
the date of such deposit (it being understood that this condition
shall not be deemed satisfied until the expiration of such period).
(5) Such defeasance or covenant defeasance shall not cause
the Trustee to have a conflicting interest as defined in Section 608
and for purposes of the Trust Indenture Act with respect to any
securities of the Company.
(6) Such defeasance or covenant defeasance shall not result
in a breach or violation of, or constitute a default under, any other
agreement or instrument to which the Company is a party or by which it
is bound.
(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 1302 or the covenant defeasance under Section 1303 (as
the case may be) have been complied with.
(8) Such defeasance or covenant defeasance shall not result
in the trust arising from such deposit constituting an investment
company as defined in the Investment Company Act of 1940, as amended,
or such trust shall be qualified under such Act or exempt from
regulation thereunder.
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SECTION 1305. Deposited Money and U.S. Government Obligations to be
Held in Trust; Other Miscellaneous Provisions.
Subject to provisions of the last paragraph of Section 1003,
all money and U.S. Government Obligations (including the proceeds thereof)
deposited with the Trustee (or such other qualifying trustee -- collectively,
for purposes of this Section 1305, the "Trustee") pursuant to Section 1304 in
respect of the Securities of such series shall be held in trust and applied by
the Trustee, in accordance with provisions of such Securities of such series
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 the Securities of such series, of all sums due and
to become due thereon in respect of principal (and premium, if any) and
interest, but such money need not be segregated from other funds except to the
extent required by law.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U.S. Government
Obligations deposited pursuant to Section 1304 or the principal and interest
received in respect thereof other than any such tax, fee or other charge which
by law is for the account of the Holders of the Outstanding Securities.
Anything in this Article Thirteen to the contrary
notwithstanding, the Trustee shall deliver or pay to the Company from time to
time upon Company Request any money or U.S. Government Obligations held by it
as provided in Section 1304 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.
SECTION 1306. Reinstatement.
If the Trustee or the Paying Agent is unable to apply any
money or U.S. Government Obligations deposited with respect to Securities of
any series in accordance with Section 1302 or 1303 by reason of any legal
proceedings or any order or judgment of any court of governmental authority
enjoining, restraining or otherwise prohibiting such application, then the
Company's obligations under this Indenture with respect to the Securities of
such series and under such Securities shall be revived and reinstated as though
no deposit had occurred pursuant to this Article Thirteen until such time as
the Trustee or Paying Agent is permitted to apply all such money or U.S.
Government Obligations in accordance with Section 1302 or 1303; provided,
however, that if the Company makes any payment of principal of or any premium
or interest on any Security following the reinstatement of its obligations, the
Company shall be subrogated to the rights of the Holders of the Securities of
such series to receive such payment from the money held by the Trustee or the
Paying Agent.
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ARTICLE FOURTEEN
SUBORDINATION
SECTION 1401. Securities Subordinated to Senior Indebtedness.
The Company and each Holder of a Security, by his acceptance
thereof, agree that (a) the payment of the principal of, premium (if any) on
and interest on each and all the Securities and (b) any other payment in
respect of the Securities, including on account of the acquisition or
redemption of Securities by the Company, is subordinated, to the extent and in
the manner provided in this Article Fourteen, to the prior payment in full of
all Senior Indebtedness of the Company, whether outstanding at the date of this
Indenture or thereafter created, incurred, assumed or guaranteed, and that
these subordination provisions are for the benefit of the holders of Senior
Indebtedness.
This Article Fourteen shall constitute a continuing offer to
all Persons who, in reliance upon such provisions, become holders of, or
continue to hold, Senior Indebtedness, and such provisions are made for the
benefit of the holders of Senior Indebtedness, and such holders are made
obligees hereunder and any one or more of them may enforce such provisions.
SECTION 1402. No Payment on Securities in Certain Circumstances.
(a) No payment shall be made by or on behalf of the Company
on account of the principal of, premium (if any) on or interest on the
Securities of any series or to acquire any of such Securities (including any
repurchases of such Securities pursuant to the provisions thereof at the option
of the Holder of such Securities) for cash or property (other than Junior
securities of the Company), or on account of any redemption provisions of such
Securities, in the event of default in payment of any principal of, premium (if
any) on or interest on any Senior Indebtedness of the Company when the same
becomes due and payable, whether at maturity or at a date fixed for prepayment
or by declaration of acceleration or otherwise (a "Payment Default"), unless
and until such Payment Default has been cured or waived or otherwise has ceased
to exist.
(b) No payment shall be made by or on behalf of the Company
on account of the principal of, premium (if any) on or interest on the
Securities of any series or to acquire any of such Securities (including any
repurchases of such Securities pursuant to the provisions thereof at the option
of the Holder of such Securities) for cash or property (other than Junior
securities of the Company), or on account of the redemption provisions of such
Securities, in the event of any event of default (other than a Payment Default)
with respect to any Designated Senior Indebtedness permitting the holders of
such Designated Senior Indebtedness (or a trustee or other representative on
behalf of the holders thereof) to declare such Designated Senior Indebtedness
due and payable prior to the date on which it would otherwise have become due
and payable, upon written notice thereof to the Company and the Trustee by any
holders of Designated Senior Indebtedness (or a trustee or other representative
on behalf of the holders thereof) (the "Payment Notice"), unless and until such
event of default shall have been cured or waived or otherwise has ceased to
exist; provided, that such payments may not be prevented pursuant to this
Section 1402(b) for more than 179 days after an applicable Payment Notice has
been received by the Trustee unless the Designated
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<PAGE> 75
Senior Indebtedness in respect of which such event of default exists has been
declared due and payable in its entirety, in which case no such payment may be
made until such acceleration has been rescinded or annulled or such Designated
Senior Indebtedness has been paid in full. No event of default that existed or
was continuing on the date of any Payment Notice (whether or not such event of
default is on the same issue of Designated Senior Indebtedness) may be made the
basis for the giving of a second Payment Notice, and only one such Payment
Notice may be given in any 365-day period.
(c) In furtherance of the provisions of Section 1401, in the
event that, notwithstanding the foregoing provisions of this Section 1402, any
payment or distribution of assets of the Company (other than Junior securities
of the Company) shall be received by the Trustee or the Holders of Securities
of any series at a time when such payment or distribution was prohibited by the
provisions of this Section 1402, then, unless such payment or distribution is
no longer prohibited by this Section 1402, such payment or distribution
(subject to the provisions of Section 1407) shall be received and held in trust
by the Trustee or such Holder or Paying Agent for the benefit of the holders of
Senior Indebtedness of the Company, and shall be paid or delivered by the
Trustee or such Holders or such Paying Agent, as the case may be, to the
holders of Senior Indebtedness of the Company remaining unpaid or unprovided
for or their representative or representatives, or to the trustee or trustees
under any indenture pursuant to which any instruments evidencing such Senior
Indebtedness of the Company may have been issued, ratably, according to the
aggregate amounts remaining unpaid on account of such Senior Indebtedness of
the Company held or represented by each, for application to the payment of all
Senior Indebtedness in full after giving effect to all concurrent payments and
distributions to or for the holders of such Senior Indebtedness.
SECTION 1403. Securities Subordinated to Prior Payment of All Senior
Indebtedness on Dissolution, Liquidation or
Reorganization.
Upon any distribution of assets of the Company or upon any
dissolution, winding up, total or partial liquidation or reorganization of the
Company, whether voluntary or involuntary, in bankruptcy, insolvency,
receivership or similar proceeding or upon assignment for the benefit of
creditors:
(a) the holders of all Senior Indebtedness of the Company
shall first be entitled to receive payments in full before the Holders
of Securities of any series are entitled to receive any payment on
account of the principal of, premium (if any) on or interest on such
Securities (other than Junior securities of the Company);
(b) any payment or distribution of assets of the Company of
any kind or character, whether in cash, property or securities (other
than Junior securities of the Company), to which the Holders of
Securities of any series or the Trustee on behalf of such Holders
would be entitled, except for the provisions of this Article Fourteen,
shall be paid by the liquidating trustee or agent or other Person
making such a payment or distribution directly to the holders of such
Senior Indebtedness or their representative, ratably according to the
respective amounts of Senior Indebtedness held or represented by each,
to the extent necessary to make payment in full of all such Senior
Indebtedness remaining unpaid after giving effect to all concurrent
payments and distributions to the holders of such Senior Indebtedness;
and
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<PAGE> 76
(c) in the event that, notwithstanding the foregoing, any
payment or distribution of assets of the Company of any kind or
character, whether in cash, property or securities (other than Junior
securities of the Company), shall be received by the Trustee or the
Holders of Securities of any series or any Paying Agent (or, if the
Company or any Affiliate of the Company is acting as its own Paying
Agent, money for any such payment or distribution shall be segregated
or held in trust) on account of the principal of, premium (if any) on
or interest on the Securities of such series before all Senior
Indebtedness of the Company is paid in full, such payment or
distribution (subject to the provisions of Section 1407) shall be
received and held in trust by the Trustee or such Holder or Paying
Agent for the benefit of the holders of such Senior Indebtedness, or
their respective representatives, ratably according to the respective
amounts of such Senior Indebtedness held or represented by each, to
the extent necessary to make payment as provided herein of all such
Senior Indebtedness remaining unpaid after giving effect to all
concurrent payments and distributions and all provisions therefor to
or for the holders of such Senior Indebtedness, but only to the extent
that as to any holder of such Senior Indebtedness, as promptly as
practical following notice from the Trustee to the holders of such
Senior Indebtedness that such prohibited payment has been received by
the Trustee, Holder(s) or Paying Agent (or has been segregated as
provided above), such holder (or a representative therefor) notifies
the Trustee of the amounts then due and owing on such Senior
Indebtedness, if any, held by such holder and only the amounts
specified in such notices to the Trustee shall be paid to the holders
of such Senior Indebtedness.
SECTION 1404. Subrogation to Rights of Holders of Senior Indebtedness.
Subject to the payment in full of all Senior Indebtedness of
the Company as provided herein, the Holders of the Securities shall be
subrogated (to the extent of the payments or distributions made to the holders
of such Senior Indebtedness pursuant to the provisions of this Article) to the
rights of the holders of such Senior Indebtedness to receive payments or
distributions of assets of the Company applicable to the Senior Indebtedness
until all amounts owing on the Securities shall be paid in full. For the
purpose of such subrogation, no such payments or distributions to the holders
of such Senior Indebtedness by the Company, or by or on behalf of the Holders
of the Securities by virtue of this Article Fourteen, which otherwise would
have been made to such Holders shall, as between the Company and such Holders,
be deemed to be payment by the Company or on account of such Senior
Indebtedness, it being understood that the provisions of this Article Fourteen
are and are intended solely for the purpose of defining the relative rights of
the Holders of the Securities, on the one hand, and the holders of such Senior
Indebtedness, on the other hand.
If any payment or distribution to which the Holders of the
Securities would otherwise have been entitled but for the provisions of this
Article Fourteen shall have been applied, pursuant to the provisions of this
Article Fourteen, to the payment of amounts payable under Senior Indebtedness
of the Company, then such Holders shall be entitled to receive from the holders
of such Senior Indebtedness any payments or distributions received by such
holders of Senior Indebtedness in excess of the amount sufficient to pay all
amounts payable under or in respect of such Senior Indebtedness in full.
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<PAGE> 77
SECTION 1405. Obligations of the Company Unconditional.
Nothing contained in this Article Fourteen or elsewhere in
this Indenture or in the Securities is intended to or shall impair, as between
the Company and the Holders of the Securities of any series, the obligation of
the Company, which is absolute and unconditional, to pay to such Holders the
principal of, premium (if any) on and interest on the Securities of such series
as and when the same shall become due and payable in accordance with their
terms, or is intended to or shall affect the relative rights of such Holders
and creditors of the Company other than the holders of the Senior Indebtedness,
nor shall anything herein or therein prevent the Trustee or any Holder from
exercising all remedies otherwise permitted by applicable law upon default
under this Indenture, subject to the rights, if any, under this Article
Fourteen, of the holders of Senior Indebtedness in respect of cash, property or
securities of the Company received upon the exercise of any such remedy.
Notwithstanding anything to the contrary in this Article Fourteen or elsewhere
in this Indenture or in the Securities, upon any distribution of assets of the
Company referred to in this Article Fourteen, the Trustee, subject to the
provisions of Sections 601 and 603, and the Holders of the Securities shall be
entitled to rely upon any order or decree made by any court of competent
jurisdiction in which such dissolution, winding up, liquidation or
reorganization proceedings are pending, or a certificate of the liquidating
trustee or agent or other Person making any distribution to the Trustee or to
such Holders for the purpose of ascertaining the Persons entitled to
participate in such distribution, the holders of the Senior Indebtedness and
other Indebtedness of the Company, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article Fourteen so long as such court has been apprised of
the provisions of, or the order, decree or certificate makes reference to, the
provisions of this Article Fourteen.
SECTION 1406. Trustee Entitled to Assume Payments Not Prohibited in
Absence of Notice.
The Trustee shall not at any time be charged with knowledge
of the existence of any facts that would prohibit the making of any payment to
or by the Trustee unless and until a Responsible Officer of the Trustee or any
Paying Agent shall have received, no later than two Business Days prior to such
payment, written notice thereof from the Company or from one or more holders of
Senior Indebtedness or from any representative therefor and, prior to the
receipt of any such written notice, the Trustee, subject to the provisions of
Sections 601 and 603, shall be entitled in all respects conclusively to assume
that no such fact exists.
SECTION 1407. Application by Trustee of Amounts Deposited with It.
Amounts deposited in trust with the Trustee pursuant to and
in accordance with Article Thirteen shall be for the sole benefit of Holders of
the Securities of series for the benefit of which such amounts were deposited,
and, to the extent allocated for the payment of Securities of such series,
shall not be subject to the subordination provisions of this Article Fourteen.
Otherwise, any deposit of assets with the Trustee or the Paying Agent (whether
or not in trust) for the payment of principal of, premium (if any) on or
interest on any Securities shall be subject to the provisions of Sections 1401,
1402, 1403 and 1404; provided that if prior to two Business Days preceding the
date on which by the terms of this Indenture any such assets may become
distributable for any purpose (including without limitation, the payment of
either principal of, premium (if any) on or
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<PAGE> 78
interest on any Security), the Trustee or such Paying Agent shall not have
received with respect to such assets the written notice provided for in Section
1406, then the Trustee or such Paying Agent shall have full power and authority
to receive such assets and to apply the same to the purpose for which they were
received, and shall not be affected by any notice to the contrary that may be
received by it on or after such date; and provided further that nothing
contained in this Article Fourteen shall prevent the Company from making, or
the Trustee from receiving or applying, any payment in connection with the
redemption of Securities if the first publication of notice of such redemption
(whether by mail or otherwise in accordance with this Indenture) has been made,
and the Trustee has received such payment from the Company, prior to the
occurrence of any of the contingencies specified in Section 1402 or 1403.
SECTION 1408. Subordination Rights Not Impaired by Acts or Omissions
of the Company or Holders of Senior Indebtedness.
No right of any present or future holders of any Senior
Indebtedness to enforce subordination provisions contained in this Article
Fourteen shall at any time in any way be prejudiced or impaired by any act or
failure to act on the part of the Company or by any act or failure to act, in
good faith, by any such holder, or by any noncompliance by the Company with the
terms of this Indenture, regardless of any knowledge thereof that any such
holder may have or be otherwise charged with. The holders of Senior
Indebtedness may extend, renew, modify or amend the terms of the Senior
Indebtedness or any security therefor and release, sell or exchange such
security and otherwise deal freely with the Company, all without affecting the
liabilities and obligations of the parties to this Indenture or the Holders of
the Securities.
SECTION 1409. Trustee to Effectuate Subordination of Securities.
Each Holder of a Security by his acceptance thereof
authorizes and expressly directs the Trustee on his behalf to take such action
as may be necessary or appropriate to effectuate the subordination provisions
contained in this Article Fourteen and to protect the rights of the Holders of
the Securities pursuant to this Indenture, and appoints the Trustee his
attorney-in-fact for such purpose, including, in the event of any dissolution,
winding up, liquidation or reorganization of the Company (whether in
bankruptcy, insolvency or receivership proceedings or upon an assignment for
the benefit of creditors of the Company), the filing of a claim for the unpaid
balance of his Securities in the form required in said proceedings and cause
said claim to be approved. If the Trustee does not file a proper claim or proof
of debt in the form required in such proceeding prior to 30 days before the
expiration of the time to file such claim or claims, then the holders of the
Senior Indebtedness or their representative is hereby authorized to have the
right to file and is hereby authorized to file an appropriate claim for and on
behalf of the Holders of said Securities. Nothing herein contained shall be
deemed to authorize the Trustee or the holders of Senior Indebtedness or their
representative to authorize or consent to or accept or adopt on behalf of any
Holder of Securities any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or the rights of any Holder thereof, or to
authorize the Trustee or the holders of Senior Indebtedness or their
representative to vote in respect of the claim of any Holder of the Securities
in any such proceeding.
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<PAGE> 79
SECTION 1410. Right of Trustee to Hold Senior Indebtedness.
The Trustee in its individual capacity shall be entitled to
all of the rights set forth in this Article Fourteen in respect of any Senior
Indebtedness at any time held by it to the same extent as any other holder of
Senior Indebtedness, and nothing in this Indenture shall be construed to
deprive the Trustee of any of its rights as such holder.
SECTION 1411. Article Fourteen Not to Prevent Events of Default.
The failure to make a payment on account of principal of or
premium (if any) on or interest on the Securities by reason of any provision of
this Article Fourteen shall not be construed as preventing the occurrence of a
Default or an Event of Default under Section 501 or in any way prevent the
Holders of the Securities from exercising any right hereunder other than the
right to receive payment on the Securities.
SECTION 1412. No Fiduciary Duty of Trustee to Holders of Senior
Indebtedness.
The Trustee shall not be deemed to owe any fiduciary duty to
the holders of Senior Indebtedness, and shall not be liable to any such holders
(other than for its willful misconduct or negligence) if it shall in good faith
mistakenly pay over or distribute to the Holders of the Securities or the
Company or any other Person, cash, property or securities to which any holders
of Senior Indebtedness shall be entitled by virtue of this Article Fourteen or
otherwise. Nothing in this Section 1412 shall affect the obligation of any
other such Person to hold such payment for the benefit of, and to pay such
payment over to, the holders of Senior Indebtedness or their representative.
SECTION 1413. Article Applicable to Paying Agent.
In case at any time any Paying Agent other than the Trustee
shall have been appointed by the Company and be then acting hereunder, the term
"Trustee" as used in this Article Fourteen shall in such case (unless the
context shall otherwise require) be construed as extending to and including
such Paying Agent within its meaning as fully for all intents and purposes as
if such Paying Agent were named in this Article in addition to or in place of
the Trustee; provided, however, that this Section 1413 shall not apply to the
Company or any Affiliate of the Company if it or such Affiliate acts as Paying
Agent.
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.
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<PAGE> 80
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 Borough of Manhattan, 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 place of such
meeting and in general terms the action proposed to be taken at such meeting,
shall be given, in the manner provided in Section 106, not less than 20 nor
more than 120 days prior to the date fixed for the meeting (or, in the case of
a meeting of Holders with respect to Securities of a series all or part of
which are represented by a Book-Entry Security, not less than 20 nor more than
40 days).
(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 20 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 Borough of Manhattan, 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 subsection (a) of this Section.
SECTION 1503. Persons Entitled to Vote at Meetings.
Upon the calling of a meeting of Holders with respect to the
Securities of a series, a record date shall be established for determining
Holders of Outstanding Securities of such series entitled to vote at such
meeting, which record date shall be the close of business on the day the notice
of the meeting of Holders is given in accordance with Section 1502. The Holders
on such record date, and their designated proxies, and only such Persons, shall
be entitled to vote at such meeting of Holders. To be entitled to vote at any
meeting of Holders a Person shall (a) be a Holder of one or more Securities or
(b) be a Person appointed by an instrument in writing as proxy by a Holder of
one or more Securities; provided, however, that in the case of any meeting of
Holders with respect to the Securities of a series all or part of which are
represented by a Book-Entry Security, only Holders, or their designated
proxies, of record on the record date established pursuant to Section 1503
hereof shall be entitled to vote at such meeting. The only Persons who shall be
entitled to be present or to speak at any meeting of Holders shall be the
persons entitled to vote at such meeting and their counsel and 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. 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
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<PAGE> 81
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 an 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. Notwithstanding the foregoing, no meeting of Holders with
respect to Securities of any series which is represented in whole or in part by
a Book-Entry Security shall be adjourned to a date more than 90 days after the
record date for such meeting unless the Trustee shall send out a new notice of
meeting and establish, in accordance with Section 1503, a new record date for
Holders entitled to vote at such meeting.
Except as limited by the proviso of the first paragraph of
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 a majority in principal amount of the
Outstanding Securities of that series; provided, however, that, except as
limited by Section 502 and the proviso to the first paragraph of 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 such specified percentage in principal amount of the Outstanding
Securities of that series.
To the extent consistent with the terms of this Indenture,
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.
SECTION 1505. Determination of Voting Rights; Conduct and Adjournment
of Meetings.
(a) Notwithstanding any other 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 it 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.
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(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 manner appoint a temporary chairman.
A permanent chairman and a permanent secretary of the meeting shall be elected
by vote of 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 the
Outstanding Securities of such series held or represented by him; 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.
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This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
BAKER HUGHES INCORPORATED
By:
--------------------------------
Name:
Title:
[TRUSTEE]
By:
--------------------------------
Name:
Title:
76
<PAGE> 1
EXHIBIT 12.1
BAKER HUGHES INCORPORATED
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
SIX MONTHS YEAR THREE MONTHS
ENDED ENDED ENDED YEAR ENDED SEPTEMBER 30,
JUNE 30, DECEMBER 31, DECEMBER 31, ---------------------------------
1999 1998 1997 1997 1996 1995 1994
------------- ----------------- ----------------- ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
Income (loss) from
continuing
operations before
income taxes,
extraordinary items
and accounting
changes............ $142.6 $(281.1) $179.2 $364.3 $415.5 $308.3 $294.4
Add:
Fixed Charges........ 118.1 219.3 39.0 146.9 126.1 126.6 144.5
Amortization of
capitalized
interest........... 1.1 3.0 0.1 0.4 -- -- --
Less:
Capitalized
interest........... 3.4 6.8 1.0 4.1 -- -- --
------ ------- ------ ------ ------ ------ ------
Income (loss) from
continuing
operations before
income taxes,
extraordinary items
and accounting
changes as
adjusted........... $258.4 $ (65.6) $217.3 $507.5 $541.6 $434.9 $438.9
====== ======= ====== ====== ====== ====== ======
Fixed charges:
Add:
Interest expense... 82.9 149.0 24.5 91.4 87.9 89.1 106.4
Interest portion of
rental expense... 31.8 63.5 13.5 51.4 38.2 37.5 38.1
Capitalized
interest......... 3.4 6.8 1.0 4.1 -- -- --
------ ------- ------ ------ ------ ------ ------
Total fixed
charges... $118.1 $ 219.3 $ 39.0 $146.9 $126.1 $126.6 $144.5
====== ======= ====== ====== ====== ====== ======
RATIO OF EARNINGS TO
FIXED CHARGES(1)... 2.19x -- 5.57x 3.45x 4.30x 3.44x 3.04x
====== ======= ====== ====== ====== ====== ======
</TABLE>
- ---------------
(1) For the year ended December 31, 1998, earnings were inadequate to cover
fixed charges by $500.4 million.
<PAGE> 1
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Baker Hughes Incorporated on Form S-3 of our report dated February 17, 1999
(which report expresses an unqualified opinion and includes an explanatory
paragraph relating to the Company's change in its method of accounting for
impairment of long-lived assets to be disposed of effective October 1, 1996 to
conform with Statement of Financial Accounting Standards No. 121), which is
incorporated by reference in the Annual Report on Form 10-K of Baker Hughes
Incorporated for the year ended December 31, 1998, as amended, and to the
reference to us under the heading "Experts" in the Prospectus, which is part of
this Registration Statement.
DELOITTE & TOUCHE LLP
Houston, Texas
September 24, 1999
