<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 14, 1997
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------
<TABLE>
<S> <C>
OWENS-ILLINOIS, INC. OWENS-ILLINOIS GROUP, INC.
(Exact name of Registrant as specified in its charter) (Exact name of Registrant as specified in its charter)
DELAWARE DELAWARE
(State or other jurisdiction of incorporation or organization) (State or other jurisdiction of incorporation or organization)
22-2781933 34-1559348
(I.R.S. Employer Identification Number) (I.R.S. Employer Identification Number)
One SeaGate One SeaGate
Toledo, Ohio 43666 Toledo, Ohio 43666
(419) 247-5000 (419) 247-5000
(Address and telephone number of (Address and telephone number of
Registrant's principal executive offices) Registrant's principal executive offices)
</TABLE>
--------------------------
Thomas L. Young, Esq.
Owens-Illinois, Inc.
One SeaGate
Toledo, Ohio 43666
(419) 247-5000
(Name, address, including ZIP code, and telephone number, including area code,
of agent for service)
--------------------------
COPIES TO:
Peter F. Kerman
Latham & Watkins
505 Montgomery Street, Suite 1900
San Francisco, California 94111
(415) 391-0600
--------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement, as determined
by the Registrants.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
--------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF AGGREGATE OFFERING REGISTRATION
SECURITIES TO BE REGISTERED PRICE(1) (2) (3) FEE(3)
<S> <C> <C>
Debt Securities.........................................................................
Guarantees of Debt Securities (4).......................................................
Common Stock, $.01 par value............................................................
Total............................................................................... $2,500,000,000 $723,093
</TABLE>
(1) Estimated solely for purposes of calculating the registration fee, which is
calculated in accordance with Rule 457(o).
(2) Not specified as to each class of securities to be registered hereunder
pursuant to General Instruction II(D) to Form S-3 under the Securities Act
of 1933.
(3) Pursuant to Rule 429(b) under the Securities Act of 1933, the registration
fee hereunder is offset by the fee of $34,483 previously calculated and paid
in connection with the registration of $100,000,000 in securities on
Registration Statement No. 33-51982.
(4) No separate consideration will be received from purchasers of Debt
Securities with respect to these guarantees and no registration fee is
attributable to the guarantees of the Debt Securities.
--------------------------
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
--------------------------
PURSUANT TO RULE 429 UNDER THE SECURITIES ACT OF 1933, THE PROSPECTUS
INCLUDED IN THIS REGISTRATION STATEMENT IS A COMBINED PROSPECTUS WHICH RELATES
TO REGISTRATION STATEMENT NO. 33-51982, AS AMENDED, PREVIOUSLY FILED BY
OWENS-ILLINOIS, INC. ON FORM S-3. THIS REGISTRATION STATEMENT ALSO CONSTITUTES
POST-EFFECTIVE AMENDMENT NO.1 WITH RESPECT TO REGISTRATION STATEMENT NO.
33-51982, AS AMENDED, PURSUANT TO WHICH $100,000,000 IN SECURITIES REMAIN TO BE
ISSUED.
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<PAGE>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
<PAGE>
SUBJECT TO COMPLETION, DATED APRIL 14, 1997
OWENS-ILLINOIS, INC.
[LOGO]
DEBT SECURITIES
COMMON STOCK
------------------------
Owens-Illinois, Inc. (the "Company"), directly or through agents, dealers,
or underwriters designated from time to time, may offer, issue and sell, in one
or more series or issuances, up to $2,500,000,000 in the aggregate of (a)
secured or unsecured debt securities (the "Debt Securities") of the Company, in
one or more series, which may be either senior debt securities (the "Senior Debt
Securities"), senior subordinated debt securities (the "Senior Subordinated Debt
Securities") or subordinated debt securities (the "Subordinated Debt
Securities") and (b) shares of common stock of the Company, par value $.01 per
share (the "Common Stock"), or any combination of the foregoing, either
individually or as units consisting of one or more of the foregoing, each on
terms to be determined at the time of sale. The Debt Securities may be issued as
exchangeable and/or convertible Debt Securities exchangeable for or convertible
into shares of Common Stock. The Company's payment obligations under any series
of Debt Securities may be guaranteed by Owens-Illinois Group, Inc., a wholly
owned subsidiary of the Company ("Group"). The Debt Securities, including any
guarantee of the Debt Securities, and the Common Stock are collectively referred
to herein as the "Securities." When a particular series of Securities is
offered, a supplement to this Prospectus (each a "Prospectus Supplement") will
be delivered with this Prospectus. The Prospectus Supplement will set forth the
terms of the offering and sale of the offered Securities.
Except as described more fully herein or as set forth in the Prospectus
Supplement relating to any offered Debt Securities, the Indenture (as herein
defined) will not provide holders of Debt Securities protection in the event of
a highly-leveraged transaction, reorganization, restructuring, merger or similar
transaction involving the Company which could adversely affect holders of Debt
Securities. See "Description of Debt Securities--Consolidation, Merger and Sale
of Assets."
The Company's Common Stock is traded on The New York Stock Exchange under
the symbol OI. Any Common Stock sold pursuant to a Prospectus Supplement will be
listed on The New York Stock Exchange. On April 11, 1997, the last reported sale
price of the Common Stock on The New York Stock Exchange was $23.75 per share.
The Company has not yet determined whether any of the Debt Securities offered
hereby will be listed on any exchange or over-the-counter market. If the Company
decides to seek listing of any such Securities, the Prospectus Supplement
relating thereto will disclose such exchange or market.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
------------------------
The Securities will be sold directly, through agents, underwriters or
dealers as designated from time to time, or through a combination of such
methods. The Company reserves the sole right to accept, and together with its
agents, from time to time, to reject in whole or in part any proposed purchase
of Securities to be made directly or through agents. If agents of the Company or
any dealers or underwriters are involved in the sale of the Securities in
respect of which this Prospectus is being delivered, the names of such agents,
dealers or underwriters and any applicable commissions or discounts will be set
forth in or may be calculated from the Prospectus Supplement with respect to
such Securities. See "Plan of Distribution" for possible indemnification
arrangements with agents, dealers and underwriters.
<PAGE>
This Prospectus may not be used to consummate sales of Securities unless
accompanied by the applicable Prospectus Supplement.
The date of this Prospectus is , 1997.
<PAGE>
AVAILABLE INFORMATION
The Company and Group have filed with the Securities and Exchange Commission
(the "Commission") a Registration Statement on Form S-3 (together with all
amendments and exhibits thereto, the "Registration Statement") under the
Securities Act of 1933, as amended (the "Securities Act"), with respect to the
Securities offered hereby. This Prospectus does not contain all of the
information set forth in the Registration Statement, part of which has been
omitted in accordance with the rules and regulations of the Commission. For
further information about the Company, Group and the Securities offered hereby,
reference is made to the Registration Statement, including the exhibits filed as
a part thereof and otherwise incorporated therein. Statements made in this
Prospectus as to the contents of any agreement or other document referred to
herein are qualified by reference to the copy of such agreement or other
document filed as an Exhibit to the Registration Statement or such other
document, each such statement being qualified in its entirety by such reference.
Each of the Company and Group is subject to the informational requirements
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and, in
accordance therewith, files periodic reports, proxy statements and other
information with the Commission. The Registration Statement, including the
exhibits thereto, as well as such reports and other information filed by the
Company and Group with the Commission, can be inspected, without charge, and
copied at the public reference facilities maintained by the Commission at 450
Fifth Street, N.W., Room 1024, Washington D.C., 20549; 7 World Trade Center, New
York, New York 10048 and 500 West Madison Street, Suite 1400, Chicago, Illinois
60661. The Commission also maintains a site on the World Wide Web at
http://www.sec.gov, that contains reports, proxy and other information regarding
registrants that file electronically with the Commission and certain of the
Company's and Group's filings are available at such web site. Copies of such
materials can be obtained from the Public Reference Section of the Commission at
450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates. Reports and
other information concerning the Company can also be inspected at the offices of
the New York Stock Exchange, 20 Broad Street, New York, New York 10005.
INFORMATION INCORPORATED BY REFERENCE
The following documents filed with the Commission pursuant to the Exchange
Act are incorporated by reference in this Prospectus:
(1) the Company's and Group's Annual Report on Form 10-K for the year
ended December 31, 1996;
(2) the Company's and Group's Current Report on Form 8-K filed with the
Commission on December 31, 1996, as amended by Form 8-K/A filed with the
Commission on March 3, 1997;
(3) the Company's and Group's Current Report on Form 8-K filed with the
Commission on March 31, 1997;
(4) the description of the Common Stock contained in the Company's
Registration Statement on Form 8-A filed on December 3, 1991, as amended;
(5) all other documents subsequently filed by the Company or Group
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the
date of this Prospectus and before the termination of the offering, which
shall be deemed to be a part hereof from the date of filing of such
documents.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any other subsequently filed document which also is incorporated or deemed
to be incorporated by reference herein modifies or supersedes such statement.
Any such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
2
<PAGE>
This Prospectus may not be used to consummate sales of offered securities
unless accompanied by a Prospectus Supplement. The delivery of this Prospectus
together with a Prospectus Supplement relating to particular offered Securities
in any jurisdiction shall not constitute an offer in the jurisdiction of any
other securities covered by this Prospectus.
The Company will provide without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, upon request, a copy of
any documents incorporated into this Prospectus by reference (other than
exhibits incorporated by reference into such document). Requests for documents
should be submitted to the Corporate Secretary, Owens-Illinois, Inc., One
SeaGate, Toledo, Ohio 43666, (telephone (419) 247-5000). The information
relating to the Company contained in this Prospectus does not purport to be
comprehensive and should be read together with the information contained in the
documents incorporated or deemed to be incorporated by reference herein.
DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS
THIS PROSPECTUS, INCLUDING ANY DOCUMENTS THAT ARE INCORPORATED BY REFERENCE
AS SET FORTH IN "INFORMATION INCORPORATED BY REFERENCE," CONTAINS
FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES
ACT AND SECTION 21E OF THE EXCHANGE ACT. SUCH STATEMENTS ARE INDICATED BY WORDS
OR PHRASES SUCH AS "ANTICIPATE," "ESTIMATE," "PROJECTS," "MANAGEMENT BELIEVES,"
"THE COMPANY BELIEVES" AND SIMILAR WORDS OR PHRASES. SUCH STATEMENTS ARE SUBJECT
TO CERTAIN RISKS, UNCERTAINTIES OR ASSUMPTIONS. SHOULD ONE OR MORE OF THESE
RISKS OR UNCERTAINTIES MATERIALIZE, OR SHOULD UNDERLYING ASSUMPTIONS PROVE
INCORRECT, ACTUAL RESULTS MAY VARY MATERIALLY FROM THOSE ANTICIPATED, ESTIMATED
OR PROJECTED.
THE COMPANY
The Company, through its subsidiaries, is the successor to a business
established in 1903. The Company is one of the world's leading manufacturers of
packaging products. Approximately one of every two glass containers made
worldwide is made by the Company, its affiliates or licensees. In addition to
being the largest manufacturer of glass containers in the United States, North
America, South America and India, and the second largest in Europe with the
acquisition of Avir S.p.A., the Company is a leading manufacturer in the United
States of plastic containers, plastic closures, plastic prescription containers,
labels, and multipack plastic carriers for beverage containers. Since 1992,
through acquisitions and investments strategic to its core businesses, the
Company has furthered its market leadership position in the geographic areas in
which it competes. During the years 1993 through 1996, the Company has invested
more than $1.0 billion in capital expenditures alone (excluding acquisition
expenditures) to improve productivity and increase capacity in key locations.
Group is a wholly owned subsidiary of the Company. The principal offices of
the Company and Group are located at One SeaGate, Toledo, Ohio 43666, and the
telephone number of each is (419) 247-5000.
3
<PAGE>
USE OF PROCEEDS
Unless otherwise indicated in the applicable Prospectus Supplement, the
Company anticipates that any net proceeds would be used for general corporate
purposes, which may include but are not limited to working capital, capital
expenditures and acquisitions or the repayment or refinancing of the Company's
indebtedness, including the Company's $250.0 million Senior Subordinated Notes
which are redeemable at 100% of principal amount on and after April 1, 1997, and
the Company's remaining Senior Subordinated Notes, aggregating $700.0 million,
which are redeemable beginning on various dates throughout 1997, commencing June
15, 1997. The factors which the Company will consider in any refinancing will
include the number of shares of Common Stock and/or the amount and
characteristics of any Debt Securities issued and may include, among others, the
impact of such refinancing on the Company's liquidity, debt-to-capital ratio and
earnings per share. When a particular series of Securities is offered, the
Prospectus Supplement relating thereto will set forth the Company's intended use
for the net proceeds received from the sale of such Securities. Pending the
application of the net proceeds, the Company expects to invest such proceeds in
short-term, interest-bearing instruments or other investment-grade securities or
to reduce indebtedness under its Bank Credit Agreement.
RATIOS OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratio of earnings to fixed charges of the
Company for the periods indicated.
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
--------------------------------
<S> <C> <C> <C> <C> <C>
1996 1995 1994 1993 1992
---- ---- ---- ---- ----
Ratio of earnings to fixed charges (a).................................................... 2.0 1.9 1.5 (b) 1.5
</TABLE>
- ------------------------
(a) For the purpose of calculating the ratio of earnings to fixed charges,
earnings consist of income before income taxes and fixed charges. Fixed
charges include interest expense and that portion of rentals representative
of an interest factor.
(b) Earnings of the Company were insufficient to cover fixed changes for the
year ended December 31, 1993 in the amount of $292.0 million due to a $250.0
million charge in the fourth quarter of 1993 principally related to the
Company's restructuring program and a $325.0 million charge in the fourth
quarter of 1993 for estimated uninsured future asbestos-related costs.
4
<PAGE>
DESCRIPTION OF DEBT SECURITIES
The following description sets forth certain general terms and provisions of
the Debt Securities to which any Prospectus Supplement may relate. The
particular terms of the Debt Securities offered by any Prospectus Supplement,
and the extent, if any, to which such general provisions do not apply to the
Debt Securities so offered, will be described in the Prospectus Supplement
relating to such Debt Securities.
Debt Securities may be issued from time to time in series under an
indenture, and one or more indentures supplemental thereto (collectively, the
"Indenture"), between the Company and a trustee to be identified in the
applicable Prospectus Supplement (the "Trustee"). The terms of the Debt
Securities will include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939 (the "TIA") as in
effect on the date of the Indenture. The Debt Securities will be subject to all
such terms, and potential purchasers of the Debt Securities are referred to the
Indenture and the TIA for a statement thereof. The following summary of certain
provisions of the Indenture does not purport to be complete and is qualified in
its entirety by reference to the Indenture, including the definitions therein of
certain terms used below. A copy of the proposed form of Indenture has been
filed as an exhibit to the Registration Statement of which this Prospectus is a
part. As used under this caption, unless the context otherwise requires,
"Offered Debt Securities" shall mean the Debt Securities offered by this
Prospectus and an accompanying Prospectus Supplement.
GENERAL
The Indenture will provide for the issuance of Debt Securities in series and
will not limit the principal amount of Debt Securities which may be issued
thereunder. In addition, except as may be provided in the Prospectus Supplement
relating to such Debt Securities, the Indenture will not limit the amount of
additional indebtedness the Company may incur.
The applicable Prospectus Supplement or Prospectus Supplements will describe
the following terms of the series of Offered Debt Securities in respect of which
this Prospectus is being delivered: (1) the title of the Offered Debt
Securities; (2) whether the Offered Debt Securities are Senior Debt Securities,
Senior Subordinated Debt Securities or Subordinated Debt Securities or any
combination thereof; (3) the price or prices (expressed as a percentage of the
aggregate principal amount therof) at which the Offered Debt Securities will be
issued; (4) any limit upon the aggregate principal amount of the Offered Debt
Securities; (5) the date or dates on which the principal of the Offered Debt
Securities is payable; (6) the rate or rates (which may be fixed or variable) at
which the Offered Debt Securities will bear interest, if any, or the manner in
which such rate or rates are determined; (7) the date or dates from which any
such interest will accrue, the interest payment dates on which any such interest
on the Offered Debt Securities will be payable and the record dates for the
determination of holders to whom such interest is payable; (8) the place or
places where the principal of and any interest on the Offered Debt Securities
will be payable; (9) the obligation of the Company, if any, to redeem,
repurchase or repay the Offered Debt Securities in whole or in part pursuant to
any sinking fund or analogous provisions or at the option of the holders and the
price or prices at which and the period or periods within which and the terms
and conditions upon which the Offered Debt Securities shall be redeemed,
repurchased or repaid pursuant to such obligation; (10) the denominations in
which any Offered Debt Securities will be issuable, if other than denominations
of U.S. $1,000 and any integral multiple thereof; (11) if other than the
principal amount thereof, the portion of the principal amount of the Offered
Debt Securities of the series which will be payable upon declaration of the
acceleration of the maturity thereof; (12) any addition to or change in the
covenants which apply to the Offered Debt Securities; (13) any Events of Default
with respect to the Offered Debt Securities, if not otherwise set forth under
"Events of Default;" (14) whether the Offered Debt Securities will be issued in
whole or in part in global form, the terms and conditions, if any, upon which
such global Offered Debt Securities may be exchanged in whole or in part for
other individual securities, and the depositary for the Offered Debt Securities;
(15) the terms and conditions, if any, upon which the Offered Debt Securities
shall be exchanged for or converted into Common Stock; (16) the nature and terms
of the
5
<PAGE>
security for any secured Offered Debt Securities; (17) the form and terms of any
guarantee of the Offered Debt Securities; and (18) any other terms of the
Offered Debt Securities which terms shall not be inconsistent with the
provisions of the Indenture.
Debt Securities may be issued at a discount from their principal amount
("Original Issue Discount Securities"). Federal income tax considerations and
other special considerations applicable to any such Original Issue Discount
Securities will be described in the applicable Prospectus Supplement.
Debt Securities may be issued in bearer form, with or without coupons.
Federal income tax considerations and other special considerations applicable to
bearer securities will be described in the applicable Prospectus Supplement.
STATUS OF DEBT SECURITIES
The Senior Debt Securities will rank PARI PASSU with all other unsecured and
unsubordinated indebtedness of the Company.
The obligations of the Company pursuant to Senior Subordinated Debt
Securities will be subordinate in right of payment, to the extent and in the
manner set forth in the Indenture, to all Senior Indebtedness of the Company.
With respect to any series of Senior Subordinated Debt Securities, "Senior
Indebtedness" of the Company will be defined to mean the principal of, and
premium, if any, and any interest (including interest accruing subsequent to the
commencement of any proceeding for the bankruptcy or reorganization of the
Company under any applicable bankruptcy, insolvency or similar law now or
hereafter in effect) and all other monetary obligations of every kind or nature
due on or in connection with (a) all indebtedness of the Company whether
heretofore or hereafter incurred (i) for borrowed money or (ii) in connection
with the acquisition by the Company or a subsidiary of the Company of assets
other than in the ordinary course of business, for the payment of which the
Company is liable directly or indirectly by guarantee, letter of credit,
obligation to purchase or acquire or otherwise, or the payment of which is
secured by a lien, charge or encumbrance on assets acquired by the Company, (b)
amendments, modifications, renewals, extensions and deferrals of any such
indebtedness, and (c) any indebtedness issued in exchange for any such
indebtedness (clauses (a) through (c) hereof being collectively referred to
herein as "Debt"); provided, however, that the following will not constitute
Senior Indebtedness with respect to Senior Subordinated Debt Securities: (1) any
Debt as to which, in the instrument evidencing such Debt or pursuant to which
such Debt was issued, it is expressly provided that such Debt is subordinate in
right of payment to all Debt of the Company not expressly subordinated to such
Debt; (2) any Debt which by its terms refers explicitly to the Senior
Subordinated Debt Securities and states that such Debt shall not be senior in
right of payment; and (3) any Debt of the Company in respect of the Senior
Subordinated Debt Securities or any Subordinated Debt Securities.
The obligations of the Company pursuant to Subordinated Debt Securities will
be subordinate in right of payment to all Senior Indebtedness of the Company and
to any Senior Subordinated Debt Securities; provided, however, that the
following will not constitute Senior Indebtedness with respect to Subordinated
Debt Securities: (1) any Debt as to which, in the instrument evidencing such
Debt or pursuant to which such Debt was issued, it is expressly provided that
such Debt is subordinate in right of payment to all Debt of the Company not
expressly subordinated to such Debt; and (2) any Debt of the Company in respect
of Subordinated Debt Securities and any Debt which by its terms refers
explicitly to the Subordinated Debt Securities and states that such Debt shall
not be senior in right of payment.
No payment pursuant to the Senior Subordinated Debt Securities or the
Subordinated Debt Securities, as the case may be, may be made unless all amounts
of principal, premium, if any, and interest then due on all applicable Senior
Indebtedness of the Company shall have been paid in full or if there shall have
occurred and be continuing beyond any applicable grace period a default in any
payment with respect to any such Senior Indebtedness, or if there shall have
occurred any event of default with respect to any such Senior Indebtedness
permitting the holders thereof to accelerate the maturity thereof, or if any
judicial
6
<PAGE>
proceeding shall be pending with respect to any such default. However, the
Company may make payments pursuant to the Senior Subordinated Debt Securities or
the Subordinated Debt Securities, as the case may be, if a default in payment or
an event of default with respect to the Senior Indebtedness permitting the
holder thereof to accelerate the maturity thereof has occurred and is continuing
and judicial proceedings with respect thereto have not been commenced within a
certain number of days of such default in payment or event of default. Upon any
distribution of the assets of the Company upon dissolution, winding-up,
liquidation or reorganization, the holders of Senior Indebtedness of the Company
will be entitled to receive payment in full of principal, premium, if any, and
interest (including interest accruing subsequent to the commencement of any
proceeding for the bankruptcy or reorganization of the Company under any
applicable bankruptcy, insolvency or similar law now or hereafter in effect)
before any payment is made on the Senior Subordinated Debt Securities or
Subordinated Debt Securities, as applicable. By reason of such subordination, in
the event of insolvency of the Company, holders of Senior Indebtedness of the
Company may receive more, ratably, and holders of the Senior Subordinated Debt
Securities or Subordinated Debt Securities, as applicable, having a claim
pursuant to the Senior Subordinated Debt Securities or Subordinated Debt
Securities, as applicable, may receive less, ratably, than the other creditors
of the Company. Such subordination will not prevent the occurrence of any event
of default (an "Event of Default") in respect of the Senior Subordinated Debt
Securities or the Subordinated Debt Securities.
If the Company offers Debt Securities, the applicable Prospectus Supplement
will set forth the aggregate amount of outstanding indebtedness, if any, as of
the most recent practicable date that by the terms of such Debt Securities would
be senior to such Debt Securities. The applicable Prospectus Supplement will
also set forth any limitation on the issuance by the Company of any additional
senior indebtedness.
CONVERSION RIGHTS
The terms, if any, on which Debt Securities of a series may be exchanged for
or converted into shares of Common Stock or Preferred Stock will be set forth in
the Prospectus Supplement relating thereto.
EXCHANGE, REGISTRATION, TRANSFER AND PAYMENT
Unless otherwise specified in the applicable Prospectus Supplement, payment
of principal, premium, if any, and any interest on the Debt Securities will be
payable, and the exchange of and the transfer of Debt Securities will be
registerable, at the office of the Trustee or at any other office or agency
maintained by the Company for such purpose subject to the limitations of the
Indenture. Unless otherwise indicated in the applicable Prospectus Supplement,
the Debt Securities will be issued in denominations of U.S. $1,000 or integral
multiples thereof. No service charge will be made for any registration of
transfer or exchange of the Debt Securities, but the Company may require payment
of a sum sufficient to cover any tax or other governmental charge imposed in
connection therewith.
GLOBAL DEBT SECURITIES
The Debt Securities of a series may be issued in the form of one or more
Global Securities (the "Global Securities") that will be deposited with a
Depositary or its nominee identified in the applicable Prospectus Supplement. In
such a case, one or more Global Securities will be issued in a denomination or
aggregate denominations equal to the portion of the aggregate principal amount
of outstanding Debt Securities of the series to be represented by such Global
Security or Securities. Each Global Security will be deposited with such
Depositary or nominee or a custodian therefor and will bear a legend regarding
the restrictions on exchanges and registration of transfer thereof referred to
below and any such other matters as may be provided for pursuant to the
applicable Indenture.
7
<PAGE>
Notwithstanding any provision of the Indenture or any Debt Security
described herein, no Global Security may be transferred to, or registered or
exchanged for Debt Securities registered in the name of, any person or entity
other than the Depositary for such Global Security or any nominee of such
Depositary, and no such transfer may be registered, unless (i) the Depositary
has notified the Company that it is unwilling or unable to continue as
Depositary for such Global Security or has ceased to be qualified to act as such
as required by the applicable Indenture, (ii) the Company executes and delivers
to the Trustee an order that such Global Security shall be so transferable,
registrable and exchangeable, and such transfers shall be registrable, or (iii)
there shall exist such circumstances, if any, as may be described in the
applicable Prospectus Supplement. All Debt Securities issued in exchange for a
Global Security or any portion thereof will be registered in such names as the
Depositary may direct.
The specific terms of the depositary arrangement with respect to any portion
of a series of Debt Securities to be represented by a Global Security will be
described in the applicable Prospectus Supplement. The Company expects that the
following provisions will apply to depositary arrangements.
Unless otherwise specified in the applicable Prospectus Supplement, Debt
Securities which are to be represented by a Global Security to be deposited with
or on behalf of a Depositary will be represented by a Global Security registered
in the name of such Depositary or its nominee. Upon the issuance of such Global
Security, and the deposit of such Global Security with or on behalf of the
Depositary for such Global Security, the Depositary will credit, on its
book-entry registration and transfer system, the respective principal amounts of
the Debt Securities represented by such Global Security to the accounts of
institutions that have accounts with such Depositary or its nominee
("participants"). The accounts to be credited will be designated by the
underwriters or agents of such Debt Securities or by the Company, if such Debt
Securities are offered and sold directly by the Company. Ownership of beneficial
interests in such Global Security will be limited to participants or persons
that may hold interests through participants. Ownership of beneficial interests
by participants in such Global Security will be shown on, and the transfer of
that ownership interest will be effected only through, records maintained by the
Depositary or its nominee for such Global Security. Ownership of beneficial
interests in such Global Security by persons that hold through participants will
be shown on, and the transfer of that ownership interest within such participant
will be effected only through, records maintained by such participant. The laws
of some jurisdictions require that certain purchasers of securities take
physical delivery of such securities in certificated form. The foregoing
limitations and such laws may impair the ability to transfer beneficial
interests in such Global Securities.
So long as the Depositary for a Global Security, or its nominee, is the
registered owner of such Global Security, such Depositary or such nominee, as
the case may be, will be considered the sole owner or holder of the Debt
Securities represented by such Global Security for all purposes under the
Indenture. Unless otherwise specified in the applicable Prospectus Supplement,
owners of beneficial interests in such Global Security will not be entitled to
have Debt Securities of the series represented by such Global Security
registered in their names, will not receive or be entitled to receive physical
delivery of Debt Securities of such series in certified form and will not be
considered the holders thereof for any purposes under the Indenture.
Accordingly, each person owning a beneficial interest in such Global Security
must rely on the procedures of the Depositary and, if such person is not a
participant, on the procedures of the participant through which such person owns
its interest, to exercise any rights of a holder under the Indenture. If the
Company requests any action of holders or if an owner of a beneficial interest
in such Global Security desires to give any notice or take any action a holder
is entitled to give or take under the Indenture, the Depositary will authorize
the participants to give such notice or take such action, and participants would
authorize beneficial owners owning through such participants to give such notice
or take such action or would otherwise act upon the instructions of beneficial
owners owning through them.
Notwithstanding any other provisions to the contrary in the Indenture, the
rights of the beneficial owners of the Debt Securities to receive payment of the
principal and premium, if any, of and interest on such Debt Securities, on or
after the respective due dates expressed in such Debt Securities, or to
institute
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<PAGE>
suit for the enforcement of any such payment on or after such respective dates,
shall not be impaired or affected without the consent of the beneficial owners.
Principal of and any interest on a Global Security will be payable in the
manner described in the applicable Prospectus Supplement.
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Company may not consolidate with or merge with or into, or sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all of its
property or assets to any person unless (a) the Company is the surviving
corporation or the entity or the person formed by or surviving any such
consolidation or merger (if other than the Company) or to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have been
made is a corporation organized and existing under the laws of the United
States, any state thereof or the District of Columbia; (b) the entity or person
formed by or surviving any such consolidation or merger (if other than the
Company) or the entity or person to which such sale, assignment, transfer,
lease, conveyance or other disposition shall have been made assumes all the
obligations of the Company under the Debt Securities and the Indenture; and (c)
immediately prior to and after giving effect to the transaction, no Default (as
defined in the Indenture) or Event of Default shall have occurred and be
continuing.
CERTAIN OTHER COVENANTS
Unless otherwise indicated in this Prospectus or a Prospectus Supplement,
the Debt Securities will not have the benefit of any covenants that limit or
restrict the Company's business or operations, the pledging of the Company's
assets or the incurrence of indebtedness by the Company.
With respect to any series of Senior Subordinated Debt Securities, the
Company will agree not to issue Debt which is, expressly by its terms,
subordinated in right of payment to any other Debt of the Company and which is
not expressly made PARI PASSU with, or subordinate and junior in right of
payment to, the Senior Subordinated Debt Securities.
The applicable Prospectus Supplement will describe any material covenants in
respect of a series of Debt Securities. Other than the covenants of the Company
included in the Indenture as described above or as described in the applicable
Prospectus Supplement, there are no covenants or other provisions in the
Indenture providing for a put or increased interest or otherwise that would
afford holders of Debt Securities additional protection in the event of a
recapitalization transaction, a change of control of the Company or a highly
leveraged transaction.
EVENTS OF DEFAULT
Unless otherwise specified in the applicable Prospectus Supplement, the
following will constitute Events of Default under the Indenture with respect to
Debt Securities of any series: (a) failure to pay principal of any Debt Security
of that series when due and payable at maturity, upon redemption or otherwise;
(b) failure to pay any interest on any Debt Security of that series when due,
and the Default continues for 30 days; (c) an Event of Default, as defined in
the Debt Securities of that series, occurs and is continuing, or the Company
fails to comply with any of its other agreements in the Debt Securities of that
series or in the Indenture with respect to that series and the Default continues
for the period and after the notice provided therein (and described below); and
(d) certain events of bankruptcy, insolvency or reorganization. A Default under
clause (c) above is not an Event of Default with respect to a particular series
of Debt Securities until the Trustee or the holders of at least 50% in principal
amount of the then outstanding Debt Securities of that series notify the Company
of the Default and the Company does not cure the Default within 30 days after
receipt of the notice. The notice must specify the Default, demand that it be
remedied and state that the notice is a "Notice of Default."
9
<PAGE>
If an Event of Default with respect to outstanding Debt Securities of any
series (other than an Event or Default relating to certain events of bankruptcy,
insolvency or reorganization) shall occur and be continuing, either the Trustee
or the holders of at least 50% in principal amount of the outstanding Debt
Securities of that series by notice, as provided in the Indenture, may declare
the unpaid principal amount (or, if the Debt Securities of that series are
Original Issue Discount Securities, such lesser amount as may be specified in
the terms of that series) of, and any accrued and unpaid interest on, all Debt
Securities of that series to be due and payable immediately. However, at any
time after a declaration of acceleration with respect to Debt Securities of any
series has been made, but before a judgment or decree based on such acceleration
has been obtained, the holders of a majority in principal amount of the
outstanding Debt Securities of that series may, under certain circumstances,
rescind and annul such acceleration. For information as to waiver of defaults,
see "Modification and Waiver" below.
The Indenture will provide that, subject to the duty of the Trustee during
an Event of Default to act with the required standard of care, the Trustee will
be under no obligation to exercise any of its rights or powers under the
applicable Indenture at the request or direction of any of the holders, unless
such holders shall have offered to the Trustee reasonable security or indemnity.
Subject to certain provisions, including those requiring security or
indemnification of the Trustee, the holders of a majority in principal amount of
the outstanding Debt Securities of any series will have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred on the Trustee, with
respect to the Debt Securities of that series.
The Company will be required to furnish to the Trustee under the Indenture
annually a statement as to the performance by the Company of its obligations
under that Indenture and as to any default in such performance.
MODIFICATION AND WAIVER
Subject to certain exceptions, the Company and the Trustee may amend the
Indenture or the Debt Securities with the written consent of the holders of a
majority in principal amount of the then outstanding Debt Securities of each
series affected by the amendment with each series voting as a separate class.
The holders of a majority in principal amount of the then outstanding Debt
Securities of any series may also waive compliance in a particular instance by
the Company with any provision of the Indenture with respect to the Debt
Securities of that series; provided, however, that without the consent of each
holder of Debt Securities affected, an amendment or waiver may not (i) reduce
the percentage of the principal amount of Debt Securities whose holders must
consent to an amendment or waiver; (ii) reduce the rate or change the time for
payment of interest on any Debt Security (including default interest); (iii)
reduce the principal of, premium, if any, or change the fixed maturity of any
Debt Security, or reduce the amount of, or postpone the date fixed for,
redemption or the payment of any sinking fund or analogous obligation with
respect thereto; (iv) make any Debt Security payable in currency other than that
stated in the Debt Security; (v) make any change in the provisions concerning
waivers of Default or Events of Default by holders or the rights of holders to
recover the principal of, premium, if any, or interest on, any Debt Security;
(vi) waive a default in the payment of the principal of, or interest on, any
Debt Security, except as otherwise provided in the Indenture or (vii) reduce the
principal amount of Original Issue Discount Securities payable upon acceleration
of the maturity thereof. The Company and the Trustee may amend the Indenture or
the Debt Securities without notice to or the consent of any holder of a Debt
Security: (i) to cure any ambiguity, defect or inconsistency; (ii) to comply
with the Indenture's provisions with respect to successor corporations; (iii) to
comply with any requirements of the Commission in connection with the
qualification of the Indenture under the TIA; (iv) to provide for Debt
Securities in addition to or in place of certificated Debt Securities; (v) to
add to, change or eliminate any of the provisions of the Indenture in respect of
one of more series of Debt Securities, provided, however, that any such
addition, change or elimination (A) shall neither (1) apply to any Debt Security
of any series created prior to the execution of such amendment and entitled to
the benefit of such provision, nor (2) modify the rights of a holder of any such
Debt Security
10
<PAGE>
with respect to such provision, or (B) shall become effective only when there is
no outstanding Debt Security of any series created prior to such amendment and
entitled to the benefit of such provision; (vi) to make any change that does not
adversely affect in any material respect the interest of any holder; or (vii) to
establish additional series of Debt Securities as permitted by the Indenture.
The holders of a majority in principal amount of the then outstanding Debt
Securities of any series, by notice to the Trustee, may waive an existing
Default or Event of Default and its consequences except a Default or Event of
Default in the payment of the principal of, or any interest on, any Debt
Security with respect to the Debt Securities of that series; provided, however,
that the holders of a majority in principal amount of the outstanding Debt
Securities of any series may rescind an acceleration and its consequences,
including any related payment default that resulted from such acceleration.
DEFEASANCE OF DEBT SECURITIES AND CERTAIN COVENANTS IN CERTAIN CIRCUMSTANCES
LEGAL DEFEASANCE. Unless otherwise specified in the applicable Prospectus
Supplement, the Indenture will provide that the Company may be discharged from
any and all obligations in respect of the Debt Securities of any series (except
for certain obligations to register the transfer or exchange of Debt Securities
of such series, to replace stolen, lost or mutilated Debt Securities of such
series, and to maintain paying agencies and certain provisions relating to the
treatment of funds held by paying agents) upon the deposit with the Trustee, in
trust, of money and/or U.S. government obligations, that, through the payment of
interest and principal in respect thereof in accordance with their terms, will
provide money in an amount sufficient in the opinion of a nationally recognized
firm of independent public accountants to pay and discharge each installment of
principal, premium, if any, and interest, if any, on and any mandatory sinking
fund payments in respect of the Debt Securities of such series on the stated
maturity of such payments in accordance with the terms of the Indenture and such
Debt Securities. Such discharge may occur only if, among other things, the
Company has received from, or there has been published by, the United States
Internal Revenue Service a ruling, or, since the date of execution of the
Indenture, there has been a change in the applicable United States federal
income tax law, in either case to the effect that holders of the Debt Securities
of such series will not recognize income, gain or loss for United States federal
income tax purposes as a result of such deposit, defeasance and discharge and
will be subject to United States federal income tax on the same amount and in
the same manner and at the same times as would have been the case if such
deposit, defeasance and discharge had not occurred.
DEFEASANCE OF CERTAIN COVENANTS. Unless otherwise specified in the
applicable Prospectus Supplement, the Indenture will provide that, upon
compliance with certain conditions, the Company may omit to comply with the
restrictive covenants contained in the Indenture, as well as any additional
covenants contained in a supplement to the Indenture, a Board Resolution or an
Officers' Certificate delivered pursuant thereto. The conditions include: the
deposit with the Trustee of money and/or U.S. government obligations, that,
through the payment of interest and principal in respect thereof in accordance
with their terms, will provide money in an amount sufficient in the opinion of a
nationally recognized firm of independent public accountants to pay principal,
premium, if any, and interest, if any, on and any mandatory sinking fund
payments in respect of the Debt Securities of such series on the stated maturity
of such payments in accordance with the terms of the Indenture and such Debt
Securities; and the delivery to the Trustee of an opinion of counsel to the
effect that the holders of the Debt Securities of such series will not recognize
income, gain or loss for United States federal income tax purposes as a result
of such deposit and related covenant defeasance and will be subject to United
States federal income tax in the same amount and in the same manner and at the
same times as would have been the case if such deposit and related covenant
defeasance had not occurred.
DEFEASANCE AND EVENTS OF DEFAULT. In the event the Company exercises its
option to omit compliance with certain covenants of the Indenture with respect
to any series of Debt Securities and the Debt Securities of such series are
declared due and payable because of the occurrence of any Event of Default, the
amount of money and/or U.S. government obligations on deposit with the Trustee
will be sufficient to pay amounts
11
<PAGE>
due on the Debt Securities of such series at the time of their stated maturity
but may not be sufficient to pay amounts due on the Debt Securities of such
series at the time of the acceleration resulting from such Event of Default.
However, the Company will remain liable for such payments.
GUARANTEES
The Company's payment obligation under any series of Debt Securities may be
guaranteed by Group. The terms of any such guarantees will be set forth in the
applicable Prospectus Supplement.
REGARDING THE TRUSTEES
The Trustee with respect to any series of Debt Securities will be identified
in the Prospectus Supplement relating to such Debt Securities. The Indenture and
provisions of the TIA incorporated by reference therein contain certain
limitations on the rights of the Trustee, should it become a creditor of the
Company, to obtain payment of claims in certain cases, or to realize on certain
property received in respect of any such claim, as security or otherwise. The
Trustee and its affiliates may engage in, and will be permitted to continue to
engage in, other transactions with the Company and its affiliates; PROVIDED,
HOWEVER, that if it acquires any conflicting interest (as defined in the TIA),
it must eliminate such conflict or resign.
The holders of a majority in principal amount of the then outstanding Debt
Securities of any series will have the right to direct the time, method and
place of conducting any proceeding for exercising any remedy available to the
Trustee. The TIA and the Indenture provide that in case an Event of Default
shall occur (and be continuing), the Trustee will be required, in the exercise
of its rights and powers, to use the degree of care and skill of a prudent man
in the conduct of his own affairs. Subject to such provision, the Trustee will
be under no obligation to exercise any of its rights or powers under the
Indenture at the request of any of the holders of the Debt Securities issued
thereunder, unless they have offered to the Trustee indemnity satisfactory to
it.
SECTION 203 OF THE DGCL
The Company is subject to the "business combination" statute of the Delaware
General Corporation Law (the "DGCL"), an anti-takeover law enacted in 1988. In
general, Section 203 of the DGCL prohibits a publicly-held Delaware corporation
from engaging in a "business combination" with an "interested stockholder," for
a period of three years after the date of the transaction in which a person
became an "interested stockholder," unless (i) prior to such date the board of
directors of the corporation approved either the "business combination" or the
transaction which resulted in the stockholder becoming an "interested
stockholder," (ii) upon consummation of the transaction which resulted in the
stockholder becoming an "interested stockholder," the "interested stockholder"
owned at least 85% of the voting stock of the corporation outstanding at the
time the transaction commenced, excluding for purposes of determining the number
of shares outstanding those shares owned (1) by persons who are directors and
also officers and (2) employee stock plans in which employee participants do not
have the right to determine confidentially whether shares held subject to the
plan will be tendered in a tender or exchange offer, or (iii) on or subsequent
to such date the "business combination" is approved by the board of directors
and authorized at an annual or special meeting of stockholders by the
affirmative vote of a least 66% of the outstanding voting stock which is not
owned by the "interested stockholder." A "business combination" includes
mergers, stock or asset sales and other transactions resulting in a financial
benefit to the "interested stockholders." An "interested stockholder" is a
person who, together with affiliates and associates, owns (or within three
years, did own) 15% or more of the corporation's voting stock. Although Section
203 permits the Company to elect not to be governed by its provisions, the
Company to date has not made this election. As a result of the application of
Section 203, potential acquirors of the Company may be discouraged from
attempting to effect an acquisition transaction with the Company, thereby
12
<PAGE>
possibly depriving holders of the Company's securities of certain opportunities
to sell or otherwise dispose of such securities at above-market prices pursuant
to such transactions.
PLAN OF DISTRIBUTION
The Company may sell the Securities to one or more underwriters for public
offering and sale by them and may also sell the Securities to investors directly
or through agents. Any such underwriter, or agent involved in the offer and sale
of Securities will be named in the applicable Prospectus Supplement. The Company
has reserved the right to sell or exchange Securities directly to investors on
its own behalf in those jurisdictions where and in such manner as it is
authorized to do so.
The distribution of the Securities may be effected from time to time in one
or more transactions at a fixed price or prices, which may be changed, or at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices, or at negotiated prices. Sales of Common Stock offered
hereby may be effected from time to time in one or more transactions on the New
York Stock Exchange or in negotiated transactions or a combination of such
methods. The Company may also, from time to time, authorize dealers, acting as
the Company's agents, to offer and sell Securities upon the terms and conditions
as are set forth in the applicable Prospectus Supplement. In connection with the
sale of Securities, underwriters may receive compensation from the Company in
the form of underwriting discounts or commissions and may also receive
commissions from purchasers of the Securities for whom they may act as agent.
Underwriters may sell Securities to or through dealers, and such dealers may
receive compensation in the form of discounts, concessions or commissions from
the underwriters and/or commissions from the purchasers for whom they may act as
agent. Any such underwriter, dealer or agent will be identified, and any such
compensation received from the Company will be described, in the Prospectus
Supplement. Unless otherwise indicated in a Prospectus Supplement, an agent will
be acting on a best efforts basis and a dealer will purchase Securities as a
principal, and may then resell such Securities at varying prices to be
determined by the dealer.
Any underwriting compensation paid by the Company to underwriters or agents
in connection with the offering of Securities, and any discounts, concessions or
commissions allowed by underwriters to participating dealers, will be set forth
in the applicable Prospectus Supplement. Dealers and agents participating in the
distribution of Securities may be deemed to be underwriters, and any discounts
and commissions received by them and any profit realized by them on resale of
the Securities may be deemed to be underwriting discounts and commissions.
Underwriters, dealers and agents may be entitled, under agreements entered into
with the Company, to indemnification against and contribution toward certain
civil liabilities, including liabilities under the Securities Act, and to
reimbursement by the Company for certain expenses.
To facilitate an offering of a series of Securities, certain persons
participating in the offering may engage in transactions that stabilize,
maintain, or otherwise affect the price of the Securities. This may include
over-allotments or short sales of the Securities, which involves the sale by
persons participating in the offering of more Securities than have been sold to
them by the Company. In such circumstances, such persons would cover such
over-allotments or short positions by purchasing in the open market or by
exercising the over-allotment option granted to such persons. In addition, such
persons may stabilize or maintain the price of the Securities by bidding for or
purchasing Securities in the open market or by imposing penalty bids, whereby
selling concessions allowed to dealers participating in any such offering may be
reclaimed if Securities sold by them are repurchased in connection with
stabilization transactions. The effect of these transactions may be to stabilize
or maintain the market price of the Securities at a level above that which might
otherwise prevail in the open market. Such transactions, if commenced, may be
discontinued at any time.
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Certain of the underwriters, dealers or agents and their associates may
engage in transactions with and perform services for the Company in the ordinary
course of business, including refinancing of the Company's indebtedness. See
"Use of Proceeds."
LEGAL MATTERS
Certain legal matters with respect to the Securities offered hereby will be
passed upon for the Company by Latham & Watkins, San Francisco, California.
Certain legal matters will be passed upon for any agents or underwriters by
counsel for such agents or underwriters identified in the applicable Prospectus
Supplement. Certain partners of Latham & Watkins, members of their families,
related persons and others, have an indirect interest, through limited
partnerships, in less than 1% of the Common Stock. Such persons do not have the
power to vote or dispose of such shares of Common Stock.
EXPERTS
The consolidated financial statements of Owens-Illinois, Inc. appearing in
the Company's and Group's Annual Report (Form 10-K) for the year ended December
31, 1996, have been audited by Ernst & Young LLP, independent auditors, as set
forth in their report thereon included therein and incorporated herein by
reference. Such consolidated financial statements are incorporated herein by
reference in reliance upon such report given upon the authority of such firm as
experts in accounting and auditing.
The consolidated financial statements of Avir Finanziaria S.p.A. and
subsidiaries as of and for the year ended December 31, 1995, appearing in the
Form 8-K/A of Owens-Illinois, Inc., dated March 3, 1997, have been audited by
KPMG S.p.A., independent auditors, as set forth in their report thereon included
therein and incorporated herein by reference. Such consolidated financial
statements are incorporated herein by reference in reliance upon such report
given upon the authority of such firm as experts in accounting and auditing.
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NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED IN
THIS PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST
NOT BE RELIED UPON AS HAVING BEEN SO AUTHORIZED. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY BY ANYONE IN
ANY JURISDICTION IN WHICH SUCH OFFER TO SELL IS NOT AUTHORIZED, OR IN WHICH THE
PERSON IS NOT QUALIFIED TO DO SO OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE
SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS
BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
---------
<S> <C>
Available Information.......................... 2
Information Incorporated by Reference.......... 2
The Company.................................... 3
Use of Proceeds................................ 4
Ratios of Earnings to Fixed Charges............ 4
Description of Debt Securities................. 5
Section 203 of the DGCL........................ 12
Plan of Distribution........................... 13
Legal Matters.................................. 14
Experts........................................ 14
</TABLE>
[LOGO]
OWENS-ILLINOIS, INC.
DEBT SECURITIES
COMMON STOCK
---------------------
PROSPECTUS
---------------------
, 1997
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<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The expenses to be paid by the Company in connection with the distribution
of the securities being registered are as set forth in the following table:
<TABLE>
<S> <C>
Securities and Exchange Commission Fee.......................... $ 757,576
*Rating Agency Fees............................................. 150,000
*Legal Fees and Expenses........................................ 400,000
*Accounting Fees and Expenses................................... 75,000
*Printing Expenses.............................................. 250,000
*Blue Sky Fees.................................................. 15,000
*Trustee/Issuing & Paying Agent Fees and Expenses............... 20,000
*Transfer Agent Fees & Expenses................................. 20,000
*Miscellaneous.................................................. 62,424
---------
*Total.................................................... $1,750,000
---------
---------
</TABLE>
- ------------------------
* Estimated.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company and Group are Delaware corporations. Subsection (b)(7) of
Section 102 of the Delaware General Corporation Law (the "DGCL"), enables a
corporation in its original certificate of incorporation or an amendment thereto
to eliminate or limit the personal liability of a director to the corporation or
its stockholders for monetary damages for violations of the director's fiduciary
duty, except (i) for any breach of the director's duty of loyalty to the
corporation or its stockholders, (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (iii)
pursuant to Section 174 of the DGCL (providing for liability of directors for
unlawful payment of dividends or unlawful stock purchases or redemptions) or
(iv) for any transaction from which a director derived an improper personal
benefit.
Subsection (a) of Section 145 of the DGCL empowers a corporation to
indemnify any director or officer, or former director or officer, who was or is
a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the corporation),
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred in connection with such action,
suit or proceeding provided that such director or officer acted in good faith in
a manner reasonably believed to be in, or not opposed to, the best interests of
the corporation, and, with respect to any criminal action or proceeding,
provided further that such director or officer had no reasonable cause to
believe his conduct was unlawful.
Subsection (b) of Section 145 empowers a corporation to indemnify any
director or officer, or former director or officer, who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the corporation to procure a judgment in its favor by
reason of the fact that such person acted in any of the capacities set forth
above, against expenses (including attorneys' fees) actually and reasonably
incurred in connection with the defense or settlement of such action or suit
provided that such director or officer acted in good faith and in a manner
reasonably believed to be in, or not opposed to, the best interests of the
corporation, except that no indemnification may be made in respect to any claim,
issue or matter as to which such director or officer shall have been
II-1
<PAGE>
adjudged to be liable to the corporation unless and only to the extent that the
Court of Chancery or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but in
view of all of the circumstances of the case, such director or officer is fairly
and reasonably entitled to indemnity for such expenses which the Court of
Chancery or such other court shall deem proper.
Section 145 further provides that to the extent a director or officer of a
corporation has been successful in the defense of any action, suit or proceeding
referred to in subsections (a) and (b) or in the defense of any claim, issue or
matter therein, he shall be indemnified against expenses (including attorneys
fees) actually and reasonably incurred by him in connection therewith; that
indemnification and advancement of expenses provided for, by, or granted
pursuant to Section 145 shall not be deemed exclusive of any other rights to
which the indemnified party may be entitled; and empowers the corporation to
purchase and maintain insurance on behalf of a director or officer of the
corporation against any liability asserted against him or incurred by him in any
such capacity, or arising out of his status as such, whether or not the
corporation would have the power to indemnify him against such liabilities under
Section 145.
Article VII of the Restated Certificate of Incorporation (filed as Exhibit
3.1) of the Company provides for the elimination of liability of directors to
the extent permitted by Section 102(b)(7) of the DGCL. Article III, Section 13
of the By-Laws of the Company (filed as Exhibit 3.2) provides for
indemnification of the officers and directors of the Company to the extent
permitted by applicable law. Section 8 of the Certificate of Incorporation, as
amended (filed as Exhibit 3.3), of Group provides for the elimination of
liability of directors to the extent permitted by Section 102(b)(7) of the DGCL.
Article III, Section 13 of the By-laws of Group (filed as Exhibit 3.4) provides
for indemnification of the officers and directors of the Company to the extent
permitted by applicable law.
The Company has in effect insurance policies in the amount of $60 million
covering all of its and Group's directors and officers.
II-2
<PAGE>
ITEM 16. EXHIBITS
<TABLE>
<S> <C>
*1.1 Form of Underwriting Agreement
3.1 Restated Certificate of Incorporation of Owens-Illinois, Inc., which was filed as
Exhibit 3.1 to the Registration Statement, File No. 33-43224, and is incorporated by
reference herein.
3.2 Bylaws of Owens-Illinois, Inc., as amended, which were filed as Exhibit 3.2 to the
Registration Statement, File No. 33-43224, and are incorporated by reference herein.
3.3 Certificate of Incorporation of Owens-Illinois Group, Inc., as amended, which was
filed as Exhibit 3.4 to the Registration Statement, File No. 33-13061, and is
incorporated by reference herein.
3.4 By-laws of Owens-Illinois Group, Inc., which were filed as Exhibit 3.5 to the
Registration Statement, File No. 33-13061, and are incorporated by reference herein.
4.1 Form of Indenture.
5 Opinion of Latham & Watkins.
12 Statement regarding Computation of Ratios.
23.1 Consent of Ernst & Young LLP.
23.2 Consent of KPMG S.p.A.
23.3 Consent of Latham & Watkins (included in Exhibit 5).
23.4 Consent of McCarter & English.
24 Powers of Attorney (contained on Page II-5).
</TABLE>
- ------------------------
* To be filed by a report on Form 8-K pursuant to Regulation S-K, Item 601(b).
ITEM 17. UNDERTAKINGS
(a) The undersigned Registrants hereby undertake:
(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) if, in the aggregate, the changes in volume and
price represent no more than a 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee" table in
the effective registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement; provided,
however, that the information required to be included in a post-effective
amendment by paragraphs (a)(1)(i) and (a)(1)(ii) above may be contained in
periodic reports filed by
II-3
<PAGE>
the Registrants pursuant to Section 13 or 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 Registrants hereby undertake that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrants' annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 and (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.
(h) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrants pursuant to the foregoing provisions or otherwise, the
Registrants have 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 Registrants of expenses incurred or paid by a director, officer or
controlling person of the Registrants 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 Registrants will, unless
in the opinion of their 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.
(j) The undersigned Registrants hereby undertake to file an application for
the purpose of determining the eligibility of the trustee to act under
Subsection (a) of Section 310 of the Trust Indenture Act (the "Act") in
accordance with the rules and regulations prescribed by the Commission under
Section 305(b)(2) of the Act.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, each of the
Registrants certify 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 Toledo, Ohio on April 14, 1997.
OWENS-ILLINOIS, INC.
OWENS-ILLINOIS GROUP, INC.
BY /S/ THOMAS L. YOUNG
-----------------------------------------
Thomas L. Young
EXECUTIVE VICE PRESIDENT-ADMINISTRATION,
GENERAL COUNSEL AND SECRETARY
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears
below does hereby constitute and appoint Thomas L. Young and Lee A. Wesselmann,
and each of them, with full power of substitution and full power to act without
the other, his true and lawful attorney-in-fact and agent
to act for him in his name, place and stead, in any and all capacities, to sign
a registration statement on Form S-3 and any or all amendments thereto
(including without limitation any post-effective amendments thereto), and any
registration statement for the same offering that is to be effective under Rule
462(b) of the Securities Act, and to file each of 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 in order to
effectuate the same as fully, to all intents and purposes, as they or he might
or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, may lawfully do or cause to be
done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by each of the following persons in the
capacities and on the dates indicated.
SIGNATURE TITLE DATE
- ------------------------------ --------------------------- -------------------
Chairman of the Board, April 14, 1997
/s/ JOSEPH H. LEMIEUX Chief Executive Officer
- ------------------------------ and Director (Principal
(Joseph H. Lemieux) Executive Officer)
Senior Vice President, April 14, 1997
Chief Financial Officer
/s/ LEE A. WESSELMANN and Director (Principal
- ------------------------------ Financial Officer and
(Lee A. Wesselmann) Principal Accounting
Officer)
/s/ ROBERT J. DINEEN Director April 14, 1997
- ------------------------------
(Robert J. Dineen)
/s/ EDWARD A. GILHULY Director April 14, 1997
- ------------------------------
(Edward A. Gilhuly)
II-5
<PAGE>
SIGNATURE TITLE DATE
- ------------------------------ --------------------------- -------------------
/s/ JAMES H. GREENE, JR. Director April 14, 1997
- ------------------------------
(James H. Greene, Jr.)
/s/ HENRY R. KRAVIS Director April 14, 1997
- ------------------------------
(Henry R. Kravis)
/s/ ROBERT J. LANIGAN Director April 14, 1997
- ------------------------------
(Robert J. Lanigan)
/s/ ROBERT I. MACDONNELL Director April 14, 1997
- ------------------------------
(Robert I. MacDonnell)
Director April 14, 1997
- ------------------------------
(John J. McMackin, Jr.)
/s/ MICHAEL W. MICHELSON Director April 14, 1997
- ------------------------------
(Michael W. Michelson)
/s/ GEORGE R. ROBERTS Director April 14, 1997
- ------------------------------
(George R. Roberts)
II-6
<PAGE>
EXHIBIT INDEX
<TABLE>
<C> <S>
*1.1 Form of Underwriting Agreement
3.1 Restated Certificate of Incorporation of Owens-Illinois, Inc., which was filed as
Exhibit 3.1 to the Registration Statement, File No. 33-43224, and is incorporated by
reference herein.
3.2 Bylaws of Owens-Illinois, Inc., as amended, which were filed as Exhibit 3.2 to the
Registration Statement, File No. 33-43224, and are incorporated by reference herein.
3.3 Certificate of Incorporation of Owens-Illinois Group, Inc., as amended, which was
filed as Exhibit 3.4 to the Registration Statement, File No. 33-13061, and is
incorporated by reference herein.
3.4 By-laws of Owens-Illinois Group, Inc., which were filed as Exhibit 3.5 to the
Registration Statement, File No. 33-13061, and are incorporated by reference herein.
4.1 Form of Indenture.
5 Opinion of Latham & Watkins.
12 Statement regarding Computation of Ratios.
23.1 Consent of Ernst & Young LLP.
23.2 Consent of KPMG S.p.A.
23.3 Consent of Latham & Watkins (included in Exhibit 5).
23.4 Consent of McCarter & English.
24 Powers of Attorney (contained on Page II-5).
</TABLE>
- ------------------------
* To be filed by a report on Form 8-K pursuant to Regulation S-K, Item 601(b)
<PAGE>
OWENS-ILLINOIS, INC.,
as Issuer
and
[ ],
as Trustee
----------------
INDENTURE
dated as of _________, 1997
----------------
<PAGE>
CROSS-REFERENCE TABLE*
<TABLE>
<CAPTION>
TRUST INDENTURE
ACT SECTION INDENTURE SECTION
- --------------------- -----------------
<S> <C>
310(a)(1)...................................... 7.10
(a)(2)...................................... 7.10
(a)(3)...................................... N.A.
(a)(4)...................................... N.A.
(a)(5)...................................... 7.10
(b)......................................... 7.08; 7.10
(c)......................................... N.A.
311(a)......................................... 7.11
(b)......................................... 7.11
(c)......................................... N.A.
312(a)......................................... 2.05
(b)......................................... 10.03
(c)......................................... 10.03
313(a)......................................... 7.06
(b)......................................... 7.06
(c)......................................... 7.06; 10.02
(d)......................................... 7.06
314(a)......................................... 4.03; 10.02
(b)......................................... N.A.
(c)(1)...................................... 10.04
(c)(2)...................................... 10.04
(c)(3)...................................... N.A.
(d)......................................... N.A.
(e)......................................... 10.05
(f)......................................... N.A.
315(a)......................................... 7.01(b)(ii)
(b)......................................... 7.05; 10.02
(c)......................................... 7.01(a)
(d)......................................... 7.01(d)
(e)......................................... 6.11
316(a)(last sentence).......................... 2.09
(a)(1)(A)................................... 6.05
(a)(1)(B)................................... 6.04
(a)(2)...................................... N.A.
(b)......................................... 6.07
(c)......................................... 2.13; 9.03
317(a)(1)...................................... 6.08
(a)(2)...................................... 6.09
(b)......................................... 2.04
318(a)......................................... 10.01
(b)......................................... N.A.
(c)......................................... 10.01
</TABLE>
N.A. means not applicable.
- --------------------------
* This Cross-Reference Table is not part of the Indenture.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE....................................... 1
Section 1.01. Certain Definitions...................................................... 1
Section 1.02. Other Definitions........................................................ 4
Section 1.03. Incorporation by Reference of Trust Indenture Act........................ 4
Section 1.04. Rules of Construction.................................................... 4
ARTICLE 2 THE SECURITIES................................................................... 5
Section 2.01. Unlimited In Amount, Issuable In Series, Form and Dating................. 5
Section 2.02. Execution and Authentication............................................. 7
Section 2.03. Registrar and Paying Agent............................................... 7
Section 2.04. Paying Agent to Hold Money in Trust...................................... 7
Section 2.05. Securityholder Lists..................................................... 8
Section 2.06. Transfer and Exchange.................................................... 8
Section 2.07. Replacement Securities................................................... 9
Section 2.08. Outstanding Securities................................................... 9
Section 2.09. Treasury Securities...................................................... 10
Section 2.10. Temporary Securities..................................................... 10
Section 2.11. Cancellation............................................................. 10
Section 2.12. Defaulted Interest....................................................... 10
Section 2.13. Special Record Dates..................................................... 11
ARTICLE 3 REDEMPTION....................................................................... 11
Section 3.01. Notices to Trustee....................................................... 11
Section 3.02. Selection of Securities to Be Redeemed................................... 12
Section 3.03. Notice of Redemption..................................................... 12
Section 3.04. Effect of Notice of Redemption........................................... 13
Section 3.05. Deposit of Redemption Price.............................................. 13
Section 3.06. Securities Redeemed in Part.............................................. 13
ARTICLE 4 COVENANTS........................................................................ 13
Section 4.01. Payment of Securities.................................................... 13
Section 4.02. Maintenance of Office or Agency.......................................... 14
Section 4.03. Commission Reports....................................................... 14
Section 4.04. Compliance Certificate................................................... 15
Section 4.05. Taxes.................................................................... 15
Section 4.06. Stay, Extension and Usury Laws........................................... 15
Section 4.07. Corporate Existence...................................................... 15
ARTICLE 5 SUCCESSORS....................................................................... 16
Section 5.01. When Company May Merge, etc.............................................. 16
Section 5.02. Successor Corporation Substituted........................................ 16
ARTICLE 6 DEFAULTS AND REMEDIES............................................................ 17
Section 6.01. Events of Default........................................................ 17
Section 6.02. Acceleration............................................................. 18
</TABLE>
S-2
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Section 6.03. Other Remedies.......................................................... 18
Section 6.04. Waiver of Past Defaults................................................. 19
Section 6.05. Control by Majority..................................................... 19
Section 6.06. Limitation on Suits..................................................... 19
Section 6.07. Rights of Holders to Receive Payment.................................... 20
Section 6.08. Collection Suit by Trustee.............................................. 20
Section 6.09. Trustee May File Proofs of Claim........................................ 20
Section 6.10. Priorities.............................................................. 20
Section 6.11. Undertaking for Costs................................................... 21
ARTICLE 7 TRUSTEE.......................................................................... 21
Section 7.01. Duties of Trustee....................................................... 21
Section 7.02. Rights of Trustee....................................................... 22
Section 7.03. Individual Rights of Trustee............................................ 23
Section 7.04. Trustee's Disclaimer.................................................... 23
Section 7.05. Notice of Defaults...................................................... 23
Section 7.06. Reports by Trustee to Holders........................................... 23
Section 7.07. Compensation and Indemnity.............................................. 24
Section 7.08. Replacement of Trustee.................................................. 24
Section 7.09. Successor Trustee by Merger, etc........................................ 26
Section 7.10. Eligibility; Disqualification........................................... 26
Section 7.11. Preferential Collection of Claims Against
Company................................................................ 26
ARTICLE 8 SATISFACTION AND DISCHARGE; DEFEASANCE........................................... 26
Section 8.01. Satisfaction and Discharge of Indenture .................................26
Section 8.02. Application of Trust Funds; Indemnification ............................ 28
Section 8.03. Legal Defeasance of Securities of any Series............................ 28
Section 8.04. Covenant Defeasance..................................................... 30
Section 8.05. Repayment to Company.................................................... 31
ARTICLE 9 SUPPLEMENTS, AMENDMENTS AND WAIVERS.............................................. 31
Section 9.01. Without Consent of Holders.............................................. 31
Section 9.02. With Consent of Holders................................................. 32
Section 9.03. Revocation and Effect of Consents....................................... 33
Section 9.04. Notation on or Exchange of Securities................................... 33
Section 9.05. Trustee to Sign Amendments, etc......................................... 34
ARTICLE 10 MISCELLANEOUS................................................................... 34
Section 10.01. Indenture Subject to Trust Indenture Act................................ 34
Section 10.02. Notices................................................................. 34
Section 10.03. Communication By Holders With Other Holders............................. 35
Section 10.04. Certificate and Opinion as to Conditions
Precedent.............................................................. 35
Section 10.05. Statements Required in Certificate or Opinion........................... 35
Section 10.06. Rules by Trustee and Agents............................................. 36
Section 10.07. Legal Holidays.......................................................... 36
Section 10.08. No Recourse Against Others.............................................. 36
Section 10.09. Counterparts............................................................ 36
</TABLE>
S-3
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Section 10.10. Governing Law........................................................... 36
Section 10.11. Severability............................................................ 36
Section 10.12. Effect of Headings, Table of Contents, etc.............................. 37
Section 10.13. Successors and Assigns.................................................. 37
Section 10.14. No Interpretation of Other Agreements................................... 37
</TABLE>
S-4
<PAGE>
INDENTURE dated as of _____________, 199__ between Owens-Illinois, Inc. ,
a Delaware corporation (the "Company"), and ____________________________, a
______________________, as Trustee (the "Trustee").
[The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its debentures,
notes or other evidences of indebtedness to be issued in one or more series
(the "Securities"), as herein provided, up to such principal amount as may
from time to time be authorized in or pursuant to one or more resolutions of
the Board of Directors or by supplemental indenture.]
Each party agrees as follows for the benefit of the other party and for
the equal and ratable benefit of the Holders of each series of the Securities:
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01. Certain Definitions.
"Affiliate" means any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company.
For purposes of this definition, "control" (including, with correlative
meanings, the terms "controlling," "controlled by" and "under common control
with"), as used with respect to any Person, shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of the
management or policies of such Person, whether through the ownership of
voting stock, by agreement or otherwise.
"Agent" means any Registrar, Paying Agent, authenticating agent or
co-Registrar.
"Board of Directors" means the Board of Directors of the Company or any
authorized committee thereof.
"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 or pursuant to authorization by the Board of
Directors and to be in full force and effect on the date of
such certification (and delivered to the Trustee, if appropriate).
"Commission" means the Securities and Exchange Commission.
"Company" means the party named as such above until a successor replaces
it pursuant to this Indenture and thereafter means the successor.
"Company Order" means a written order signed in the name of the Company
by two Officers, one of whom must be the Company's principal executive
officer, principal financial officer or principal accounting officer.
"Company Request" means a written request signed in the name of the
Company by its Chairman of the Board, a President or a Vice President, and by
its Treasurer, an Assistant Treasurer, its Secretary or an Assistant
Secretary, and delivered to the Trustee.
"Default" means any event that is, or with the passage of time or the
giving of notice or both would be, an Event of Default.
<PAGE>
"Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant
segment of the accounting profession, which are applicable from time to time.
"Global Security" shall mean a Security issued to evidence all or a part
of any series of Securities that is executed by the Company and authenticated
and delivered by the Trustee to a depositary or pursuant to such depositary's
instructions, all in accordance with this Indenture and pursuant to Section
2.01, which shall be registered as to principal and interest
in the name of such depositary or its nominee.
"Holder" or "Securityholder" means a Person in whose name a Security is
registered in the register of Securities kept by the Registrar.
"Indenture" means this Indenture, as amended or supplemented from time to
time.
"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.
"Officer" means the Chairman of the Board, the Chief Executive Officer,
the President, the Chief Operating Officer, the Chief Financial Officer, any
Vice-President, the Treasurer, the Controller, the Secretary, any Assistant
Treasurer or any Assistant Secretary of the Company.
"Officers' Certificate" means a certificate signed by two Officers, one
of whom must be the Chief Executive Officer, the President, the Chief
Financial Officer, the Treasurer or principal accounting officer of the
Company.
2
<PAGE>
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee. The counsel may be an employee of or
counsel to the Company or the Trustee.
"Original Issue Discount Security" means any Security which provides that
an amount less than its principal amount is due and payable upon acceleration
after an Event of Default.
"Person" means any individual, corporation, partnership, joint venture,
association, limited liability company, joint stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
"principal" of a Security means the principal amount due on the stated
maturity of the Security plus the premium, if any, on the Security.
"Securities" means the Securities authenticated and delivered under this
Indenture.
"Securities Act" means the Securities Act of 1933, as amended from time
to time.
"Subsidiary" means any corporation, partnership or limited liability
company of which the Company, or the Company and one or more Subsidiaries, or
any one or more Subsidiaries, directly or indirectly own (i) in the case of a
corporation, voting securities entitling the holders thereof to elect a
majority of the directors, either at all times or so long as there is no
default or contingency which permits the holders of any other class of
securities to vote for the election of one or more directors, (ii) in the
case of a partnership, at least a majority of the general partnership
interests and at least a majority of total outstanding partnership interests
or (iii) in the case of a limited liability company, at least a majority of
the membership interests.
"TIA" means the Trust Indenture Act of 1939, as amended from time to
time, and as in effect on the date of execution of this Indenture; provided,
however, that in the event the TIA is amended after such date, "TIA" means,
to the extent required by such amendment, the Trust Indenture Act, as so
amended.
"Trustee" means the party named as such above until a successor becomes
such pursuant to this Indenture and thereafter means or includes each party
who is then a trustee hereunder, and if at any time there is more than one
such party, "Trustee" as used with respect to the Securities of any series
means the Trustee with respect to Securities of that series. If Trustees
with respect to different series of Securities are trustees under this
Indenture, nothing herein shall constitute the Trustees co-trustees of the
same trust, and each Trustee shall be the trustee of a trust separate and
apart from any trust administered by any other Trustee with respect to a
different series of Securities.
"Trust Officer" means the Chairman of the Board, the President or any
other officer or assistant officer of the Trustee assigned by the Trustee to
administer its corporate trust matters.
"U.S. Government Obligations" means securities which are (i) direct
obligations of The United States of America for the payment of which its full
faith and credit is pledged or (ii) 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 unconditionally guaranteed as a full
faith and credit obligation by The United States of America which are not
callable or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank or trust company as custodian
with respect to any such U.S. Government Obligation or a specific payment of
interest on or principal of any such U.S. Government Obligation held by such
custodian for the account of the holder of a depository receipt, provided
that (except as required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such depository receipt
from any amount received by the custodian in respect of the U.S. Government
Obligation evidenced by such depository receipt.
3
<PAGE>
Section 1.02. Other Definitions.
Term Defined in Section
"Bankruptcy Law"................ 6.01
"Custodian"..................... 6.01
"Event of Default".............. 6.01
"Legal Holiday"................. 10.07
"Paying Agent".................. 2.03
"redemption price".............. 3.03
"Registrar"..................... 2.03
Section 1.03. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Securities.
"indenture securityholder" means a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the Securities means the Company and any successor
obligor on the Securities.
All other terms used in this Indenture that are defined by the TIA, defined
by TIA reference to another statute or defined by Commission rule under the
TIA have the meanings so assigned to them.
Section 1.04. Rules of Construction.
Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(iii) "or" is not exclusive;
(iv) words in the singular include the plural, and in the plural
include the singular; and
(v) provisions apply to successive events and transactions.
4
<PAGE>
ARTICLE 2
THE SECURITIES
Section 2.01. Unlimited In Amount, Issuable In Series, Form and Dating.
The aggregate principal amount of Securities which may be authenticated
and delivered under this Indenture is unlimited. The Securities may be
issued in one or more series. There shall be established in or pursuant to a
Board Resolution or an Officer's Certificate pursuant to authority granted
under a Board Resolution or established in one or more indentures
supplemental hereto, prior to the issuance of Securities of any series:
(a) the title of the Securities of the series (which shall
distinguish the Securities of the series from all other Securities);
(b) any limit upon the aggregate principal amount of 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 this Article 2);
(c) the price or prices (expressed as a percentage of the aggregate
principal amount thereof) at which the Securities of the Series will be
issued;
(d) the date or dates on which the principal of the Securities of the
series is payable;
(e) the rate or rates which may be fixed or variable at which the
Securities of the series shall bear interest, if any, or the manner in which
such rate or rates shall be determined, the date or dates from which such
interest shall accrue, the interest payment dates on which such interest
shall be payable and the record dates for the determination of Holders to
whom interest is payable;
(f) the place or places where the principal of and any interest on
Securities of the series shall be payable, if other than as provided
herein;
(g) the price or prices at which (if any), the period or periods
within which (if any) and the terms and conditions upon which (if other
than as provided herein) Securities of the series may be redeemed, in whole
or in part, at the option, or as an obligation, of the Company;
(h) the obligation, if any, of the Company to redeem, purchase or
repay Securities of the series, in whole or in part, pursuant to any
sinking fund or analogous provisions or at the option of a Holder thereof
and the price or prices at which and the period and periods within which
and the terms and conditions upon which Securities of the series shall be
redeemed, purchased or repaid pursuant to such obligation;
(i) if other than denominations of $1,000 and any multiple thereof,
the denominations in which Securities of the series shall be issuable;
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(j) if other than the principal amount thereof, the portion of the
principal amount of Securities of the series which shall be payable upon
declaration of acceleration of the maturity thereof pursuant to Section
6.02 hereof;
(k) any addition to or change in the covenants set forth in Article 4
which applies to Securities of the series;
(l) any Events of Default with respect to the Securities of a
particular series, if not set forth herein;
(m) the Trustee for the series of Securities;
(n) whether the Securities of the series shall be issued in whole or
in part in the form of a Global Security or Securities; the terms and
conditions, if any, upon which such Global Security or Securities may be
exchanged in whole or in part for other individual Securities, and the
depositary for such Global Security and Securities;
(o) the provisions, if any, relating to any security provided for
the Securities of the series;
(p) the form and terms of any guarantee of the Securities of the
series and the execution of this Indenture by any guarantor;
(q) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture, but which may modify or
delete any provision of this Indenture with respect to such series;
provided, however, that no such term may modify or delete any provision
hereof if imposed by the TIA; and provided, further, that any modification
or deletion of the rights, duties or immunities of the Trustee hereunder
shall have been consented to in writing by the Trustee).
All Securities of any series shall be substantially identical except as
to denomination and except as may otherwise be provided in or pursuant to
such Board Resolution or Officer's Certificate or in any such indenture
supplemental hereto.
The principal of and any interest on the Securities shall be payable at
the office or agency of the Company designated in the form of Security for
the series (each such place herein called the "Place of Payment"); provided,
however, that payment of interest may be made at the option of the Company by
check mailed to the address of the Person entitled thereto as such address
shall appear in the register of Securities referred to in Section 2.03 hereof.
Each Security shall be in one of the forms approved from time to time by
or pursuant to a Board Resolution or Officer's Certificate, or established in
one or more indentures supplemental hereto. Prior to the delivery of a
Security to the Trustee for authentication in any form approved by or
pursuant to a Board Resolution or Officer's Certificate, the Company shall
deliver to the Trustee the Board Resolution or Officer's Certificate by or
pursuant to which such form of Security has been approved, which Board
Resolution or Officer's Certificate shall have attached thereto a true and
correct copy of the form of Security which has been approved by or pursuant
thereto.
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The Securities may have notations, legends or endorsements required by
law, stock exchange rule or usage. Each Security shall be dated the date of
its authentication.
Section 2.02. Execution and Authentication.
Two Officers shall sign the Securities for the Company by manual or
facsimile signature. The Company's seal shall be reproduced on the
Securities.
If an Officer whose signature is on a Security no longer holds that
office at the time the Security is authenticated, the Security shall
nevertheless be valid.
A Security shall not be valid until authenticated by the manual signature
of the Trustee. The signature shall be conclusive evidence that the Security
has been authenticated under this Indenture.
The Trustee shall authenticate Securities for original issue upon a
written order of the Company signed by one Officer.
The Trustee may appoint an authenticating agent acceptable to the Company
to authenticate Securities. An authenticating agent may authenticate
Securities whenever the Trustee may do so. Each reference in this Indenture
to authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with the Company
or an Affiliate of the Company.
Section 2.03. Registrar and Paying Agent.
The Company shall maintain an office or agency where Securities of a
particular series may be presented for registration of transfer or for
exchange (the "Registrar") and an office or agency where Securities of that
series may be presented for payment (a "Paying Agent"). The Registrar for a
particular series of Securities shall keep a register of the Securities of
that series and of their transfer and exchange. The Company may appoint one
or more co-Registrars and one or more additional paying agents for each
series of Securities. The term "Paying Agent" includes any additional paying
agent. The Company may change any Paying Agent, Registrar or co-Registrar
without prior notice to any Securityholder. The Company shall notify the
Trustee in writing of the name and address of any Agent not a party to this
Indenture.
If the Company fails to maintain a Registrar or Paying Agent for any
series of Securities, the Trustee shall act as such. The Company or any of
its Affiliates may act as Paying Agent, Registrar or co-Registrar.
The Company hereby appoints the Trustee the initial Registrar and Paying
Agent for each series of Securities unless another Registrar or Paying Agent,
as the case may be, is appointed prior to the time Securities of that series
are first issued.
Section 2.04. Paying Agent to Hold Money in Trust.
Whenever the Company has one or more Paying Agents it will, prior to each
due date of the principal of or interest on, any Securities, deposit with a
Paying Agent a sum sufficient to pay the principal or interest so becoming due,
such sum to be held in trust for the benefit of the Persons entitled to such
principal or
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interest, and (unless such Paying Agent is the Trustee) the Company will
promptly notify the Trustee of its action or failure so to act.
The Company shall require each Paying Agent other than the Trustee to
agree in writing that such Paying Agent will hold in trust for the benefit of
the Securityholders of the particular series for which it is acting, or the
Trustee, all money held by the Paying Agent for the payment of principal or
interest on the Securities of such series, and that such Paying Agent will
notify the Trustee of any Default by the Company or any other obligor of the
series of Securities in making any such payment and 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.
If the Company or an Affiliate acts as Paying Agent, it shall segregate and
hold in a separate trust fund for the benefit of the Securityholders of the
particular series for which it is acting all money held by it as Paying
Agent. The Company at any time may require a Paying Agent to pay all money
held by it to the Trustee. Upon so doing, the Paying Agent (if other than
the Company or an Affiliate of the Company) shall have no further liability
for such money. Upon any bankruptcy or reorganization proceedings relating
to the Company, the Trustee shall serve as Paying Agent for the Securities.
Section 2.05. Securityholder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses
of Securityholders, separately by series, and shall otherwise comply with TIA
Section 312(a). If the Trustee is not the Registrar, the Company shall
furnish to the Trustee at least seven business days before each interest
payment date and at such other times as the Trustee may request in writing, a
list in such form and as of such date as the Trustee may reasonably require
of the names and addresses of Securityholders, separately by series, relating
to such interest payment date or request, as the case may be.
Section 2.06. Transfer and Exchange.
Where Securities of a series are presented to the Registrar or a
co-Registrar with a request to register a transfer or to exchange them for an
equal principal amount of Securities of the same series of other authorized
denominations, the Registrar shall register the transfer or make the exchange
if its requirements for such transactions are met. To permit registrations
of transfers and exchanges, the Company shall issue and the Trustee shall
authenticate Securities at the Registrar's request.
No service charge shall be made for any registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover
any transfer tax or similar governmental charge payable in connection
therewith (other than any such transfer tax or similar governmental charge
payable upon exchanges pursuant to Sections 2.10, 3.06 or 9.04).
The Company need not issue, and the Registrar or co-Registrar need not
register the transfer or exchange of, (i) any Security of a particular series
during a period beginning at
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the opening of business 15 days before the day of any selection of Securities
of that series for redemption under Section 3.02 and ending at the close of
business on the day of selection, or (ii) any Security so selected for
redemption in whole or in part, except the unredeemed portion of any Security
of that series being redeemed in part.
Section 2.07. Replacement Securities.
If a mutilated Security is surrendered to the Trustee or if the Holder of
a Security claims that the Security has been lost, destroyed or wrongfully
taken, the Company shall issue and the Trustee shall authenticate a
replacement Security of the same series if the Company's and the Trustee's
requirements are met. The Trustee or the Company may require an indemnity
bond to be furnished which is sufficient in the judgment of both to protect
the Company, the Trustee, and any Agent from any loss which any of them may
suffer if a Security is replaced. The Company may charge such Holder for its
expenses in replacing a Security.
Every replacement Security is an obligation of the Company and shall be
entitled to all the benefit of the Indenture equally and proportionately with
any and all other Securities of the same series.
Section 2.08. Outstanding Securities.
The Securities of any series outstanding at any time are all the
Securities of that series authenticated by the Trustee except for those
cancelled by it, those delivered to it for cancellation, and those described
in this Section as not outstanding.
If a Security is replaced pursuant to Section 2.07, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
If Securities are considered paid under Section 4.01, they cease to be
outstanding and interest on them ceases to accrue.
Except as set forth in Section 2.09 hereof, a Security does not cease to
be outstanding because the Company or an Affiliate holds the Security.
For each series of Original Issue Discount Securities, the principal
amount of such Securities that shall be deemed to be outstanding and used to
determine whether the necessary Holders have given any request, demand,
authorization, direction, notice, consent or waiver shall be the principal
amount of such Securities that could be declared to be due and payable upon
acceleration upon an Event of Default as of the date of such determination.
When requested by the Trustee, the Company will advise the Trustee of such
amount, showing its computations in reasonable detail.
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Section 2.09. Treasury Securities.
In determining whether the Holders of the required principal amount of
Securities of any series have concurred in any direction, waiver or consent,
Securities owned by the Company or an Affiliate shall be considered as though
they are not outstanding, except that for the purposes of determining whether
the Trustee shall be protected in relying on any such direction, waiver or
consent, only Securities which the Trustee knows are so owned shall be so
considered.
Section 2.10. Temporary Securities.
Until definitive Securities are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Securities upon a
written order of the Company signed by one Officer of the Company.
Temporary Securities shall be substantially in the form of definitive
Securities but may have variations that the Company considers appropriate for
temporary Securities. Without unreasonable delay, the Company shall prepare
and the Trustee shall authenticate definitive Securities in exchange for
temporary Securities.
Holders of temporary securities shall be entitled to all of the benefits
of this Indenture.
Section 2.11. Cancellation.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee
any Securities surrendered to them for registration of transfer, exchange or
payment. The Trustee shall cancel all Securities surrendered for
registration of transfer, exchange, payment, replacement or cancellation and
shall destroy such Securities (subject to the record retention requirements
of the Exchange Act). Certification of the destruction of all cancelled
Securities shall be delivered to the Company. The Company may not issue new
Securities to replace Securities that it has paid or that have been delivered
to the Trustee for cancellation.
Section 2.12. Defaulted Interest.
If the Company fails to make a payment of interest on any series of
Securities, it shall pay such defaulted interest plus (to the extent lawful)
any interest payable on the defaulted interest, in any lawful manner. It may
elect to pay such defaulted interest, plus any such interest payable on it,
to the Persons who are Holders of such Securities on which the interest is
due on a subsequent special record date. The Company shall notify the
Trustee in writing of the amount of defaulted interest proposed to be paid on
each such Security. The Company shall fix any such record date and payment
date for such payment. At least 15 days before any such record date, the
Company shall mail to Securityholders affected thereby a notice that states
the record date, payment date, and amount of such interest to be paid.
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Section 2.13. Special Record Dates.
(a) The Company may, but shall not be obligated to, set a record date
for the purpose of determining the identity of Holders entitled to consent to
any supplement, amendment or waiver permitted by this Indenture. If a record
date is fixed, the Holders of Securities of that series outstanding on such
record date, and no other Holders, shall be entitled to consent to such
supplement, amendment or waiver or revoke any consent previously given,
whether or not such Holders remain Holders after such record date. No
consent shall be valid or effective for more than 90 days after such record
date unless consents from Holders of the principal amount of Securities of
that series required hereunder for such amendment or waiver to be effective
shall have also been given and not revoked within such 90-day period.
(b) The Trustee may, but shall not be obligated to, fix any day as a
record date for the purpose of determining the Holders of any series of
Securities entitled to join in the giving or making of any notice of Default,
any declaration of acceleration, any request to institute proceedings or any
other similar direction. If a record date is fixed, the Holders of
Securities of that series outstanding on such record date, and no other
Holders, shall be entitled to join in such notice, declaration, request or
direction, whether or not such Holders remain Holders after such record date;
provided, however, that no such action shall be effective hereunder unless
taken on or prior to the date 90 days after such record date.
ARTICLE 3
REDEMPTION
Section 3.01. Notices to Trustee.
If the Company elects to redeem Securities of any series pursuant to any
optional redemption provisions thereof, it shall notify the Trustee of the
redemption date and the principal amount of Securities of that series to be
redeemed.
The Company shall give the notice provided for in this Section at least
45 days before the redemption date (unless a shorter notice period shall be
satisfactory to the Trustee), which notice shall specify the provisions of such
Security pursuant to which the Company elects to redeem such Securities.
If the Company elects to reduce the principal amount of Securities of any
series to be redeemed pursuant to mandatory redemption provisions thereof, it
shall notify the Trustee of the amount of, and the basis for, any such
reduction. If the Company elects to credit against any such mandatory
redemption Securities it has not previously delivered to the Trustee for
cancellation, it shall deliver such Securities with such notice.
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Section 3.02. Selection of Securities to Be Redeemed.
If less than all the Securities of any series are to be redeemed, the
Trustee shall select the Securities of that series to be redeemed by a method
that complies with the requirements of any exchange on which the Securities
of that series are listed, or, if the Securities of that series are not
listed on an exchange, on a pro rata basis or by lot. The Trustee shall make
the selection not more than 75 days and not less than 30 days before the
redemption date from Securities of that series outstanding and not previously
called for redemption. Except as otherwise provided as to any particular
series of Securities, Securities and portions thereof that the Trustee
selects shall be in amounts equal to the minimum authorized denomination for
Securities of the series to be redeemed or any integral multiple thereof.
Provisions of this Indenture that apply to Securities called for redemption
also apply to portions of Securities called for redemption. The Trustee
shall notify the Company promptly in writing of the Securities or portions of
Securities to be called for redemption.
Section 3.03. Notice of Redemption.
Except as otherwise provided as to any particular series of Securities,
at least 30 days but not more than 60 days before a redemption date, the
Company shall mail a notice of redemption to each Holder whose Securities are
to be redeemed.
The notice shall identify the Securities of the series to be redeemed and
shall state:
(1) the redemption date;
(2) the redemption price fixed in accordance with the terms of the
Securities of the series to be redeemed, plus accrued interest, if any, to
the date fixed for redemption (the "redemption price");
(3) if any Security is being redeemed in part, the portion of the
principal amount of such Security to be redeemed and that, after the
redemption date, upon surrender of such Security, a new Security or
Securities in principal amount equal to the unredeemed portion will be
issued;
(4) the name and address of the Paying Agent;
(5) that Securities called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(6) that, unless the Company defaults in payment of the redemption
price, interest on Securities called for redemption ceases to accrue on and
after the redemption date; and
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(7) the CUSIP number, if any, of the Securities to be redeemed.
At the Company's request, the Trustee shall give the notice of redemption
in the Company's name and at its expense. The notice mailed in the manner
herein provided shall be conclusively presumed to have been duly given
whether or not the Holder receives such notice. In any case, failure to give
such notice by mail or any defect in the notice of the Holder of any Security
shall not affect the validity of the proceeding for the redemption of any
other Security.
Section 3.04. Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.03
hereof, Securities called for redemption become due and payable on the
redemption date for the redemption price. Upon surrender to the Paying
Agent, such Securities will be paid at the Redemption Price.
Section 3.05. Deposit of Redemption Price.
On or before the redemption date, the Company shall deposit with the
Paying Agent (or, if the Company or any Affiliate is the Paying Agent, shall
segregate and hold in trust) money sufficient to pay the redemption price of
all Securities called for redemption on that date other than Securities which
have previously been delivered by the Company to the Trustee for
cancellation. The Paying Agent shall return to the Company any money not
required for that purpose.
Section 3.06. Securities Redeemed in Part.
Upon surrender of a Security that is redeemed in part, the Company shall
issue and the Trustee shall authenticate for the Holder at the expense of the
Company a new Security of the same series equal in principal amount to the
unredeemed portion of the Security surrendered.
ARTICLE 4
COVENANTS
Section 4.01. Payment of Securities.
The Company shall pay or cause to be paid the principal of and interest
on the Securities on the dates and in the manner provided in this Indenture
and the Securities. Principal and interest shall be considered paid on the
date due if the Paying Agent, if other than the Company or an Affiliate,
holds as of 10:00 a.m. Eastern Time on that date
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immediately available funds designated for and sufficient to pay all
principal and interest then due.
To the extent lawful, the Company shall pay interest on overdue principal
and overdue installments of interest at the rate per annum borne by the
applicable series of Securities.
Section 4.02. Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, the City of New
York, an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee or Registrar) where Securities may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Company in respect of the Securities and this Indenture may be
served. The Company shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at
any time the Company shall fail to maintain any such required office or
agency or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
corporate trust office of the Trustee.
The Company may also from time to time designate one or more other
offices or agencies where the Securities 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 the
Borough of Manhattan, the City of New York for such purposes. The Company
shall give prompt written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or
agency.
The Company hereby designates the Corporate Trust Office of the Trustee
as one such office or agency of the Company in accordance with Section 2.03.
Section 4.03. Commission Reports.
The Company shall deliver to the Trustee within 15 days after it files
them 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 by rules and regulations prescribe) which the
Company is required to file with the Commission pursuant to Section 13 or
15(d) of the Exchange Act; provided, however the Company shall not be
required to deliver to the Trustee any materials for which the Company has
sought and received confidential treatment by the Commission. The Company also
shall comply with the other provisions of TIA Section 314(a).
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Section 4.04. Compliance Certificate.
The Company shall deliver to the Trustee, within 120 days after the end
of each fiscal year of the Company, an Officers' Certificate stating that in
the course of the performance by the signers of their duties as officers of
the Company, they would normally have knowledge of any failure by the Company
to comply with all conditions, or default by the Company with respect to any
covenants, under this Indenture, and further stating whether or not they have
knowledge of any such failure or default and, if so, specifying each such
failure or default and the nature thereof. For purposes of this Section,
such compliance shall be determined without regard to any period of grace or
requirement of notice provided for in this Indenture. The certificate need
not comply with Section 10.04.
Section 4.05. Taxes.
The Company shall pay prior to delinquency, all material taxes,
assessments, and governmental levies except as contested in good faith by
appropriate proceedings.
Section 4.06. Stay, Extension and Usury Laws.
The Company covenants (to the extent that it may lawfully do so) that it
shall not at any time insist upon, plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay, extension or usury law
wherever enacted, now or at any time hereafter in force, that 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 shall not, by resort to any
such law, hinder, delay or impede the execution of any power herein granted
to the Trustee, but shall suffer and permit the execution of every such power
as though no such law has been enacted.
Section 4.07. Corporate Existence.
Subject to Article 5 hereof, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect (i) its
corporate existence, and the corporate, partnership or other existence of
each of its Subsidiaries, in accordance with the respective organizational
documents (as the same may be amended from time to time) of each Subsidiary
and (ii) the rights (charter and statutory), licenses and franchises of the
Company and its Subsidiaries; provided, however, that the Company shall not
be required to preserve
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any such right, license or franchise, or the corporate, partnership or other
existence of any of its Subsidiaries, if the Board of Directors shall
determine that the preservation thereof is no longer desirable in the conduct
of the business of the Company and its Subsidiaries, taken as a whole, and
that the loss thereof is not adverse in any material respect to the Holders.
ARTICLE 5
SUCCESSORS
Section 5.01. When Company May Merge, etc.
The Company shall not consolidate or merge with or into (whether or not
the Company is the surviving corporation), or sell, assign, transfer, lease,
convey or otherwise dispose of all or substantially all of its properties or
assets in one or more related transactions to any Person unless:
(1) the Company is the surviving corporation or the Person
formed by or surviving any such consolidation or merger (if other than the
Company) or to which such sale, assignment, transfer, lease, conveyance or
other disposition shall have been made is a corporation organized and
existing under the laws of the United States, any state thereof or the
District of Columbia;
(2) the Person formed by or assuming any such consolidation
or merger (if other than the Company) or the Person to which such
sale, assignment, transfer, lease, conveyance or other disposition shall
have been made assumes by supplemental indenture all the obligations of the
Company under the Securities and this Indenture; and
(3) immediately prior to and after giving effect to the transaction
no Default or Event of Default shall have occurred and be continuing.
The Company shall deliver to the Trustee on or prior to the consummation of the
proposed transaction an Officers' Certificate to the foregoing effect and an
Opinion of Counsel stating that the proposed transaction and such
supplemental indenture comply with this Indenture.
Section 5.02. Successor Corporation Substituted.
Upon any consolidation or merger, or any transfer by the Company (other
than by lease) of all or substantially all of the assets of the Company in
accordance with Section 5.01, the successor corporation formed by such
consolidation or into which the Company is merged or to which such transfer
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 corporation had been named as the Company herein. In the
event of any such transfer, the predecessor Company shall be released and
discharged from all liabilities and obligations in respect of the Securities
and the Indenture, and the predecessor Company may be dissolved, wound up or
liquidated at any time thereafter.
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ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
An "Event of Default" occurs with respect to Securities of any particular
series if, unless in the establishing Board Resolution, Officer's Certificate
or supplemental indenture hereto, it is provided that such series shall not
have the benefit of said Event of Default:
(1) the Company defaults in the payment of interest on any Security
of that series when the same becomes due and payable and the Default
continues for a period of 30 days;
(2) the Company defaults in the payment of the principal of any
Security of that series when the same becomes due and payable at maturity,
upon redemption or otherwise;
(3) an Event of Default, as defined in the Securities of that series,
occurs and is continuing, or the Company fails to comply with any of its
other agreements in the Securities of that series or in this Indenture with
respect to that series and the Default continues for the period and after
the notice specified below;
(4) the Company pursuant to or within the meaning of any Bankruptcy
Law:
(A) commences a voluntary case;
(B) consents to the entry of an order for relief against it in
an involuntary case;
(C) consents to the appointment of a Custodian of it or for all
or substantially all of its property;
(D) makes a general assignment for the benefit of its creditors;
or
(E) admits in writing its inability generally to pay its debts
as the same become due.
(5) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(A) is for relief against the Company in an involuntary case;
(B) appoints a Custodian of the Company or for all or
substantially all of its property; or
(C) orders the liquidation of the Company;
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and the order or decree remains unstayed and in effect for 60 days.
(6) any other Event of Default provided with respect to
Securities of that series which is specified in a Board Resolution,
Officer's Certificate or supplemental indenture establishing that
series of Securities.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar
federal or state law for the relief of debtors. The term "Custodian" means
any receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.
A Default under clause (3) above is not an Event of Default with respect
to a particular series of Securities until the Trustee or the Holders of at
least 50% in principal amount of the then outstanding Securities of that
series notify the Company of the Default and the Company does not cure the
Default within 30 days after receipt of the notice. The notice must specify
the Default, demand that it be remedied and state that the notice is a
"Notice of Default."
Section 6.02. Acceleration.
If an Event of Default with respect to Securities of any series (other
than an Event of Default specified in clauses (4) and (5) of Section 6.01)
occurs and is continuing, the Trustee by notice to the Company, or the
Holders of at least 50% in principal amount of the then outstanding
Securities of that series by notice to the Company and the Trustee, may
declare the unpaid principal (or, in the case of Original Issue Discount
Securities, such lesser amount as may be provided for in such Securities) of
and any accrued interest on all the Securities of that series to be due and
payable on the Securities of that series. Upon such declaration the
principal (or such lesser amount) and interest shall be due and payable
immediately. If an Event of Default specified in clause (4) or (5) of
Section 6.01 occurs, all of such amount shall become and be immediately due
and payable without any declaration or other act on the part of the Trustee
or any Holder. The Holders of a majority in principal amount of the then
outstanding Securities of that series by notice to the Trustee may rescind an
acceleration and its consequences if the rescission would not conflict with
any judgment or decree and if all existing Events of Default with respect to
that series have been cured or waived except nonpayment of principal (or such
lesser amount) or interest that has become due solely because of the
acceleration.
Section 6.03. Other Remedies.
If an Event of Default with respect to Securities of any series occurs
and is continuing, the Trustee may pursue any available remedy to collect the
payment of principal or interest on the Securities of that series or to
enforce the performance of any provision of the Securities of that series or
this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or acquiescence in the Event of Default. All
remedies are cumulative to the extent permitted by law.
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Section 6.04. Waiver of Past Defaults.
Subject to Section 9.02, the Holders of a majority in principal amount of
the then outstanding Securities of any series by notice to the Trustee may
waive an existing Default or Event of Default with respect to that series and
its consequences except a Default or Event of Default in the payment of the
principal (including any mandatory sinking fund or like payment) of or
interest on any Security of that series (provided, however, that the Holders
of a majority in principal amount of the outstanding Securities of any series
may rescind an acceleration and its consequences, including any related
payment default that resulted from such acceleration).
Section 6.05. Control by Majority.
The Holders of a majority in principal amount of the then outstanding
Securities of any series may direct the time, method and place of conducting
any proceeding for any remedy with respect to that series available to the
Trustee or exercising any trust or power conferred on it. However, the
Trustee may refuse to follow any direction that conflicts with law or this
Indenture, that is unduly prejudicial to the rights of another Holder of
Securities of that series, or that may involve the Trustee in personal
liability. The Trustee may take any other action which it deems proper which
is not inconsistent with any such direction.
Section 6.06. Limitation on Suits.
A Holder of Securities of any series may not pursue a remedy with respect
to this Indenture or the Securities unless:
(1) the Holder gives to the Trustee written notice of a continuing
Event of Default with respect to that series;
(2) the Holders of at least 50% in principal amount of the then
outstanding Securities of that series make a written request to the Trustee
to pursue the remedy;
(3) such Holder or Holders offer to the Trustee indemnity
satisfactory to the Trustee against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer and, if requested, the provision of
indemnity; and
(5) during such 60-day period the Holders of a majority in principal
amount of the then outstanding Securities of that series do not give the
Trustee a direction inconsistent with the request.
No Holder of any series of Securities may use this Indenture to prejudice the
rights of another Holder of Securities of that series or to obtain a
preference or priority over another Holder of Securities of that series.
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Section 6.07. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Security to receive payment of principal of and interest, if any,
on the Security, on or after the respective due dates expressed in the
Security, or to bring suit for the enforcement of any such payment on or
after such respective dates, shall not be impaired or affected without the
consent of the Holder.
Section 6.08. Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(1) or (2) occurs and is
continuing with respect to Securities of any series, the Trustee may recover
judgment in its own name and as trustee of an express trust against the
Company for the whole amount of principal (or such portion of the principal
as may be specified as due upon acceleration at that time in the terms of
that series of Securities) and interest, if any, remaining unpaid on the
Securities of that series then outstanding, together with (to the extent
lawful) interest on overdue principal and interest, and such further amount
as shall be sufficient to cover the costs and, to the extent lawful, expenses
of collection, including the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel and any other amounts due
the Trustee under Section 7.07.
Section 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the Trustee
and the Securityholders allowed in any judicial proceedings relative to the
Company (or any other obligor on the Securities), its creditors or its
property and shall be entitled to and empowered to collect and receive any
money or other property payable or deliverable on any such claims and to
distribute the same, and any custodian in any such judicial proceedings is
hereby authorized by each Holder to make such payments to the Trustee and, in
the event that the Trustee shall consent to the making of such payments
directly to the Holders, to pay to the Trustee any amount due to it for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agent and counsel, and any other amounts due the Trustee under Section
7.07. Nothing contained herein shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Securityholder
any plan of reorganization, arrangement, adjustment or composition affecting
the Securities or the rights of any Holder thereof, or to authorize the
Trustee to vote in respect of the claim of any Securityholder in any such
proceeding.
Section 6.10. Priorities.
If the Trustee collects any money with respect to Securities of any
series pursuant to this Article, it shall pay out the money in the following
order:
First: to the Trustee, its agents and attorneys for amounts
due under Section 7.07, including payment of all
compensation, expense and liabilities incurred, and
all advances made, by the Trustee and the costs and
expenses of collection;
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Second: to Securityholders for amounts due and unpaid on the
Securities of such series for principal and interest,
ratably, without preference or priority of any kind,
according to the amounts due and payable on the
Securities of such series for principal and interest,
respectively; and
Third: to the Company or to such party as a court of
competent jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Securities of any series pursuant to this Section. The Trustee
shall notify the Company in writing reasonably in advance of any such record
date and payment date.
Section 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted
by it as a Trustee, a court in its discretion may require the filing by any
party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in the suit, having
due regard to the merits and good faith of the claims or defense made by the
party litigant. This Section does not apply to a suit by the Trustee, a suit
by a Holder pursuant to Section 6.07 or a suit by Holders of more than 10% in
principal amount of the then outstanding Securities.
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee.
(a) If 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.
(b) Except during the continuance of an Event of Default known to the
Trustee:
(i) the duties of the Trustee shall be determined solely by the
express provisions of this Indenture or the TIA and the Trustee
need perform only those duties that are specifically set forth in
this Indenture or the TIA and no others, and no implied covenants
or obligations shall be read into this Indenture against the
Trustee; and
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(ii) 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. However, the Trustee shall
examine the certificates and opinions to determine whether or not
they conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of
this Section;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a responsible officer of the Trustee,
unless it is proved that the Trustee was negligent in
ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 6.05 hereof.
(d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to
paragraphs (a), (b), and (c) of this Section.
(e) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or incur any liability. The Trustee may refuse to
perform any duty or exercise any right or power unless it receives security
and indemnity satisfactory to it against any loss, liability or expense.
(f) The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree in writing with the Company. Absent written
instruction from the Company, the Trustee shall not be required to invest any
such money. Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law.
Section 7.02. Rights of Trustee.
Subject to TIA Section 315(a) through (d):
(a) The Trustee may rely on any document believed by it to be genuine
and to have been signed or presented by the proper person. The Trustee need
not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel, or both. The Trustee shall
not be liable for any action
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it takes or omits to take in good faith in reliance on such Officers'
Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and shall not be responsible for
the misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it believes to be authorized or within its rights or
powers, unless the Trustee's conduct constitutes negligence.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice form the Company shall be sufficient if
signed by an Officer of the Company.
Section 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner
or pledgee of Securities and may otherwise deal with the Company or an
Affiliate with the same rights it would have if it were not Trustee. Any
Agent may do the same with like rights. However, the Trustee is subject to
TIA Sections 310(b) and 311.
Section 7.04. Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the
Company's use of the proceeds from the Securities, and it shall not be
responsible for any statement in the Securities other than its certificate of
authentication.
Section 7.05. Notice of Defaults.
If a Default or Event of Default with respect to the Securities of any
series occurs and is continuing and if it is known to the Trustee, the
Trustee shall mail to all Holders of Securities of that series a notice of
the Default or Event of Default within 90 days after it occurs. Except in
the case of a Default or Event of Default in payment on any such Security,
the Trustee may withhold the notice if and so long as a committee of its
Trust Officers in good faith determines that withholding the notice is in the
interests of such Securityholders.
Section 7.06. Reports by Trustee to Holders.
Within 60 days after May 15 in each year, the Trustee with respect to any
series of Securities shall mail to Holders of Securities of that series as
provided in TIA Section 313(c) a brief report dated as of such May 15 that
complies with TIA Section 313(a) (if such report is required by TIA
Section 313(a)). The Trustee shall also comply with TIA Section 313(b).
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A copy of each report at the time of its mailing to Securityholders shall
be mailed to the Company and filed with the Commission and each stock
exchange on which any of the Securities are listed, as required by TIA
Section 313(d). The Company shall notify the Trustee when the Securities are
listed on any stock exchange.
Section 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time such compensation
as shall be agreed upon in writing for its services hereunder. The Company
shall reimburse the Trustee upon written request for all reasonable
out-of-pocket expenses incurred by it. Such expenses shall include the
reasonable compensation and out-of-pocket expenses of the Trustee's agents
and counsel.
The Company shall indemnify the Trustee for any loss or liability
incurred by it, without negligence or bad faith on its part, in connection
with the administration of this Indenture and its duties hereunder. The
Trustee shall notify the Company promptly of any claim for which it may seek
indemnity. The Company shall defend the claim and the Trustee shall
cooperate in the defense. The Trustee may have separate counsel and the
Company shall pay the reasonable fees and expenses of such counsel. The
Company need not pay for any settlement made without its consent.
To secure the Company's payment obligations in this Section, the Trustee
shall have a lien prior to the Securities on all money or property held or
collected by the Trustee in its capacity as Trustee, except money or property
held in trust to pay principal and interest on particular Securities. Such
lien will survive the satisfaction and discharge of this Indenture.
If the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(4) or (5) occurs, the expenses and the
compensation for the services will be intended to constitute expenses of
administration under any applicable Bankruptcy Law.
Section 7.08. Replacement of Trustee.
A resignation or removal of the Trustee with respect to one or more or
all series of Securities and appointment of a successor Trustee shall become
effective only upon the successor Trustee's acceptance of appointment as
provided in this Section.
The Trustee may resign with respect to one or more or all series of
Securities by so notifying the Company in writing. The Holders of a majority
in principal amount of the then outstanding Securities of any series may
remove the Trustee as to that series by so notifying the Trustee in writing
and may appoint a successor Trustee with the Company's consent. The Company
may remove the Trustee with respect to one or more or all series of
Securities if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent;
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(3) a receiver or other public officer takes charge of the Trustee or
its property; or
(4) the Trustee becomes incapable of acting.
If, as to any series of Securities, the Trustee resigns or is removed or
if a vacancy exists in the office of Trustee for any reason, the Company
shall promptly appoint a successor Trustee for that series. Within one year
after the successor Trustee with respect to any series takes office, the
Holders of a majority in principal amount of the then outstanding Securities
of that series may appoint a successor Trustee to replace the successor
Trustee appointed by the Company. If a successor Trustee as to a particular
series does not take office within 60 days after the retiring Trustee resigns
or is removed, the retiring Trustee, the Company or the Holders of at least
10% in principal amount of the then outstanding Securities of that series may
petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee fails to comply with Section 7.10 with respect to any
series, any Holder of Securities of that series who satisfies the
requirements of TIA Section 310(b) may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee for that series.
A successor Trustee as to any series of Securities shall deliver a
written acceptance of its appointment to the retiring Trustee and to the
Company. Immediately after that, the retiring Trustee shall promptly transfer
all property held by it as Trustee to the successor Trustee (subject to the
lien provided for in Section 7.07), the resignation or removal of the
retiring Trustee shall become effective, and the successor Trustee shall have
all the rights, powers and duties of the Trustee under this Indenture as to
that series. The successor Trustee shall mail a notice of its succession to
the Holders of Securities of that series.
Notwithstanding replacement of the Trustee pursuant to this Section 7.08,
the Company's obligations under Section 7.07 hereof shall continue for the
benefit of the retiring trustee.
In case of the appointment hereunder of a successor Trustee with respect
to the Securities of one or more (but not all) series, the Company, the
retiring Trustee and each successor Trustee with respect to the Securities of
one or more series shall execute and deliver an indenture supplemental hereto
wherein each successor Trustee shall accept such appointment and which (1)
shall contain such provisions as shall be necessary or desirable to transfer
and confirm to, and to vest in, each successor Trustee all the rights,
powers, trusts and duties of the retiring Trustee with respect to the
Securities of that or those series to which the appointment of such successor
Trustee relates, (2) shall contain such provisions as shall be 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 or desirable to provide for or
facilitate the administration of the trusts hereunder by more than one
Trustee; provided, however, that nothing herein or in such supplemental
Indenture shall constitute
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such Trustee co-trustees of the same trust and that each such Trustee shall
be trustee of a trust hereunder separate and apart from any trust hereunder
administered by any other such Trustee.
Upon the execution and delivery of such supplemental Indenture the
resignation or removal of the retiring Trustee shall become effective to the
extent provided therein and each such successor Trustee, without any further
act, deed or conveyance, shall become vested with all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of
that or those series to which the appointment of such successor Trustee
relates.
Section 7.09. Successor Trustee by Merger, etc.
If the Trustee as to any series of Securities consolidates, merges or
converts into, or transfers all or substantially all of its corporate trust
business to, another corporation, the successor corporation without any
further act shall be the successor Trustee as to that series.
Section 7.10. Eligibility; Disqualification.
Each series of Securities shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1), (2) and (5). The Trustee as to any
series of Securities shall always have a combined capital and surplus of at
least $25,000,000 as set forth in its most recent published annual report of
condition. The Trustee is subject to TIA Section 310(b).
Section 7.11. Preferential Collection of Claims Against Company.
The Trustee is subject to TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or
been removed shall be subject to TIA Section 311(a) to the extent indicated
therein.
ARTICLE 8
SATISFACTION AND DISCHARGE; DEFEASANCE
Section 8.01. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Order cease to be of further effect
(except as to any surviving rights of registration of transfer or exchange of
Securities herein expressly provided for), and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(a) either
(i) all Securities theretofore authenticated and delivered
(other than Securities that have been destroyed, lost or stolen
and that have been replaced or paid) have been delivered to the
Trustee for cancellation; or
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(ii) all such Securities not theretofore delivered to the
Trustee for cancellation
(1) have become due and payable, or
(2) will become due and payable at their stated maturity
within one year, or
(3) 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, or
(4) are deemed paid and discharged pursuant to Section
8.03, as applicable;
and the Company, in the case of (1), (2) or (3) above, has deposited or
caused to be deposited with the Trustee as trust funds in trust an amount
sufficient for the purpose of paying and discharging the entire indebtedness
on such Securities not theretofore delivered to the Trustee for cancellation,
for principal and interest to the date of such deposit (in the case of
Securities which have become due and payable on or prior to the date of such
deposit) or to the stated maturity or redemption date, as the case may be;
(b) the Company has paid or caused to be paid all other sums
payable hereunder by the Company; and
(c) 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 7.07, and, if money
shall have been deposited with the Trustee pursuant to clause (a) of this
Section or if money or obligations shall have been deposited with or received
by the Trustee pursuant to Section 8.03, the obligations of the Trustee under
Section 8.02 and Section 8.05 shall survive.
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Section 8.02. Application of Trust Funds; Indemnification.
(a) Subject to the provisions of Section 8.05, all money deposited
with the Trustee pursuant to Section 8.01, all money and U.S. Government
Obligations deposited with the Trustee pursuant to Section 8.03 or 8.04
and all money received by the Trustee in respect of U.S. Government
Obligations deposited with the Trustee pursuant to Section 8.03 or 8.04,
shall be held in trust and applied by it, in accordance with the
provisions of the Securities and this Indenture, to the payment,
either directly or through any Paying Agent (including the Company
acting as its own Paying Agent) as the Trustee may determine, to the
persons entitled thereto, of the principal and interest for whose payment
such money has been deposited with or received by the Trustee or to make
mandatory sinking fund payments or analogous payments as contemplated by
Sections 8.03 and 8.04.
(b) The Company shall pay and shall indemnify the Trustee against
any tax, fee or other charge imposed on or assessed against U.S.
Government Obligations deposited pursuant to Sections 8.03 or 8.04 or
the interest and principal received in respect of such obligations other
than any payable by or on behalf of Holders.
(c) The Trustee shall deliver or pay to the Company from time to
time upon Company Request any U.S. Government Obligations or money held by it
as provided in Sections 8.03 or 8.04 which, in the opinion of a nationally
recognized firm of independent certified public accountants expressed in a
written certification thereof delivered to the Trustee, are then in excess of
the amount thereof which then would have been required to be deposited for
the purpose for which such U.S. Government Obligations or money were
deposited or received. This provision shall not authorize the sale by the
Trustee of any U.S. Government Obligations held under this Indenture.
Section 8.03. Legal Defeasance of Securities of any Series.
Unless this Section 8.03 is otherwise specified to be inapplicable to
Securities of any series, the Company shall be deemed to have paid and
discharged the entire indebtedness on all the outstanding Securities of any
such series on the 91st day after the date of the deposit referred to in
subparagraph (d) hereof, and the provisions of this Indenture, as it relates
to such outstanding Securities of such series, shall no longer be in effect
(and the Trustee, at the expense of the Company, shall, upon Company
Request, execute proper instruments acknowledging the same), except as to:
(a) the rights of Holders of Securities of such series to receive,
from the trust funds described in subparagraph (d) hereof, (i) payment of
the principal of an each installment of principal of or interest on the
outstanding Securities of such series on the stated maturity of such
principal of or interest and (ii) the benefit of any mandatory sinking fund
payments applicable to the Securities of such series on the day on which
such payments are due and payable in accordance with the terms of this
Indenture and the Securities of such series;
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(b) the Company's obligations with respect to such Securities of such
series under Sections 2.03, 2.06 and 2.07; and
(c) the rights, powers, trust and immunities of the Trustee hereunder
and the duties of the Trustee under Section 8.02 and the duty of the
Trustee to authenticate Securities of such series issued on registration of
transfer of exchange;
provided that, the following conditions shall have been satisfied:
(d) the Company shall have deposited or caused to be deposited
irrevocably with the Trustee as trust funds in trust for the purpose of
making the following payments, specifically pledged as security for and
dedicated solely to the benefit of the Holders of such Securities, cash in
U.S. Dollars and/or U.S. Government Obligations which through the payment
of interest and principal in respect thereof, in accordance with their
terms, will provide (and without reinvestment and assuming no tax liability
will be imposed on such Trustee), not later than one day before the due
date of any payment of money, an amount in cash, sufficient, in the opinion
of a nationally recognized firm of independent public accountants expressed
in a written certification thereof delivered to the Trustee, to pay and
discharge each installment of principal (including mandatory sinking fund
or analogous payments) of and interest, if any, on all the Securities of
such series on the dates such installments of interest or principal are
due;
(e) such deposit will not result in a breach or violation of, or
constitute a default under, this Indenture or any other agreement or
instrument to which the Company is a party or by which it is bound;
(f) no Default or Event of Default with respect to the Securities of
such series shall have occurred and be continuing on the date of such
deposit or during the period ending on the 91st day after such date;
(g) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel to the effect that (i) the Company
has received from, or there has been published by, the Internal Revenue
Service a ruling, or (ii) since the date of execution of this Indenture,
there has been a change in the applicable Federal income tax law, in either
case to the effect that, and based thereon such Opinion of Counsel shall
confirm that, the Holders of the 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 and in the same manner and at the same times
as would have been the case if such deposit, defeasance and discharge had
not occurred;
(h) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the
intent of preferring the Holders of the Securities of such series over
any other creditors of the
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company or with the intent of defeating, hindering, delaying or
defrauding any other creditors of the Company;
(i) such deposit 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; and
(j) 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 the defeasance contemplated by this
Section have been complied with.
Section 8.04. Covenant Defeasance.
Unless this Section 8.04 is otherwise inapplicable to Securities of any
series, on and after the 91st day after the date of the deposit referred to
in subparagraph (a) hereof, the Company may omit to comply with any term,
provision or condition set forth under Sections 4.03, 4.04, 4.05, 4.06, 4.07
and 5.01 as well as any additional covenants contained in a supplemental
indenture hereto for a particular series of Securities or a Board Resolution
or an Officers' Certificate delivered pursuant to Section 2.01(n) (and the
failure to comply with any such provisions shall not constitute a Default or
Event of Default under Section 6.01) and the occurrence of any event
described in clause (e) of Section 6.01 shall not constitute a Default or
Event of Default hereunder, with respect to the Securities of such series,
provided that the following conditions shall have been satisfied:
(a) With reference to this Section 8.04, the Company has deposited or
caused to be irrevocably deposited (except as provided in Section 8.03)
with the Trustee as trust funds in trust, specifically pledged as security
for, and dedicated solely to, the benefit of the Holders of such
Securities, cash in U.S. Dollars and/or U.S. Government Obligations which
through the payment of interest and principal in respect thereof, in
accordance with their terms, will provide (and without reinvestment and
assuming no tax liability will be imposed on such Trustee), not later than
one day before the due date of any payment of money, an amount in cash,
sufficient, in the opinion of a nationally recognized firm of independent
certified public accountants expressed in a written certification thereof
delivered to the Trustee, to pay principal and interest, if any, on and any
mandatory sinking fund in respect of the Securities of such series on the
dates such installments of interest or principal are due;
(b) Such deposit will not result in a breach or violation of, or
constitute a default under, this Indenture or any other agreement or
instrument to which the Company is a party or by which it is bound;
(c) No Default or Event of Default with respect to the Securities of
such series shall have occurred and be continuing on the date of such
deposit or during the period ending on the 91st day after such date;
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(d) The Company shall have delivered to the Trustee an Opinion of
Counsel confirming that Holders of the Securities of such series will not
recognize income, gain or loss for federal income tax purposes as a result
of such deposit and defeasance and will be subject to federal income tax on
the same amounts, in the same manner and at the same times as would have
been the case if such deposit and defeasance had not occurred;
(e) The Company shall have delivered to the Trustee an Officers'
Certificate stating the deposit was not made by the Company with the intent
of preferring the Holders of the Securities of such series over any other
creditors of the Company or with the intent of defeating, hindering,
delaying or defrauding any other creditors of the Company; and
(f) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the defeasance contemplated by
this Section have been complied with.
Section 8.05. Repayment to Company.
The Trustee and the Paying Agent shall pay to the Company upon request
any money held by them for the payment of principal or interest that remains
unclaimed for two years after the date upon which such payment shall have
become due. After payment to the Company, Securityholders entitled to the
money must look to the Company for payment as general creditors unless an
applicable abandoned property law designates another Person.
ARTICLE 9
SUPPLEMENTS, AMENDMENTS AND WAIVERS
Section 9.01. Without Consent of Holders.
The Company and the Trustee as to any series of Securities may supplement
or amend this Indenture or the Securities without notice to or the consent of
any Securityholder:
(1) to cure any ambiguity, defect or inconsistency;
(2) to comply with Article 5;
31
<PAGE>
(3) to comply with any requirements of the Commission in connection
with the qualification of this Indenture under the TIA;
(4) to provide for uncertificated Securities in addition to or in
place of certificated Securities;
(5) to add to, change or eliminate any of the provisions of this
Indenture in respect of one or more series of Securities, provided,
however, that any such addition, change or elimination (A) shall neither
(i) apply to any Security of any series created prior to the execution of
such supplemental indenture and entitled to the benefit of such provision
nor (ii) modify the rights of the Holder of any such Security with respect
to such provision or (B) shall become effective only when there is no
outstanding Security of any series created prior to the execution of such
supplemental indenture and entitled to the benefit of such provision;
(6) to make any change that does not adversely affect in any material
respect the interests of the Securityholders of any series; or
(7) to establish additional series of Securities as permitted by
Section 2.01.
Section 9.02. With Consent of Holders.
Subject to Section 6.07, the Company and the Trustee as to any series of
Securities may amend this Indenture or the Securities of that series with the
written consent of the Holders of a majority in principal amount of the then
outstanding Securities of each series affected by the amendment, with each
such series voting as a separate class. The Holders of a majority in
principal amount of the then outstanding Securities of any series may also
waive compliance in a particular instance by the Company with any provision
of this Indenture with respect to that series or the Securities of that
series; provided, however, that without the consent of each Securityholder
affected, an amendment or waiver may not:
(1) reduce the percentage of the principal amount of Securities whose
Holders must consent to an amendment or waiver;
(2) reduce the amount of, or postpone the date fixed for, the
payment of any sinking fund or analogous provision;
(3) reduce the rate of, or change the time for payment of interest
on, any Security;
(4) reduce the principal of or change the fixed maturity of any
Security or waive a redemption payment or alter the redemption provisions
with respect thereto;
(5) make any Security payable in money other than that stated in the
Security;
(6) reduce the principal amount of Original Issue Discount
Securities payable upon acceleration of the maturity thereof;
(7) make any change in Section 6.04, 6.07 or 9.02 (this sentence); or
32
<PAGE>
(6) waive a default in the payment of the principal of, or interest
on, any Security, except to the extent otherwise provided for in Section
6.02.
An amendment or waiver under this Section which waives, 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 the consent of the Holders under this
Section to approve the particular form of any proposed amendment or waiver,
but it shall be sufficient if such consent approves the substance thereof.
The Company will mail supplemental indentures to Holders upon request.
Any failure of the Company to mail such notice, or any defect therein, shall
not, however, in any way impair or affect the validity of any such
supplemental indenture or waiver.
Section 9.03. Revocation and Effect of Consents.
Until an amendment or waiver becomes effective, a consent to it by a
Holder of a Security is a continuing consent by the Holder and every
subsequent Holder of a Security or portion of a Security that evidences the
same debt as the consenting Holder's Security, even if notation of the
consent is not made on any Security; provided, however, that unless a record
date shall have been established pursuant to Section 2.13(a), any such Holder
or subsequent Holder may revoke the consent as to his Security or portion of
a Security if the Trustee receives the notice of revocation before the date
on which the amendment or waiver becomes effective. An amendment or waiver
shall become effective on receipt by the Trustee of consents from the Holders
of the requisite percentage principal amount of the outstanding Securities of
any series, and thereafter shall bind every Holder of Securities of that
series.
Section 9.04. Notation on or Exchange of Securities.
If an amendment or waiver changes the terms of a Security: (a) the
Trustee may require the Holder of the Security to deliver it to the Trustee,
the Trustee may place an appropriate notation on the Security about the
changed terms and return it to the Holder and the Trustee may place an
appropriate notation on any Security thereafter authenticated; or (b) if the
Company or the Trustee so determines, the Company in exchange for the
Security shall issue and the Trustee shall authenticate a new Security that
reflects the changed terms.
33
<PAGE>
Section 9.05. Trustee to Sign Amendments, etc.
The Trustee shall receive an Opinion of Counsel stating that the
execution of any amendment or waiver proposed pursuant to this Article is
authorized or permitted by this Indenture. Subject to the preceding
sentence, the Trustee shall sign such amendment or waiver if the same does
not adversely affect the rights, duties, liabilities or immunities of the
Trustee. The Trustee may, but shall not be obligated to, execute any such
amendment, supplement or waiver which affects the Trustee's own rights,
duties, liabilities or immunities under this Indenture or otherwise.
ARTICLE 10
MISCELLANEOUS
Section 10.01. Indenture Subject to Trust Indenture Act.
This Indenture is subject to the provisions of the TIA which are required
to be part of this Indenture, and shall, to the extent applicable, be
governed by such provisions.
Section 10.02. Notices.
Any notice or communication is duly given if in writing and delivered in
person or sent by first-class mail (registered or certified, return receipt
requested), telecopier or overnight air courier guaranteeing next day
delivery, addressed as follows:
If to the Company:
Owens-Illinois, Inc.
One SeaGate
Toledo, Ohio 43666
Attention:
If to the Trustee:
_______________________________
_______________________________
_______________________________
_______________________________
Attention:[___________________]
The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders) shall
be deemed to have been duly given: at the time delivered by hand, if
personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when receipt
34
<PAGE>
acknowledged, if telecopied; and the next Business Day after timely delivery
to the courier, if sent by overnight air courier guaranteeing next day
delivery.
Any notice or communication to a Securityholder shall be mailed by
first-class mail to his address shown on the register kept by the Registrar.
Failure to mail a notice or communication to a Securityholder or any defect
in it shall not affect its sufficiency with respect to other Securityholders.
If the Company mails a notice or communication to Securityholders, it shall
mail a copy to the Trustee at the same time.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
Section 10.03. Communication By Holders With Other Holders.
Holders may communicate pursuant to TIA Section 312(b) with other
Holders with respect to their rights under this Indenture or the Securities.
The Company, the Trustee, the Registrar and anyone else shall have the
protection of TIA Section 312(c).
Section 10.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(b) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
Section 10.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture (other than the certificate
provided for in Section 4.03) shall include:
(1) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(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 such Person, he or she has
made such examination or investigation as is necessary to enable him or her
to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
35
<PAGE>
(4) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been complied with; provided, however, that
with respect to matters of fact an Opinion of Counsel may rely on an
officer's certificate or certificates of public officials.
Section 10.06. Rules by Trustee and Agents.
The Trustee as to Securities of any series may make reasonable rules for
action by or at a meeting of Holders of Securities of that series. The
Registrar and any Paying Agent or Authenticating Agent may make reasonable
rules and set reasonable requirements for their functions.
Section 10.07. Legal Holidays.
A "Legal Holiday" is a Saturday, a Sunday or a day on which banking
institutions in New York, New York or Toledo, Ohio, are not required to be
open. If a payment date is a Legal Holiday at a place of payment, payment may
be made at that place on the next succeeding day that is not a Legal Holiday,
and no interest shall accrue for the intervening period.
Section 10.08. No Recourse Against Others.
A past, present or future director, officer, employee, stockholder or
incorporator, as such, of the Company or any successor corporation shall not
have any liability for any obligations of the Company under any series of
Securities or the Indenture or for any claim based on, in respect of, or by
reason of such obligations or their creation. Each Securityholder by
accepting a Security waives and releases all such liability. The waiver and
release are part of the consideration of issuance of the Securities. Such
waiver may not be effective to waive liabilities under the federal securities
laws and it is the view of the Commission that such a waiver is against
public policy.
Section 10.09. Counterparts.
This Indenture may be executed by the parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement.
Section 10.10. Governing Law.
The internal laws of the State of New York shall govern this Indenture
and the Securities, without regard to the conflict of laws provisions
thereof.
Section 10.11. Severability.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.
36
<PAGE>
Section 10.12. Effect of Headings, Table of Contents, etc.
The Article and Section headings herein and the table of contents are for
convenience only and shall not affect the construction hereof.
Section 10.13. Successors and Assigns.
All covenants and agreements of the Company in this Indenture and the
Securities shall bind its successors and assigns. All agreements of the
Trustee in this Indenture shall bind its successor.
Section 10.14. No Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or any Subsidiary. Any such indenture, loan or
debt agreement may not be used to interpret this Indenture.
37
<PAGE>
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have executed this Indenture as of
the date first above written.
OWENS-ILLINOIS, INC.
By____________________________
Name:
Title:
[ ],
as Trustee
By____________________________
Name:
Title:
S-1
<PAGE>
Exhibit 5
[Latham & Watkins Letterhead]
April 14, 1997
Owens-Illinois, Inc.
Owens-Illinois Group, Inc.
One SeaGate
Toledo, Ohio 43666
Re: $2,500,000,000 Aggregate Offering Price of
Securities of Owens-Illinois, Inc.
Ladies and Gentlemen:
In connection with the registration statement on Form S-3
filed on April 14, 1997 with the Securities and Exchange Commission
(the "Commission") under the Securities Act of 1933, as amended
(the "Securities Act"), which registration statement also
constitutes, pursuant to Rule 429 under the Securities Act,
Post-Effective Amendment No. 1 to Registration Statement No.
33-51982 (collectively, the "Registration Statements"), you have
requested our opinion with respect to the matters set forth below.
You have provided us with a draft prospectus (the "Prospectus")
which is a part of the Registration Statements. The Prospectus provides that
it will be supplemented in the future by one or more supplements to the
Prospectus (each a "Prospectus Supplement"). The Prospectus as supplemented
by various Prospectus Supplements will provide for the registration by the
Owens-Illinois, Inc., a Delaware corporation (the "Company"), of up to
$2,500,000,000 aggregate offering price of (i) one or more series of senior,
senior subordinated or subordinated debt securities (the "Debt Securities"),
or (ii) shares of common stock, par value $.01 per share (the "Common Stock")
and the registration by Owens-Illinois Group, Inc., a Delaware corporation
("Group"), of guarantees of the Debt Securities (the "Guarantees"). The Debt
Securities, the Guarantees and Common Stock are collectively referred to
herein as the "Securities." Any Debt Securities may be exchangeable and/or
convertible into shares of Common Stock. The Debt Securities may be issued
pursuant to one or more indentures and one or more supplements thereto
(collectively, the "Indentures"), in each case between the Company and a
trustee (each, a "Trustee").
<PAGE>
Owens-Illinois, Inc.
April 14, 1997
Page 2
In our capacity as your special counsel in connection with the
Registration Statements, we are generally familiar with the proceedings taken
and proposed to be taken by the Company in connection with the authorization
and issuance of the Securities. For purposes of this opinion, we have
assumed that such proceedings will be timely and properly completed, in
accordance with all requirements of applicable federal, Delaware and New York
laws, in the manner presently proposed.
We have made such legal and factual examinations and inquiries,
including an examination of originals and copies certified or otherwise
identified to our satisfaction, of all such documents, corporate records and
instruments of the Company as we have deemed necessary or appropriate for
purposes of this opinion. In our examination, we have assumed the
genuineness of all signatures, the authenticity of all documents submitted to
us as originals, and the conformity to authentic original documents of all
documents submitted to us as copies.
We have been furnished with, and with your consent have exclusively
relied upon, certificates of officers of the Company with respect to certain
factual matters. In addition, we have obtained and relied upon such
certificates and assurances from public officials as we have deemed necessary.
We are opining herein as to the effect on the subject transaction
only of the federal securities laws of the United States, the General
Corporation Law of the State of Delaware and with respect to opinion
paragraphs 1 and 2 below, the internal laws of the State of New York, and we
express no opinion with respect to the applicability thereto, or the effect
thereon, of the laws of any other jurisdiction or, in the case of Delaware,
any other laws, or as to any matters of municipal law or the laws of any
local agencies within any state.
Subject to the foregoing and the other qualifications set forth
herein, it is our opinion that, as of the date hereof:
1. When (a) the Debt Securities have been duly established in
accordance with the terms of the applicable Indentures (including, without
limitation, the adoption by the Board of Directors of the Company of a
resolution duly authorizing the issuance and delivery of the Debt
Securities), duly authenticated by the Trustee and duly executed and
delivered on behalf of the Company against payment therefor in accordance
with the terms and provisions of the applicable Indenture and as contemplated
by the Registration Statements, the Prospectus and the related Prospectus
Supplement(s), and (b) when each of the Registration Statements and any
required post-effective amendment thereto have all become effective under the
Securities Act, and (c) assuming that the terms of the Debt Securities as
executed and delivered are as described in the Registration Statements, the
Prospectus and the related Prospectus Supplement(s), and (d) assuming that
the Debt Securities as executed
<PAGE>
Owens-Illinois, Inc.
April 14, 1997
Page 3
and delivered do not violate any law applicable to the Company or result in a
default under or breach of any agreement or instrument binding upon the
Company, and (e) assuming that the Debt Securities as executed and delivered
comply with all requirements and restrictions, if any, applicable to the
Company, whether imposed by any court or governmental or regulatory body
having jurisdiction over the Company, and (f) assuming that the Debt
Securities are then issued and sold as contemplated in the Registration
Statements, the Prospectus and the related Prospectus Supplement(s), the Debt
Securities will constitute valid and legally binding obligations of the
Company, enforceable against the Company in accordance with the terms of the
Debt Securities.
2. When (a) the Guarantees and the related Debt Securities have
been duly established in accordance with the terms of the applicable
Indentures (including, without limitation, the adoption by the Board of
Directors of the Company of a resolution duly authorizing the issuance and
delivery of the Guarantees and the related Debt Securities), the Guarantees
have been duly executed and delivered and the related Debt Securities have
been duly authenticated by the Trustee and duly executed and delivered on
behalf of the Company against payment therefor in accordance with the terms
and provisions of the applicable Indenture and as contemplated by the
Registration Statements, the Prospectus and the related Prospectus
Supplement(s), and (b) when each of the Registration Statements and any
required post-effective amendment thereto have all become effective under the
Securities Act, and (c) assuming that the terms of the Guarantees as executed
and delivered are as described in the Registration Statements, the Prospectus
and the related Prospectus Supplement(s), and (d) assuming that the
Guarantees as executed and delivered do not violate any law applicable to the
Group or result in a default under or breach of any agreement or instrument
binding upon the Group, and (e) assuming that the Guarantees as executed and
delivered comply with all requirements and restrictions, if any, applicable
to the Group, whether imposed by any court or governmental or regulatory body
having jurisdiction over the Group, and (f) assuming that the Guarantees are
then issued as contemplated in the Registration Statements, the Prospectus
and the related Prospectus Supplement(s), the Guarantees will constitute
valid and legally binding obligations of the Group, enforceable against the
Group in accordance with the terms of the Guarantees.
3. The Company has the authority pursuant to its Certificate of
Incorporation to issue up to 250,000,000 shares of Common Stock. Upon
adoption by the Board of Directors of the Company of a resolution in form and
content as required by applicable law and upon issuance and delivery of and
payment for such shares in the manner contemplated by the Registration
Statements, the Prospectus and the related Prospectus Supplement(s) and by
such resolution, such shares of Common Stock (including any Common Stock duly
issued upon the exchange or conversion of Debt Securities that are
exchangeable or convertible into Common Stock) will be validly issued, fully
paid and nonassessable.
<PAGE>
Owens-Illinois, Inc.
April 14, 1997
Page 4
The opinions set forth in paragraphs 1 and 2 above are subject to
the following exceptions, limitations and qualifications: (i) the effect of
bankruptcy, insolvency, reorganization, moratorium or other similar laws now
or hereafter in effect relating to or affecting the rights and remedies of
creditors; (ii) the effect of general principles of equity, including without
limitation, concepts of materiality, reasonableness, good faith and fair
dealing and the possible unavailability of specific performance or injunctive
relief, regardless of whether enforcement is considered in a proceeding in
equity or at law, and the discretion of the court before which any proceeding
therefor may be brought; (iii) the unenforceability under certain
circumstances under law or court decisions of provisions providing for the
indemnification of, or contribution to, a party with respect to a liability
where such indemnification or contribution is contrary to public policy; (iv)
we express no opinion concerning the enforceability of any waiver of rights
or defenses with respect to stay, extension or usury laws; and (v) we express
no opinion with respect to whether acceleration of Debt Securities may affect
the collectibility of any portion of the stated principal amount thereof
which might be determined to constitute unearned interest thereon.
We assume for purposes of this opinion that each of the Company and
Group has been duly incorporated and is validly existing as a corporation
under the laws of the State of Delaware and has the corporate power and
authority to issue and sell the Securities; that the applicable Indenture has
been duly authorized by all necessary corporate action by the Company and
Group, has been duly executed and delivered by the Company and Group and
constitutes the legally valid, binding and enforceable obligation of each of
the Company and Group enforceable against each of the Company and Group in
accordance with its terms; the Trustee for each Indenture is duly organized,
validly existing and in good standing under the laws of its jurisdiction of
organization; that the Trustee is duly qualified to engage in the activities
contemplated by the applicable Indenture; that the applicable Indenture has
been duly authorized, executed and delivered by the Trustee and constitutes a
legally valid, binding and enforceable obligation of the Trustee, enforceable
against the Trustee in accordance with its terms; that the Trustee is in
compliance, generally and with respect to acting as Trustee under the
applicable Indenture, with all applicable laws and regulations; and that the
Trustee has the requisite organizational and legal power and authority to
perform its obligations under the applicable Indenture.
We consent to your filing this opinion as an exhibit to the
Registration Statements and to the reference to our firm under the caption
"Legal Matters" in the Prospectus included therein.
Very truly yours,
/s/ Latham & Watkins
<PAGE>
EXHIBIT 12
OWENS-ILLINOIS, INC.
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(MILLIONS OF DOLLARS, EXCEPT RATIOS)
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
-----------------------------------------------------
1996 1995 1994 1993 1992
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Earnings (loss) from continuing operations before income taxes, minority
share owners' interests, extraordinary items and cumulative effect of
accounting change..................................................... $ 324.1 $ 310.0 $ 171.3 $ (294.5) $ 156.9
Pretax earnings of majority-owned subsidiary not consolidated........... 8.7 4.3 1.7
Less: Equity earnings................................................... (15.2) (14.4) (22.3) (25.3) (23.2)
Add: Total fixed charges deducted from earnings......................... 324.3 321.1 298.0 316.4 339.5
Proportional share of pretax earnings of 50% owned associates...... 18.6 17.4
Dividends received from less than 50% owned associates............. 2.7 3.7 2.9 4.9 4.9
--------- --------- --------- --------- ---------
Earnings available for payment of fixed charges.................... $ 635.9 $ 620.4 $ 458.6 $ 24.4 $ 497.2
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------
Fixed charges (including the Company's proportional share of 50% owned
associates):
Interest expense................................................... $ 297.6 $ 294.6 $ 273.1 $ 284.6 $ 306.9
Portion of operating lease rental deemed to be interest............ 21.7 21.5 19.8 20.3 20.6
Amortization of deferred financing costs and debt discount
expense.......................................................... 5.0 5.0 5.1 11.5 12.0
--------- --------- --------- --------- ---------
Total fixed charges deducted from earnings and total fixed
charges....................................................... $ 324.3 $ 321.1 $ 298.0 $ 316.4 $ 339.5
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------
Ratio of earnings to fixed charges...................................... 2.0 1.9 1.5 1.5
Deficiency of earnings available to cover fixed charges................. $ 292.0
</TABLE>
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement on Form S-3 and related Prospectus of Owens-Illinois,
Inc. and Owens-Illinois Group, Inc. for the registration of $2.5 billion of debt
securities, guarantees of debt securities and common stock and to the
incorporation by reference therein of our report dated February 4, 1997, with
respect to the consolidated financial statements and schedule of Owens-Illinois,
Inc. included in the Annual Report (Form 10-K) of Owens-Illinois, Inc. and
Owens-Illinois Group, Inc. for the year ended December 31, 1996, filed with the
Securities and Exchange Commission.
/s/ Ernst & Young LLP
Toledo, Ohio
April 14, 1997
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
Avir Finanziaria S.p.A.:
We consent to the reference to our firm under the caption "Experts" and to
the incorporation by reference in the Registration Statement dated April 14,
1997 on Form S-3 for the registration of debt securities, guarantees of debt
securities and common stock of Owens-Illinois, Inc. and Owens-Illinois Group,
Inc. of our report dated May 13, 1996, except as to Note 21, which is as of
March 3, 1997, with respect to the consolidated financial statements of Avir
Finanziaria S.p.A. and subsidiaries as of and for the year ended December 31,
1995, which report appears in the Form 8-K/A of Owens-Illinois, Inc. dated March
3, 1997.
/s/ KPMG S.p.A.
Rome, Italy
April 14, 1997
<PAGE>
EXHIBIT 23.4
CONSENT OF MCCARTER & ENGLISH
April 11, 1997
Ladies and Gentleman:
We consent to the reference to our firm contained under the caption
"Contingencies" in the Annual Report on Form 10-K of Owens-Illinois, Inc. and
Owens-Illinois Group, Inc. for the year ended December 31, 1996 being
incorporated by reference in the Registration Statement on Form S-3 relating to
the registration by Owens-Illinois, Inc. and Owens-Illinois Group, Inc. of $2.5
billion of debt securities, guarantees of debt securities and common stock.
Very truly yours,
/s/ McCarter & English
