<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 6, 1998
REGISTRATION NO. 333-33133
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
---------------------
QUAKER STATE CORPORATION
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 25-0742820
(State of Incorporation) (I.R.S. Employer Identification No.)
</TABLE>
225 EAST JOHN CARPENTER FREEWAY
IRVING, TEXAS 75062
(972) 868-0400
(Address, including zip code, and telephone
number, including area code, of
registrant's principal executive offices)
---------------------
PAUL E. KONNEY
SENIOR VICE PRESIDENT,
GENERAL COUNSEL AND SECRETARY
QUAKER STATE CORPORATION
225 EAST JOHN CARPENTER FREEWAY
IRVING, TEXAS 75062
(972) 868-0400
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
---------------------
COPIES TO:
JEFFREY A. CHAPMAN
MARIAN L. BRANCACCIO
VINSON & ELKINS L.L.P.
2001 ROSS AVENUE, SUITE 3700
DALLAS, TEXAS 75201
(214) 220-7700
---------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
================================================================================
<PAGE> 2
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.
SUBJECT TO COMPLETION, DATED APRIL 6, 1998
PROSPECTUS
DEBT SECURITIES
CAPITAL STOCK
WARRANTS
QUAKER STATE CORPORATION
---------------------
Quaker State Corporation (the "Company") may from time to time offer in one
or more series its (a) debt securities ("Debt Securities"), (b) warrants to
purchase Debt Securities ("Debt Warrants"), (c) Capital Stock, par value $1.00
per share ("Capital Stock"), or (d) warrants to purchase Capital Stock ("Capital
Stock Warrants"), all having an aggregate initial offering price not to exceed
$400,000,000 or the equivalent thereof in one or more foreign currencies,
foreign currency units, or composite currencies, including European Currency
Units. The Debt Warrants and the Capital Stock Warrants are collectively
referred to herein as the "Warrants." The Debt Securities, Capital Stock and
Warrants offered by the Company hereby (collectively referred to herein as the
"Offered Securities") may be offered, separately or together, in separate
series, in amounts, at prices and on terms to be set forth in a supplement to
this Prospectus (a "Prospectus Supplement").
The specific terms of the Offered Securities in respect of which this
Prospectus is being delivered will be set forth in the applicable Prospectus
Supplement and will include, where applicable: (a) in the case of Debt
Securities, the specific title, aggregate principal amount, currency, form
(which may be registered or bearer, certificated or global), authorized
denominations, maturity, rate (or manner of calculation thereof) and time of
payment of interest, terms for redemption at the option of the Company or
repayment at the option of the holder, terms for sinking fund payments, and any
initial public offering price, (b) in the case of Capital Stock, the number of
shares and the terms of the offering and sale thereof, (c) in the case of
Warrants, the number and terms thereof, the designation and the number of
securities issuable upon exercise, the exercise price, the terms of the offering
and sale thereof, and where applicable, the duration and detachability thereof,
and (d) in the case of all Offered Securities, whether such Offered Securities
will be offered separately or as a unit with other Offered Securities. The
applicable Prospectus Supplement will also contain information, where
applicable, about certain United States federal income tax considerations
relating to, and any listing on a securities exchange of, the Offered Securities
covered by such Prospectus Supplement.
The Company may sell the Offered Securities in or outside the United States
through underwriters, brokers or dealers, directly to one or more purchasers or
through agents. If any agents or underwriters are involved in the sale of any of
the Offered Securities, their names, and any applicable purchase price, fee,
commission or discount arrangement between or among them, will be set forth, or
will be calculable from the information set forth, in the applicable Prospectus
Supplement. See "Plan of Distribution." No Offered Securities may be sold
without delivery of the applicable Prospectus Supplement describing the method
and terms of the offering of such series of Offered Securities.
---------------------
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 date of this Prospectus is , 1998.
<PAGE> 3
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 (the "Exchange Act"), and, in accordance therewith, files
reports, proxy statements and other information with the Securities and Exchange
Commission (the "Commission"). Such reports, proxy statements and other
information can be inspected and copied at the public reference facilities
maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549;
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661;
and 7 World Trade Center, 13th Floor, New York, New York 10048. Copies of such
material can be obtained at prescribed rates from the Public Reference Section
of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. Such
material can also be obtained from the Commission's web site at
http://www.sec.gov. The Company's outstanding shares of Capital Stock are listed
on the New York Stock Exchange (the "NYSE") and the Pacific Stock Exchange (the
"PSE") under the symbol "KSF," and all such reports, proxy statements and other
information filed by the Company with the NYSE may be inspected at the NYSE's
offices at 20 Broad Street, New York, New York 10005 and at the PSE's offices at
301 Pine Street, San Francisco, California 94104.
This Prospectus constitutes part of a registration statement on Form S-3
(together with all amendments and exhibits thereto, the "Registration
Statement") filed by the Company with the Commission under the Securities Act of
1933 (the "Securities Act"). This Prospectus and the accompanying Prospectus
Supplement do not contain all of the information set forth in the Registration
Statement, certain parts of which are omitted in accordance with the rules and
regulations of the Commission. For further information with respect to the
Company and the Offered Securities, reference is hereby made to the Registration
Statement and to the exhibits thereto. Statements contained herein regarding the
provisions of certain documents are not necessarily complete, and in each
instance, reference is made to the copy of such document filed as an exhibit to
the Registration Statement or otherwise filed with the Commission, and each such
statement is qualified in its entirety by that reference.
INCORPORATION BY REFERENCE
There are incorporated herein by reference the following documents
heretofore filed by the Company with the Commission (File No. 1-2677):
(a) the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1997;
(b) the Company's Current Report on Form 8-K/A-2 dated October 2,
1996, relating to the acquisition of Blue Coral, Inc.; and
(c) the description of the Capital Stock contained in the Company's
Current Report on Form 8-K filed on November 12, 1997.
All documents subsequently filed by the Company pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus
and prior to the termination of the offering of the Offered Securities shall be
deemed to be incorporated by reference in this Prospectus and to be a part
hereof from the date of filing of such documents. Any statement contained herein
or 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 subsequently filed
document which 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 to constitute a part of this Prospectus, except
as so modified or superseded.
The Company will provide without charge to each person, including any
beneficial owner, to whom a copy of this Prospectus is delivered, upon the
written or oral request of such person, a copy of any or all of the documents
incorporated herein by reference, other than exhibits to such documents (unless
such exhibits are specifically incorporated by reference into such documents).
Requests for such copies should be directed to General Counsel, Quaker State
Corporation, 225 East John Carpenter Freeway, Irving, Texas 75062, telephone
(972) 868-0400.
2
<PAGE> 4
With the exception of historical information, the matters discussed herein
and in documents incorporated by reference are forward-looking statements that
involve risks and uncertainties, including, but not limited to, economic
conditions, product demand, competitive products and pricing, availability of
products, changes in inventory due to shifts in market demand, environmental and
trade regulations, litigation and other risks described in other filings made by
the Company with the Commission. As used herein the terms "Quaker State" and
"Company" include Quaker State Corporation, a Delaware corporation, and one or
more of its subsidiaries, as appropriate.
THE COMPANY
Quaker State Corporation is a leading marketer of branded and private label
lubricants, lubricant services and consumer branded automotive aftermarket
products. The Company's products include motor oils and other lubricants,
automobile engine and fuel treatments, automotive appearance products, window
shades, accessories and air fresheners. The Company's lubricant services are
marketed through fast lube centers in selected areas of the United States and
Canada.
The Company's Lubricants and Lubricant Services segment markets and
distributes major national brand, private label and proprietary brand lubricants
and other automotive aftermarket products primarily in the United States, Canada
and Mexico. The Quaker State brand of motor oil has the second highest market
share in the motor oil category in the United States and a significant market
share in Mexico and Canada. From 1993 to 1997, the Company increased its motor
oil market share in the United States from 12.5% to 14.5%, based on data from
NPD (National Pocket Diary), the recognized authority on market share data in
this category. Through its subsidiary Q Lube, Inc., the second largest fast lube
chain in the United States, the Company operates fast lube centers which offer
consumers quick and economical oil changes and related services for passenger
vehicles. The Lubricants and Lubricant Services segment also provides
collection, transportation and recycling services for used oil, antifreeze and
filters in certain regions of the United States. During 1997, revenues and
operating profit from the Lubricants and Lubricant Services segment comprised
approximately 76% and 43% of the Company's total revenues and operating profit,
respectively.
Beginning in 1995 with the acquisition of Slick 50, the Company began
building a consumer products business that complements the existing Quaker State
motor oil brand. The Company's Consumer Products segment now consists of the
following recently acquired companies: Slick 50, Inc. ("Slick 50"), Blue Coral,
Inc. ("Blue Coral"), Medo Industries, Inc. and its affiliated companies
(collectively, "Medo"), the Axius division of Medo and Rain-X Corporation
("Rain-X"). Slick 50 is the leading brand of automotive engine and fuel
treatment products and related automotive chemicals. Blue Coral manufactures and
markets automotive appearance products, whose leading consumer brands include
Blue Coral, Black Magic and Westley's. Medo is the leading seller of automotive
air freshener products, whose brands include Ultra Norsk. Axius is the leading
marketer of autoshades and automotive accessories, whose brands include
Autoshade sun protectors and Axius car organizers. Rain-X also is a marketer of
automotive glass protectant products. During 1997, revenues and operating profit
from the Consumer Products segment comprised approximately 24% and 57% of the
Company's total revenues and operating profit, respectively.
The Company, a Delaware corporation formed in 1931, has its principal
executive offices at 225 E. John Carpenter Freeway, Irving, Texas 75062. Its
telephone number is (972) 868-0400.
USE OF PROCEEDS
Unless otherwise described in the applicable Prospectus Supplement, the net
proceeds from the sale of the Offered Securities will be used for general
corporate purposes, which may include repayment of indebtedness, redemption or
repurchase of securities of the Company or any subsidiary, additions to working
capital and capital expenditures.
3
<PAGE> 5
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the Company's consolidated ratios of
earnings to fixed charges for each of the years ended December 31, 1997, 1996,
1995, 1994 and 1993.
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------
1997 1996 1995 1994 1993
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Ratio of earnings to fixed charges(a)................. .7 1.8 .6 1.3 1.3
</TABLE>
- ---------------
(a) For purposes of computing such ratio, earnings consist of income before
income taxes plus fixed charges net of interest capitalized, and fixed
charges consist of interest expense, interest capitalized, amortization of
debt expense and discount or premium relating to any indebtedness, and the
portion of rental expense attributable to interest.
4
<PAGE> 6
DESCRIPTION OF DEBT SECURITIES
The following description of the terms of the Debt Securities 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 may apply to the Debt Securities so offered will be described
in the Prospectus Supplement relating to such Debt Securities. Accordingly, for
a description of the terms of a particular issue of Debt Securities, reference
must be made to both the Prospectus Supplement relating thereto and to the
following description.
The Debt Securities will be general obligations of the Company and may be
subordinated to Senior Indebtedness (as defined below) of the Company to the
extent set forth in the Prospectus Supplement relating thereto. See "Description
of Debt Securities -- Subordination." Debt Securities will be issued under an
Indenture (the "Indenture") to be entered into between the Company and one or
more commercial banks to be selected as trustees (collectively, the "Trustee").
A copy of the form of Indenture has been filed as an exhibit to the Registration
Statement filed with the SEC. The following discussion of certain provisions of
the Indenture is a summary only and does not purport to be a complete
description of the terms and provisions of the Indenture. Accordingly, the
following discussion is qualified in its entirety by reference to the provisions
of the Indenture, including the definition therein of terms used below with
their initial letters capitalized.
GENERAL
The Indenture does not limit the aggregate principal amount of Debt
Securities that can be issued thereunder. The Debt Securities may be issued in
one or more series as may be authorized from time to time by the Company.
Reference is made to the applicable Prospectus Supplement for the following
terms of the Debt Securities of the series with respect to which such Prospectus
Supplement is being delivered:
(a) The title of the Debt Securities of the series;
(b) Any limit on the aggregate principal amount of the Debt Securities
of the series that may be authenticated and delivered under the Indenture;
(c) The date or dates on which the principal and premium with respect
to the Debt Securities of the series are payable;
(d) The rate or rates (which may be fixed or variable) at which the
Debt Securities of the series shall bear interest (if any) or the method of
determining such rate or rates, the date or dates from which such interest
shall accrue, the dates on which such interest shall be payable or the
method by which such dates will be determined, the record dates for the
determination of holders thereof to whom such interest is payable (in the
case of Registered Securities), and the basis upon which such interest will
be calculated if other than that of a 360-day year of twelve 30-day months;
(e) The place or places, if any, in addition to or instead of the
corporate trust office of the Trustee (in the case of Registered
Securities) or the principal London office of the Trustee (in the case of
Bearer Securities), where the principal, premium and interest with respect
to Debt Securities of the series shall be payable;
(f) The price or prices at which, the period or periods within which,
and the terms and conditions upon which Debt Securities of the series may
be redeemed, in whole or in part, at the option of the Company or
otherwise;
(g) Whether Debt Securities of the series are to be issued as
Registered Securities or Bearer Securities or both and, if Bearer
Securities are to be issued, whether coupons will be attached thereto,
whether Bearer Securities of the series may be exchanged for Registered
Securities of the series, and the circumstances under which and the places
at which any such exchanges, if permitted, may be made;
(h) If any Debt Securities of the series are to be issued as Bearer
Securities or as one or more Global Securities representing individual
Bearer Securities of the series, whether certain provisions for the payment
of additional interest or tax redemptions shall apply; whether interest
with respect to any
5
<PAGE> 7
portion of a temporary Bearer Security of the series payable with respect
to any interest payment date prior to the exchange of such temporary Bearer
Security for definitive Bearer Securities of the series shall be paid to
any clearing organization with respect to the portion of such temporary
Bearer Security held for its account and, in such event, the terms and
conditions (including any certification requirements) upon which any such
interest payment received by a clearing organization will be credited to
the persons entitled to interest payable on such interest payment date; and
the terms upon which a temporary Bearer Security may be exchanged for one
or more definitive Bearer Securities of the series;
(i) The obligation, if any, of the Company to redeem, purchase, or
repay Debt Securities of the series pursuant to any sinking fund or
analogous provisions or at the option of a holder thereof and the price or
prices at which, the period or periods within which, and the terms and
conditions upon which Debt Securities of the series shall be redeemed,
purchased or repaid, in whole or in part, pursuant to such obligations;
(j) The terms, if any, upon which the Debt Securities of the series
may be convertible into or exchanged for Capital Stock, other Debt
Securities, or Warrants, and the terms and conditions upon which such
conversion or exchange shall be effected, including the initial conversion
or exchange price or rate, the conversion or exchange period, and any other
additional provisions; provided however, that Debt Securities of the series
may be converted into or exchanged for securities other than Capital Stock,
other Debt Securities or Warrants only if such conversion or exchange
occurs after one year from the date of sale of the Debt Securities of the
series;
(k) If other than denominations of $1,000 or any integral multiple
thereof, the denominations in which Debt Securities of the series shall be
issuable;
(l) If the amount of principal, premium, or interest with respect to
the Debt Securities of the series may be determined with reference to an
index or pursuant to a formula, the manner in which such amounts will be
determined;
(m) If the principal amount payable at the stated maturity of Debt
Securities of the series will not be determinable as of any one or more
dates prior to such stated maturity, the amount that will be deemed to be
such principal amount as of any such date for any purpose, including the
principal amount thereof which will be due and payable upon any maturity
other than the stated maturity or which will be deemed to be outstanding as
of any such date (or, in any such case, the manner in which such deemed
principal amount is to be determined), and if necessary, the manner of
determining the equivalent thereof in United States currency;
(n) Any changes or additions to the provisions of the Indenture
dealing with defeasance, including the addition of covenants that may be
subject to the Company's covenant defeasance option;
(o) If other than such coin or currency of the United States at the
time of payment is legal tender for payment of public and private debts,
the coin or currency or currencies or units of two or more currencies in
which payment of the principal, premium and interest with respect to Debt
Securities of the series shall be payable;
(p) If other than the principal amount thereof, the portion of the
principal amount of Debt Securities of the series that shall be payable
upon declaration of acceleration of the maturity thereof or provable in
bankruptcy;
(q) The terms, if any, of the transfer, mortgage, pledge or assignment
as security for the Debt Securities of the series of any properties,
assets, monies, proceeds, securities or other collateral, including whether
certain provisions of the Trust Indenture Act are applicable and any
corresponding changes to provisions of the Indenture as then in effect;
(r) Any addition to or change in the Events of Default with respect to
the Debt Securities of the series and any change in the right of the
Trustee or the holders to declare the principal, premium and interest with
respect to such Debt Securities due and payable;
6
<PAGE> 8
(s) If the Debt Securities of the series shall be issued in whole or
in part in the form of a Global Security, the terms and conditions, if any,
upon which such Global Security may be exchanged in whole or in part for
other individual Debt Securities in definitive registered form, the
Depositary for such Global Security, and the form of any legend or legends
to be borne by any such Global Security in addition to or in lieu of the
legend referred to in the Indenture;
(t) Any Trustee, authenticating or paying agents, transfer agents or
registrars;
(u) The applicability of, and any addition to or change in, the
covenants and definitions then set forth in the Indenture or in the terms
then set forth in the Indenture relating to permitted consolidations,
mergers or sales of assets, including conditioning any merger, conveyance,
transfer or lease permitted by the Indenture upon the satisfaction of an
indebtedness coverage standard by the Company and any successor to the
Company;
(v) The terms, if any, of any guarantee of the payment of principal,
premium and interest with respect to Debt Securities of the series and any
corresponding changes to the provisions of the Indenture as then in effect;
(w) The subordination, if any, of the Debt Securities of the series
pursuant to the Indenture and any changes or additions to the provisions of
the Indenture relating to subordination;
(x) With regard to Debt Securities of the series that do not bear
interest, the dates for certain required reports to the Trustee; and
(y) Any other terms of the Debt Securities of the series (which terms
shall not be prohibited by the provisions of the Indenture).
The Prospectus Supplement will also describe any material United States
federal income tax consequences or other special considerations applicable to
the series of Debt Securities to which such Prospectus Supplement relates,
including those applicable to (a) Bearer Securities, (b) Debt Securities with
respect to which payments of principal, premium or interest are determined with
reference to an index or formula (including changes in prices of particular
securities, currencies or commodities), (c) Debt Securities with respect to
which principal, premium or interest is payable in a foreign or composite
currency, (d) Debt Securities that are issued at a discount below their stated
principal amount, bearing no interest or interest at a rate that at the time of
issuance is below market rates ("Original Issue Discount Debt Securities"), and
(e) variable rate Debt Securities that are exchangeable for fixed rate Debt
Securities.
Payments of interest on Registered Securities may be made at the option of
the Company by check mailed to the registered holders thereof or, if so provided
in the applicable Prospectus Supplement, at the option of a holder by wire
transfer to an account designated by such holder. Except as otherwise provided
in the applicable Prospectus Supplement, no payment on a Bearer Security will be
made by mail to an address in the United States or by wire transfer to an
account in the United States.
Unless otherwise provided in the applicable Prospectus Supplement,
Registered Securities may be transferred or exchanged at the office of the
Trustee at which its corporate trust business is principally administered in the
United States or at the office of the Trustee or the Trustee's agent in the
Borough of Manhattan, the City and State of New York, at which its corporate
agency business is conducted, subject to the limitations provided in the
Indenture, without the payment of any service charge, other than any tax or
governmental charge payable in connection therewith. Bearer Securities will be
transferable only by delivery. Provisions with respect to the exchange of Bearer
Securities will be described in the Prospectus Supplement relating to such
Bearer Securities.
All funds paid by the Company to a paying agent for the payment of
principal, premium or interest with respect to any Debt Securities that remain
unclaimed at the end of two years after such principal, premium or interest
shall have become due and payable will be repaid to the Company, and the holders
of such Debt Securities or any coupons appertaining thereto will thereafter look
only to the Company for payment thereof.
7
<PAGE> 9
GLOBAL SECURITIES
The Debt Securities of a series may be issued in whole or in part in the
form of one or more Global Securities. A Global Security is a Debt Security that
represents, and is denominated in an amount equal to the aggregate principal
amount of, all outstanding Debt Securities of a series, or any portion thereof,
in either case having the same terms, including the same original issue date,
date or dates on which principal and interest are due, and interest rate or
method of determining interest. A Global Security will be deposited with, or on
behalf of, a Depositary, which will be identified in the Prospectus Supplement
relating to such Debt Securities. Global Securities may be issued in either
registered or bearer form and in either temporary or definitive form. Unless and
until it is exchanged in whole or in part for the individual Debt Securities
represented thereby, a Global Security may not be transferred except as a whole
by the Depositary to a nominee of the Depositary, by a nominee of the Depositary
to the Depositary or another nominee of the Depositary, or by the Depositary or
any nominee of the Depositary to a successor Depositary or any nominee of such
successor.
The specific terms of the depositary arrangement with respect to a series
of Debt Securities will be described in the Prospectus Supplement relating to
such Debt Securities. The Company anticipates that the following provisions will
generally apply to depositary arrangements.
Upon the issuance of a Global Security, the Depositary for such Global
Security will credit, on its book-entry registration and transfer system, the
respective principal amounts of the individual Debt Securities represented by
such Global Security to the accounts of persons that have accounts with the
Depositary ("participants"). Such accounts shall be designated by the dealers or
underwriters with respect to such Debt Securities or, if such Debt Securities
are offered and sold directly by the Company or through one or more agents, by
the Company or such agents. Ownership of beneficial interests in a Global
Security will be limited to participants or persons that hold beneficial
interests through participants. Ownership of beneficial interests in such Global
Security will be shown on, and the transfer of that ownership will be effected
only through, records maintained by the Depositary (with respect to interests of
participants) or records maintained by participants (with respect to interests
of persons other than participants). The laws of some states require that
certain purchasers of securities take physical delivery of such securities in
definitive form. Such limitations and laws may impair the ability to transfer
beneficial interests in a Global Security.
So long as the Depositary for a Global Security, or its nominee, is the
registered owner or holder of such Global Security, such Depositary or nominee,
as the case may be, will be considered the sole owner or holder of the
individual Debt Securities represented by such Global Security for all purposes
under the Indenture. Except as provided below, owners of beneficial interests in
a Global Security will not be entitled to have any of the individual Debt
Securities represented by such Global Security registered in their names, will
not receive or be entitled to receive physical delivery of any of such Debt
Securities in definitive form, and will not be considered the owners or holders
thereof under the Indenture.
Subject to the restrictions described under "Description of Debt
Securities -- Limitations on Issuance of Bearer Securities," payments of
principal, premium and interest with respect to individual Debt Securities
represented by a Global Security will be made to the Depositary or its nominee,
as the case may be, as the registered owner or holder of such Global Security.
Neither the Company, the Trustee, any paying agent or registrar for such Debt
Securities, or any agent of the Company or the Trustee will have any
responsibility or liability for (a) any aspect of the records relating to or
payments made by the Depositary, its nominee or any participants on account of
beneficial interests in the Global Security or for maintaining, supervising, or
reviewing any records relating to such beneficial interests, (b) the payment to
the owners of beneficial interests in the Global Security of amounts paid to the
Depositary or its nominee, or (c) any other matter relating to the actions and
practices of the Depositary, its nominee or its participants. Neither the
Company, the Trustee, any paying agent or registrar for such Debt Securities, or
any agent of the Company or the Trustee will be liable for any delay by the
Depositary, its nominee or any of its participants in identifying the owners of
beneficial interests in the Global Security, and the Company and the Trustee may
conclusively rely on, and will be protected in relying on, instructions from the
Depositary or its nominee for all purposes.
The Company expects that the Depositary for a series of Debt Securities or
its nominee, upon receipt of any payment of principal, premium or interest with
respect to a definitive Global Security representing any of
8
<PAGE> 10
such Debt Securities, will immediately credit participants' accounts with
payments in amounts proportionate to their respective beneficial interests in
the principal amount of such Global Security, as shown on the records of the
Depositary or its nominee. The Company also expects that payments by
participants to owners of beneficial interests in such Global Security held
through such participants will be governed by standing instructions and
customary practices, as is now the case with securities held for the accounts of
customers and registered in street name. Such payments will be the
responsibility of such participants. Receipt by owners of beneficial interests
in a temporary Global Security of payments of principal, premium or interest
with respect thereto will be subject to the restrictions described under
"Description of Debt Securities -- Limitations on Issuance of Bearer
Securities."
If the Depositary for a series of Debt Securities is at any time unwilling,
unable or ineligible to continue as depositary, the Company shall appoint a
successor depositary. If a successor depositary is not appointed by the Company
within 90 days, the Company will issue individual Debt Securities of such series
in exchange for the Global Security representing such series of Debt Securities.
In addition, the Company may at any time and in its sole discretion, subject to
any limitations described in the Prospectus Supplement relating to such Debt
Securities, determine no longer to have Debt Securities of a series represented
by a Global Security and, in such event, will issue individual Debt Securities
of such series in exchange for the Global Security representing such series of
Debt Securities. Furthermore, if the Company so specifies with respect to the
Debt Securities of a series, an owner of a beneficial interest in a Global
Security representing Debt Securities of such series may, on terms acceptable to
the Company, the Trustee and the Depositary for such Global Security, receive
individual Debt Securities of such series in exchange for such beneficial
interests, subject to any limitations described in the Prospectus Supplement
relating to such Debt Securities. In any such instance, an owner of a beneficial
interest in a Global Security will be entitled to physical delivery of
individual Debt Securities of the series represented by such Global Security
equal in principal amount to such beneficial interest and to have such Debt
Securities registered in its name (if the Debt Securities are issuable as
Registered Securities). Individual Debt Securities of such series so issued will
be issued (a) as Registered Securities in denominations, unless otherwise
specified by the Company, of $1,000 and integral multiples thereof if the Debt
Securities are issuable as Registered Securities, (b) as Bearer Securities in
the denomination or denominations specified by the Company if the Debt
Securities are issuable as Bearer Securities, or (c) as either Registered
Securities or Bearer Securities as described above if the Debt Securities are
issuable in either form. See, however, "Description of Debt
Securities -- Limitations on Issuance of Bearer Securities" for a description of
certain restrictions on the issuance of individual Bearer Securities in exchange
for beneficial interests in a bearer Global Security.
LIMITATIONS ON ISSUANCE OF BEARER SECURITIES
The Debt Securities of a series may be issued as Registered Securities
(which will be registered as to principal and interest in the register
maintained by the registrar for such Debt Securities) or Bearer Securities
(which will be transferable only by delivery). If such Debt Securities are
issuable as Bearer Securities, certain special limitations and considerations
will apply.
In compliance with United States federal income tax laws and regulations,
the Company and any underwriter, agent or dealer participating in an offering of
Bearer Securities will agree that, in connection with the original issuance of
such Bearer Securities and during the period ending 40 days after the issue
date, they will not offer, sell or deliver any such Bearer Security, directly or
indirectly, to a United States Person (as defined below) or to any person within
the United States, except to the extent permitted under United States Treasury
regulations.
Bearer Securities will bear a legend to the following effect: "Any United
States Person who holds this obligation will be subject to limitations under the
United States federal income tax laws, including the limitations provided in
Sections 165(j) and 1287(a) of the Internal Revenue Code." The sections referred
to in the legend provide that, with certain exceptions, a United States taxpayer
who holds Bearer Securities will not be allowed to deduct any loss with respect
to, and will not be eligible for capital gain treatment with respect to any gain
realized on the sale, exchange, redemption, or other disposition of, such Bearer
Securities.
9
<PAGE> 11
For this purpose, "United States" includes the United States of America and
its possessions, and "United States Person" means a citizen or resident of the
United States, a corporation, partnership, or other entity created or organized
in or under the laws of the United States, or an estate or trust the income of
which is subject to United States federal income taxation regardless of its
source.
Pending the availability of a definitive Global Security or individual
Bearer Securities, as the case may be, Debt Securities that are issuable as
Bearer Securities may initially be represented by a single temporary Global
Security, without interest coupons, to be deposited with a common depositary in
London for Morgan Guaranty Trust Company of New York, Brussels office, as
operator of the Euroclear System ("Euroclear"), or Centrale de Livraison de
Valeurs Mobilieres S.A. ("CEDEL") for credit to the accounts designated by or on
behalf of the purchasers thereof. Following the availability of a definitive
Global Security in bearer form, without coupons attached, or individual Bearer
Securities, and subject to any further limitations described in the applicable
Prospectus Supplement, the temporary Global Security will be exchangeable for
interests in such definitive Global Security or for such individual Bearer
Securities, respectively, only upon receipt of a "Certificate of Non-U.S.
Beneficial Ownership," which is a certificate to the effect that a beneficial
interest in a temporary Global Security is owned by a person that is not a
United States Person or is owned by or through a financial institution in
compliance with applicable United States Treasury regulations. No Bearer
Security will be delivered in or to the United States. If so specified in the
applicable Prospectus Supplement, interest on a temporary Global Security will
be paid to each of Euroclear and CEDEL with respect to that portion of such
temporary Global Security held for its account, but only upon receipt as of the
relevant interest payment date of a Certificate of Non-U.S. Beneficial
Ownership.
SUBORDINATION
Debt Securities of a series may be subordinated ("Subordinated Debt
Securities") to Senior Indebtedness (as defined below) to the extent set forth
in the Prospectus Supplement relating thereto. The Company currently conducts
certain of its operations through subsidiaries, and the holders of Debt
Securities (whether or not Subordinated Debt Securities) will be structurally
subordinated to the creditors of the Company's subsidiaries.
Subordinated Debt Securities of a series and any coupons appertaining
thereto will be subordinate in right of payment, to the extent and in the manner
set forth in the Indenture and the Prospectus Supplement relating to such
Subordinated Debt Securities, to the prior payment of all indebtedness of the
Company that is designated as "Senior Indebtedness" with respect to such series.
"Senior Indebtedness," with respect to any series of Subordinated Debt
Securities, will consist of (a) any and all amounts payable under or with
respect to the Company's "Bank Indebtedness" (defined as the Credit Agreement,
dated as of June 12, 1997, between Quaker State and Morgan Guaranty Trust
Company Of New York, As Agent), and (b) any other indebtedness of the Company
that is designated in a resolution of the Company's Board of Directors (the
"Board") or the supplemental Indenture establishing such series as Senior
Indebtedness with respect to such series.
Upon any payment or distribution of assets of the Company to creditors or
upon a total or partial liquidation or dissolution of the Company or in a
bankruptcy, receivership or similar proceeding relating to the Company or its
property, holders of Senior Indebtedness shall be entitled to receive payment in
full in cash of the Senior Indebtedness before holders of Subordinated Debt
Securities shall be entitled to receive any payment of principal, premium or
interest with respect to the Subordinated Debt Securities, and until the Senior
Indebtedness is paid in full, any distribution to which holders of Subordinated
Debt Securities would otherwise be entitled shall be made to the holders of
Senior Indebtedness (except that such holders may receive shares of stock and
any debt securities that are subordinated to Senior Indebtedness to at least the
same extent as the Subordinated Debt Securities).
The Company may not make any payments of principal, premium or interest
with respect to Subordinated Debt Securities, make any deposit for the purpose
of defeasance of such Subordinated Debt Securities, or repurchase, redeem or
otherwise retire (except, in the case of Subordinated Debt Securities that
provide for a mandatory sinking fund, by the delivery of Subordinated Debt
Securities by the Company to the Trustee in
10
<PAGE> 12
satisfaction of the Company's sinking fund obligation) any Subordinated Debt
Securities if (a) any principal, premium or interest with respect to Senior
Indebtedness is not paid within any applicable grace period (including at
maturity) or (b) any other default on Senior Indebtedness occurs and the
maturity of such Senior Indebtedness is accelerated in accordance with its
terms, unless, in either case, the default has been cured or waived and such
acceleration has been rescinded, such Senior Indebtedness has been paid in full
in cash, or the Company and the Trustee receive written notice approving such
payment from the representatives of each issue of "Designated Senior
Indebtedness" (which will include the Bank Indebtedness and any other specified
issue of Senior Indebtedness of at least $100 million). During the continuance
of any default (other than a default described in clause (a) or (b) above) with
respect to any Senior Indebtedness pursuant to which the maturity thereof may be
accelerated immediately without further notice (except such notice as may be
required to effect such acceleration) or the expiration of any applicable grace
periods, the Company may not pay the Subordinated Debt Securities for a period
(the "Payment Blockage Period") commencing on the receipt by the Company and the
Trustee of written notice of such default from the representative of any
Designated Senior Indebtedness specifying an election to effect a Payment
Blockage Period (a "Blockage Notice"). The Payment Blockage Period may be
terminated before its expiration by written notice to the Trustee and the
Company from the person who gave the Blockage Notice, by repayment in full in
cash of the Senior Indebtedness with respect to which the Blockage Notice was
given, or because the default giving rise to the Payment Blockage Period is no
longer continuing. Unless the holders of such Senior Indebtedness shall have
accelerated the maturity thereof, the Company may resume payments on the
Subordinated Debt Securities after the expiration of the Payment Blockage
Period. Not more than one Blockage Notice may be given in any period of 360
consecutive days unless the first Blockage Notice within such 360-day period is
given by or on behalf of holders of Designated Senior Indebtedness other than
the Bank Indebtedness, in which case, the representative of the Bank
Indebtedness may give another Blockage Notice within such period. In no event,
however, may the total number of days during which any Payment Blockage Period
or Periods is in effect exceed 179 days in the aggregate during any period of
360 consecutive days. After all Senior Indebtedness is paid in full and until
the Subordinated Debt Securities are paid in full, holders of the Subordinated
Debt Securities shall be subrogated to the rights of holders of Senior
Indebtedness to receive distributions applicable to Senior Indebtedness.
By reason of such subordination, in the event of insolvency, creditors of
the Company who are holders of Senior Indebtedness, as well as certain general
creditors of the Company, may recover more, ratably, than the holders of the
Subordinated Debt Securities.
EVENTS OF DEFAULT AND REMEDIES
The following events are defined in the Indenture as "Events of Default"
with respect to a series of Debt Securities:
(a) Default in the payment of any installment of interest on any Debt
Securities of that series or any payment with respect to the related
coupons, if any, as and when the same shall become due and payable (whether
or not, in the case of Subordinated Debt Securities, such payment shall be
prohibited by reason of the subordination provisions described above) and
continuance of such default for a period of 30 days;
(b) Default in the payment of principal or premium with respect to any
Debt Securities of that series as and when the same shall become due and
payable, whether at maturity, upon redemption, by declaration, upon
required repurchase, or otherwise (whether or not, in the case of
Subordinated Debt Securities, such payment shall be prohibited by reason of
the subordination provisions described above);
(c) Default in the payment of any sinking fund payment with respect to
any Debt Securities of that series as and when the same shall become due
and payable;
(d) Failure on the part of the Company to comply with the provisions
of the Indenture relating to consolidations, mergers and sales of assets;
(e) Failure on the part of the Company duly to observe or perform any
other of the covenants or agreements on the part of the Company in the Debt
Securities of that series, in any resolution of the
11
<PAGE> 13
Board authorizing the issuance of that series of Debt Securities, in the
Indenture with respect to such series, or in any supplemental Indenture
with respect to such series (other than a covenant a default in the
performance of which is otherwise specifically dealt with) continuing for a
period of 60 days after the date on which written notice specifying such
failure and requiring the Company to remedy the same shall have been given
to the Company by the Trustee or to the Company and the Trustee by the
holders of at least 25% in aggregate principal amount of the Debt
Securities of that series at the time outstanding;
(f) Indebtedness of the Company or any subsidiary of the Company is
not paid within any applicable grace period after final maturity or is
accelerated by the holders thereof because of a default, the total amount
of such Indebtedness unpaid or accelerated exceeds $20 million or the
United States dollar equivalent thereof at the time, and such default
remains uncured or such acceleration is not rescinded for 10 days after the
date on which written notice specifying such failure and requiring the
Company to remedy the same shall have been given to the Company by the
Trustee or to the Company and the Trustee by the holders of at least 25% in
aggregate principal amount of the Debt Securities of that series at the
time outstanding;
(g) The Company or any of its "Significant Subsidiaries" (defined as
any subsidiary of the Company that would be a "significant subsidiary" as
defined in Rule 405 under the Securities Act as in effect on the date of
the Indenture) shall (1) voluntarily commence any proceeding or file any
petition seeking relief under the United States Bankruptcy Code or other
federal or state bankruptcy, insolvency or similar law, (2) consent to the
institution of, or fail to controvert within the time and in the manner
prescribed by law, any such proceeding or the filing of any such petition,
(3) apply for or consent to the appointment of a receiver, trustee,
custodian, sequestrator or similar official for the Company or any such
Significant Subsidiary or for a substantial part of its property, (4) file
an answer admitting the material allegations of a petition filed against it
in any such proceeding, (5) make a general assignment for the benefit of
creditors, (6) admit in writing its inability or fail generally to pay its
debts as they become due, (7) take corporate action for the purpose of
effecting any of the foregoing, or (8) take any comparable action under any
foreign laws relating to insolvency;
(h) The entry of an order or decree by a court having competent
jurisdiction for (1) relief with respect to the Company or any of its
Significant Subsidiaries or a substantial part of any of their property
under the United States Bankruptcy Code or any other federal or state
bankruptcy, insolvency, or similar law, (2) the appointment of a receiver,
trustee, custodian, sequestrator, or similar official for the Company or
any such Significant Subsidiary or for a substantial part of any of their
property (except any decree or order appointing such official of any
Significant Subsidiary pursuant to a plan under which the assets and
operations of such Significant Subsidiary are transferred to or combined
with another Significant Subsidiary or Subsidiaries of the Company or to
the Company), or (3) the winding-up or liquidation of the Company or any
such Significant Subsidiary (except any decree or order approving or
ordering the winding-up or liquidation of the affairs of a Significant
Subsidiary pursuant to a plan under which the assets and operations of such
Significant Subsidiary are transferred to or combined with another
Significant Subsidiary or Subsidiaries of the Company or to the Company),
and such order or decree shall continue unstayed and in effect for 60
consecutive days, or any similar relief is granted under any foreign laws
and the order or decree stays in effect for 60 consecutive days;
(i) Any judgment or decree for the payment of money in excess of $20
million or the United States dollar equivalent thereof at the time is
entered against the Company or any Subsidiary of the Company by a court of
competent jurisdiction, which judgment is not covered by insurance, and is
not discharged and either (1) an enforcement proceeding has been commenced
by any creditor upon such judgment or decree or (2) there is a period of 60
days following the entry of such judgment or decree during which such
judgment or decree is not discharged or waived or the execution thereof
stayed and, in either case, such default continues for 10 days after the
date on which written notice specifying such failure and requiring the
Company to remedy the same shall have been given to the Company by the
Trustee or to the Company and the Trustee by the holders of at least 25% in
aggregate principal amount of the Debt Securities of that series at the
time outstanding; and
12
<PAGE> 14
(j) Any other Event of Default provided with respect to Debt
Securities of that series.
An Event of Default with respect to one series of Debt Securities is not
necessarily an Event of Default for another series.
If an Event of Default described in clause (a), (b), (c), (d), (e), (f),
(i) or (j) above occurs and is continuing with respect to any series of Debt
Securities, unless the principal and interest with respect to all the Debt
Securities of such series shall have already become due and payable, either the
Trustee or the holders of not less than 25% in aggregate principal amount of the
Debt Securities of such series then outstanding may declare the principal amount
(or, if Original Issue Discount Debt Securities, such portion of the principal
amount as may be specified in such series) of and interest on all the Debt
Securities of such series due and payable immediately. If an Event of Default
described in clause (g) or (h) above occurs, unless the principal and interest
with respect to all the Debt Securities of all series shall have become due and
payable, the principal amount (or, if any series are Original Issue Discount
Debt Securities, such portion of the principal amount as may be specified in
such series) of and interest on all Debt Securities of all series then
outstanding shall become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any holder of Debt
Securities.
If an Event of Default occurs and is continuing, the Trustee shall be
entitled and empowered to institute any action or proceeding for the collection
of the sums so due and unpaid or to enforce the performance of any provision of
the Debt Securities of the affected series or the Indenture, to prosecute any
such action or proceeding to judgment or final decree, and to enforce any such
judgment or final decree against the Company or any other obligor on the Debt
Securities of such series. In addition, if there shall be pending proceedings
for the bankruptcy or reorganization of the Company or any other obligor on the
Debt Securities, or if a receiver, trustee, or similar official shall have been
appointed for its property, the Trustee shall be entitled and empowered to file
and prove a claim for the whole amount of principal, premium, and interest (or,
in the case of Original Issue Discount Debt Securities, such portion of the
principal amount as may be specified in the terms of such series) owing and
unpaid with respect to the Debt Securities. No holder of any Debt Security or
coupon of any series shall have any right to institute any action or proceeding
upon or under or with respect to the Indenture, for the appointment of a
receiver or trustee, or for any other remedy, unless (a) such holder previously
shall have given to the Trustee written notice of an Event of Default with
respect to Debt Securities of that series and of the continuance thereof, (b)
the holders of not less than 25% in aggregate principal amount of the
outstanding Debt Securities of that series shall have made written request to
the Trustee to institute such action or proceeding with respect to such Event of
Default and shall have offered to the Trustee such reasonable indemnity as it
may require against the costs, expenses, and liabilities to be incurred therein
or thereby, and (c) the Trustee, for 60 days after its receipt of such notice,
request, and offer of indemnity shall have failed to institute such action or
proceeding and no direction inconsistent with such written request shall have
been given to the Trustee pursuant to the provisions of the Indenture.
Prior to the acceleration of the maturity of the Debt Securities of any
series, the holders of a majority in aggregate principal amount of the Debt
Securities of that series at the time outstanding may, on behalf of the holders
of all Debt Securities and any related coupons of that series, waive any past
default or Event of Default and its consequences for that series, except (a) a
default in the payment of the principal, premium or interest with respect to
such Debt Securities or (b) a default with respect to a provision of the
Indenture that cannot be amended without the consent of each holder affected
thereby. In case of any such waiver, such default shall cease to exist, any
Event of Default arising therefrom shall be deemed to have been cured for all
purposes, and the Company, the Trustee and the holders of the Debt Securities of
that series shall be restored to their former positions and rights under the
Indenture.
The Trustee shall, within 90 days after the occurrence of a default known
to it with respect to a series of Debt Securities, give to the holders of the
Debt Securities of such series notice of all uncured defaults with respect to
such series known to it, unless such defaults shall have been cured or waived
before the giving of such notice; provided, however, that except in the case of
default in the payment of principal, premium or interest with respect to the
Debt Securities of such series or in the making of any sinking fund payment with
respect to the Debt Securities of such series, the Trustee shall be protected in
withholding such notice if it in
13
<PAGE> 15
good faith determines that the withholding of such notice is in the interest of
the holders of such Debt Securities.
MODIFICATION OF THE INDENTURE
The Company and the Trustee may enter into supplemental Indentures without
the consent of the holders of Debt Securities for one or more of the following
purposes:
(a) To evidence the succession of another person to the Company
pursuant to the provisions of the Indenture relating to consolidations,
mergers, and sales of assets and the assumption by such successor of the
covenants, agreements, and obligations of the Company in the Indenture and
in the Debt Securities;
(b) To surrender any right or power conferred upon the Company by the
Indenture, to add to the covenants of the Company such further covenants,
restrictions, conditions or provisions for the protection of the holders of
all or any series of Debt Securities as the Board shall consider to be for
the protection of the holders of such Debt Securities, and to make the
occurrence, or the occurrence and continuance, of a default in any of such
additional covenants, restrictions, conditions, or provisions a default or
an Event of Default under the Indenture (provided, however, that with
respect to any such additional covenant, restriction, condition or
provision, such supplemental Indenture may provide for a period of grace
after default, which may be shorter or longer than that allowed in the case
of other defaults, may provide for an immediate enforcement upon such
default, may limit the remedies available to the Trustee upon such default,
or may limit the right of holders of a majority in aggregate principal
amount of any or all series of Debt Securities to waive such default);
(c) To cure any ambiguity or to correct or supplement any provision
contained in the Indenture, in any supplemental Indenture, or in any Debt
Securities that may be defective or inconsistent with any other provision
contained therein, to convey, transfer, assign, mortgage or pledge any
property to or with the Trustee, or to make such other provisions in regard
to matters or questions arising under the Indenture as shall not adversely
affect the interests of any holders of Debt Securities of any series;
(d) To modify or amend the Indenture in such a manner as to permit the
qualification of the Indenture or any supplemental Indenture under the
Trust Indenture Act as then in effect;
(e) To add to or change any of the provisions of the Indenture to
provide that Bearer Securities may be registerable as to principal, to
change or eliminate any restrictions on the payment of principal or premium
with respect to Registered Securities or of principal, premium or interest
with respect to Bearer Securities, or to permit Registered Securities to be
exchanged for Bearer Securities, so long as any such action does not
adversely affect the interests of the holders of Debt Securities or any
coupons of any series in any material respect or permit or facilitate the
issuance of Debt Securities of any series in uncertificated form;
(f) To comply with the provisions of the Indenture relating to
consolidations, mergers and sales of assets;
(g) In the case of Subordinated Debt Securities, to make any change in
the provisions of the Indenture relating to subordination that would limit
or terminate the benefits available to any holder of Senior Indebtedness
under such provisions (but only if such holder of Senior Indebtedness
consents to such change);
(h) To add guarantees with respect to the Debt Securities or to secure
the Debt Securities;
(i) To make any change that does not adversely affect the rights of
any holder;
(j) To add to, change or eliminate any of the provisions of the
Indenture with respect to one or more series of Debt Securities, so long as
any such addition, change or elimination not otherwise permitted under the
Indenture shall (1) neither apply to any Debt Security of any series
created prior to the execution of such supplemental Indenture and entitled
to the benefit of such provision nor modify the
14
<PAGE> 16
rights of the holders of any such Debt Security with respect to such
provision or (2) become effective only when there is no such Debt Security
outstanding;
(k) To evidence and provide for the acceptance of appointment by a
successor or separate Trustee with respect to the Debt Securities of one or
more series and to add to or change any of the provisions of the Indenture
as shall be necessary to provide for or facilitate the administration of
the Indenture by more than one Trustee; and
(l) To establish the form or terms of Debt Securities and coupons of
any series, as described above under "Description of Debt
Securities -- General."
With the consent of the holders of a majority in aggregate principal amount
of the outstanding Debt Securities of each series affected thereby, the Company
and the Trustee may from time to time and at any time enter into a supplemental
Indenture for the purpose of adding any provisions to, changing in any manner,
or eliminating any of the provisions of the Indenture or of any supplemental
Indenture or modifying in any manner the rights of the holders of the Debt
Securities of such series; provided, however, that without the consent of the
holders of each Debt Security so affected, no such supplemental Indenture shall
(a) reduce the percentage in principal amount of Debt Securities of any series
whose holders must consent to an amendment, (b) reduce the rate of or extend the
time for payment of interest on any Debt Security or coupon or reduce the amount
of any payment to be made with respect to any coupon, (c) reduce the principal
of or extend the stated maturity of any Debt Security, (d) reduce the premium
payable upon the redemption of any Debt Security or change the time at which any
Debt Security may or shall be redeemed, (e) make any Debt Security payable in a
currency other than that stated in the Debt Security, (f) in the case of any
Subordinated Debt Security or coupons appertaining thereto, make any change in
the provisions of the Indenture relating to subordination that adversely affects
the rights of any holder under such provisions, (g) release any security that
may have been granted with respect to the Debt Securities, (h) make any change
in the provisions of the Indenture relating to waivers of defaults or amendments
that require unanimous consent, (i) change any obligation of the Company
provided for in the Indenture to pay additional interest with respect to Bearer
Securities, or (j) limit the obligation of the Company to maintain a paying
agency outside the United States for payment on Bearer Securities or limit the
obligation of the Company to redeem certain Bearer Securities.
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Company may not consolidate with or merge with or into any person, or
convey, transfer or lease all or substantially all of its assets, unless the
following conditions have been satisfied:
(a) Either (1) the Company shall be the continuing person in the case
of a merger or (2) the resulting, surviving or transferee person, if other
than the Company (the "Successor Company"), shall be a corporation
organized and existing under the laws of the United States, any State or
the District of Columbia and shall expressly assume all of the obligations
of the Company under the Debt Securities and coupons and the Indenture;
(b) Immediately after giving effect to such transaction (and treating
any indebtedness that becomes an obligation of the Successor Company or any
subsidiary of the Company as a result of such transaction as having been
incurred by the Successor Company or such subsidiary at the time of such
transaction), no Default or Event of Default would occur or be continuing;
(c) The Successor Company waives any right to redeem any Bearer
Security under circumstances in which the Successor Company would be
entitled to redeem such Bearer Security but the Company would not have been
so entitled to redeem if the consolidation, merger, conveyance, transfer,
or lease had not occurred; and
(d) The Company shall have delivered to the Trustee an officers'
certificate and an opinion of counsel, each stating that such
consolidation, merger or transfer complies with the Indenture.
15
<PAGE> 17
SATISFACTION AND DISCHARGE OF THE INDENTURE; DEFEASANCE
The Indenture shall generally cease to be of any further effect with
respect to a series of Debt Securities if (a) the Company has delivered to the
Trustee for cancellation all Debt Securities of such series (with certain
limited exceptions) or (b) all Debt Securities and coupons of such series not
theretofore delivered to the Trustee for cancellation shall have become due and
payable, or are by their terms to become due and payable within one year or are
to be called for redemption within one year, and the Company shall have
deposited with the Trustee as trust funds the entire amount sufficient to pay at
maturity or upon redemption all such Debt Securities and coupons (and, in either
case, the Company shall also pay or cause to be paid all other sums payable
under the Indenture by the Company).
In addition, the Company shall have a "legal defeasance option" (pursuant
to which it may terminate, with respect to the Debt Securities of a particular
series, all of its obligations under such Debt Securities and the Indenture with
respect to such Debt Securities) and a "covenant defeasance option" (pursuant to
which it may terminate, with respect to the Debt Securities of a particular
series, its obligations with respect to such Debt Securities under certain
specified covenants contained in the Indenture). If the Company exercises its
legal defeasance option with respect to a series of Debt Securities, payment of
such Debt Securities may not be accelerated because of an Event of Default. If
the Company exercises its covenant defeasance option with respect to a series of
Debt Securities, payment of such Debt Securities may not be accelerated because
of an Event of Default related to the specified covenants.
The Company may exercise its legal defeasance option or its covenant
defeasance option with respect to the Debt Securities of a series only if (a)
the Company irrevocably deposits in trust with the Trustee cash or U.S.
Government Obligations (as defined in the Indenture) for the payment of
principal, premium and interest with respect to such Debt Securities to maturity
or redemption, as the case may be, (b) the Company delivers to the Trustee a
certificate from a nationally recognized firm of independent accountants
expressing their opinion that the payments of principal and interest when due
and without reinvestment on the deposited U.S. Government Obligations plus any
deposited money without investment will provide cash at such times and in such
amounts as will be sufficient to pay the principal, premium and interest when
due with respect to all the Debt Securities of such series to maturity or
redemption, as the case may be, (c) 123 days pass after the deposit is made and
during the 123-day period no default described in clause (g) or (h) under
"Description of Debt Securities -- Events of Default and Remedies" with respect
to the Company occurs that is continuing at the end of such period, (d) no
Default has occurred and is continuing on the date of such deposit and after
giving effect thereto, (e) the deposit does not constitute a default under any
other agreement binding on the Company and, in the case of Subordinated Debt
Securities, is not prohibited by the provisions of the Indenture relating to
subordination, (f) the Company delivers to the Trustee an opinion of counsel to
the effect that the trust resulting from the deposit does not constitute, or is
qualified as, a regulated investment company under the Investment Company Act of
1940, (g) the Company shall have delivered to the Trustee an opinion of counsel
addressing certain federal income tax matters relating to the defeasance, and
(h) the Company delivers to the Trustee an officers' certificate and an opinion
of counsel, each stating that all conditions precedent to the defeasance and
discharge of the Debt Securities of such series as contemplated by the Indenture
have been complied with.
The Trustee shall hold in trust cash or U.S. Government Obligations
deposited with it as described above and shall apply the deposited cash and the
proceeds from deposited U.S. Government Obligations to the payment of principal,
premium and interest with respect to the Debt Securities and coupons of the
defeased series. In the case of Subordinated Debt Securities and coupons related
thereto, the money and U.S. Government Obligations so held in trust will not be
subject to the subordination provisions of the Indenture.
THE TRUSTEE
The Company may appoint a separate Trustee for any series of Debt
Securities. As used herein in the description of a series of Debt Securities,
the term "Trustee" refers to the Trustee appointed with respect to such series
of Debt Securities.
16
<PAGE> 18
The Company may maintain banking and other commercial relationships with
the Trustee and its affiliates in the ordinary course of business, and the
Trustee may own Debt Securities.
DESCRIPTION OF STOCK
The following is a summary of certain features of the Company's stock and
certain provisions of the Company's Certificate of Incorporation, as amended
(the "Certificate of Incorporation") and Bylaws, as amended (the "Bylaws"), and
the Rights Agreement (defined below). This summary does not purport to be
complete and is subject to and is qualified in its entirety by reference to the
Certificate of Incorporation, Bylaws and the Rights Agreement, copies of which
are exhibits to the Registration Statement of which this Prospectus is a part.
See "Available Information."
CAPITAL STOCK
The Capital Stock, par value $1.00 per share, is the only class of capital
stock authorized to be issued by the Company. Holders of Capital Stock are
entitled to receive dividends when, as and if declared by the Board out of any
funds legally available therefor and are entitled to one vote per share held on
all matters voted upon by stockholders. Holders of the Capital stock are
entitled upon liquidation to share ratably in the net assets of the Company and
have no preemptive or other rights to subscribe for any other shares or
securities. The Capital Stock is not convertible into any other class of stock,
and there are no redemption or sinking fund provisions with respect to the
Capital Stock.
SUPER-MAJORITY VOTE PROVISION
The Company's Certificate of Incorporation provides that, except as
provided below, the affirmative vote of the holders of 95% of all shares of
stock entitled to be voted in an election of directors is required to authorize
a business combination with any other entity which has become the beneficial
owner, directly or indirectly, of more than 30% of the outstanding shares of
such stock. The term "business combination" includes (i) any merger or
consolidation of the Company with or into such other entity, (ii) any sale or
lease of all or any substantial part of the assets of the Company to such other
entity or (iii) any sale or lease by such other entity to the Company or any
subsidiary in exchange for securities of the Company of assets having an
aggregate fair market value of $5,000,000 or more. The term "other entity"
includes any person, any "affiliate" or "associate" of such person (as these
terms are defined in Rule 12b-2, promulgated by the Commission under the
Exchange Act, as in effect on July 1, 1979) and any other person with which such
person or any "affiliate" or "associate" of such person has any agreement,
arrangement or understanding, directly or indirectly, for the purpose of
acquiring, holding, voting or disposing of the Company's stock. Except as
provided below, the 95% stockholder vote is required even if the other entity
ceases to be a 30% beneficial owner so long as the other entity continues to be
an "affiliate" of the Company.
The 95% stockholder vote for a business combination with such other entity
is not required if certain minimum price and other requirements are satisfied.
The minimum price provisions require that the consideration per share received
by the Company stockholders in the business combination (i) bear the same or a
greater percentage relationship to the market price of the Capital Stock
immediately prior to the announcement of the business combination as the highest
per share price which such other entity paid for any shares of the Capital Stock
already owned by it bears to the market price of the Capital Stock immediately
prior to the commencement of acquisition of the Capital Stock by such other
entity, (ii) be not less than the highest per share price paid for any shares of
the Capital Stock by such other entity and (iii) be not less than the earnings
per share of the Capital Stock for the four prior fiscal quarters multiplied by
the then price/earnings multiple (if any) of such other entity as customarily
computed and reported in the financial community. In the event the Company is
the surviving corporation in the business combination, the consideration per
share received by the stockholders in the business combination is considered to
be the market price of the Capital Stock.
The other requirements that must be satisfied to avoid the 95% stockholder
vote are as follows: First, the other entity must not have received the benefit,
directly or indirectly, of any loans, advances, guarantees,
17
<PAGE> 19
pledges or other financial assistance or tax credits provided by the Company or,
without the unanimous approval of the Board, must not have made any major change
in the Company's business or equity capital structure. Second, after having
acquired a 30% interest, the other entity (i) must have taken steps to ensure
continued representation on the Board by "Continuing Directors" (as defined
below) proportionate to the stockholdings of the Company's public stockholders
not affiliated with the other entity, (ii) must have made no reduction in the
rate of dividends payable on the Capital Stock, except as necessary to insure
that a quarterly dividend payment does not exceed 12.5% of the Company's net
income for the four prior fiscal quarters or except as may have been approved by
a unanimous vote of the Board, (iii) must not have acquired any newly issued
shares of stock, directly or indirectly, from the Company (except upon
conversion of convertible securities acquired by it prior to obtaining a 30%
interest or as a result of a pro rata stock dividend or stock split) and (iv)
must not have acquired any additional shares of outstanding Capital Stock or
securities convertible into Capital stock except as part of the transaction
which results in such other entity acquiring its 30% interest. Third, the
business combination must be approved at a meeting of the Company stockholders
from whom proxies are solicited in accordance with the rules of the Commission.
If the minimum price and other requirements are satisfied, the vote
required for authorization of the business combination would be the affirmative
vote of the holders of a majority of the outstanding shares of Capital Stock or
of a majority of the shares of Capital Stock represented at the meeting,
depending upon the nature of the particular business combination and the
requirements of Delaware law applicable to the business combination. No
amendment of the Certificate of Incorporation may change or repeal the
super-majority vote provision without a 95% stockholder vote unless such
amendment would be unanimously recommended to the Company's stockholders by all
of the members of the Board who are "Continuing Directors", in which event the
amendment could be adopted upon the affirmative vote of the holders of a
majority of the outstanding shares of the Capital Stock. "Continuing Directors"
are those members of the Board who were elected by the public stockholders prior
to the time the other entity became a 10% beneficial owner or who were
recommended to succeed a Continuing Director by a majority of the Continuing
Directors.
The super-majority vote provision described above is contained in Article
Fourteenth of the Company's Certificate of Incorporation. The description is
subject in all respects to the provisions of Article Fourteenth.
STOCKHOLDER RIGHTS PLAN
On September 28, 1995, the Board declared a dividend distribution of one
Capital Stock Purchase Right (a "Right") for each outstanding share of Capital
Stock. The Rights were issued on October 18, 1995 to stockholders of record on
that date. When exercisable, each Right entitles the registered holder to
purchase from the Company one share of Capital Stock at a price of $50 per share
of Capital Stock, subject to adjustment in certain circumstances (the "Purchase
Price"). The description and terms of the Rights are set forth in a Rights
Agreement, dated as of September 28, 1995 (the "Rights Agreement"), between the
Company and Mellon Securities Trust Company, as Rights Agent (the "Rights
Agent"). The following summary is subject in all respects to the provisions of
the Rights Agreement.
Transfer and Detachment. Until the "Distribution Date", which is the
earlier to occur of (i) ten business days following the time (the "Stock
Acquisition Time") of a public announcement or notice to the Company that a
person or group of affiliated or associated persons (an "Acquiring Person") has
acquired, or obtained the right to acquire, beneficial ownership (as defined in
the Rights Agreement) of 15% or more of the outstanding shares of Capital Stock,
and (ii) ten business days, or such later date as may be determined by the Board
of Directors, after the date of the commencement or announcement by a person of
an intention to make a tender offer or exchange offer for an amount of Capital
Stock which, together with the shares of such stock already owned by such
person, constitutes 15% or more of the outstanding shares of the Capital Stock,
the Rights will be evidenced, with respect to any Capital Stock certificate
outstanding as of October 18, 1995, by such Capital Stock certificate with a
copy of a Summary of Rights attached thereto. The Rights Agreement provides
that, until the Distribution Date, the Rights will be transferred with and only
with the Capital Stock. Until the Distribution Date (or earlier redemption or
expiration of the Rights), new Capital Stock certificates issued after October
18, 1995, upon the transfer or issuance of new shares of Capital Stock, will
contain a notation incorporating the Rights Agreement by reference. Until the
Distribution Date (or earlier redemption
18
<PAGE> 20
or expiration of the Rights), the surrender for transfer of any of the Capital
Stock certificates outstanding as of October 18, 1995, even without a copy of
the Summary of Rights attached thereto, will also constitute the transfer of the
Rights associated with the shares of Capital Stock represented by such
certificate. As long as the Rights are attached to the shares of Capital Stock,
the Company will issue one Right with each share of Capital Stock it issues so
that all shares have attached Rights.
As soon as practicable following the Distribution Date, separate
certificates evidencing the Rights ("Right Certificates") will be mailed to
holders of record of the Capital Stock as of the close of business on the
Distribution Date, and such separate Right Certificates alone will evidence the
Rights.
Exercisability. The Rights are not exercisable until the Distribution Date.
The Rights will expire on September 28, 2005 unless earlier redeemed by the
Company.
Right to Acquire Stock at Half Price. In the event that after the Stock
Acquisition Time, the Company is acquired in a merger or other business
combination transaction or 50% or more of the Company's assets, cash flow or
earning power are sold or otherwise transferred, the Rights Agreement provides
that proper provision shall be made so that each holder of a Right, upon the
exercise thereof at the then current exercise price of the Right, shall
thereafter be entitled to receive that number of shares of common stock of the
acquiring company which at the time of such transaction would have a market
value (as defined in the Rights Agreement) of two times the exercise price of
the Right. In the event that the Company is the surviving corporation of a
merger and the Capital Stock is changed or exchanged, proper provision shall be
made so that each holder of a Right will thereafter have the right to receive
upon exercise that number of shares of common stock of the other party to the
transaction having a market value of two times the exercise price of the Right.
In the event that a person or group becomes an Acquiring Person(otherwise
than pursuant to a tender offer or exchange offer for all outstanding shares of
the Capital Stock at a price and on terms which are determined to be fair and in
the best interests of the Company and its stockholders by a majority of the
members of the Board who are not Acquiring Persons or representatives or
nominees of or affiliated or associated with an Acquiring Person), proper
provision shall be made so that each holder of a Right, other than Rights that
were beneficially owned by the Acquiring Person, which will thereafter be void,
will thereafter have the right to receive upon exercise that number of shares of
Capital Stock having a market value (as defined in the Rights Agreement) of two
times the exercise price of the Right. A person or group will not be deemed to
be an Acquiring Person if the Board determines that such person or group became
an Acquiring Person inadvertently and such person or group promptly divests
itself of a sufficient number of shares of Capital Stock so that such person or
group is no longer an Acquiring Person.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Company, including, without limitation, the right
to vote or to receive dividends.
Adjustments. The Purchase Price payable and the number of shares of Capital
Stock or other securities or property issuable upon the exercise of the Rights
are subject to adjustment from time to time to prevent dilution (i) in the event
of a stock dividend on or a subdivision, combination or reclassification of the
shares of Capital Stock, (ii) upon the fixing of a record date for the issuance
to holders of Capital Stock of certain rights, options or warrants to subscribe
for shares of Capital Stock or convertible securities at less than the current
market price of shares of Capital Stock or (iii) upon the fixing of a record
date for the making of a distribution to holders of shares of Capital Stock of
evidences of indebtedness or assets (excluding regular periodic cash dividends
not exceeding 125% of the last regular periodic cash dividend or dividends
payable in shares of Capital Stock) or of subscription rights or warrants (other
than those referred to above). The number of Rights and the number of shares of
Capital Stock issuable upon exercise of each Right are also subject to
adjustment in the case of a stock split, combination or stock dividend on the
shares of Capital Stock prior to the Distribution Date.
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in
the Purchase Price. No fractional shares of Capital Stock will be issued and, in
lieu thereof, an adjustment in cash will be made based on the market value of
shares of Capital Stock on the last trading date prior to the date of exercise.
19
<PAGE> 21
Redemption or Exchange. At any time prior to the earlier of (i) the Stock
Acquisition Time and (ii) September 28, 2005, the Company, by resolution of the
Board, may redeem the Rights in whole, but not in part, at a price of $.01 per
Right (the "Redemption Price"). Immediately upon the action by the Board to
elect to redeem the Rights, the right to exercise the Rights will terminate and
the only right of the holders of Rights will be to receive the Redemption Price.
At any time after a person becomes an Acquiring Person and prior to the
acquisition by such person of 50% or more of the outstanding Capital Stock, the
Board may exchange the Rights (other than Rights beneficially owned by such
person which have become void), in whole or in part, for Capital Stock at an
exchange ratio of one share of Capital Stock per Right (subject to adjustment).
The Company may at its option substitute shares of any substantially similar
equity security of the Company for some or all of the shares of Capital Stock
exchangeable for Rights, at an exchange ratio of one share of such equity
security for each share of Capital Stock to be exchanged.
Amendment. The Rights and the Rights Agreement can be amended by the Board
in any respect (including, without limitation, any extension of the period in
which the Right Certificates may be redeemed) at any time prior to the Stock
Acquisition Time. From and after such time, without the approval of the
Company's stockholders or the holders of the Rights, the Board may only
supplement or amend the Rights Agreement in order (i) to cure any ambiguity,
(ii) to correct or supplement any provision contained in the Rights Agreement
which may be defective or inconsistent with any other provision in the Rights
Agreement, (iii) to shorten or lengthen any time period under the Rights
Agreement or (iv) to make any changes or supplements which the Company may deem
necessary or desirable which shall not adversely affect the interests of the
holders of Right Certificates (other than an Acquiring Person or an affiliate or
associate of any such person), provided that any such action by the Board must
have the concurrence of a majority of the Continuing Directors (as defined in
the Rights Agreement) and provided that the Continuing Directors constitute a
majority of directors then in office, and provided that the Rights Agreement may
not be supplemented or amended to lengthen (A) a time period relating to when
the Rights may be redeemed or to modify the ability (or inability) of the Board
to redeem the Rights, in either case at such time as the Rights are not then
redeemable or (B) any other time period unless such lengthening is for the
purpose of protecting, enhancing or clarifying the rights of or the benefits to
the holders of Rights (other than an Acquiring Person or an affiliate or
associate of any such person).
SECTION 203 OF DELAWARE GENERAL CORPORATION LAW
The super-majority vote provision and the stockholder rights plan described
above may be considered as having an antitakeover effect. Effective February 2,
1988, a new Section 203 of the Delaware General Corporation Law entitled
"Business Combinations with Interested Stockholders" was enacted which also
could be considered as having such an effect. However, the Company, by an
amendment to the Company's Bylaws adopted by its Board of Directors on March 31,
1988, elected not to be governed by the new Section 203.
DESCRIPTION OF WARRANTS
The Company may issue Warrants for the purchase of Debt Securities or
Capital Stock. Warrants may be issued independently or together with Debt
Securities or Capital Stock offered by any Prospectus Supplement and may be
attached to or separate from any such Offered Securities. Each series of
Warrants will be issued under a separate warrant agreement (a "Warrant
Agreement") to be entered into between the Company and a bank or trust company,
as warrant agent (the "Warrant Agent"). The Warrant Agent will act solely as an
agent of the Company in connection with the Warrants and will not assume any
obligation or relationship of agency or trust for or with any holders or
beneficial owners of Warrants. The following summary of certain provisions of
the Warrants does not purport to be complete and is subject to, and qualified in
its entirety by reference to, the provisions of the Warrant Agreement that will
be filed with the SEC in connection with the offering of such Warrants.
20
<PAGE> 22
DEBT WARRANTS
The Prospectus Supplement relating to a particular issue of Debt Warrants
will describe the terms of such Debt Warrants, including the following: (a) the
title of such Debt Warrants; (b) the offering price of such Debt Warrants, if
any; (c) the aggregate number of such Debt Warrants; (d) the designation and
terms of the Debt Securities purchasable upon exercise of such Debt Warrants;
(e) if applicable, the designation and terms of the Debt Securities with which
such Debt Warrants are issued and the number of such Debt Warrants issued with
each such Debt Security; (f) if applicable, the date from and after which such
Debt Warrants and any Debt Securities issued therewith will be separately
transferable; (g) the principal amount of Debt Securities purchasable upon
exercise of a Debt Warrant and the price at which such principal amount of Debt
Securities may be purchased upon exercise (which price may be payable in cash,
securities, or other property); (h) the date on which the right to exercise such
Debt Warrants shall commence and the date on which such right shall expire; (i)
if applicable, the minimum or maximum amount of such Debt Warrants that may be
exercised at any one time; (j) whether the Debt Warrants represented by the Debt
Warrant certificates or Debt Securities that may be issued upon exercise of the
Debt Warrants will be issued in registered or bearer form; (k) information with
respect to book-entry procedures, if any; (l) the currency or currency units in
which the offering price, if any, and the exercise price are payable; (m) if
applicable, a discussion of material United States federal income tax
considerations; (n) the antidilution provisions of such Debt Warrants, if any;
(o) the redemption or call provisions, if any, applicable to such Debt Warrants;
and (p) any additional terms of the Debt Warrants, including terms, procedures,
and limitations relating to the exchange and exercise of such Debt Warrants.
CAPITAL STOCK WARRANTS
The Prospectus Supplement relating to any particular issue of Capital Stock
Warrants will describe the terms of such Warrants, including the following: (a)
the title of such Warrants; (b) the offering price for such Warrants, if any;
(c) the aggregate number of such Warrants; (d) the designation and terms of the
Capital Stock purchasable upon exercise of such Warrants; (e) if applicable, the
designation and terms of the Offered Securities with which such Warrants are
issued and the number of such Warrants issued with each such Offered Security;
(f) if applicable, the date from and after which such Warrants and any Offered
Securities issued therewith will be separately transferable; (g) the number of
shares of Capital Stock purchasable upon exercise of a Warrant and the price at
which such shares may be purchased upon exercise (which price may be payable in
cash, securities, or other property); (h) the date on which the right to
exercise such Warrants shall commence and the date on which such right shall
expire; (i) if applicable, the minimum or maximum amount of such Warrants that
may be exercised at any one time; (j) the currency or currency units in which
the offering price, if any, and the exercise price are payable; (k) if
applicable, a discussion of material United States federal income tax
considerations; (l) the antidilution provisions of such Warrants, if any; (m)
the redemption or call provisions, if any, applicable to such Warrants; and (n)
any additional terms of the Warrants, including terms, procedures, and
limitations relating to he exchange and exercise of such Warrants.
PLAN OF DISTRIBUTION
The Company may sell the Offered Securities in or outside the United States
through underwriters, brokers or dealers, directly to one or more purchasers, or
through agents. The Prospectus Supplement with respect to the Offered Securities
will set forth the terms of the offering of the Offered Securities, including
the name or names of any underwriters, dealers or agents, the purchase price of
the Offered Securities and the proceeds to the Company from such sale, any
delayed delivery arrangements, any underwriting discounts and other items
constituting underwriters' compensation, the initial public offering price, any
discounts or concessions allowed or reallowed or paid to dealers, and any
securities exchanges on which the Offered Securities may be listed.
If underwriters are used in the sale, the Offered Securities will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of sale.
The Offered
21
<PAGE> 23
Securities may be offered to the public either through underwriting syndicates
represented by one or more managing underwriters or directly by one or more
firms acting as underwriters. The underwriter or underwriters with respect to a
particular underwritten offering of Offered Securities will be named in the
Prospectus Supplement relating to such offering, and if an underwriting
syndicate is used, the managing underwriter or underwriters will be set forth on
the cover of such Prospectus Supplement. Unless otherwise set forth in the
Prospectus Supplement relating thereto, the obligations of the underwriters or
agents to purchase the Offered Securities will be subject to conditions
precedent and the underwriters will be obligated to purchase all the Offered
Securities if any are purchased. The initial public offering price and any
discounts or concessions allowed or reallowed or paid to dealers may be changed
from time to time.
During and after a sale, the underwriters may purchase and sell the Offered
Securities in the open market. These transactions may include over-allotment and
stabilizing transactions and purchases to cover syndicate short positions
created in connection with the sale. The underwriters may also impose a penalty
bid, whereby selling concessions allowed to syndicate members or other
broker-dealers in respect of the Offered Securities sold in the sale for their
account may be reclaimed by the syndicate if such Offered Securities are
repurchased by the syndicate in stabilizing or covering transactions. These
activities may stabilize, maintain or otherwise affect the market price of the
Offered Securities, which may be higher than the price that might otherwise
prevail in the open market, and, if commenced, may be discontinued at any time.
The Company may also sell the Offered Securities pursuant to one or more
standby agreements with one or more underwriters in connection with the call for
redemption of a specified class or series of any securities of the Company or
any subsidiary of the Company. In such a standby agreement, the underwriter or
underwriters would agree either (a) to purchase from the Company up to the
number of shares of Capital Stock that would be issuable upon conversion of all
of the shares of such class or series of securities of the Company or its
subsidiary at an agreed price per share of Capital Stock or (b) to purchase from
the Company up to a specified dollar amount of Offered Securities at an agreed
price per Offered Security which price may be fixed or may be established by
formula or other method and which may or may not relate to market prices of the
Capital Stock or any other security of the Company then outstanding. The
underwriter or underwriters would also agree, if applicable, to convert into
Capital Stock or other security of the Company any securities of such class or
series held or purchased by the underwriter or underwriters. The underwriter or
underwriters may assist in the solicitation of conversions by holders of such
class or series of securities.
If dealers are used in the sale of Offered Securities with respect to which
this Prospectus is delivered, the Company will sell such Offered Securities to
the dealers as principals. The dealers may then resell such Offered Securities
to the public at varying prices to be determined by such dealers at the time of
resale. The name of the dealers and the terms of the transaction will be set
forth in the Prospectus Supplement relating thereto.
Offered Securities may be sold directly by the Company or through agents
designated by the Company from time to time at fixed prices, which may be
changed, or at varying prices determined at the time of sale. Any agent involved
in the offer or sale of the Offered Securities with respect to which this
Prospectus is delivered will be named, and any commissions payable by the
Company to such agent will be set forth, in the Prospectus Supplement relating
thereto. Unless otherwise indicated in the Prospectus Supplement, any such agent
will be acting on a best efforts basis for the period of its appointment.
In connection with the sale of the Offered Securities, underwriters or
agents may receive compensation from the Company or from purchasers of Offered
Securities for whom they may act as agents in the form of discounts,
concessions, or commissions. Underwriters, agents and dealers participating in
the distribution of the Offered Securities may be deemed to be underwriters, and
any discounts or commissions received by them from the Company and any profit on
the resale of the Offered Securities by them may be deemed to be underwriting
discounts or commissions under the Securities Act.
If so indicated in the Prospectus Supplement, the Company will authorize
agents, underwriters or dealers to solicit offers from certain types of
institutions to purchase Offered Securities from the Company at the public
offering price set forth in the Prospectus Supplement pursuant to delayed
delivery contracts providing for payment and delivery on a specified date in the
future. Such contracts will be subject only to those
22
<PAGE> 24
conditions set forth in the Prospectus Supplement, and the Prospectus Supplement
will set forth the commission payable for solicitation of such contracts.
Agents, dealers and underwriters may be entitled under agreements entered
into with the Company to indemnification by the Company against certain civil
liabilities, including liabilities under the Securities Act, or to contribution
with respect to payments that such agents, dealers, or underwriters may be
required to make with respect thereto. Agents, dealers, and underwriters may be
customers of, engage in transactions with, or perform services for the Company
in the ordinary course of business.
The Offered Securities may or may not be listed on a national securities
exchange. No assurances can be given that there will be a market for the Offered
Securities.
EXPERTS
The consolidated financial statements and related schedule of the Company
included in the Company's annual report on Form 10-K for the year ended December
31, 1997, incorporated by reference herein and in the Registration Statement
have been audited by Coopers & Lybrand L.L.P., independent accountants, to the
extent and for the periods indicated in their reports, and have been
incorporated by reference herein and in the Registration Statement in reliance
upon the authority of that firm as experts in accounting and auditing.
LEGAL MATTERS
The legality of the Offered Securities will be passed upon for the Company
by Vinson & Elkins L.L.P., Dallas, Texas, or by such other firm as may be named
in the Prospectus Supplement relating to a particular issue of Offered
Securities, and for any underwriters or agents by a firm named in the Prospectus
Supplement relating to a particular issue of Offered Securities.
23
<PAGE> 25
- ------------------------------------------------------
------------------------------------------------------
- ------------------------------------------------------
------------------------------------------------------
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS OR IN A PROSPECTUS
SUPPLEMENT IN CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY OR ANY OTHER PERSON. NEITHER THIS PROSPECTUS NOR ANY
PROSPECTUS SUPPLEMENT CONSTITUTES AN OFFER TO SELL OR A SOLICITATION OF ANY
OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES TO WHICH IT RELATES, NOR
DOES IT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF ANY OFFER TO BUY SUCH
SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT
AUTHORIZED, OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION 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 PROSPECTUS
SUPPLEMENT NOR ANY SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT ANY INFORMATION CONTAINED HEREIN OR
THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF.
---------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information................. 2
Incorporation by Reference............ 2
The Company........................... 3
Use of Proceeds....................... 4
Ratio of Earnings to Fixed Charges.... 4
Description of Debt Securities........ 5
Description of Stock.................. 17
Description of Warrants............... 20
Plan of Distribution.................. 21
Experts............................... 23
Legal Matters......................... 23
</TABLE>
DEBT SECURITIES
CAPITAL STOCK
WARRANTS
-----------------
PROSPECTUS
-----------------
, 1998
- ------------------------------------------------------
------------------------------------------------------
- ------------------------------------------------------
------------------------------------------------------
<PAGE> 26
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the estimated expenses in connection with
the issuance and distribution of the securities registered hereby, which will be
borne by the Company:
<TABLE>
<S> <C>
SEC registration fee........................................ $121,212
Printing, engraving and duplicating expenses................ 20,000
Legal fees and expenses..................................... 12,000
Blue sky fees and expenses (including legal fees)........... *
Accounting fees and expenses................................ 50,000
Rating agency fees.......................................... *
Trustee and transfer agent fees (including legal fees)...... *
Miscellaneous expenses (including listing fees, if
applicable)............................................... 20,000
--------
Total............................................. $223,212
========
</TABLE>
- ---------------
* Not applicable.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Certificate of Incorporation of the Company provides that, to the
fullest extent that the law of the State of Delaware, as the same exists or may
hereafter be amended, permits elimination of the personal liability of
directors, no director of the Company shall be personally liable to the Company
or to its stockholders for monetary damages for breach of fiduciary duty as a
director. The DGCL permits a corporation's certificate of incorporation to
provide that no director of the corporation shall be personally liable to the
corporation or its stockholders for monetary damages for any breach of his or
her fiduciary duty as a director; provided that such provision shall not
eliminate or limit the liability of a director (i) for any breach of a
director's duty of loyalty to the corporation or its stockholders, (ii) for acts
or omissions that are not in good faith or involve intentional misconduct or a
knowing violation of the law, (iii) under Section 174 of the DGCL or (iv) for
any transaction from which the director derived an improper personal benefit.
The Certificate of Incorporation of the Company also provides, in general,
that the Company shall indemnify its officers and directors against reasonable
expenses and any liability paid or incurred by such person in connection with
any actual or threatened claim, action, suit or proceeding, civil, criminal,
administrative, investigative or other, whether brought by or in the right of
the Company or otherwise, in which he or she may be involved, as a party or
otherwise, by reason of such person being or having been a director or officer
of the Company or by reason of the fact that such person is or was serving at
the request of the Company as a director, officer, employee, fiduciary or other
representative of another corporation, partnership, joint venture, trust,
employee benefit plan or other entity, except as prohibited by law. Section 145
of the DGCL provides, in general, that each director and officer of a
corporation may be indemnified against expenses (including attorneys' fees,
judgments, fines and amounts paid in settlement) actually and reasonably
incurred in connection with the defense or settlement of any threatened, pending
or completed legal proceedings in which he or she is involved by reason of the
fact the he or she is or was a director or officer if he or she acted in good
faith and in a manner that he or she reasonably believed to be in or not opposed
to the best interests of the corporation and, with respect to any criminal
action or proceeding, if he or she had no reasonable cause to believe that his
or her conduct was unlawful. If the legal proceeding, however, is by or in the
right of the corporation, the director or officer may not be indemnified in
respect of any claim, issue or matter as to which he or she shall have been
adjudged to be liable for negligence or misconduct in the performance of his or
her duty to the corporation unless a court determines otherwise.
In addition, the Certificate of Incorporation of the Company provides that
the Company may purchase and maintain insurance to protect itself and any
director or officer entitled to indemnification pursuant to the
II-1
<PAGE> 27
Certificate of Incorporation. Accordingly, the Company carries directors and
officers liability coverage which is subject to certain limitations and
exclusions.
The Company has entered into an Indemnification and Insurance Agreement
with each of its directors (the "Indemnification and Insurance Agreements").
These agreements provide that the Company must, within 30 days of a request,
indemnify an officer or director for liabilities incurred to the fullest extent
permitted by the DGCL. The Company must, within two days of a request, indemnify
an officer or director for expenses incurred in the defense of a claim or other
proceeding. The obligation of the Company to provide the indemnification does
not apply if, before the date on which the Company must provide the
indemnification, the Company's board of directors, or a representative chosen by
the board of directors, concludes that indemnification would be improper under
the DGCL. It is the position of the Commission that indemnification of directors
and officers for liability under the Securities Act is against public policy and
unenforceable pursuant to Section 14 of the Securities Act.
The preceding discussion of the registrant's Certificate of Incorporation,
Section 145 of the DGCL, and the Indemnification and Insurance Agreements is not
intended to be exhaustive and is qualified in its entirety by the Certificate of
Incorporation, Section 145 of the DGCL and the Indemnification and Insurance
Agreements.
II-2
<PAGE> 28
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT
------- -------
<C> <S>
1.1* -- Underwriting Agreement.
3.1** -- Composite Certificate of Incorporation (filed as Exhibit
3 to the Company's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1996, and incorporated herein by
reference).
3.2 -- Bylaws, as amended to July 25, 1996 (filed as Exhibit 3
to the Company's Quarterly Report on Form 10-Q for the
quarter ended September 30, 1996, and incorporated herein
by reference).
4.1 -- Rights Agreement, dated as of September 28, 1995, between
the Company and Mellon Securities Trust Company, as
Rights Agent (filed as Exhibit 1 to the Company's Current
Report on Form 8-K dated October 20, 1995, and
incorporated herein by reference).
4.2** -- Form of Certificate of Capital Stock, par value $1.00 per
share, of the Company.
4.3** -- Form of Indenture between the Company and one or more
commercial banks to be named, as trustee.
4.4* -- Form of Senior Debt Security.
4.5* -- Form of Subordinated Debt Security.
4.6* -- Form of Warrant Agreement.
4.7* -- Form of Warrant Certificate.
5.1** -- Opinion of Vinson & Elkins L.L.P.
12.1** -- Computation of Ratio of Earnings to Fixed Charges.
23.1** -- Consent of Coopers & Lybrand L.L.P.
23.2** -- Consent of Vinson & Elkins L.L.P. (included in the
opinion filed as Exhibit 5.1).
24.1+ -- Powers of Attorney.
25.1* -- Form T-1 Statement of Eligibility under the Trust
Indenture Act of 1939 of trustee.
</TABLE>
- ---------------
* To be filed.
** Filed herewith.
+ Previously filed.
II-3
<PAGE> 29
ITEM 17. UNDERTAKINGS
The undersigned Registrant hereby undertakes:
(a) 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 the 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 and 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 paragraphs (a)(i) and (a)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant
pursuant to Section 13 or 15(d) of the Exchange Act that are incorporated
by reference in the Registration Statement.
(b) That, for the purpose of determining any liability under the
Securities Act, 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.
(c) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange
Act 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.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions set forth or described in Item 15 of this
Registration Statement, or otherwise, the Registrant has been advised that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act and is therefore
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-4
<PAGE> 30
The undersigned Registrant hereby undertakes that:
(a) For purposes of determining any liability under the Securities
Act, the information omitted from the form of prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.
(b) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities
offered herein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
The undersigned Registrant hereby undertakes 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 "Trust Indenture Act") in
accordance with the rules and regulations prescribed by the Commission under
Section 305(b)(2) of the Trust Indenture Act.
II-5
<PAGE> 31
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Amendment No. 1 to
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the city of Irving, Texas, on the 9th day of April, 1998.
QUAKER STATE CORPORATION
By: /s/ HERBERT M. BAUM
----------------------------------
Herbert M. Baum
Chairman of the Board and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 1 to Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE CAPACITY DATE
--------- -------- ----
<C> <S> <C>
/s/ HERBERT M. BAUM Chairman of the Board, Chief April 9, 1998
- ----------------------------------------------------- Executive Officer and Director
Herbert M. Baum (Principal Executive Officer)
* Vice Chairman, Chief Financial April 9, 1998
- ----------------------------------------------------- Officer and Director
Conrad A. Conrad (Principal Financial Officer)
* Vice President and Controller April 9, 1998
- ----------------------------------------------------- (Principal Accounting Officer)
Keith S. Krzeminski
* Director April 9, 1998
- -----------------------------------------------------
John D. Barr
* Director April 9, 1998
- -----------------------------------------------------
Leonard M. Carroll
* Director April 9, 1998
- -----------------------------------------------------
J. Taylor Crandall
* Director April 9, 1998
- -----------------------------------------------------
Laurel Cutler
* Director April 9, 1998
- -----------------------------------------------------
C. Frederick Fetterolf
* Director April 9, 1998
- -----------------------------------------------------
Thomas A. Gardner
* Director April 9, 1998
- -----------------------------------------------------
F. William Grube
</TABLE>
II-6
<PAGE> 32
<TABLE>
<CAPTION>
SIGNATURE CAPACITY DATE
--------- -------- ----
<C> <S> <C>
* Director April 9, 1998
- -----------------------------------------------------
Forrest R. Haselton
Director April 9, 1998
- -----------------------------------------------------
Kenneth Lee
* Director April 9, 1998
- -----------------------------------------------------
L. David Myatt
* Director April 9, 1998
- -----------------------------------------------------
Raymond A. Ross, Jr.
* Director April 9, 1998
- -----------------------------------------------------
Lorne R. Waxlax
*By: /s/ HERBERT M. BAUM April 9, 1998
-----------------------------------------------
Herbert M. Baum
Attorney-in-Fact
</TABLE>
II-7
<PAGE> 33
INDEX TO EXHIBITS
<TABLE>
<C> <S> <C>
</TABLE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT
------- -------
<C> <S>
4.2 -- Form of Certificate of Capital Stock, par value $1.00 per
share, of the Company.
4.3 -- Form of Indenture between the Company and one or more
commercial banks to be named, as trustee.
5.1 -- Opinion of Vinson & Elkins L.L.P.
12.1 -- Computation of Ratio of Earnings to Fixed Charges.
23.1 -- Consent of Coopers & Lybrand L.L.P.
23.2 -- Consent of Vinson & Elkins L.L.P. (to be included in the
opinion to be filed as Exhibit 5.1).
</TABLE>
<PAGE> 1
EXHIBIT 4.2
NUMBER QUAKER STATE CORPORATION SHARES
SU
INCORPORATED UNDER THE LAWS SEE REVERSE FOR
OF THE STATE OF DELAWARE CERTAIN DEFINITIONS
THIS CERTIFICATE IS TRANSFERABLE IN CUSIP 747410 10 8
DALLAS, TEXAS OR NEW YORK, NEW YORK
THIS CERTIFIES THAT IS THE OWNER OF
FULL-PAID AND NON-ASSESSABLE SHARES OF THE PAR VALUE OF $1.00
EACH OF THE CAPITAL STOCK OF THE
Quaker State Corporation, transferable on the books of the Corporation by
the owner in person, or by duly authorized attorney upon the surrender of his
certificate properly endorsed.
This certificate is not valid until countersigned by the Transfer Agent and
registered by the Registrar.
Witness the facsimile seal of the Corporation and the signatures of its
duly authorized Officers.
Dated:
/s/ PAUL E. KONNEY /s/ HERBERT M. BAUM
VICE PRESIDENT, [SEAL] CHAIRMAN, PRESIDENT
GENERAL COUNSEL AND SECRETARY AND CHIEF EXECUTIVE OFFICER
COUNTERSIGNED AND REGISTERED:
CHEMICAL MELLON SHAREHOLDER SERVICES, L.L.C.
TRANSFER AGENT
AND REGISTRAR
BY
AUTHORIZED SIGNATURE
<PAGE> 2
This certificate also evidences and entitles the holder hereof to certain Rights
as set forth in a Rights Agreement between Quaker State Corporation (the
"Corporation") and Mellon Securities Trust Company, dated as of September 28,
1995 (the "Rights Agreement"), the terms of which are hereby incorporated herein
by reference and a copy of which is on file at the principal executive offices
of the Corporation. Under certain circumstances, as set forth in the Rights
Agreement, such Rights will be evidenced by separate certificates and will no
longer be evidenced by this certificate. The corporation will mail to the holder
of this certificate a copy of the Rights Agreement without charge promptly after
receipt of a written request therefor. Under certain circumstances as set forth
in the Rights Agreement, Rights issued to an Acquiring Person or any Associate
or Affiliate thereof (as such terms are defined in the Rights Agreement) may be
null and void. The Rights shall not be exercisable, and shall be void so long as
held, by a holder in any jurisdiction where the requisite qualification for the
issuance to such holder, or the exercise by such holder of the Rights in such
jurisdiction, shall not have been obtained or be obtainable.
QUAKER STATE CORPORATION
The following abbreviations, when used in the inscription on the face
of this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
<TABLE>
<S> <C>
TEN COM -- as tenants in common UNIF GIFT MIN ACT -- __________ Custodian ________
TEN ENT -- as tenants by the entireties (Cust) (Minor)
JT TEN -- as joint tenants with right of Under Uniform Gifts to Minors
survivorship and not as tenants Act _________________________
in common (State)
</TABLE>
Additional abbreviations may also be used though not in the above list.
For Value Received, ____________ hereby sell, assign and transfer unto:
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
[ ]
- --------------------------------------------------------------------------------
PLEASE PRINT OR TYPE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE, OF ASSIGNEE
- --------------------------------------------------------------------------------
Shares
- -------------------------------------------------------------------------
of the Capital Stock represented by the within Certificate, and do hereby
irrevocably constitute and appoint
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Attorney to transfer the said stock on the books of the within-named
Corporation, with full power of substitution in the premises.
Dated
-----------------------
NOTICE:
THE SIGNATURE(S) TO
THIS ASSIGNMENT MUST X
CORRESPOND WITH THE --------------------------------------------
NAME(S) AS WRITTEN (SIGNATURE)
UPON THE FACE OF THE -->
CERTIFICATE IN EVERY X
PARTICULAR WITHOUT --------------------------------------------
ALTERATION OR EN- (SIGNATURE)
LARGEMENT OR ANY
CHANGE WHATEVER.
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN
ELIGIBLE GUARANTOR INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS
AND CREDIT UNIONS WITH MEMBERSHIP IN AN
APPROVED SIGNATURE GUARANTEE MEDALLION
PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15.
SIGNATURE(S) GUARANTEED BY:
<PAGE> 1
EXHIBIT 4.3
================================================================================
QUAKER STATE CORPORATION
AND
_______________________________________________________,
AS TRUSTEE
__________
INDENTURE
DATED AS OF _________________, 1998
__________
DEBT SECURITIES
================================================================================
<PAGE> 2
TABLE OF CONTENTS*
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
ARTICLE 1
DEFINITIONS
Section 1.01 Certain Terms Defined . . . . . . . . . . . . . . . . . . . 1
Section 1.02 Incorporation by Reference of Trust Indenture Act . . . . . 10
Section 1.03 Rules of Construction . . . . . . . . . . . . . . . . . . . 11
ARTICLE 2
DEBT SECURITIES
Section 2.01 Forms Generally . . . . . . . . . . . . . . . . . . . . . . 11
Section 2.02 Form of Trustee's Certificate of Authentication . . . . . . 12
Section 2.03 Principal Amount; Issuable in Series . . . . . . . . . . . . 12
Section 2.04 Execution of Debt Securities . . . . . . . . . . . . . . . . 16
Section 2.05 Authentication and Delivery of Debt Securities . . . . . . . 16
Section 2.06 Denomination of Debt Securities . . . . . . . . . . . . . . 18
Section 2.07 Registration of Transfer and Exchange . . . . . . . . . . . 18
Section 2.08 Temporary Debt Securities . . . . . . . . . . . . . . . . . 20
Section 2.09 Mutilated, Destroyed, Lost or Stolen Debt Securities . . . . 21
Section 2.10 Cancelation of Surrendered Debt Securities . . . . . . . . . 22
Section 2.11 Provisions of the Indenture and Debt Securities
for the Sole Benefit of the Parties and the Holders . . . . 23
Section 2.12 Payment of Interest; Interest Rights Preserved . . . . . . . 23
Section 2.13 Securities Denominated in Foreign Currencies . . . . . . . . 24
Section 2.14 Wire Transfers . . . . . . . . . . . . . . . . . . . . . . . 25
Section 2.15 Securities Issuable in the Form of a Global Security . . . . 25
Section 2.16 Medium Term Securities . . . . . . . . . . . . . . . . . . . 27
Section 2.17 Defaulted Interest . . . . . . . . . . . . . . . . . . . . . 28
Section 2.18 Judgments . . . . . . . . . . . . . . . . . . . . . . . . . 29
ARTICLE 3
REDEMPTION OF DEBT SECURITIES
Section 3.01 Applicability of Article . . . . . . . . . . . . . . . . . . 30
</TABLE>
*This Table of Contents is not part of the Indenture.
(i)
<PAGE> 3
<TABLE>
<S> <C> <C>
Section 3.02 Tax Redemption; Special Tax Redemption . . . . . . . . . . . 30
Section 3.03 Notice of Redemption; Selection of Debt Securities . . . . . 30
Section 3.04 Payment of Debt Securities Called for Redemption . . . . . . 32
Section 3.05 Mandatory and Optional Sinking Funds . . . . . . . . . . . . 33
Section 3.06 Redemption of Debt Securities for Sinking Fund . . . . . . . 34
ARTICLE 4
PARTICULAR COVENANTS OF THE COMPANY
Section 4.01 Payment of Principal of, and Premium, If Any,
and Interest on, Debt Securities . . . . . . . . . . . . . . 35
Section 4.02 Maintenance of Offices or Agencies for Registration of
Transfer, Exchange
and Payment of Debt Securities . . . . . . . . . . . . . . . 36
Section 4.03 Appointment to Fill a Vacancy in the Office of Trustee . . . 37
Section 4.04 Duties of Paying Agents, etc. . . . . . . . . . . . . . . . 37
Section 4.05 Statement by Officers as to Default . . . . . . . . . . . . 38
Section 4.06 Payment of Additional Interest . . . . . . . . . . . . . . . 38
Section 4.07 Further Instruments and Acts . . . . . . . . . . . . . . . . 40
Section 4.08 Existence . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 4.09 Maintenance of Properties . . . . . . . . . . . . . . . . . 40
Section 4.10 Payment of Taxes and Other Claims . . . . . . . . . . . . . 40
Section 4.11 Limitation on Liens . . . . . . . . . . . . . . . . . . . . 41
Section 4.12 Limitation on Sale and Leaseback Transactions . . . . . . . 41
ARTICLE 5
HOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE
Section 5.01 Company to Furnish Trustee Information as
to Names and Addresses of Holders;
Preservation of Information . . . . . . . . . . . . . . . . 42
Section 5.02 Communications to Holders . . . . . . . . . . . . . . . . . 43
Section 5.03 Reports by Company . . . . . . . . . . . . . . . . . . . . . 43
Section 5.04 Reports by Trustee . . . . . . . . . . . . . . . . . . . . . 44
Section 5.05 Record Dates for Action by Holders . . . . . . . . . . . . . 44
ARTICLE 6
REMEDIES OF THE TRUSTEE AND HOLDERS IN EVENT OF DEFAULT
Section 6.01 Events of Default . . . . . . . . . . . . . . . . . . . . . 45
</TABLE>
(ii)
<PAGE> 4
<TABLE>
<S> <C> <C>
Section 6.02 Collection of Indebtedness by Trustee, etc. . . . . . . . . 48
Section 6.03 Application of Moneys Collected by Trustee. . . . . . . . . 49
Section 6.04 Limitation on Suits by Holders. . . . . . . . . . . . . . . 50
Section 6.05 Remedies Cumulative; Delay or Omission in
Exercise of Rights Not a Waiver of Default. . . . . . . . . 51
Section 6.06 Rights of Holders of Majority in Principal
Amount of Debt Securities to Direct Trustee
and to Waive Default. . . . . . . . . . . . . . . . . . . . 51
Section 6.07 Trustee to Give Notice of Defaults Known to It,
but May Withhold Such Notice in Certain
Circumstances . . . . . . . . . . . . . . . . . . . . . . . 52
Section 6.08 Requirement of an Undertaking To Pay Costs
in Certain Suits under the Indenture or
Against the Trustee . . . . . . . . . . . . . . . . . . . . 52
ARTICLE 7
CONCERNING THE TRUSTEE
Section 7.01 Certain Duties and Responsibilities . . . . . . . . . . . . 52
Section 7.02 Certain Rights of Trustee . . . . . . . . . . . . . . . . . 54
Section 7.03 Trustee Not Liable for Recitals in Indenture
or in Debt Securities . . . . . . . . . . . . . . . . . . . 55
Section 7.04 Trustee, Paying Agent or Registrar May Own Debt Securities. 55
Section 7.05 Moneys Received by Trustee to Be Held in Trust. . . . . . . 55
Section 7.06 Compensation and Reimbursement. . . . . . . . . . . . . . . 55
Section 7.07 Right of Trustee to Rely on an Officers'
Certificate Where No Other Evidence
Specifically Prescribed . . . . . . . . . . . . . . . . . . 56
Section 7.08 Separate Trustee; Replacement of Trustee. . . . . . . . . . 56
Section 7.09 Successor Trustee by Merger . . . . . . . . . . . . . . . . 58
Section 7.10 Eligibility; Disqualification . . . . . . . . . . . . . . . 58
Section 7.11 Preferential Collection of Claims Against Company . . . . . 58
Section 7.12 Compliance with Tax Laws. . . . . . . . . . . . . . . . . . 58
ARTICLE 8
CONCERNING THE HOLDERS
Section 8.01 Evidence of Action by Holders . . . . . . . . . . . . . . . 59
Section 8.02 Proof of Execution of Instruments and of
Holding of Debt Securities. . . . . . . . . . . . . . . . . 59
Section 8.03 Who May Be Deemed Owner of Debt Securities. . . . . . . . . 60
Section 8.04 Instruments Executed by Holders Bind Future Holders . . . . 60
</TABLE>
(iii)
<PAGE> 5
<TABLE>
<S> <C> <C>
ARTICLE 9
SUPPLEMENTAL INDENTURES
Section 9.01 Purposes for Which Supplemental Indenture May Be
Entered into Without Consent of Holders . . . . . . . . . . 61
Section 9.02 Modification of Indenture with Consent of
Holders of Debt Securities . . . . . . . . . . . . . . . . . 63
Section 9.03 Effect of Supplemental Indentures . . . . . . . . . . . . . 65
Section 9.04 Debt Securities May Bear Notation of Changes
by Supplemental Indentures . . . . . . . . . . . . . . . . . 65
Section 9.05 Payment for Consent . . . . . . . . . . . . . . . . . . . . 65
ARTICLE 10
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
Section 10.01 Consolidations and Mergers of the Company . . . . . . . . . 66
Section 10.02 Rights and Duties of Successor Corporation . . . . . . . . . 66
ARTICLE 11
SATISFACTION AND DISCHARGE; INDENTURE; DEFEASANCE; UNCLAIMED MONEYS
Section 11.01 Applicability of Article . . . . . . . . . . . . . . . . . . 67
Section 11.02 Satisfaction and Discharge of Indenture; Defeasance . . . . 67
Section 11.03 Conditions of Defeasance . . . . . . . . . . . . . . . . . . 68
Section 11.04 Application of Trust Money . . . . . . . . . . . . . . . . . 69
Section 11.05 Repayment to Company . . . . . . . . . . . . . . . . . . . . 70
Section 11.06 Indemnity for U.S. Government Obligations . . . . . . . . . 70
Section 11.07 Reinstatement . . . . . . . . . . . . . . . . . . . . . . . 70
ARTICLE 12
SUBORDINATION OF DEBT SECURITIES
Section 12.01 Applicability of Article; Agreement To Subordinate . . . . . 70
Section 12.02 Liquidation, Dissolution, Bankruptcy . . . . . . . . . . . . 70
Section 12.03 Default on Senior Indebtedness . . . . . . . . . . . . . . . 71
Section 12.04 Acceleration of Payment of Debt Securities . . . . . . . . . 72
Section 12.05 When Distribution Must Be Paid Over . . . . . . . . . . . . 72
Section 12.06 Subrogation . . . . . . . . . . . . . . . . . . . . . . . . 72
Section 12.07 Relative Rights . . . . . . . . . . . . . . . . . . . . . . 72
Section 12.08 Subordination May Not Be Impaired by Company . . . . . . . . 73
</TABLE>
(iv)
<PAGE> 6
<TABLE>
<S> <C> <C>
Section 12.09 Rights of Trustee and Paying Agent . . . . . . . . . . . . . 73
Section 12.10 Distribution or Notice to Representative . . . . . . . . . . 73
Section 12.11 Article Not to Prevent Defaults or Limit Right
to Accelerate . . . . . . . . . . . . . . . . . . . . . . . 73
Section 12.12 Trust Moneys Not Subordinated . . . . . . . . . . . . . . . 73
Section 12.13 Trustee Entitled to Rely . . . . . . . . . . . . . . . . . . 73
Section 12.14 Trustee to Effectuate Subordination . . . . . . . . . . . . 74
Section 12.15 Trustee Not Fiduciary for Holders of Senior Indebtedness . . 74
Section 12.16 Reliance by Holders of Senior Indebtedness on
Subordination Provisions . . . . . . . . . . . . . . . . . . 74
ARTICLE 13
MISCELLANEOUS PROVISIONS
Section 13.01 Successors and Assigns of Company Bound by Indenture . . . . 75
Section 13.02 Acts of Board, Committee or Officer of Successor
Company Valid . . . . . . . . . . . . . . . . . . . . . . . 75
Section 13.03 Required Notices or Demands . . . . . . . . . . . . . . . . 75
Section 13.04 Indenture and Debt Securities to Be Construed in
Accordance with the Laws of the State of New York . . . . . 76
Section 13.05 Officers' Certificate and Opinion of Counsel to
Be Furnished upon Application or Demand by the Company . . . 76
Section 13.06 Payments Due on Legal Holidays . . . . . . . . . . . . . . . 76
Section 13.07 Provisions Required by Trust Indenture Act to Control . . . 77
Section 13.08 Computation of Interest on Debt Securities . . . . . . . . . 77
Section 13.09 Rules by Trustee, Paying Agent and Registrar . . . . . . . . 77
Section 13.10 No Recourse Against Others . . . . . . . . . . . . . . . . . 77
Section 13.11 Severability . . . . . . . . . . . . . . . . . . . . . . . . 77
Section 13.12 Effect of Headings . . . . . . . . . . . . . . . . . . . . . 77
Section 13.13 Indenture May Be Executed in Counterparts . . . . . . . . . 77
</TABLE>
(v)
<PAGE> 7
QUAKER STATE CORPORATION
DEBT SECURITIES
CROSS REFERENCE SHEET(1)
This Cross Reference Sheet shows the location in the Indenture of the provisions
inserted pursuant to Sections 310-318(a), inclusive of the Trust Indenture Act
of 1939.
<TABLE>
<CAPTION>
INDENTURE
TIA SECTION SECTION
----------- ---------
<S> <C>
310 (a)(1)................................................... 7.10
(a)(2)................................................... 7.10
(a)(3)................................................... 7.10
(a)(4)................................................... 7.10
(a)(5)................................................... 7.10
(b)...................................................... 7.10
(c)...................................................... N.A.(2)
311 (a)...................................................... 7.11
(b)...................................................... 7.11
(c)...................................................... N.A.
312 (a)...................................................... 5.01
(b)...................................................... 5.02
(c)...................................................... 5.02
313 (a)...................................................... 5.04
(b)(1)................................................... 5.04
(b)(2)................................................... 5.04
(c)...................................................... 13.03
(d)...................................................... 5.04
314 (a)(1)................................................... 5.03(a)
(a)(2)................................................... 5.03(b)
(a)(3)................................................... 5.03(a) & (b)
& 13.03
(a)(4)................................................... 4.05
(b)...................................................... N.A.
</TABLE>
- --------
(1) The Cross Reference Sheet is not part of the Indenture.
(2) N.A. means "Not Applicable."
<PAGE> 8
INDENTURE dated as of __________, 1998, between Quaker State
Corporation, a corporation incorporated and existing under the laws of the
State of Delaware (hereinafter sometimes called the "Company"), and
____________________________________, a __________________ (hereinafter
sometimes called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its debentures,
notes, bonds or other evidences of indebtedness to be issued in one or more
series unlimited as to principal amount (herein called the "Debt Securities"),
as in this Indenture provided.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH
That in order to declare the terms and conditions upon which the Debt
Securities are authenticated, issued and delivered, and in consideration of the
premises, and of the purchase and acceptance of the Debt Securities by the
holders thereof, the Company and the Trustee covenant and agree with each
other, for the benefit of the respective Holders from time to time of the Debt
Securities or any series thereof, as follows:
ARTICLE 1
DEFINITIONS
Section 1.01 Certain Terms Defined. The terms defined in this
Section 1.01 (except as herein otherwise expressly provided or unless the
context otherwise requires) for all purposes of this Indenture and of any
Indenture supplemental hereto shall have the respective meanings specified in
this Section 1.01. All other terms used in this Indenture which are defined in
the Trust Indenture Act or which are by reference therein defined in the
Securities Act (except as herein otherwise expressly provided or unless the
context otherwise requires), shall have the meanings assigned to such terms in
the Trust Indenture Act and in the Securities Act as in force as of the date of
original execution of this Indenture.
"Affiliate" of any specified Person means any other Person, directly
or indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct
1
<PAGE> 9
the management and policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise; and the
terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Authorized Newspaper" means a newspaper in an official language of
the country of publication customarily published at least once a day, and
customarily published for at least five days in each calendar week, and of
general circulation in such city or cities specified pursuant to Section 2.03
with respect to the Debt Securities of any series. Where successive
publications are required to be made in Authorized Newspapers, the successive
publications may be made in the same or in different newspapers in the same
city meeting the foregoing requirements and in each case on any business day in
such city.
"Attributable Debt" in respect of a Sale and Leaseback Transaction
means, at the time of determination, the then present value (discounted at the
actual rate of interest of such transaction) of the obligation of the lessee
for net rental payments during the remaining term of the lease included in such
Sale and Leaseback Transaction (including any period for which such lease has
been extended or may, at the option of the lessor, be extended).
"Bank Indebtedness" means any and all amounts payable under or in
respect of the Credit Agreement, as supplemented amended or modified from time
to time, including principal, premium (if any), interest (including interest
accruing on or after the filing of any petition in bankruptcy or for
reorganization relating to the Company whether or not a claim for post-filing
interest is allowed in such proceedings), fees, charges, expenses,
reimbursement obligations, guarantees and all other amounts payable thereunder
or in respect thereof.
"Bearer Holder" means, with respect to any Bearer Security or Coupon,
the bearer thereof.
"Bearer Security" means any Debt Security (with or without Coupons),
title to which passes by delivery only, but does not include any Coupons.
"Board of Directors" means either the Board of Directors of the
Company or any duly authorized committee or subcommittee of such Board, except
as the context may otherwise require.
"business day" means, when used with respect to any Place of Payment
specified pursuant to Section 2.03, any day that is not a Saturday, a Sunday or
a legal holiday or a day on which banking institutions or trust companies in
such Place of Payment are authorized or obligated by law to close, except as
otherwise specified pursuant to Section 2.03.
"Capital Stock" of any Person means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents of
or interests (including partnership interests) in (however designated) equity
of such Person, including any Preferred Stock, but excluding any debt
securities convertible into such equity.
2
<PAGE> 10
"Common Stock" means the capital stock, par value $1.00 per share, of
the Company, which stock is currently listed on the New York Stock Exchange and
the Pacific Stock Exchange.
"Company" means Parker & Parsley Petroleum Company, a Delaware
corporation, and, subject to the provisions of Article 10, shall also include
its successors and assigns.
"Company Order" means a written order of the Company, signed by its
Chairman of the Board, Vice Chairman, President or any Vice President and by
its Treasurer, Secretary, any Assistant Treasurer or any Assistant Secretary.
"Consolidated", when used with respect to any of the terms defined in
this Indenture, refers to such terms as reflected in a consolidation of the
accounts of the Company and its Subsidiaries in accordance with GAAP.
"corporate trust office of the trustee" or other similar term means
the office of the Trustee at which the corporate trust business of the Trustee
shall, at any particular time, be principally administered in the United States
of America, except that with respect to the presentation of Debt Securities for
payment or for registration of transfer and exchange, such term shall also mean
the office of the Trustee or the Trustee's agent in the Borough of Manhattan,
the city and state of New York, at which at any particular time its corporate
agency business shall be conducted.
"Coupon" means any interest coupon appertaining to any Bearer
Security.
"Coupon Security" means any Bearer Security authenticated and
delivered with one or more Coupons appertaining thereto.
"Credit Agreement" means the Credit Agreement dated as of June 12,
1997, among the Company and Morgan Guaranty Trust Company of New York, as
Agent, as supplemented, amended or modified from time to time.
"Currency" means Dollars or Foreign Currency.
"Debt Security" or "Debt Securities" has the meaning stated in the
first recital of this Indenture and more particularly means any debt security
or debt securities, as the case may be, of any series authenticated and
delivered under this Indenture.
"Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default.
"Defaulted Interest" has the meaning specified in Section 2.17.
3
<PAGE> 11
"Depositary" means, unless otherwise specified by the Company pursuant
to either Section 2.03 or 2.15, with respect to registered Debt Securities of
any series issuable or issued in whole or in part in the form of one or more
Global Securities, The Depository Trust Company, New York, New York, or any
successor thereto registered as a clearing agency under the Exchange Act or
other applicable statutes or regulations.
"Designated Senior Indebtedness" means (a) the Bank Indebtedness and
(b) any other Senior Indebtedness which, at the date of determination, has an
aggregate principal amount outstanding of, or under which, at the date of
determination, the holders thereof are committed to lend up to, at least $100
million and is specifically designated by the Company in the instrument
evidencing or governing such Senior Indebtedness as "Designated Senior
Indebtedness" for purposes of this Indenture and has been designated as
"Designated Senior Indebtedness" for purposes of this Indenture in an Officers'
Certificate received by the Trustee.
"Disqualified Stock" of a Person means Redeemable Stock of such Person
as to which the maturity, mandatory redemption, conversion or exchange or
redemption at the option of the holder thereof occurs, or may occur, on or
prior to the first anniversary of the earliest Stated Maturity of the Debt
Securities.
"Dollar" or "$" means such currency of the United States as at the
time of payment is legal tender for the payment of public and private debts.
"Dollar Equivalent" means, with respect to any monetary amount in a
Foreign Currency, at any time for the determination thereof, the amount of
Dollars obtained by converting such Foreign Currency involved in such
computation into Dollars at the spot rate for the purchase of Dollars with the
applicable Foreign Currency as quoted by ____________________________ (unless
another comparable financial institution is designated by the Company) in New
York, New York at approximately 11:00 a.m. (New York time) on the date two
business days prior to such determination.
"European Currency Units" has the meaning assigned to it from time to
time by the Council of the European Communities.
"European Communities" means the European Economic Community, the
European Coal and Steel Community and the European Atomic Energy Community.
"Event of Default" has the meaning specified in Section 6.01.
"Exchange Act" means the Securities Exchange Act of 1934.
"Foreign Currency" means a currency issued by the government of any
country other than the United States or a composite currency the value of which
is determined by reference to the values of the currencies of any group of
countries.
4
<PAGE> 12
"Funded Debt" means Indebtedness of the Company and its Restricted
Subsidiaries, whether incurred, assumed or guaranteed, which by its terms
matures more than one year from the date of creation thereof, or which is
extendable or renewable at the sole option of the obligor so that it may become
payable more than one year from such date.
"GAAP" means generally accepted accounting principles in the United
States as in effect as of the date on which the Debt Securities of the
applicable series are issued, including those 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
approved by a significant segment of the accounting profession. All ratios and
computations based on GAAP contained in this Indenture shall be computed in
conformity with GAAP consistently applied.
"Global Security" means with respect to any series of Debt Securities
issued hereunder, a Debt Security which is executed by the Company and
authenticated and delivered by the Trustee to the Depositary or pursuant to the
Depositary's instruction, all in accordance with this Indenture and any
Indentures supplemental hereto, or resolution of the Board of Directors and set
forth in an Officers' Certificate, which shall be registered in the name of the
Depositary or its nominee and which shall represent, and shall be denominated
in an amount equal to the aggregate principal amount of, all the Outstanding
Debt Securities of such series or any portion thereof, in either case having
the same terms, including, without limitation, the same original issue date,
date or dates on which principal is due and interest rate or method of
determining interest.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness or other obligation
of any other Person and any obligation, direct or indirect, contingent or
otherwise, of such Person (a) to purchase or pay (or advance or supply funds
for the purchase or payment of) such Indebtedness or other obligation of such
other Person (whether arising by virtue of partnership arrangements, or by
agreement to keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions or otherwise) or (b)
entered into for purposes of assuring in any other manner the obligee of such
Indebtedness or other obligation of the payment thereof or to protect such
obligee against loss in respect thereof (in whole or in part); provided,
however, that the term "Guarantee" shall not include endorsements for
collection or deposit in the ordinary course of business. The term "Guarantee"
used as a verb has a corresponding meaning.
"Holder," "Holder of Debt Securities" or other similar terms means,
with respect to a Registered Security, the Registered Holder and, with respect
to a Bearer Security or a Coupon, the Bearer Holder.
"Incur" means issue, assume, Guarantee, incur or otherwise become
liable for; provided, however, that any Indebtedness or Capital Stock of a
Person existing at the time such Person becomes a Subsidiary (whether by
merger, consolidation, acquisition or otherwise) shall be deemed
5
<PAGE> 13
to be incurred by such Subsidiary at the time it becomes a Subsidiary. The
terms "Incurred", "Incurrence" and "Incurring" shall each have a correlative
meaning.
"Indebtedness" of any Person means, without duplication, notes, bonds,
debentures or other evidences of indebtedness for borrowed money and all
indebtedness under purchase money mortgages or other purchase money liens or
conditional sales or similar title retention agreements, in each case where
such indebtedness has been created, incurred, assumed or guaranteed by such
Person or where such person is otherwise liable therefor, and indebtedness for
borrowed money secured by any mortgage, pledge or other lien or encumbrance
upon property owned by such Person even though such Person has not assumed or
become liable for the payment of such indebtedness.
"Indenture" means this instrument as originally executed, or, if
amended or supplemented as herein provided, as so amended or supplemented and
shall include the form and terms of particular series of Debt Securities as
contemplated hereunder, whether or not a supplemental Indenture is entered into
with respect thereto.
"Interest" includes, when used with respect to a Bearer Security, any
additional interest payable on such Bearer Security pursuant to Section 3.02 or
4.06.
"Lien" means any mortgage, pledge, hypothecation, charge, assignment,
deposit arrangement, encumbrance, security interest, lien (statutory or other),
or preference, priority, or other security or similar agreement or preferential
arrangement of any kind or nature whatsoever (including, without limitation,
any agreement to give or grant a Lien or any lease, conditional sale or other
title retention agreement having substantially the same economic effect as any
of the foregoing).
"Net Tangible Assets" means the total amounts of assets (less
depreciation and valuation reserves and other reserves and items deductible
from gross book value of specific asset accounts under generally accepted
accounting principles) which under GAAP would be included on a balance sheet
after deducting therefrom (a) all liability items except Funded Debt and
stockholders' equity and (b) all goodwill, trade names, trademarks, patents,
unamortized debt discount and expense and other like intangibles, which in each
case would be so included on such balance sheet.
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, the Vice Chairman, the President or any Vice President and by the
Treasurer, the Secretary or any Assistant Treasurer or Assistant Secretary of
the Company. Each such certificate shall include the statements provided for
in Section 13.05, if applicable.
"Opinion of Counsel" means an opinion in writing signed by legal
counsel for the Company (which counsel may be an employee of the Company), or
outside counsel for the Company. Each such opinion shall include the
statements provided for in Section 13.05, if applicable.
6
<PAGE> 14
"Original Issue Discount Debt Security" means any Debt Security which
provides for an amount less than the principal amount thereof to be due and
payable upon a declaration of acceleration of the maturity thereof pursuant to
Section 6.01.
"Outstanding", when used with respect to any series of Debt
Securities, means, as of the date of determination, all Debt Securities of that
series theretofore authenticated and delivered under this Indenture, except:
(a) Debt Securities of that series theretofore canceled
by the Trustee or delivered to the Trustee for cancelation;
(b) Debt Securities of that series for whose payment or
redemption money in the necessary amount has been theretofore
deposited with the Trustee or any paying agent (other than the
Company) in trust or set aside and segregated in trust by the Company
(if the Company shall act as its own paying agent) for the Holders of
such Debt Securities; provided, that, if such Debt Securities are to
be redeemed, notice of such redemption has been duly given pursuant to
this Indenture or provision therefor satisfactory to the Trustee has
been made; and
(c) Debt Securities of that series which have been paid
pursuant to Section 2.09 or in exchange for or in lieu of which other
Debt Securities have been authenticated and delivered pursuant to this
Indenture, other than any such Debt Securities in respect of which
there shall have been presented to the Trustee proof satisfactory to
it that such Debt Securities are held by a bona fide purchaser in
whose hands such Debt Securities are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Debt Securities of any series have given
any request, demand, authorization, direction, notice, consent or waiver
hereunder, Debt Securities owned by the Company or any other obligor upon the
Debt Securities or any Affiliate of the Company or of such other obligor shall
be disregarded and deemed not to be Outstanding, except that, in determining
whether the Trustee shall be protected in relying upon any such request,
demand, authorization, direction, notice, consent or waiver, only Debt
Securities which the Trustee knows to be so owned shall be so disregarded.
Debt Securities so owned which have been pledged in good faith may be regarded
as Outstanding if the pledgee establishes to the satisfaction of the Trustee
the pledgee's right so to act with respect to such Debt Securities and that the
pledgee is not the Company or any other obligor upon the Debt Securities or an
Affiliate of the Company or of such other obligor. In determining whether the
Holders of the requisite principal amount of Outstanding Debt Securities have
given any request, demand, authorization, direction, notice, consent or waiver
hereunder, the principal amount of an Original Issue Discount Debt Security
that shall be deemed to be Outstanding for such purposes shall be the amount of
the principal thereof that would be due and payable as of the date of such
determination upon a declaration of acceleration of the maturity thereof
pursuant to Section 6.01. In determining whether the Holders of the requisite
principal amount of the Outstanding Debt
7
<PAGE> 15
Securities of any series have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, the principal amount of a Debt
Security denominated in one or more foreign currencies or currency units that
shall be deemed to be Outstanding for such purposes shall be the Dollar
Equivalent, determined in the manner provided as contemplated by Section 2.03
on the date of original issuance of such Debt Security, of the principal amount
(or, in the case of any Original Issue Discount Security, the Dollar Equivalent
on the date of original issuance of such Security of the amount determined as
provided in the preceding sentence above) of such Debt Security.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Place of Payment" means, when used with respect to the Debt
Securities of any series, the place or places where the principal of, and
premium, if any, and interest on, the Debt Securities of that series are
payable as specified pursuant to Section 2.03.
"Preferred Stock", as applied to the Capital Stock of any corporation,
means Capital Stock of any class or classes (however designated) which is
preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
"Principal Property" means any refinery, processing or manufacturing
plant (together with any pipeline, terminal or other facility related to such
refinery or processing or manufacturing plant and necessary for its economic
operation), blending, packaging or bulk materials handling facility,
distribution center, service center or store located in the United States or
Canada, and owned or leased by the Company or a Subsidiary or any interest of
the Company or any Subsidiarily in such property (in each case including the
real estate related thereto), except any such property which the Company's
Board of Directors, in its good faith opinion, reasonably determines not to be
of material importance to the business of the Company and its Subsidiaries, as
evidenced by a resolution of the Board of Directors.
"Redeemable Stock" means, with respect to any Person, any Capital
Stock which by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable) or upon the happening of any event
(a) matures or is mandatorily redeemable pursuant to a sinking fund obligation
or otherwise, (b) is convertible or exchangeable for Indebtedness (other than
Preferred Stock) or Disqualified Stock or (c) is redeemable at the option of
the holder thereof, in whole or in part.
"Registered Holder" means the Person in whose name a Registered
Security is registered in the Debt Security Register (as defined in Section
2.07(a)).
"Registered Security" means any Debt Security registered as to
principal and interest in the Debt Security Register (as defined in Section
2.07(a)).
8
<PAGE> 16
"Registrar" has the meaning set forth in Section 2.07(a).
"Representative" means the trustee, agent or representative (if any)
for an issue of Senior Indebtedness.
"responsible officer", when used with respect to the Trustee, means
any Account Manager or any officer within the Institutional Trust Group of the
Trustee, including any Vice President, any Second Vice President, any trust
officer or any other officer of the Trustee performing functions similar to
those performed by the persons who at the time shall be such officers, and any
other officer of the Trustee to whom corporate trust matters are referred
because of his knowledge of and familiarity with the particular subject.
"Restricted Subsidiary" means any Subsidiary that owns or leases any
Principal Property.
"Sale and Leaseback Transaction" has the meaning set forth in Section
4.12.
"Secured Indebtedness" means any Indebtedness of the Company secured
by a Lien.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Funded Debt" means all Funded Debt, except Funded Debt the
payment of which is subordinated to the payment of the Debt Securities.
"Senior Indebtedness" means, as to any series of Debt Securities
subordinated pursuant to the provisions of Article 12, (a) Bank Indebtedness,
and (b) any other Indebtedness of the Company identified as Senior Indebtedness
in the resolution of the Board of Directors and accompanying Officers'
Certificate or supplemental Indenture setting forth the terms, including as to
Subordination, of such series.
"Significant Subsidiary" means a Subsidiary of any Person that would
be a "significant subsidiary" as defined in Rule 405 under the Securities Act
as in effect on the date of this Indenture.
"Stated Maturity" means, with respect to any security, the date
specified in such security as the fixed date on which the payment of principal
of such security is due and payable, including pursuant to any mandatory
redemption provision (but excluding any provision providing for the repurchase
of such security at the option of the holder thereof upon the happening of any
contingency beyond the control of the issuer unless such contingency has
occurred).
"Subsidiary" of any Person means any corporation, association,
partnership or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by (a) such
Person, (b) such Person and one or more Subsidiaries of such Person or (c) one
or more Subsidiaries of such Person.
9
<PAGE> 17
"Trustee" initially means ____________________________ and any other
Person or Persons appointed as such from time to time pursuant to Section 7.08,
and, subject to the provisions of Article 7, includes its or their successors
and assigns. If at any time there is more than one such Person, "Trustee" as
used with respect to the Debt Securities of any series shall mean the Trustee
with respect to the Debt Securities of that series.
"Trust Indenture Act" (except as herein otherwise expressly provided)
means the Trust Indenture Act of 1939 as in force at the date of this Indenture
as originally executed and, to the extent required by law, as amended after the
date of this Indenture as originally executed.
"United States" means the United States of America (including the
States and the District of Columbia), its territories, its possessions and
other areas subject to its jurisdiction.
"United States Alien" means any Person who, for United States Federal
income tax purposes, is a foreign corporation, a nonresident alien individual,
a nonresident alien fiduciary of a foreign estate or trust, or a foreign
partnership one or more members of which is, for United States Federal income
tax purposes, a foreign corporation, a nonresident alien individual or a
nonresident alien fiduciary of a foreign estate or trust.
"U.S. Government Obligations" means securities that are (a) direct
obligations of the United States of America for the payment of which its full
faith and credit is pledged or (b) 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, in either case,
are not callable or redeemable at the option of the issuer thereof.
"Yield to Maturity" means the yield to maturity, calculated at the
time of issuance of a series of Debt Securities, or, if applicable, at the most
recent redetermination of interest on such series and calculated in accordance
with accepted financial practice.
Section 1.02 Incorporation by Reference of Trust Indenture Act.
This Indenture is subject to the mandatory provisions of the Trust Indenture
Act which are incorporated by reference in and made a part of this Indenture.
The following Trust Indenture Act terms have the following meanings:
"indenture securities" means the Debt Securities.
"indenture security holder" means a Holder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
10
<PAGE> 18
"obligor" on the indenture securities means the Company and any other
obligor on the Debt Securities.
All other Trust Indenture Act terms used in this Indenture that are
defined by the Trust Indenture Act, reference to another statute or defined by
rules of the Securities and Exchange Commission have the meanings assigned to
them by such definitions.
Section 1.03 Rules of Construction. Unless the context otherwise
requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(c) "or" is not exclusive;
(d) "including" means including without limitation;
(e) words in the singular include the plural and words in the
plural include the singular;
(f) if the applicable series of Debt Securities are subordinated
pursuant to Article 12, unsecured Indebtedness shall not be deemed to be
subordinate or junior to Secured Indebtedness merely by virtue of its nature as
unsecured Indebtedness;
(g) the principal amount of any noninterest bearing or other
discount security at any date shall be the principal amount thereof that would
be shown on a balance sheet of the issuer dated such date prepared in
accordance with GAAP; and
(h) the principal amount of any Preferred Stock shall be the
greater of (i) the maximum liquidation value of such Preferred Stock or (ii)
the maximum mandatory redemption or mandatory repurchase price with respect to
such Preferred Stock.
ARTICLE 2
DEBT SECURITIES
Section 2.01 Forms Generally. The Debt Securities and Coupons, if
any, of each series shall be in substantially the form established without the
approval of any Holder by or pursuant to a resolution of the Board of Directors
or in one or more Indentures supplemental hereto, in each case with such
appropriate insertions, omissions, substitutions and other variations as are
required or permitted by this Indenture, and may have such letters, numbers or
other marks of identification and such legends or endorsements placed thereon
as the Company may deem appropriate (and, if not
11
<PAGE> 19
contained in a supplemental Indenture entered into in accordance with Article
9, as are not prohibited by the provisions of this Indenture) or as may be
required or appropriate to comply with any law or with any rules made pursuant
thereto or with any rules of any securities exchange on which such series of
Debt Securities may be listed, or to conform to general usage, or as may,
consistently herewith, be determined by the officers executing such Debt
Securities and Coupons, as evidenced by their execution of the Debt Securities
and Coupons.
The definitive Debt Securities of each series and Coupons, if any,
shall be printed, lithographed or engraved on steel engraved borders or may be
produced in any other manner, all as determined by the officers executing such
Debt Securities and Coupons, as evidenced by their execution of such Debt
Securities and Coupons.
Each Bearer Security and each Coupon shall bear a legend substantially
to the following effect: "Any United States Person who holds this obligation
will be subject to limitations under the United States Federal income tax laws,
including the limitations provided in Sections 165(j) and 1287(a) of the
Internal Revenue Code."
Section 2.02 Form of Trustee's Certificate of Authentication. The
Trustee's Certificate of Authentication on all Debt Securities authenticated by
the Trustee shall be in substantially the following form:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Debt Securities of the series designated therein
referred to in the within-mentioned Indenture.
,
As Trustee
By
-----------------------------------
Authorized Signature
Section 2.03 Principal Amount; Issuable in Series. The aggregate
principal amount of Debt Securities which may be issued, executed,
authenticated, delivered and outstanding under this Indenture is unlimited.
The Debt Securities may be issued in one or more series. There shall
be established, without the approval of any Holders, in or pursuant to a
resolution of the Board of Directors and set forth in
12
<PAGE> 20
an Officers' Certificate, or established in one or more Indentures supplemental
hereto, prior to the issuance of Debt Securities of any series any or all of
the following:
(a) the title of the Debt Securities of the series (which shall
distinguish the Debt Securities of the series from all other Debt Securities);
(b) any limit upon the aggregate principal amount of the Debt
Securities of the series which may be authenticated and delivered under this
Indenture (except for Debt Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other Debt
Securities of the series pursuant to this Article 2);
(c) the date or dates on which the principal and premium, if any,
of the Debt Securities of the series are payable;
(d) the rate or rates (which may be fixed or variable) at which
the Debt Securities of the series shall bear interest, if any, or the method of
determining such rate or rates, the date or dates from which such interest
shall accrue, the interest payment dates on which such interest shall be
payable, or the method by which such date will be determined, in the case of
Registered Securities, the record dates for the determination of Holders
thereof to whom such interest is payable; and the basis upon which interest
will be calculated if other than that of a 360-day year of twelve thirty-day
months;
(e) the place or places, if any, in addition to or instead of the
corporate trust office of the Trustee (in the case of Registered Securities) or
the principal London office of the Trustee (in the case of Bearer Securities),
where the principal of, and premium, if any, and interest on, Debt Securities
of the series shall be payable;
(f) the price or prices at which, the period or periods within
which and the terms and conditions upon which Debt Securities of the series may
be redeemed, in whole or in part, at the option of the Company or otherwise;
(g) whether Debt Securities of the series are to be issued as
Registered Securities or Bearer Securities or both, and, if Bearer Securities
are to be issued, whether Coupons will be attached thereto, whether Bearer
Securities of the series may be exchanged for Registered Securities of the
series and the circumstances under which and the places at which any such
exchanges, if permitted, may be made;
(h) if any Debt Securities of the series are to be issued as
Bearer Securities or as one or more Global Securities representing individual
Bearer Securities of the series, (i) whether the provisions of Sections 3.02
and 4.06 or other provisions for payment of additional interest or tax
redemptions shall apply and, if other provisions shall apply, such other
provisions; (ii) whether interest in respect of any portion of a temporary
Bearer Security of the series (delivered pursuant to Section 2.08) payable in
respect of any interest payment date prior to the exchange of such temporary
13
<PAGE> 21
Bearer Security for definitive Bearer Securities of the series shall be paid to
any clearing organization with respect to the portion of such temporary Bearer
Security held for its account and, in such event, the terms and conditions
(including any certification requirements) upon which any such interest payment
received by a clearing organization will be credited to the Persons entitled to
interest payable on such interest payment date; and (iii) the terms upon which
a temporary Bearer Security may be exchanged for one or more definitive Bearer
Securities of the series;
(i) the obligation, if any, of the Company to redeem, purchase or
repay Debt Securities of the series 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 or periods within which and the terms and conditions upon
which Debt Securities of the series shall be redeemed, purchased or repaid, in
whole or in part, pursuant to such obligations;
(j) the terms, if any, upon which the Debt Securities of the
series may be convertible into or exchanged for Common Stock, Preferred Stock
(which may be represented by depositary shares), other Debt Securities or
warrants for Common Stock, Preferred Stock or Indebtedness or other securities
of any kind of the Company or any other obligor and the terms and conditions
upon which such conversion or exchange shall be effected, including the initial
conversion or exchange price or rate, the conversion or exchange period and any
other provision in addition to or in lieu of those described herein;
(k) if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which Debt Securities of the series
shall be issuable;
(l) if the amount of principal of or any premium or interest on
Debt Securities of the series may be determined with reference to an index or
pursuant to a formula, the manner in which such amounts will be determined;
(m) if the principal amount payable at the Stated Maturity of Debt
Securities of the series will not be determinable as of any one or more dates
prior to such Stated Maturity, the amount which will be deemed to be such
principal amount as of any such date for any purpose, including the principal
amount thereof which will be due and payable upon any maturity other than the
Stated Maturity or which will be deemed to be Outstanding as of any such date
(or, in any such case, the manner in which such deemed principal amount is to
be determined); and the manner of determining the equivalent thereof in the
currency of the United States of America for purposes of the definition of
Dollar Equivalent;
(n) any changes or additions to Article 11, including the addition
of additional covenants that may be subject to the covenant defeasance option
pursuant to Section 11.02(b)(ii);
(o) if other than such coin or Currency of the United States as at
the time of payment is legal tender for payment of public and private debts,
the coin or Currency or Currencies or units of
14
<PAGE> 22
two or more Currencies in which payment of the principal of, and premium, if
any, and interest on, Debt Securities of the series shall be payable;
(p) if other than the principal amount thereof, the portion of the
principal amount of Debt Securities of the series which shall be payable upon
declaration of acceleration of the maturity thereof pursuant to Section 6.01 or
provable in bankruptcy pursuant to Section 6.02;
(q) the terms, if any, of the transfer, mortgage, pledge or
assignment as security for the Debt Securities of the series of any properties,
assets, moneys, proceeds, securities or other collateral, including whether
certain provisions of the Trust Indenture Act are applicable and any
corresponding changes to provisions of this Indenture as currently in effect;
(r) any addition to or change in the Events of Default with
respect to the Debt Securities of the series and any change in the right of the
Trustee or the Holders to declare the principal of, and premium and interest
on, such Debt Securities due and payable;
(s) if the Debt 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 Debt Securities in
definitive registered form; and the Depositary for such Global Security or
Securities and the form of any legend or legends to be borne by any such Global
Security or Securities in addition to or in lieu of the legend referred to in
Section 2.15;
(t) any trustees, authenticating or paying agents, transfer agents
or registrars;
(u) the applicability of, and any addition to or change in the
covenants and definitions currently set forth in this Indenture or in the terms
currently set forth in Article 10, including conditioning any merger,
conveyance, transfer or lease permitted by Article 10 upon the satisfaction of
an Indebtedness coverage standard by the Company and the Successor Company (as
defined in Article 10);
(v) the terms, if any, of any Guarantee of the payment of
principal of, and premium, if any, and interest on, Debt Securities of the
series and any corresponding changes to the provisions of this Indenture as
currently in effect;
(w) the subordination, if any, of the Debt Securities of the
series pursuant to Article 12 and any changes or additions to Article 12;
(x) with regard to Debt Securities of the series that do not bear
interest, the dates for certain required reports to the Trustee; and
(y) any other terms of the Debt Securities of the series (which
terms shall not be prohibited by the provisions of this Indenture).
15
<PAGE> 23
All Debt Securities of any one series and the Coupons, if any,
appertaining thereto shall be substantially identical except as to denomination
and except as may otherwise be provided in or pursuant to such resolution of
the Board of Directors and as set forth in such Officers' Certificate or in any
such Indenture supplemental hereto.
Section 2.04 Execution of Debt Securities. The Debt Securities
and the Coupons, if any, shall be signed on behalf of the Company by its
Chairman of the Board, its Vice Chairman, its President or a Vice President and
by its Secretary, an Assistant Secretary, a Treasurer or an Assistant
Treasurer. Such signatures upon the Debt Securities and Coupons may be the
manual or facsimile signatures of the present or any future such authorized
officers and may be imprinted or otherwise reproduced on the Debt Securities
and Coupons. The seal of the Company, if any, may be in the form of a
facsimile thereof and may be impressed, affixed, imprinted or otherwise
reproduced on the Debt Securities and Coupons.
Only such Debt Securities and Coupons as shall bear thereon a
certificate of authentication substantially in the form hereinbefore recited,
signed manually by the Trustee, shall be entitled to the benefits of this
Indenture or be valid or obligatory for any purpose. Such certificate by the
Trustee upon any Debt Security or Coupon executed by the Company shall be
conclusive evidence that the Debt Security or Coupon so authenticated has been
duly authenticated and delivered hereunder.
In case any officer of the Company who shall have signed any of the
Debt Securities or Coupons shall cease to be such officer before the Debt
Securities or Coupons so signed shall have been authenticated and delivered by
the Trustee, or disposed of by the Company, such Debt Securities or Coupons
nevertheless may be authenticated and delivered or disposed of as though the
Person who signed such Debt Securities or Coupons had not ceased to be such
officer of the Company; and any Debt Security or Coupon may be signed on behalf
of the Company by such Persons as, at the actual date of the execution of such
Debt Security or Coupon, shall be the proper officers of the Company, although
at the date of such Debt Security or Coupon or of the execution of this
Indenture any such Person was not such officer.
Section 2.05 Authentication and Delivery of Debt Securities. At
any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Debt Securities, with appropriate Coupons,
if any, of any series executed by the Company to the Trustee for
authentication, and the Trustee shall thereupon authenticate and deliver said
Debt Securities and Coupons to or upon a Company Order. In authenticating such
Debt Securities and Coupons, and accepting the additional responsibilities
under this Indenture in relation to such Debt Securities and Coupons, the
Trustee shall be entitled to receive, and (subject to Section 7.01) shall be
fully protected in relying upon:
(a) a copy of any resolution or resolutions of the Board of
Directors, certified by the Secretary or Assistant Secretary of the Company,
authorizing the terms of issuance of any series of Debt Securities and Coupons;
16
<PAGE> 24
(b) an executed supplemental Indenture, if any;
(c) an Officers' Certificate; and
(d) an Opinion of Counsel prepared in accordance with Section
13.05 which shall also state:
(i) that the form of such Debt Securities and Coupons has
been established by or pursuant to a resolution of the Board of
Directors or by a supplemental Indenture as permitted by Section 2.01
in conformity with the provisions of this Indenture;
(ii) that the terms of such Debt Securities and Coupons
have been established by or pursuant to a resolution of the Board of
Directors or by a supplemental Indenture as permitted by Section 2.03
in conformity with the provisions of this Indenture;
(iii) that such Debt Securities and Coupons, when
authenticated and delivered by the Trustee and issued by the Company
in the manner and subject to any conditions specified in such Opinion
of Counsel, will constitute valid and legally binding obligations of
the Company, enforceable in accordance with their terms except as (A)
the enforceability thereof may be limited by bankruptcy, insolvency or
similar laws affecting the enforcement of creditors' rights generally
and (B) rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general
applicability;
(iv) that the Company has the corporate power to issue
such Debt Securities and Coupons and has duly taken all necessary
corporate action with respect to such issuance;
(v) that the issuance of such Debt Securities and Coupons
will not contravene the charter or by-laws of the Company or result in
any material violation of any of the terms or provisions of any law or
regulation or of any indenture, mortgage or other material agreement
known to such counsel by which the Company is bound;
(vi) that authentication and delivery of such Debt
Securities and Coupons and the execution and delivery of any
supplemental Indenture will not violate the terms of this Indenture;
and
(vii) such other matters as the Trustee may reasonably
request.
Such Opinion of Counsel need express no opinion as to whether a court
in the United States would render a money judgment in a currency other than
that of the United States.
The Trustee shall have the right to decline to authenticate and
deliver any Debt Securities or Coupons under this Section 2.05 if the Trustee,
being advised by counsel, determines that such action may not lawfully be taken
or if the Trustee shall determine in good faith by its board of
17
<PAGE> 25
directors or trustees, executive committee or a trust committee of directors,
trustees or vice presidents that such action would expose the Trustee to
personal liability to existing Holders.
The Trustee may appoint an authenticating agent reasonably acceptable
to the Company to authenticate Debt Securities and Coupons, if any, of any
series. Unless limited by the terms of such appointment, an authenticating
agent may authenticate Debt 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
any Registrar, paying agent or agent for service of notices and demands.
Unless otherwise provided in the form of Debt Security for any series,
each Debt Security shall be dated the date of its authentication.
Section 2.06 Denomination of Debt Securities. Unless otherwise
provided in the form of Debt Security for any series, the Debt Securities of
each series shall be issuable only as Registered Securities in such
denominations as shall be specified or contemplated by Section 2.03. In the
absence of any such specification with respect to the Debt Securities of any
series, the Debt Securities of such series shall be issuable in denominations
of $1,000 and any integral multiple thereof.
Section 2.07 Registration of Transfer and Exchange.
(a) The Company shall keep or cause to be kept a register for each
series of Registered Securities issued hereunder (hereinafter collectively
referred to as the "Debt Security Register"), in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Registered Securities and the transfer of Registered Securities
as in this Article 2 provided. At all reasonable times the Debt Security
Register shall be open for inspection by the Trustee. Subject to Section 2.15,
upon due presentment for registration of transfer of any Registered Security at
any office or agency to be maintained by the Company in accordance with the
provisions of Section 4.02, the Company shall execute and the Trustee shall
authenticate and deliver in the name of the transferee or transferees a new
Registered Security or Registered Securities of authorized denominations for a
like aggregate principal amount. In no event may Registered Securities,
including Registered Securities received in exchange for Bearer Securities, be
exchanged for Bearer Securities.
Unless and until otherwise determined by the Company by resolution of
the Board of Directors, the register of the Company for the purpose of
registration, exchange or registration of transfer of the Registered Securities
shall be kept at the corporate trust office of the Trustee and, for this
purpose, the Trustee shall be designated "Registrar".
Registered Securities of any series (other than a Global Security,
except as set forth below) may be exchanged for a like aggregate principal
amount of Registered Securities of the same series of other authorized
denominations. Subject to Section 2.15, Registered Securities to be exchanged
18
<PAGE> 26
shall be surrendered at the office or agency to be maintained by the Company as
provided in Section 4.02, and the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor the Registered Security or
Registered Securities which the Holder making the exchange shall be entitled to
receive.
At the option of the Holder of Bearer Securities of any series, except
as otherwise specified as contemplated by Section 2.03(h) or 2.03(i) with
respect to a Global Security representing Bearer Securities, Bearer Securities
of such series may be exchanged for Registered Securities (if the Debt
Securities of such series are issuable as Registered Securities) or Bearer
Securities of the same series, of any authorized denomination or denominations,
of like tenor and aggregate principal amount, upon surrender of the Bearer
Securities to be exchanged at the office or agency of the Company maintained
for such purpose, with all unmatured Coupons and all matured Coupons in Default
thereto appertaining; provided, however, that delivery of a Bearer Security
shall occur only outside the United States. If such Holder is unable to
produce any such unmatured Coupon or Coupons or matured Coupon or Coupons in
Default, such exchange may be effected if such Holder's Bearer Securities are
accompanied by payment in funds acceptable to the Company and the Trustee in an
amount equal to the face amount of such missing Coupon or Coupons, or the
surrender of such missing Coupon or Coupons may be waived by the Company and
the Trustee if there be furnished to them such security or indemnity as they
may require to save each of them and any paying agent harmless. If thereafter
such Holder shall surrender to any paying agent any such missing Coupon in
respect of which such a payment shall have been made, such Holder shall be
entitled to receive the amount of such payment; provided, however, that, except
as otherwise provided in Section 2.12, interest represented by Coupons shall be
payable only upon presentation and surrender of those Coupons at an office or
agency located outside the United States.
Whenever any Debt Securities are so surrendered for exchange, the
Company shall execute, and the Trustee shall authenticate and deliver, the Debt
Securities that the Holder making the exchange is entitled to receive.
Notwithstanding the foregoing, the exchange of Bearer Securities for
Registered Securities will be subject to the provisions of United States income
tax laws and regulations applicable to Debt Securities in effect at the time of
such exchange.
(b) All Registered Securities presented or surrendered for
registration of transfer, exchange or payment shall (if so required by the
Company, the Trustee or the Registrar) be duly endorsed or be accompanied by a
written instrument or instruments of transfer, in form satisfactory to the
Company, the Trustee and the Registrar, duly executed by the Registered Holder
or his attorney duly authorized in writing.
All Debt Securities issued in exchange for or upon transfer of Debt
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture as the Debt
Securities surrendered for such exchange or transfer.
19
<PAGE> 27
No service charge shall be made for any exchange or registration of
transfer of Debt Securities (except as provided by Section 2.09), but the
Company may require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto, other than those
expressly provided in this Indenture to be made at the Company's own expense or
without expense or without charge to the Holders.
The Company shall not be required (i) to issue, register the transfer
of or exchange any Debt Securities for a period of 15 days next preceding any
mailing of notice of redemption of Debt Securities of such series or (ii) to
register the transfer of or exchange any Debt Securities selected, called or
being called for redemption; provided, however, that, if specified pursuant to
Section 2.03, any Bearer Securities of any series that are exchangeable for
Registered Securities and that are called for redemption pursuant to Section
3.02 may, to the extent permitted by applicable law, be exchanged for one or
more Registered Securities of such series during the period preceding the
redemption date therefor.
Prior to the due presentation for registration of transfer of any Debt
Security, the Company, the Trustee, any paying agent or any Registrar may deem
and treat the Person in whose name a Debt Security is registered as the
absolute owner of such Debt Security for the purpose of receiving payment of
principal of, and premium, if any, and interest on, such Debt Security and for
all other purposes whatsoever, whether or not such Debt Security is overdue,
and none of the Company, the Trustee, any paying agent or Registrar shall be
affected by notice to the contrary.
None of the Company, the Trustee, any agent of the Trustee, any paying
agent or any Registrar will have any responsibility or liability for any aspect
of the records relating to, or payments made on account of, beneficial
ownership interests of a Global Security or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
Section 2.08 Temporary Debt Securities. Pending the preparation
of definitive Debt Securities of any series, the Company may execute and the
Trustee shall authenticate and deliver temporary Debt Securities (printed,
lithographed, photocopied, typewritten or otherwise produced) of any authorized
denomination, and substantially in the form of the definitive Debt Securities
in lieu of which they are issued, in registered form or, if authorized, in
bearer form with one or more Coupons or without Coupons, and with such
omissions, insertions and variations as may be appropriate for temporary Debt
Securities and Coupons, all as may be determined by the Company with the
concurrence of the Trustee. Temporary Debt Securities and Coupons may contain
such reference to any provisions of this Indenture as may be appropriate.
Every temporary Debt Security shall be executed by the Company and be
authenticated by the Trustee upon the same conditions and in substantially the
same manner, and with like effect, as the definitive Debt Securities.
If temporary Debt Securities of any series are issued, the Company
will cause definitive Debt Securities of such series to be prepared without
unreasonable delay. Except as otherwise specified as contemplated by Section
2.03(h)(iii) with respect to a series of Debt Securities issuable as Bearer
Securities or as one or more Global Securities representing individual Bearer
Securities of the series,
20
<PAGE> 28
(a) after the preparation of definitive Debt Securities of such series, the
temporary Debt Securities of such series shall be exchangeable for definitive
Debt Securities of such series upon surrender of the temporary Debt Securities
of such series at the office or agency of the Company at a Place of Payment for
such series, without charge to the Holder thereof, except as provided in
Section 2.07 in connection with a transfer and except that a Person receiving
definitive Bearer Securities shall bear the cost of insurance, postage,
transportation and the like unless otherwise specified pursuant to Section
2.03, and (b) upon surrender for cancelation of any one or more temporary Debt
Securities of any series (accompanied by any unmatured Coupons appertaining
thereto), the Company shall execute and the Trustee shall authenticate and
deliver in exchange therefor a like principal amount of definitive Debt
Securities of the same series of authorized denominations and of like tenor;
provided, however, that no definitive Bearer Security shall be delivered in
exchange for a temporary Registered Security; and provided, further, however,
that delivery of a Global Security representing individual Bearer Securities or
a Bearer Security shall occur only outside the United States. Until so
exchanged, temporary Debt Securities of any series shall in all respects be
entitled to the same benefits under this Indenture as definitive Debt
Securities of such series, except as otherwise specified as contemplated by
Section 2.03(h)(ii) with respect to the payment of interest on Global
Securities in temporary form.
Unless otherwise specified pursuant to Section 2.03, the Company will
execute and deliver each definitive Global Security representing individual
Bearer Securities and each Bearer Security to the Trustee at its principal
office in London or such other place outside the United States specified
pursuant to Section 2.03.
Upon any exchange of a portion of a temporary Global Security for a
definitive Global Security or for the individual Debt Securities represented
thereby pursuant to Section 2.07 or this Section 2.08, the temporary Global
Security shall be endorsed by the Trustee to reflect the reduction of the
principal amount evidenced thereby, whereupon the principal amount of such
temporary Global Security shall be reduced for all purposes by the amount so
exchanged and endorsed.
Section 2.09 Mutilated, Destroyed, Lost or Stolen Debt Securities.
If (a) any mutilated Debt Security or any mutilated Coupon with the Coupon
Security to which it appertains (and all unmatured Coupons attached thereto) is
surrendered to the Trustee at its corporate trust office (in the case of
Registered Securities) or at its principal London office (in the case of Bearer
Securities) or (b) the Company and the Trustee receive evidence to their
satisfaction of the destruction, loss or theft of any Debt Security or any
Coupon, and there is delivered to the Company and the Trustee such security or
indemnity as may be required by them to save each of them and any paying agent
harmless, and neither the Company nor the Trustee receives notice that such
Debt Security or Coupon has been acquired by a bona fide purchaser, then the
Company shall execute and, upon a Company Order, the Trustee shall authenticate
and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost
or stolen Debt Security or in exchange for the Coupon Security to which such
mutilated, destroyed, lost or stolen Coupon appertained, a new Debt Security of
the same series of like tenor, form, terms and principal amount, bearing a
number not contemporaneously Outstanding, and, in the case of a Coupon
Security, with such Coupons attached thereto that neither
21
<PAGE> 29
gain nor loss in interest shall result from such exchange or substitution.
Upon the issuance of any substituted Debt Security, the Company may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other expenses connected therewith.
In case any Debt Security or Coupon which has matured or is about to mature or
which has been called for redemption shall become mutilated or be destroyed,
lost or stolen, the Company may, instead of issuing a substituted Debt Security
or Coupon, pay or authorize the payment of the same (without surrender thereof
except in the case of a mutilated Debt Security or Coupon) if the applicant for
such payment shall furnish the Company and the Trustee with such security or
indemnity as either may require to save it harmless from all risk, however
remote, and, in case of destruction, loss or theft, evidence to the
satisfaction of the Company and the Trustee of the destruction, loss or theft
of such Debt Security or Coupon and of the ownership thereof; provided,
however, that payment of principal of, and premium, if any, and interest on,
Bearer Securities or Coupons shall, except as otherwise provided in Section
2.12, be payable only at an office or agency located outside the United States.
Every substituted Debt Security of any series, with its Coupons, if
any, issued pursuant to the provisions of this Section 2.09 by virtue of the
fact that any Debt Security or Coupon is destroyed, lost or stolen shall
constitute an original additional contractual obligation of the Company,
whether or not the destroyed, lost or stolen Debt Security or Coupon shall be
found at any time, and shall be entitled to all the benefits of this Indenture
equally and proportionately with any and all other Debt Securities of that
series and Coupons, if any, duly issued hereunder. All Debt Securities and
Coupons, if any, shall be held and owned upon the express condition that the
foregoing provisions are exclusive with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Debt Securities or Coupons, and shall
preclude any and all other rights or remedies, notwithstanding any law or
statute existing or hereafter enacted to the contrary with respect to the
replacement or payment of negotiable instruments or other securities without
their surrender.
Section 2.10 Cancelation of Surrendered Debt Securities. All Debt
Securities surrendered for payment, redemption, registration of transfer or
exchange and all Coupons surrendered for payment or exchange shall, if
surrendered to the Company or any paying agent or a Registrar, be delivered to
the Trustee for cancelation by it, or if surrendered to the Trustee, shall be
canceled by it, and no Debt Securities or Coupons shall be issued in lieu
thereof except as expressly permitted by any of the provisions of this
Indenture. All canceled Debt Securities and Coupons held by the Trustee shall
be destroyed (subject to the record retention requirements of the Exchange Act)
and certification of their destruction delivered to the Company, unless
otherwise directed. On request of the Company, the Trustee shall deliver to
the Company canceled Debt Securities and Coupons held by the Trustee. If the
Company shall acquire any of the Debt Securities or Coupons, however, such
acquisition shall not operate as a redemption or satisfaction of the
indebtedness represented thereby unless and until the same are delivered or
surrendered to the Trustee for cancelation. The Company may not issue new Debt
Securities or Coupons to replace Debt Securities or Coupons it has redeemed,
paid or delivered to the Trustee for cancelation.
22
<PAGE> 30
Section 2.11 Provisions of the Indenture and Debt Securities for
the Sole Benefit of the Parties and the Holders. Nothing in this Indenture or
in the Debt Securities or Coupons, expressed or implied, shall give or be
construed to give to any Person, other than the parties hereto, the Holders or
any Registrar or paying agent, any legal or equitable right, remedy or claim
under or in respect of this Indenture, or under any covenant, condition or
provision herein contained; all its covenants, conditions and provisions being
for the sole benefit of the parties hereto, the Holders and any Registrar and
paying agents.
Section 2.12 Payment of Interest; Interest Rights Preserved.
(a) Interest on any Registered Security that is payable and is
punctually paid or duly provided for on any interest payment date shall be paid
to the Person in whose name such Registered Security is registered at the close
of business on the regular record date for such interest notwithstanding the
cancelation of such Registered Security upon any transfer or exchange
subsequent to the regular record date. In case a Coupon Security of any series
is surrendered in exchange for a Registered Security of such series after the
close of business (at an office or agency in a Place of Payment for such
series) on any regular record date and before the opening of business (at such
office or agency) on the next succeeding interest payment date, such Coupon
Security shall be surrendered without the Coupon relating to such interest
payment date and interest will not be payable on such interest payment date in
respect of the Registered Security issued in exchange for such Coupon Security,
but will be payable only to the Holder of such Coupon when due in accordance
with the provisions of this Indenture. Payment of interest on Registered
Securities shall be made at the corporate trust office of the Trustee (except
as otherwise specified pursuant to Section 2.03), or at the option of the
Company, by check mailed to the address of the Person entitled thereto as such
address shall appear in the Debt Security Register or, if provided pursuant to
Section 2.03 and in accordance with arrangements satisfactory to the Trustee,
at the option of the Registered Holder by wire transfer to an account
designated by the Registered Holder.
(b) No interest shall be payable with respect to a Bearer Security
or Coupon unless such certification requirements as are specified pursuant to
Section 2.03(h)(iii) are satisfied with respect to such Bearer Security or
Coupon. Interest on any Coupon Security that is payable and is punctually paid
or duly provided for on any interest payment date shall be paid to the Holder
of the Coupon that has matured on such interest payment date upon surrender of
such Coupon on such interest payment date at the principal London office of the
Trustee or at such other Place of Payment outside the United States specified
pursuant to Section 2.03.
Interest on any Bearer Security (other than a Coupon Security) that is
payable and is punctually paid or duly provided for on any interest payment
date shall be paid to the Holder of the Bearer Security upon presentation of
such Bearer Security and notation thereon on such interest payment date at the
principal London office of the Trustee or at such other Place of Payment
outside the United States specified pursuant to Section 2.03.
23
<PAGE> 31
Unless otherwise specified pursuant to Section 2.03, at the direction
of the Holder of any Bearer Security or Coupon payable in Dollars, and subject
to applicable laws and regulations, payments in respect of such Bearer Security
or Coupon will be made by check drawn on a bank in New York, New York or, in
accordance with arrangements satisfactory to the Trustee, by wire transfer to a
Dollar account maintained by such Holder with a bank outside the United States.
If such payment at the offices of all paying agents outside the United States
becomes illegal or is effectively precluded because of the imposition of
exchange controls or similar restrictions on the full payment or receipt of
such amounts in Dollars, then, to the extent permitted by United States tax
law, the Company will appoint an office or agent in the United States at which
such payment may be made. Unless otherwise specified pursuant to Section 2.03,
at the direction of the Holder of any Bearer Security or Coupon payable in a
Foreign Currency, payment on such Bearer Security or Coupon will be made by a
check drawn on a bank outside the United States or, in accordance with
arrangements satisfactory to the Trustee, by wire transfer to an appropriate
account maintained by such Holder outside the United States. Except as
provided in this paragraph, no payment on any Bearer Security or Coupon will be
made by mail to an address in the United States or by transfer to an account in
the United States.
(c) Subject to the foregoing provisions of this Section 2.12 and
Section 2.17, each Debt Security of a particular series delivered under this
Indenture upon registration of transfer of or in exchange for or in lieu of any
other Debt Security of the same series shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Debt
Security.
Section 2.13 Securities Denominated in Foreign Currencies.
(a) Except as otherwise specified pursuant to Section 2.03 for
Bearer Securities of any series, payment of the principal of, and premium, if
any, and interest on, Bearer Securities of such series denominated in any
Currency will be made in such Currency.
(b) Except as otherwise specified pursuant to Section 2.03 for
Registered Securities of any series, payment of the principal of, and premium,
if any, and interest on, Registered Securities of such series will be made in
Dollars.
(c) For the purposes of calculating the principal amount of Debt
Securities of any series denominated in a Foreign Currency or in units of two
or more Foreign Currencies (including European Currency Units) for any purpose
under this Indenture, the principal amount of such Debt Securities at any time
Outstanding shall be deemed to be the Dollar Equivalent of such principal
amount as of the date of any such calculation.
In the event any Foreign Currency or currencies or units of two or
more Currencies in which any payment with respect to any series of Debt
Securities may be made ceases to be a freely convertible Currency on Currency
markets in the United States, for any date thereafter on which payment of
principal of, or premium, if any, or interest on, the Debt Securities of a
series is due, the Company shall select the Currency of payment for use on such
date, all as provided in the Debt
24
<PAGE> 32
Securities of such series. In such event, the Company shall, as provided in
the Debt Securities of such series, notify the Trustee of the Currency which it
has selected to constitute the funds necessary to meet the Company's
obligations on such payment date and of the amount of such Currency to be paid.
Such amount shall be determined as provided in the Debt Securities of such
series. The payment to the Trustee with respect to such payment date shall be
made by the Company solely in the Currency so selected.
Section 2.14 Wire Transfers. Notwithstanding any other provision
to the contrary in this Indenture, the Company may make any payment of monies
required to be deposited with the Trustee on account of principal of, or
premium, if any, or interest on, the Debt Securities (whether pursuant to
optional or mandatory redemption payments, interest payments or otherwise) by
wire transfer in immediately available funds to an account designated by the
Trustee on or before the date such moneys are to be paid to the Holders of the
Debt Securities in accordance with the terms hereof.
Section 2.15 Securities Issuable in the Form of a Global Security.
(a) If the Company shall establish pursuant to Sections 2.01 and
2.03 that the Debt Securities of a particular series are to be issued in whole
or in part in the form of one or more Global Securities, then the Company shall
execute and the Trustee or its agent shall, in accordance with Section 2.05,
authenticate and deliver, such Global Security or Securities, which (i) shall
represent, and shall be denominated in an amount equal to the aggregate
principal amount of, the Outstanding Debt Securities of such series to be
represented by such Global Security or Securities, or such portion thereof as
the Company shall specify in an Officer's Certificate, (ii) shall be registered
in the name of the Depositary for such Global Security or Securities or its
nominee, (iii) shall be delivered by the Trustee or its agent to the Depositary
or pursuant to the Depositary's instruction and (iv) shall bear a legend
substantially to the following effect: 'Unless and until it is exchanged in
whole or in part for the individual Debt Securities represented hereby, this
Global Security may not be transferred except as a whole by the Depositary to a
nominee of the Depositary or by a nominee of the Depositary to the Depositary
or another nominee of the Depositary or by the Depositary or any such nominee
to a successor Depositary or a nominee of such successor Depositary', or such
other legend as may then be required by the Depositary for such Global Security
or Securities.
(b) Notwithstanding any other provision of this Section 2.15 or of
Section 2.07 to the contrary, and subject to the provisions of paragraph (c)
below, unless the terms of a Global Security expressly permit such Global
Security to be exchanged in whole or in part for definitive Debt Securities in
registered form, a Global Security may be transferred, in whole but not in part
and in the manner provided in Section 2.07, only by the Depositary to a nominee
of the Depositary for such Global Security, or by a nominee of the Depositary
to the Depositary or another nominee of the Depositary, or by the Depositary or
a nominee of the Depositary to a successor Depositary for such Global Security
selected or approved by the Company, or to a nominee of such successor
Depositary.
(c) (i) If at any time the Depositary for a Global Security
or Securities notifies the Company that it is unwilling or unable to continue
as Depositary for such Global Security or
25
<PAGE> 33
Securities or if at any time the Depositary for the Debt Securities for such
series shall no longer be eligible or in good standing under the Exchange Act
or other applicable statute, rule or regulation, the Company shall appoint a
successor Depositary with respect to such Global Security or Securities. If a
successor Depositary for such Global Security or Securities is not appointed by
the Company within 90 days after the Company receives such notice or becomes
aware of such ineligibility, the Company shall execute, and the Trustee or its
agent, upon receipt of a Company Order for the authentication and delivery of
such individual Debt Securities of such series in exchange for such Global
Security, will authenticate and deliver, individual Debt Securities of such
series of like tenor and terms in definitive form in an aggregate principal
amount equal to the principal amount of the Global Security in exchange for
such Global Security or Securities.
(ii) The Company may at any time and in its sole
discretion determine that the Debt Securities of any series or portion thereof
issued or issuable in the form of one or more Global Securities shall no longer
be represented by such Global Security or Securities. In such event the
Company will execute, and the Trustee, upon receipt of a Company Order for the
authentication and delivery of individual Debt Securities of such series in
exchange in whole or in part for such Global Security, will authenticate and
deliver individual Debt Securities of such series of like tenor and terms in
definitive form in an aggregate principal amount equal to the principal amount
of such series or portion thereof in exchange for such Global Security or
Securities.
(iii) If specified by the Company pursuant to Sections 2.01
and 2.03 with respect to Debt Securities issued or issuable in the form of a
Global Security, the Depositary for such Global Security may surrender such
Global Security in exchange in whole or in part for individual Debt Securities
of such series of like tenor and terms in definitive form on such terms as are
acceptable to the Company, the Trustee and such Depositary. Thereupon the
Company shall execute, and the Trustee or its agent upon receipt of a Company
Order for the authentication and delivery of definitive Debt Securities of such
series shall authenticate and deliver, without service charge, (A) to each
Person specified by such Depositary a new Debt Security or Securities of the
same series of like tenor and terms and of any authorized denomination as
requested by such Person in aggregate principal amount equal to and in exchange
for such Person's beneficial interest in the Global Security; and (B) to such
Depositary a new Global Security of like tenor and terms and in an authorized
denomination equal to the difference, if any, between the principal amount of
the surrendered Global Security and the aggregate principal amount of Debt
Securities delivered to Holders thereof.
(iv) In any exchange provided for in any of the preceding
three paragraphs, the Company will execute and the Trustee or its agent will
authenticate and deliver individual Debt Securities. In case a Coupon Security
of any series is surrendered in exchange for a Registered Security of such
series after the close of business (at an office or agency in a Place of
Payment for such series) on any special record date and before the opening of
business (at such office or agency) on the related proposed date of payment of
Defaulted Interest, such Coupon Security shall be surrendered without the
Coupon relating to such proposed date of payment and Defaulted Interest will
not be payable on such proposed date of payment in respect of the Registered
Security issued
26
<PAGE> 34
in exchange for such Coupon Security, but will be payable only to the Holder of
such Coupon when due in accordance with the provisions of this Indenture. Upon
the exchange of the entire principal amount of a Global Security for individual
Debt Securities, such Global Security shall be canceled by the Trustee or its
agent. Except as provided in the preceding paragraph, Registered Securities
issued in exchange for a Global Security pursuant to this Section 2.15 shall be
registered in such names and in such authorized denominations as the Depositary
for such Global Security, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Trustee or the Registrar. The
Trustee or the Registrar shall deliver such Registered Securities to the
Persons in whose names such Registered Securities are so registered.
(v) Payments in respect of the principal of and interest
on any Debt Securities registered in the name of the Depositary or its nominee
will be payable to the Depositary or such nominee in its capacity as the
registered owner of such Global Security. The Company and the Trustee may
treat the Person in whose name the Debt Securities, including the Global
Security, are registered as the owner thereof for the purpose of receiving such
payments and for any and all other purposes whatsoever. None of the Company,
the Trustee, any Registrar, the paying agent or any agent of the Company or the
Trustee will have any responsibility or liability for (A) any aspect of the
records relating to or payments made on account of the beneficial ownership
interests of the Global Security by the Depositary or its nominee or any of the
Depositary's direct or indirect participants, or for maintaining, supervising
or reviewing any records of the Depositary, its nominee or any of its direct or
indirect participants relating to the beneficial ownership interests of the
Global Security, (B) the payments to the beneficial owners of the Global
Security of amounts paid to the Depositary or its nominee, or (C) any other
matter relating to the actions and practices of the Depositary, its nominee or
any of its direct or indirect participants. None of the Company, the Trustee
or any such agent will be liable for any delay by the Depositary, its nominee,
or any of its direct or indirect participants in identifying the beneficial
owners of the Debt Securities, and the Company and the Trustee may conclusively
rely on, and will be protected in relying on, instructions from the Depositary
or its nominee for all purposes (including with respect to the registration and
delivery, and the respective principal amounts, of the Debt Securities to be
issued).
The Trustee shall deliver individual Bearer Securities issued in
exchange for a Global Security pursuant to this Section 2.15 to the Persons and
in such authorized denominations as the Depositary for such Global Security,
pursuant to instructions from its direct or indirect participants or otherwise,
shall instruct the Trustee; provided, however, that individual Bearer
Securities shall be delivered in exchange for a Global Security only in
accordance with the procedures as may be specified pursuant to Section 2.03.
Notwithstanding the foregoing, the exchange of Bearer Securities for
Registered Securities will be subject to the provisions of United States income
tax laws and regulations applicable to debt Securities in effect at the time of
such exchange.
Section 2.16 Medium Term Securities. Notwithstanding any contrary
provision herein, if all Debt Securities of a series are not to be originally
issued at one time, it shall not be necessary for
27
<PAGE> 35
the Company to deliver to the Trustee an Officers' Certificate, resolutions of
the Board of Directors, supplemental Indenture, Opinion of Counsel or written
order or any other document otherwise required pursuant to Section 2.01, 2.03,
2.05 or 13.05 at or prior to the time of authentication of each Debt Security
of such series if such documents are delivered to the Trustee or its agent at
or prior to the authentication upon original issuance of the first such Debt
Security of such series to be issued; provided, that any subsequent request by
the Company to the Trustee to authenticate Debt Securities of such series upon
original issuance shall constitute a representation and warranty by the Company
that, as of the date of such request, the statements made in the Officers'
Certificate delivered pursuant to Section 2.05 or 13.05 shall be true and
correct as if made on such date and that the Opinion of Counsel delivered at or
prior to such time of authentication of an original issuance of Debt Securities
shall specifically state that it shall relate to all subsequent issuances of
Debt Securities of such series that are identical to the Debt Securities issued
in the first issuance of Debt Securities of such series.
A Company Order delivered by the Company to the Trustee in the
circumstances set forth in the preceding paragraph may provide that Debt
Securities which are the subject thereof will be authenticated and delivered by
the Trustee or its agent on original issue from time to time upon the
telephonic or written order of Persons designated in such Company Order (any
such telephonic instructions to be promptly confirmed in writing by such
Person) and that such Persons are authorized to determine, consistent with the
Officers' Certificate, supplemental Indenture or resolution of the Board of
Directors relating to such written order, such terms and conditions of such
Debt Securities as are specified in such Officers' Certificate, supplemental
Indenture or such resolution.
Section 2.17 Defaulted Interest.
(a) Any interest on any Debt Security of a particular series which
is payable, but is not punctually paid or duly provided for, on the dates and
in the manner provided in the Debt Securities of such series and in this
Indenture (herein called "Defaulted Interest") shall, if such Debt Security is
a Registered Security, forthwith cease to be payable to the Registered Holder
thereof on the relevant record date by virtue of having been such Registered
Holder, and such Defaulted Interest may be paid by the Company, at its election
in each case, as provided in clause (i) or (ii) below:
(i) The Company may elect to make payment of any
Defaulted Interest to the Persons in whose names the Registered
Securities of such series are registered at the close of business on a
special record date for the payment of such Defaulted Interest, which
shall be fixed in the following manner. The Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be
paid on each such Registered Security of such series and the date of
the proposed payment, and at the same time the Company shall deposit
with the Trustee an amount of money equal to the aggregate amount
proposed to be paid in respect of such Defaulted Interest or shall
make arrangements satisfactory to the Trustee for such deposit prior
to the date of the proposed payment, such money when deposited to be
held in trust for the benefit of the Persons entitled to such
Defaulted Interest as in this clause
28
<PAGE> 36
provided. Thereupon the Trustee shall fix a special record date for
the payment of such Defaulted Interest which shall be not more than 15
days and not less than 10 days prior to the date of the proposed
payment and not less than 10 days after the receipt by the Trustee of
the notice of the proposed payment. The Trustee shall promptly notify
the Company of such special record date and, in the name and at the
expense of the Company, shall cause notice of the proposed payment of
such Defaulted Interest and the special record date therefor to be
mailed, first class postage pre-paid, to each Holder thereof at its
address as it appears in the Security Register, not less than 10 days
prior to such special record date. Notice of the proposed payment of
such Defaulted Interest and the special record date therefor having
been so mailed, such Defaulted Interest shall be paid to the Persons
in whose names the Registered Securities of such series are registered
at the close of business on such special record date. In case a
Coupon Security of any such series is surrendered in exchange for a
Registered Security of such series after the close of business (at an
office or agency in a Place of Payment for such series) on any special
record date and before the opening of business (at such office or
agency) on the related proposed date of payment of Defaulted Interest,
such Coupon Security shall be surrendered without the Coupon relating
to such proposed date of payment and Defaulted Interest will not be
payable on such proposed date of payment in respect of the Registered
Security issued in exchange for such Coupon Security, but will be
payable only to the Holder of such Coupon when due in accordance with
the provisions of this Indenture.
(ii) The Company may make payment of any Defaulted
Interest on the Registered Securities of such series in any other
lawful manner not inconsistent with the requirements of any securities
exchange on which the Registered Securities of such series may be
listed, and upon such notice as may be required by such exchange, if,
after notice given by the Company to the Trustee of the proposed
payment pursuant to this clause, such manner of payment shall be
deemed practicable by the Trustee.
(b) Any Defaulted Interest payable in respect of Bearer Securities
of any series shall be payable pursuant to such procedures as may be
satisfactory to the Trustee in such manner that there is no discrimination
between the Holders of Registered Securities (if any) and Bearer Securities of
such series, and notice of the payment date therefor shall be given by the
Trustee, in the name and at the expense of the Company, in the manner provided
in Section 13.03 not more than 25 days and not less than 20 days prior to the
date of the proposed payment.
Section 2.18 Judgments. The Company may provide pursuant to
Section 2.03 for Debt Securities of any series that (a) the obligation, if any,
of the Company to pay the principal of, and premium, if any, and interest on,
the Debt Securities of any series in a Foreign Currency or Dollars (the
"Designated Currency") as may be specified pursuant to Section 2.03 is of the
essence and agrees that, to the fullest extent possible under applicable law,
judgments in respect of Debt Securities of such series shall be given in the
Designated Currency; (b) the obligation of the Company to make payments in the
Designated Currency of the principal of, and premium, if any, and interest on,
such Debt Securities shall, notwithstanding any payment in any other Currency
29
<PAGE> 37
(whether pursuant to a judgment or otherwise), be discharged only to the extent
of the amount in the Designated Currency that the Holder receiving such payment
may, in accordance with normal banking procedures, purchase with the sum paid
in such other Currency (after any premium and cost of exchange) on the business
day in the country of issue of the Designated Currency or in the international
banking community (in the case of a composite currency) immediately following
the day on which such Holder receives such payment; (c) if the amount in the
Designated Currency that may be so purchased for any reason falls short of the
amount originally due, the Company shall pay such additional amounts as may be
necessary to compensate for such shortfall; and (d) any obligation of the
Company not discharged by such payment shall be due as a separate and
independent obligation and, until discharged as provided herein, shall continue
in full force and effect.
ARTICLE 3
REDEMPTION OF DEBT SECURITIES
Section 3.01 Applicability of Article. The provisions of this
Article shall be applicable to the Debt Securities of any series which are
redeemable before their Stated Maturity except as otherwise specified as
contemplated by Section 2.03 for Debt Securities of such series.
Section 3.02 Tax Redemption; Special Tax Redemption. Unless
otherwise specified pursuant to Section 2.03, Bearer Securities of any series
may be redeemed at the option of the Company in whole, but not in part, at any
time, on giving not less than 30 or more than 60 days' notice in accordance
with Section 3.03 (which notice shall be irrevocable), at the redemption price
thereof (calculated without premium), if the Company has or will become
obligated to pay additional interest on such Bearer Securities pursuant to
Section 4.06 as a result of any change in, or amendment to, the laws (or any
regulations or rulings promulgated thereunder) of the United States or any
political subdivision or taxing authority thereof or therein, or any change in
the application or official interpretation of such laws, regulations or
rulings, which change or amendment becomes effective on or after the date on
which any Person (including any Person acting as underwriter, broker or dealer)
agrees to purchase any of such Bearer Securities pursuant to their original
issuance, and such obligation cannot be avoided by the Company taking
reasonable measures available to it; provided, that no such notice of
redemption shall be given earlier than 90 days prior to the earliest date on
which the Company would be obligated to pay such additional interest were a
payment in respect of the Bearer Securities of that series then due. Prior to
the publication of any notice of redemption pursuant to this Section 3.02, the
Company shall deliver to the Trustee (a) an Officers' Certificate stating that
the Company is entitled to effect such redemption and setting forth a statement
of facts showing that the conditions precedent to the right of the Company so
to redeem have occurred and (b) an Opinion of Counsel to the effect that the
Company has or will become obligated to pay such additional interest as a
result of such change or amendment.
Section 3.03 Notice of Redemption; Selection of Debt Securities.
In case the Company shall desire to exercise the right to redeem all or, as the
case may be, any part of the Debt Securities
30
<PAGE> 38
of any series in accordance with their terms, a resolution of the Board of
Directors of the Company or a supplemental Indenture, the Company shall fix a
date for redemption and shall give notice of such redemption at least 30 and
not more than 60 days prior to the date fixed for redemption to the Holders of
Debt Securities of such series so to be redeemed as a whole or in part, in the
manner provided in Section 13.03. The notice if given 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 or
any defect in the notice to the Holder of any Debt Security of a series
designated for redemption as a whole or in part shall not affect the validity
of the proceedings for the redemption of any other Debt Security of such
series.
Each such notice of redemption shall specify the date fixed for
redemption, the redemption price at which Debt Securities of such series are to
be redeemed, the Place or Places of Payment that payment will be made upon
presentation and surrender of such Debt Securities, that any interest accrued
to the date fixed for redemption will be paid as specified in said notice, that
the redemption is for a sinking fund payment (if applicable), that, unless
otherwise specified in such notice, Coupon Securities of any series, if any,
surrendered for redemption must be accompanied by all Coupons maturing
subsequent to the date fixed for redemption, failing which the amount of any
such missing Coupon or Coupons will be deducted from the redemption price, if
the Bearer Securities of any series are to be redeemed and any Registered
Securities of such series are not to be redeemed, and if such Bearer Securities
may be exchanged for Registered Securities not subject to redemption on the
applicable redemption date pursuant to Section 2.15(c) or otherwise, the last
date on which such exchanges may be made, that, if the Company defaults in
making such redemption payment or if the Debt Securities of that series are
subordinated pursuant to the terms of Article 12, the paying agent is
prohibited from making such payment pursuant to the terms of this Indenture,
that on and after said date any interest thereon or on the portions thereof to
be redeemed will cease to accrue, that in the case of Original Issue Discount
Securities original issue discount will cease to accrue after the date fixed
for redemption, the terms of the Debt Securities of that series pursuant to
which the Debt Securities of that series are being redeemed and that no
representation is made as to the correctness or accuracy of the CUSIP number,
if any, listed in such notice or printed on the Debt Securities of that series.
If less than all the Debt Securities of a series are to be redeemed the notice
of redemption shall specify the CUSIP numbers of the Debt Securities of that
series to be redeemed. In case any Debt Security of a series is to be redeemed
in part only, the notice of redemption shall state the portion of the principal
amount thereof to be redeemed and shall state that on and after the date fixed
for redemption, upon surrender of such Debt Security, a new Debt Security or
Debt Securities of that series in principal amount equal to the unredeemed
portion thereof, and in the case of a Bearer Security with appropriate Coupons,
if any, will be issued.
At least 60 days before the redemption date (unless the Trustee
consents to a shorter period), the Company shall give notice to the Trustee of
the redemption date, the principal amount of Debt Securities to be redeemed and
the series and terms of the Debt Securities pursuant to which such redemption
will occur. Such notice shall be accompanied by an Officers' Certificate and
an Opinion of Counsel from the Company to the effect that such redemption will
comply with the conditions herein. If fewer than all the Debt Securities of a
series are to be redeemed, the record date relating
31
<PAGE> 39
to such redemption shall be selected by the Company and given to the Trustee,
which record date shall be not less than 15 days after the date of notice to
the Trustee.
On or prior to the redemption date for any Registered Securities, the
Company shall deposit with the Trustee or with a paying agent (or, if the
Company is acting as its own paying agent, segregate and hold in trust) an
amount of money in the Currency in which such Debt Securities are denominated
(except as provided pursuant to Section 2.03) sufficient to pay the redemption
price of such Registered Securities or any portions thereof that are to be
redeemed on that date. In the case of any redemption pertaining to Bearer
Securities or Coupon Securities, the Company shall, no later than the business
day prior to such redemption date, deposit with the Trustee or with a paying
agent (other than the Company) an amount of money in the Currency in which such
Debt Securities are denominated (except as provided pursuant to Section 2.03)
sufficient to pay the redemption price of such Bearer or Coupon Securities or
any portion thereof that are to be redeemed on the redemption date.
If less than all the Debt Securities of like tenor and terms of a
series are to be redeemed (other than pursuant to mandatory sinking fund
redemptions) the Trustee shall select, in such manner as in its sole discretion
it shall deem appropriate and fair, the Debt Securities of that series or
portions thereof (in multiples of $1,000) to be redeemed. In any case where
more than one Registered Security of such series is registered in the same
name, the Trustee in its discretion may treat the aggregate principal amount so
registered as if it were represented by one Registered Security of such series.
The Trustee shall promptly notify the Company in writing of the Debt Securities
selected for redemption and, in the case of any Debt Securities selected for
partial redemption, the principal amount thereof to be redeemed. If any Debt
Security called for redemption shall not be so paid upon surrender thereof on
such redemption date, the principal, premium, if any, and interest shall bear
interest until paid from the redemption date at the rate borne by the Debt
Securities of that series. If less than all the Debt Securities of unlike
tenor and terms of a series are to be redeemed, the particular Debt Securities
to be redeemed shall be selected by the Company. Provisions of this Indenture
that apply to Debt Securities called for redemption also apply to portions of
Debt Securities called for redemption.
Section 3.04 Payment of Debt Securities Called for Redemption. If
notice of redemption has been given as provided in Section 3.03, the Debt
Securities or portions of Debt Securities of the series with respect to which
such notice has been given shall become due and payable on the date and at the
Place or Places of Payment stated in such notice at the applicable redemption
price, together with any interest accrued to the date fixed for redemption, and
on and after said date (unless the Company shall default in the payment of such
Debt Securities at the applicable redemption price, together with any interest
accrued to said date) any interest on the Debt Securities or portions of Debt
Securities of any series so called for redemption shall cease to accrue, any
original issue discount in the case of Original Issue Discount Securities shall
cease to accrue and any Coupons for such interest appertaining to any Coupon
Securities to be redeemed, except to the extent described below, shall be void.
On presentation and surrender of such Debt Securities at the Place or Places of
Payment in said notice specified, the said Debt Securities or the specified
portions thereof shall be paid and
32
<PAGE> 40
redeemed by the Company at the applicable redemption price, together with any
interest accrued thereon to the date fixed for redemption.
If any Coupon Security surrendered for redemption shall not be
accompanied by all Coupons appertaining thereto maturing on or after the
applicable redemption date, the redemption price for such Coupon Security may
be reduced by an amount equal to the face amount of all such missing Coupons.
If thereafter the Holder of such Coupon shall surrender to any paying agent
outside the United States any such missing Coupon in respect of which a
deduction shall have been made from the redemption price, such Holder shall be
entitled to receive the amount so deducted. The surrender of such missing
Coupon or Coupons may be waived by the Company and the Trustee, if there be
furnished to them such security or indemnity as they may require to save each
of them and any paying agent harmless.
Any Debt Security that is to be redeemed only in part shall be
surrendered at the corporate trust office or such other office or agency of the
Company as is specified pursuant to Section 2.03 (in the case of Registered
Securities) and at the principal London office of the Trustee or such other
office or agency of the Company outside the United States as is specified
pursuant to Section 2.03 (in the case of Bearer Securities) with, if the
Company, the Registrar or the Trustee so requires, due endorsement by, or a
written instrument of transfer in form satisfactory to the Company, the
Registrar and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing, and the Company shall execute, and the Trustee
shall authenticate and deliver to the Holder of such Debt Security without
service charge, a new Debt Security or Debt Securities of the same series, of
like tenor and form, of any authorized denomination as requested by such Holder
in aggregate principal amount equal to and in exchange for the unredeemed
portion of the principal of the Debt Security so surrendered, and, in the case
of a Coupon Security, with appropriate Coupons attached; except that if a
Global Security is so surrendered, the Company shall execute, and the Trustee
shall authenticate and deliver to the Depositary for such Global Security,
without service charge, a new Global Security in a denomination equal to and in
exchange for the unredeemed portion of the principal of the Global Security so
surrendered. In the case of a Debt Security providing appropriate space for
such notation, at the option of the Holder thereof, the Trustee, in lieu of
delivering a new Debt Security or Debt Securities as aforesaid, may make a
notation on such Debt Security of the payment of the redeemed portion thereof.
Section 3.05 Mandatory and Optional Sinking Funds. The minimum
amount of any sinking fund payment provided for by the terms of Debt Securities
of any series, resolution of the Board of Directors or a supplemental Indenture
is herein referred to as a "mandatory sinking fund payment," and any payment in
excess of such minimum amount provided for by the terms of Debt Securities of
any series, resolution of the Board of Directors or a supplemental Indenture is
herein referred to as an "optional sinking fund payment".
In lieu of making all or any part of any mandatory sinking fund
payment with respect to any Debt Securities of a series in cash, the Company
may at its option (a) deliver to the Trustee Debt Securities of that series
(together with the unmatured Coupons, if any, appertaining thereto)
33
<PAGE> 41
theretofore purchased or otherwise acquired by the Company or (b) receive
credit for the principal amount of Debt Securities of that series which have
been redeemed either at the election of the Company pursuant to the terms of
such Debt Securities or through the application of permitted optional sinking
fund payments pursuant to the terms of such Debt Securities, resolution or
supplemental Indenture; provided, that such Debt Securities have not been
previously so credited. Such Debt Securities shall be received and credited
for such purpose by the Trustee at the redemption price specified in such Debt
Securities, resolution or supplemental Indenture for redemption through
operation of the sinking fund and the amount of such mandatory sinking fund
payment shall be reduced accordingly.
Section 3.06 Redemption of Debt Securities for Sinking Fund. Not
less than 60 days prior to each sinking fund payment date for any series of
Debt Securities, the Company will deliver to the Trustee an Officers'
Certificate specifying the amount of the next ensuing sinking fund payment for
that series pursuant to the terms of that series, any resolution or
supplemental Indenture, the portion thereof, if any, which is to be satisfied
by payment of cash in the Currency in which the Debt Securities of such series
are denominated (except as provided pursuant to Section 2.03) and the portion
thereof, if any, which is to be satisfied by delivering and crediting Debt
Securities of that series pursuant to this Section 3.06 (which Debt Securities,
if not previously redeemed, will accompany such certificate) and whether the
Company intends to exercise its right to make any permitted optional sinking
fund payment with respect to such series. Such certificate shall also state
that no Event of Default has occurred and is continuing with respect to such
series. Such certificate shall be irrevocable and upon its delivery the
Company shall be obligated to make the cash payment or payments therein
referred to, if any, on or before the next succeeding sinking fund payment
date. Failure of the Company to deliver such certificate (or to deliver the
Debt Securities and Coupons, if any, specified in this paragraph) shall not
constitute a Default, but such failure shall require that the sinking fund
payment due on the next succeeding sinking fund payment date for that series
shall be paid entirely in cash and shall be sufficient to redeem the principal
amount of such Debt Securities subject to a mandatory sinking fund payment
without the option to deliver or credit Debt Securities as provided in this
Section 3.06 and without the right to make any optional sinking fund payment,
if any, with respect to such series.
Any sinking fund payment or payments (mandatory or optional) made in
cash plus any unused balance of any preceding sinking fund payments made in
cash which shall equal or exceed $100,000 (or a lesser sum if the Company shall
so request) with respect to the Debt Securities of any particular series shall
be applied by the Trustee on the sinking fund payment date on which such
payment is made (or, if such payment is made before a sinking fund payment
date, on the sinking fund payment date following the date of such payment) to
the redemption of such Debt Securities at the redemption price specified in
such Debt Securities, resolution or supplemental Indenture for operation of the
sinking fund together with any accrued interest to the date fixed for
redemption. Any sinking fund moneys not so applied or allocated by the Trustee
to the redemption of Debt Securities shall be added to the next cash sinking
fund payment received by the Trustee for such series and, together with such
payment, shall be applied in accordance with the provisions of this Section
3.06. Any and all sinking fund moneys with respect to the Debt Securities of
any particular
34
<PAGE> 42
series held by the Trustee on the last sinking fund payment date with respect
to Debt Securities of such series and not held for the payment or redemption of
particular Debt Securities shall be applied by the Trustee, together with other
moneys, if necessary, to be deposited sufficient for the purpose, to the
payment of the principal of the Debt Securities of that series at its Stated
Maturity.
The Trustee shall select the Debt Securities to be redeemed upon such
sinking fund payment date in the manner specified in the last paragraph of
Section 3.03 and the Company shall cause notice of the redemption thereof to be
given in the manner provided in Section 3.03 except that the notice of
redemption shall also state that the Debt Securities are being redeemed by
operation of the sinking fund. Such notice having been duly given, the
redemption of such Debt Securities shall be made upon the terms and in the
manner stated in Section 3.04.
At least one business day before each sinking fund payment date, the
Company shall pay to the Trustee (or, if the Company is acting as its own
paying agent, the Company shall segregate and hold in trust) in cash a sum in
the Currency in which the Debt Securities of such series are denominated
(except as provided pursuant to Section 2.03) equal to any interest accrued to
the date fixed for redemption of Debt Securities or portions thereof to be
redeemed on such sinking fund payment date pursuant to this Section 3.06.
The Trustee shall not redeem any Debt Securities of a series with
sinking fund moneys or mail any notice of redemption of such Debt Securities by
operation of the sinking fund for such series during the continuance of a
Default in payment of interest on such Debt Securities or of any Event of
Default (other than an Event of Default occurring as a consequence of this
paragraph) with respect to such Debt Securities, except that if the notice of
redemption of any such Debt Securities shall theretofore have been mailed in
accordance with the provisions hereof, the Trustee shall redeem such Debt
Securities if cash sufficient for that purpose shall be deposited with the
Trustee for that purpose in accordance with the terms of this Article 3.
Except as aforesaid, any moneys in the sinking fund for such series at the time
when any such Default or Event of Default shall occur and any moneys thereafter
paid into such sinking fund shall, during the continuance of such Default or
Event of Default, be held as security for the payment of such Debt Securities;
provided, however, that in case such Event of Default or Default shall have
been cured or waived as provided herein, such moneys shall thereafter be
applied on the next sinking fund payment date for such Debt Securities on which
such moneys may be applied pursuant to the provisions of this Section 3.06.
ARTICLE 4
PARTICULAR COVENANTS OF THE COMPANY
Section 4.01 Payment of Principal of, and Premium, If Any, and
Interest on, Debt Securities. The Company, for the benefit of each series of
Debt Securities, will duly and punctually pay or cause to be paid the principal
of, and premium, if any, and interest on, each of the Debt Securities and pay
any Coupons at the place, at the respective times and in the manner provided
35
<PAGE> 43
herein, in the Debt Securities and in the Coupons. Each installment of
interest on the Debt Securities may at the Company's option be paid by mailing
checks for such interest payable to the Person entitled thereto pursuant to
Section 2.07(a) to the address of such Person as it appears on the Debt
Security Register. Any interest due on Coupon Securities on or before the
Stated Maturity of the related Debt Security, other than additional interest,
if any, payable as provided in Section 4.06 in respect of principal of, or
premium, if any, on such a Debt Security, shall be payable only upon
presentation and surrender of the several Coupons for such interest
installments as are evidenced thereby as they severally mature.
Principal, premium and interest of Debt Securities of any series shall
be considered paid on the date due if on such date the Trustee or any paying
agent holds in accordance with this Indenture money sufficient to pay in the
Currency in which the Debt Securities of such series are denominated (except as
provided pursuant to Section 2.03) all principal, premium and interest then due
and, in the case of Debt Securities subordinated pursuant to the terms of
Article 12, the Trustee or such paying agent, as the case may be, is not
prohibited from paying such money to the Holders on that date pursuant to the
terms of this Indenture.
The Company shall pay interest on overdue principal at the rate
specified therefor in the Debt Securities and it shall pay interest on overdue
installments of interest at the same rate to the extent lawful.
Section 4.02 Maintenance of Offices or Agencies for Registration
of Transfer, Exchange and Payment of Debt Securities. The Company will
maintain in each Place of Payment for any series of Debt Securities and
Coupons, if any, an office or agency where Debt Securities and Coupons of such
series (but, except as otherwise provided in Section 2.12, unless such Place of
Payment is located outside the United States, not Bearer Securities or Coupons)
may be presented or surrendered for payment, where Debt Securities of such
series may be surrendered for transfer or exchange and where notices and
demands to or upon the Company in respect of the Debt Securities and Coupons of
such series and this Indenture may be served. So long as any Bearer Securities
of any series remain outstanding, the Company will maintain for such purposes
one or more offices or agencies outside the United States in such city or
cities specified pursuant to Section 2.03 and, if any Bearer Securities are
listed on a securities exchange that requires an office or agency for the
payment of principal of, and premium, if any, or interest on, such Bearer
Securities in a location other than the location of an office or agency
specified pursuant to Section 2.03, the Company will maintain for such purposes
an office or agency in such location so long as any Bearer Securities are
listed on such securities exchange and such exchange so requires. The Company
will give prompt written notice to the Trustee of the location, and any change
in the location, of such office or agency. If at any time the Company shall
fail to maintain any such required office or agency or shall fail to furnish
the Trustee with the address thereof, such presentations, surrenders, notices
and demands may be made or served at the corporate trust office of the Trustee
(in the case of Registered Securities) and at the principal London office of
the Trustee (in the case of Bearer Securities), and the Company hereby appoints
the Trustee as its agent to receive all presentations, surrenders, notices and
demands.
36
<PAGE> 44
The Company may also from time to time designate different or
additional offices or agencies to be maintained for such purposes (in or
outside of such Place of Payment), and may from time to time rescind any such
designation; provided, however, that no such designation or rescission shall in
any manner relieve the Company of its obligations described in the preceding
paragraph. The Company will give prompt written notice to the Trustee of any
such additional designation or rescission of designation and any change in the
location of any such different or additional office or agency.
Section 4.03 Appointment to Fill a Vacancy in the Office of
Trustee. The Company, whenever necessary to avoid or fill a vacancy in the
office of Trustee, will appoint, in the manner provided in Section 7.10, a
Trustee, so that there shall at all times be a Trustee hereunder with respect
to each series of Debt Securities.
Section 4.04 Duties of Paying Agents, etc. (a) The Company shall
cause each paying agent, if any, other than the Trustee, to execute and deliver
to the Trustee an instrument in which such agent shall agree with the Trustee,
subject to the provisions of this Section 4.04,
(i) that it will hold all sums held by it as such agent
for the payment of the principal of, and premium, if any, or interest
on, the Debt Securities of any series and the payment of any related
Coupons (whether such sums have been paid to it by the Company or by
any other obligor on the Debt Securities or Coupons of such series) in
trust for the benefit of the Holders of the Debt Securities and
Coupons of such series;
(ii) that it will give the Trustee notice of any failure
by the Company (or by any other obligor on the Debt Securities or
Coupons of such series) to make any payment of the principal of, and
premium, if any, or interest on, the Debt Securities of such series or
any payment on any related Coupons when the same shall be due and
payable; and
(iii) that it will at any time during the continuance of an
Event of Default, upon the written request of the Trustee, forthwith
pay to the Trustee all sums so held by it as such agent.
(b) If the Company shall act as its own paying agent, it will, on
or before each due date of the principal of, and premium, if any, or interest
on, the Debt Securities and Coupons, if any, of any series, set aside,
segregate and hold in trust for the benefit of the Holders of the Debt
Securities and Coupons of such series a sum sufficient to pay such principal,
premium, if any, or interest so becoming due. The Company will promptly notify
the Trustee of any failure by the Company to take such action or the failure by
any other obligor on such Debt Securities or Coupons to make any payment of the
principal of, and premium, if any, or interest on, such Debt Securities or
Coupons when the same shall be due and payable.
(c) Anything in this Section 4.04 to the contrary notwithstanding,
the Company may, at any time, for the purpose of obtaining a satisfaction and
discharge of this Indenture, or for any other
37
<PAGE> 45
reason, pay or cause to be paid to the Trustee all sums held in trust by it or
any paying agent, as required by this Section 4.04, such sums to be held by the
Trustee upon the same trusts as those upon which such sums were held by the
Company or such paying agent.
(d) Whenever the Company shall have one or more paying agents with
respect to any series of Debt Securities and Coupons, it will, prior to each
due date of the principal of, and premium, if any, or interest on, any Debt
Securities of such series, deposit with any such paying agent a sum sufficient
to pay the principal, premium or interest so becoming due, such sum to be held
in trust for the benefit of the Persons entitled thereto, and (unless any such
paying agent is the Trustee) the Company will promptly notify the Trustee of
its action or failure so to act.
(e) Anything in this Section 4.04 to the contrary notwithstanding,
the agreement to hold sums in trust as provided in this Section 4.04 is subject
to the provisions of Section 11.05.
Section 4.05 Statement by Officers as to Default. The Company
will deliver to the Trustee, on or before a date not more than four months
after the end of each fiscal year of the Company (currently on a calendar year
basis) ending after the date hereof, an Officers' Certificate stating, as to
each officer signing such certificate, that (a) in the course of his
performance of his duties as an officer of the Company he would normally have
knowledge of any Default, (b) whether or not to the best of his knowledge any
Default occurred during such year and (c) if to the best of his knowledge the
Company is in Default, specifying all such Defaults and what action the Company
is taking or proposes to take with respect thereto. The Company also shall
comply with Section 314(a)(4) of the Trust Indenture Act.
Section 4.06 Payment of Additional Interest. Unless otherwise
provided pursuant to Section 2.03, the provisions of this Section 4.06 shall be
applicable to Bearer Securities of any series.
The Company will, subject to the exceptions and limitations set forth
below, pay as additional interest to the Holder of any Bearer Security or
Coupon that is a United States Alien such amounts as may be necessary so that
every net payment on such Bearer Security or Coupon, after deduction or
withholding for or on account of any present or future tax, assessment or other
governmental charge imposed upon or as a result of such payment by the United
States (or any political subdivision or taxing authority thereof or therein),
will not be less than the amount provided in such Bearer Security or Coupon to
be then due and payable. However, the Company will not be required to make any
such payment of additional interest for or on account of:
(a) any tax, assessment or other governmental charge that
would not have been imposed but for (i) the existence of any present
or former connection between such Holder (or between a fiduciary,
settlor or beneficiary of, or a Person holding a power over, such
Holder, if such Holder is an estate or a trust, or a member or
shareholder of such Holder, if such Holder is a partnership or
corporation) and the United States, including such Holder (or such
fiduciary, settlor, beneficiary, Person holding a power, member or
shareholder) being or having been a citizen or resident thereof or
being or having been engaged in trade or
38
<PAGE> 46
business or present therein or having or having had a permanent
establishment therein or (ii) such Holder's past or present status for
United States Federal income tax purposes as a personal holding
company, foreign personal holding company or private foundation or
other tax-exempt organization with respect to the United States or as
a corporation that accumulates earnings to avoid United States Federal
income tax;
(b) any estate, inheritance, gift, sales, transfer or
personal property tax or any similar tax, assessment or other
governmental charge;
(c) any tax, assessment or other governmental charge that
would not have been imposed but for the presentation by the Holder of
a Bearer Security or Coupon for payment more than 15 days after the
date on which such payment became due and payable or on which payment
thereof was duly provided for, whichever occurs later;
(d) any tax, assessment or other governmental charge that
is payable otherwise than by deduction or withholding from a payment
on a Bearer Security or Coupon;
(e) any tax, assessment or other governmental charge that
would not have been imposed but for a failure to comply with
applicable certification, documentation, information or other
reporting requirement concerning the nationality, residence, identity
or connection with the United States of the Holder or beneficial owner
of a Bearer Security or Coupon if, without regard to any tax treaty,
such compliance is required by statute or regulation of the United
States as a precondition to relief or exemption from such tax,
assessment or other governmental charge; or
(f) any tax, assessment or other governmental charge
imposed on a Holder that actually or constructively owns ten percent
or more of the combined voting power of all classes of stock of the
Company or that is a controlled foreign corporation related to the
Company through stock ownership;
nor shall additional interest be paid with respect to a payment on a Bearer
Security or Coupon to a Holder that is a fiduciary or partnership or other than
the sole beneficial owner of such payment to the extent a beneficiary or
settlor with respect to such fiduciary or a member of such partnership or a
beneficial owner would not have been entitled to the additional interest had
such beneficiary, settlor, member or beneficial owner been the Holder of such
Bearer Security or Coupon.
Whenever in this Indenture there is mentioned, in any context, the
payment of the principal of, or premium, if any, or interest on, any Debt
Security or payment with respect to any Coupon of any series, such mention
shall be deemed to include mention of the payment of additional interest
provided for in the terms of such Debt Securities and this Section 4.06 to the
extent that, in such context, additional interest is, was or would be payable
in respect thereof pursuant to the provisions of this Section 4.06 and express
mention of the payment of additional interest (if applicable) in any
39
<PAGE> 47
provisions hereof shall not be construed as excluding additional interest in
those provisions hereof where such express mention is not made.
If the payment of additional interest becomes required in respect of
the Debt Securities or Coupons of a series, at least ten days prior to the
first interest payment date with respect to which such additional interest will
be payable (or if the Debt Securities of that series will not bear interest
prior to its Stated Maturity, the first day on which a payment of principal,
and premium, if any, is made and on which such additional interest will be
payable), and at least ten days prior to each date of payment of principal, and
premium, if any, or interest if there has been any change with respect to the
matters set forth in the below-mentioned Officers' Certificate, the Company
will furnish the Trustee and each paying agent with an Officers' Certificate
that shall specify by country the amount, if any, required to be withheld on
such payments to Holders of Debt Securities or Coupons that are United States
Aliens, and the Company will pay to the Trustee or such paying agent the
additional interest, if any, required by the terms of such Debt Securities and
this Section 4.06. The Company covenants to indemnify the Trustee and any
paying agent for, and to hold them harmless against, any loss, liability or
expense reasonably incurred without negligence or bad faith on their part
arising out of or in connection with actions taken or omitted by any of them in
reliance on any Officers' Certificate furnished pursuant to this Section 4.06.
Section 4.07 Further Instruments and Acts. The Company will, upon
request of the Trustee, execute and deliver such further instruments and do
such further acts as may reasonably be necessary or proper to carry out more
effectively the purposes of this Indenture.
Section 4.08 Existence. Subject to Article 10, the Company will
do or cause to be done all things necessary to preserve and keep in full force
and effect its existence, rights (charter and statutory) and franchises;
provided, however, that the Company shall not be required to preserve any such
right or franchise if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company and that the loss thereof is not disadvantageous in any material
respect to the Holders.
Section 4.09 Maintenance of Properties. The Company will cause
all properties used or useful in the conduct of its business or the business of
any Subsidiary to be maintained and kept in good condition, repair and working
order and supplied with all necessary equipment and will cause to be made all
necessary repairs, renewals, replacements, betterments and improvements
thereof, all as in the judgment of the Company may be necessary so that the
business carried on in connection therewith may be properly and advantageously
conducted at all times; provided, however, that nothing in this Section shall
prevent the Company from discontinuing the operation or maintenance of any of
such properties if such discontinuance is, in the judgment of the Company,
desirable in the conduct of its business or the business of any Subsidiary and
not disadvantageous in any material respect to the Holders.
Section 4.10 Payment of Taxes and Other Claims. The Company will
pay or discharge or cause to be paid or discharged, before the same shall
become delinquent, (a) all taxes, assessments
40
<PAGE> 48
and governmental charges levied or imposed upon the Company or any Subsidiary
or upon the income, profits or property of the Company or any Subsidiary, and
(b) all lawful claims for labor, materials and supplies which, if unpaid, might
by law become a lien upon the property of the Company or any Subsidiary;
provided, however, that the Company shall not be required to pay or discharge
or cause to be paid or discharged any such tax, assessment, charge or claim
whose amount, applicability or validity is being contested in good faith by
appropriate proceedings.
Section 4.11 Limitation on Liens. So long as any of the Debt
Securities are Outstanding, the Company will not, and will not permit any
Restricted Subsidiary to, issue, assume, incur or guarantee any Indebtedness
secured by a Lien on or with respect to any Principal Property of the Company
or any Restricted Subsidiary, or upon any shares of capital stock or
Indebtedness of any Restricted Subsidiary, whether now owned or leased or
hereafter acquired, without in any such case effectively providing that the
Debt Securities shall be secured equally and ratably with (or prior to) such
Indebtedness, except that the foregoing restrictions shall not apply to: (a)
Liens existing as of the date of this Indenture, (b) Liens to secure the
payment of all or any part of the purchase price or cost of construction or
improvements in respect of property or properties acquired by the Company or a
Restricted Subsidiary after the date of this Indenture securing Indebtedness
incurred prior to, at the time of, or within 270 days after, the acquisition of
any such property or the completion of any such construction or improvements
and which secure Indebtedness not in excess of the amount expended in the
acquisition of, or construction or improvements on, such properties, (c) Liens
upon any property owned or leased by any Restricted Subsidiary when it becomes
a Restricted Subsidiary, (d) Liens existing on any property at the time of its
acquisition by the Company or a Restricted Subsidiary (including acquisition
through merger or consolidation), (e) Liens securing Indebtedness of a
Restricted Subsidiary to the Company or to another Restricted Subsidiary and
(f) the extension, renewal or replacement (or successive extensions, renewals
or replacements), in whole or in part, of any Lien referred to in the foregoing
clauses (a) through (e), or of any Indebtedness secured thereby, but only if
the principal amount of Indebtedness secured by the Lien immediately prior
thereto is not increased and the Lien is not extended to other property.
Notwithstanding the foregoing, the Company or any Restricted Subsidiary may
issue, assume, incur or guarantee Indebtedness secured by Liens which otherwise
would be subject to the foregoing restrictions, in an aggregate amount which,
together with all other such Indebtedness outstanding secured by Liens as
provided above (not including Indebtedness excluded as provided in clauses (a)
through (f) above) and all Attributable Debt in respect of Sale and Leaseback
Transactions which would not be permitted by either clause (a), (b) or (c) in
Section 4.12, does not exceed 15% of Consolidated Net Tangible Assets.
Section 4.12 Limitation on Sale and Leaseback Transactions. So
long as any of the Debt Securities are Outstanding, the Company will not, nor
will it permit any Restricted Subsidiary to, enter into any arrangement with
any Person (other than the Company or a Restricted Subsidiary) providing for
the leasing by the Company or any Restricted Subsidiary of any Principal
Property, whether now owned or hereafter acquired, which has been or is to be
sold or transferred by the Company or such Restricted Subsidiary to such
Persons with the intention of taking back a lease on such property (a "Sale and
Leaseback Transaction") unless (a) such transaction involves a lease or
41
<PAGE> 49
right to possession or use for a temporary period not to exceed three years
following such sale, by the end of which it is intended that the use of such
property by the lessee will be discontinued, (b) the Company or such Restricted
Subsidiary would, on the effective date of such transaction, be entitled to
issue, assume or guarantee Indebtedness secured by a Lien on such property at
least equal in an amount to the Attributable Debt in respect thereof, without
equally and ratably securing the Debt Securities as set forth in this
Indenture, or (c) if the proceeds of such sale (i) are equal to or greater than
the fair market value (as determined by the Board of Directors of the Company)
of such property and (ii) are applied within 270 days after the receipt of the
proceeds of sale or transfer to either the purchase or acquisition of fixed
assets or equipment used in the operation of the business or the construction
of fixed improvements on real property or to the repayment of Debt Securities
or Senior Funded Debt of the Company or any Restricted Subsidiary. The
preceding restrictions shall not apply to any Sale and Leaseback Transaction
between the Company and a Restricted Subsidiary or between Restricted
Subsidiaries. Notwithstanding the foregoing, the Company or any Restricted
Subsidiary may enter into Sale and Leaseback Transactions in addition to any
permitted by the two immediately preceding sentences and without any obligation
to retire any Debt Securities or other Indebtedness, provided that, at the time
of entering into such Sale and Leaseback Transactions, and after giving effect
thereto, the amount of Attributable Debt in respect of such Sale and Leaseback
Transaction, together with all such other Attributable Debt outstanding and all
Indebtedness outstanding secured by Liens (not including Indebtedness excluded
as provided in clauses (a) through (f) in Section 4.11), does not exceed 15% of
Consolidated Net Tangible Assets.
ARTICLE 5
HOLDERS' LISTS AND REPORTS BY
THE COMPANY AND THE TRUSTEE
Section 5.01 Company to Furnish Trustee Information as to Names
and Addresses of Holders; Preservation of Information. The Company covenants
and agrees that it will furnish or cause to be furnished to the Trustee with
respect to the Registered Securities of each series:
(a) not more than 15 days after each record date with
respect to the payment of interest, if any, a list, in such form as
the Trustee may reasonably require, of the names and addresses of the
Registered Holders as of such record date, and
(b) at such other times as the Trustee may request in
writing, within 30 days after the receipt by the Company of any such
request, a list of similar form and contents as of a date not more
than 15 days prior to the time such list is furnished;
provided, however, that so long as the Trustee shall be the Registrar, such
lists shall not be required to be furnished.
42
<PAGE> 50
The Company shall also be required to furnish to the Trustee at all
such times set forth above all information in the possession or control of the
Company or any of its paying agents other than the Trustee as to the names and
addresses of the Bearer Holders of all series; provided, however, that the
Company shall have no obligation to investigate any matter relating to any
Bearer Holders.
The Trustee shall preserve, in as current a form as is reasonably
practicable, all information as to the names and addresses of the Holders (i)
contained in the most recent list furnished to it as provided in this Section
5.01 or (ii) received by it in the capacity of paying agent or Registrar (if so
acting) hereunder.
The Trustee may destroy any list furnished to it as provided in this
Section 5.01 upon receipt of a new list so furnished.
Section 5.02 Communications to Holders. Holders may communicate
pursuant to Section 312(b) of the Trust Indenture Act with other Holders with
respect to their rights under this Indenture or the Debt Securities. The
Company, the Trustee, the Registrar and anyone else shall have the protection
of Section 312(c) of the Trust Indenture Act.
Section 5.03 Reports by Company.
(a) The Company covenants and agrees, and any obligor hereunder
shall covenant and agree, to file with the Trustee and the Holders (in the
manner and to the extent provided in Section 5.04), within 15 days after the
Company or such obligor, as the case may be, is required to file the same with
the Securities and Exchange 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 said Commission may from time to time by rules and regulations
prescribe) which the Company or such obligor, as the case may be, may be
required to file with said Commission pursuant to Section 13 or Section 15(d)
of the Exchange Act; or, if the Company or such obligor, as the case may be, is
not required to file information, documents or reports pursuant to either of
such Sections, then to file with the Trustee, the Holders (in the manner and to
the extent provided in Section 5.04) and said Commission, in accordance with
rules and regulations prescribed from time to time by said Commission, such of
the supplementary and periodic information, documents and reports which may be
required pursuant to Section 13 of the Exchange Act in respect of a security
listed and registered on a national securities exchange as may be prescribed
from time to time in such rules and regulations.
(b) The Company covenants and agrees, and any obligor hereunder
shall covenant and agree, to file with the Trustee, the Holders (in the manner
and to the extent provided in Section 5.04) and the Securities and Exchange
Commission, in accordance with the rules and regulations prescribed from time
to time by said Commission, such additional information, documents, and reports
with respect to compliance by the Company or such obligor, as the case may be,
with the conditions and covenants provided for in this Indenture as may be
required from time to time by such rules and regulations.
43
<PAGE> 51
Section 5.04 Reports by Trustee. As promptly as practicable after
each January 1 beginning with the January 1 following the date of this
Indenture, and in any event prior to February 15 in each year, the Trustee
shall mail to each Holder a brief report dated as of that complies
with Section 313(a) of the Trust Indenture Act. The Trustee also shall comply
with Section 313(b) of the Trust Indenture Act.
Reports pursuant to this Section 5.04 shall be transmitted by mail:
(a) to all Registered Holders, as the names and addresses
of such Holders appear in the Debt Security Register;
(b) to such Bearer Holders of any series as have, within
two years preceding such transmission, filed their names and addresses
with the Trustee for such series for that purpose; and
(c) except in the cases of reports under Section
313(b)(2) of the Trust Indenture Act, to each Holder of a Debt
Security of any series whose name and address appear in the
information preserved at the time by the Trustee in accordance with
Section 5.02.
A copy of each report at the time of its mailing to Holders shall be
filed with the Securities and Exchange Commission and each stock exchange (if
any) on which the Debt Securities of any series are listed. The Company agrees
to notify promptly the Trustee whenever the Debt Securities of any series
become listed on any stock exchange and of any delisting thereof.
Section 5.05 Record Dates for Action by Holders. If the Company
shall solicit from the holders of Debt Securities of any series any action
(including the making of any demand or request, the giving of any direction,
notice, consent or waiver or the taking of any other action), the Company may,
at its option, by resolution of the Board of Directors, fix in advance a record
date for the determination of Holders of Debt Securities entitled to take such
action, but the Company shall have no obligation to do so. Any such record
date shall be fixed at the Company's discretion. If such a record date is
fixed, such action may be sought or given before or after the record date, but
only the Holders of Debt Securities of record at the close of business on such
record date shall be deemed to be Holders of Debt Securities for the purpose of
determining whether Holders of the requisite proportion of Debt Securities of
such series Outstanding have authorized or agreed or consented to such action,
and for that purpose the Debt Securities of such series Outstanding shall be
computed as of such record date.
44
<PAGE> 52
ARTICLE 6
REMEDIES OF THE TRUSTEE AND
HOLDERS IN EVENT OF DEFAULT
Section 6.01 Events of Default. If any one or more of the
following shall have occurred and be continuing with respect to Debt Securities
of any series (each of the following, an "Event of Default"):
(a) default in the payment of any installment of interest
upon any Debt Securities of that series or any payment with respect to
the related Coupons, if any, as and when the same shall become due and
payable, whether or not such payment shall be prohibited by Article
12, if applicable, and continuance of such default for a period of 30
days; or
(b) default in the payment of the principal of or
premium, if any, on any Debt Securities of that series as and when the
same shall become due and payable, whether at maturity, upon
redemption, by declaration, upon required repurchase or otherwise,
whether or not such payment shall be prohibited by Article 12, if
applicable; or
(c) default in the payment of any sinking fund payment
with respect to any Debt Securities of that series as and when the
same shall become due and payable; or
(d) failure on the part of the Company to comply with
Article 10; or
(e) failure on the part of the Company duly to observe or
perform any other of the covenants or agreements on the part of the
Company in the Debt Securities of that series, in any resolution of
the Board of Directors authorizing the issuance of that series of Debt
Securities, in this Indenture with respect to such series or in any
supplemental Indenture with respect to such series (other than a
covenant a default in the performance of which is elsewhere in this
Section specifically addressed), continuing for a period of 60 days
after the date on which written notice specifying such failure and
requiring the Company to remedy the same shall have been given, by
registered or certified mail, to the Company by the Trustee or to the
Company and the Trustee by the Holders of at least 25% in aggregate
principal amount of the Debt Securities of that series at the time
Outstanding; or
(f) Indebtedness of the Company or any Subsidiary of the
Company is not paid within any applicable grace period after final
maturity or is accelerated by the holders thereof because of a
default, the total amount of such Indebtedness unpaid or accelerated
exceeds $20,000,000 or its Dollar Equivalent at the time and such
default remains uncured or such acceleration is not rescinded for 10
days after the date on which written notice specifying such failure
and requiring the Company to remedy the same shall have been given, by
registered or certified mail, to the Company by the Trustee or to the
Company and the
45
<PAGE> 53
Trustee by the Holders of at least 25% in aggregate principal amount
of the Debt Securities of that series at the time Outstanding; or
(g) the Company or any of its Significant Subsidiaries
shall (i) voluntarily commence any proceeding or file any petition
seeking relief under Title 11 of the United States Code or any other
Federal or State bankruptcy, insolvency or similar law, (ii) consent
to the institution of, or fail to controvert within the time and in
the manner prescribed by law, any such proceeding or the filing of any
such petition, (iii) apply for or consent to the appointment of a
receiver, trustee, custodian, sequestrator or similar official for the
Company or any such Significant Subsidiary or for a substantial part
of its property, (iv) file an answer admitting the material
allegations of a petition filed against it in any such proceeding, (v)
make a general assignment for the benefit of creditors, (vi) admit in
writing its inability or fail generally to pay its debts as they
become due, (vii) take corporate action for the purpose of effecting
any of the foregoing, or (viii) take any comparable action under any
foreign laws relating to insolvency; or
(h) the entry of an order or decree by a court having
competent jurisdiction in the premises for (i) relief in respect of
the Company or any of its Significant Subsidiaries or a substantial
part of any of their property under Title 11 of the United States Code
or any other Federal or State bankruptcy, insolvency or similar law,
(ii) the appointment of a receiver, trustee, custodian, sequestrator
or similar official for the Company or any such Significant Subsidiary
or for a substantial part of any of their property (except any decree
or order appointing such official of any Significant Subsidiary
pursuant to a plan under which the assets and operations of such
Significant Subsidiary are transferred to or combined with another
Subsidiary or Subsidiaries of the Company or to the Company) or (iii)
the winding-up or liquidation of the Company or any such Significant
Subsidiary (except any decree or order approving or ordering the
winding up or liquidation of the affairs of a Significant Subsidiary
pursuant to a plan under which the assets and operations of such
Significant Subsidiary are transferred to or combined with another
Subsidiary or Subsidiaries of the Company or to the Company); and such
order or decree shall continue unstayed and in effect for 60
consecutive days; or any similar relief is granted under any foreign
laws and the order or decree stays in effect for 60 consecutive days;
or
(i) any judgment or decree for the payment of money in
excess of $20,000,000 or its Dollar Equivalent at the time is entered
against the Company or any Subsidiary of the Company by a court or
courts of competent jurisdiction, which judgment is not covered by
insurance, and is not discharged and either (i) an enforcement
proceeding has been commenced by any creditor upon such judgment or
decree or (ii) there is a period of 60 days following the entry of
such judgment or decree during which such judgment or decree is not
discharged, waived or the execution thereof stayed and, in the case of
(i) or (ii), such default continues for 10 days after the date on
which written notice specifying such failure and requiring the Company
to remedy the same shall have been given, by registered or certified
mail, to the Company by the Trustee or to the Company and the Trustee
by the Holders of
46
<PAGE> 54
at least 25% in aggregate principal amount of the Debt Securities of
that series at the time Outstanding; or
(j) any other Event of Default provided with respect to
Debt Securities of that series;
then and in each and every case that an Event of Default described in clause
(a), (b), (c), (d), (e), (f), (i) or (j) with respect to Debt Securities of
that series at the time Outstanding occurs and is continuing, unless the
principal of and interest on all the Debt Securities of that series shall have
already become due and payable, either the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Debt Securities of that series
then Outstanding hereunder, by notice in writing to the Company (and to the
Trustee if given by Holders), may declare the principal of (or, if the Debt
Securities of that series are Original Issue Discount Debt Securities, such
portion of the principal amount as may be specified in the terms of that
series) and interest on all the Debt Securities of that series to be due and
payable immediately, and upon any such declaration the same shall become and
shall be immediately due and payable, anything in this Indenture or in the Debt
Securities or Coupons appertaining thereto of that series contained to the
contrary notwithstanding. If an Event of Default described in clause (g) or
(h) occurs, then and in each and every such case, unless the principal of and
interest on all the Debt Securities shall have become due and payable, the
principal of (or, if any Debt Securities are Original Issue Discount Debt
Securities, such portion of the principal amount as may be specified in the
terms thereto) and interest on all the Debt Securities then Outstanding
hereunder shall ipso facto become and be immediately due and payable without
any declaration or other act on the part of the Trustee or any Holders,
anything in this Indenture or in the Debt Securities contained to the contrary
notwithstanding.
The Holders of a majority in principal amount of the Debt Securities
of a particular series by notice to the Trustee may rescind an acceleration and
its consequences if the rescission would not conflict with any judgment or
decree already rendered and if all existing Events of Default have been cured
or waived except nonpayment of principal or interest that has become due solely
because of acceleration. Upon any such rescission, the parties hereto shall be
restored respectively to their several positions and rights hereunder, and all
rights, remedies and powers of the parties hereto shall continue as though no
such proceeding had been taken.
In case the Trustee or any Holder shall have proceeded to enforce any
right under this Indenture and such proceedings shall have been discontinued or
abandoned because of such rescission or annulment or for any other reason or
shall have been determined adversely to the Trustee or such Holder, then and in
every such case the parties hereto shall be restored respectively to their
several positions and rights hereunder, and all rights, remedies and powers of
the parties hereto shall continue as though no such proceeding had been taken.
The foregoing Events of Default shall constitute Events of Default
whatever the reason for any such Event of Default and whether it is voluntary
or involuntary or is effected by operation of
47
<PAGE> 55
law or pursuant to any judgment, decree or order of any court or any order,
rule or regulation of any administrative or governmental body.
The Company shall deliver to the Trustee, within 30 days after the
occurrence thereof, written notice in the form of an Officers' Certificate of
any event which with the giving of notice and the lapse of time would become an
Event of Default under clause (c), (d), (e), (f), (i) or (j), its status and
what action the Company is taking or proposes to take with respect thereto.
Section 6.02 Collection of Indebtedness by Trustee, etc. If an
Event of Default occurs and is continuing, the Trustee, in its own name and as
trustee of an express trust, shall be entitled and empowered to institute any
action or proceedings at law or in equity for the collection of the sums so due
and unpaid or enforce the performance of any provision of the Debt Securities
of the affected series or this Indenture, and may prosecute any such action or
proceedings to judgment or final decree, and may enforce any such judgment or
final decree against the Company or any other obligor upon the Debt Securities,
and the Coupons, if any, appertaining thereto, of such series (and collect, in
the manner provided by law out of the property of the Company or any other
obligor upon the Debt Securities and Coupons of such series wherever situated,
the moneys adjudged or decreed to be payable).
In case there shall be pending proceedings for the bankruptcy or for
the reorganization of the Company or any other obligor upon the Debt Securities
and Coupons, if any, of any series under Title 11 of the United States Code or
any other Federal or State bankruptcy, insolvency or similar law, or in case a
receiver, trustee or other similar official shall have been appointed for its
property, or in case of any other similar judicial proceedings relative to the
Company or any other obligor upon the Debt Securities of any series, its
creditors or its property, the Trustee, irrespective of whether the principal
of Debt Securities and Coupons, if any, of any series shall then be due and
payable as therein expressed or by declaration or otherwise and irrespective of
whether the Trustee shall have made any demand pursuant to the provisions of
this Section 6.02, shall be entitled and empowered, by intervention in such
proceedings or otherwise, to file and prove a claim or claims for the whole
amount of principal, premium, if any, and interest (or, if the Debt Securities
of such series are Original Issue Discount Debt Securities, such portion of the
principal amount as may be specified in the terms of such series) owing and
unpaid in respect of the Debt Securities and Coupons of such series, and to
file such other papers or documents as may be necessary or advisable in order
to have the claims of the Trustee (including any claim for reasonable
compensation to the Trustee, its agents, attorneys and counsel, and for
reimbursement of all expenses and liabilities Incurred, and all advances made,
by the Trustee except as a result of its negligence or bad faith) and of the
Holders thereof allowed in any such judicial proceedings relative to the
Company, or any other obligor upon the Debt Securities and Coupons of such
series, its creditors or its property, and to collect and receive any moneys or
other property payable or deliverable on any such claims, and to distribute all
amounts received with respect to the claims of such Holders and of the Trustee
on their behalf, and any receiver, assignee or trustee in bankruptcy or
reorganization is hereby authorized by each of such Holders to make payments to
the Trustee, and, in the event that the Trustee shall consent to the making of
payments directly to such Holders, to pay to the Trustee such amount as shall
be
48
<PAGE> 56
sufficient to cover reasonable compensation to the Trustee, its agents,
attorneys and counsel, and all other reasonable expenses and liabilities
Incurred, and all advances made, by the Trustee except as a result of its
negligence or bad faith.
All rights of action and of asserting claims under this Indenture, or
under any of the Debt Securities and the Coupons, if any, appertaining thereto,
of any series, may be enforced by the Trustee without the possession of any
such Debt Securities or Coupons, or the production thereof in any trial or
other proceedings relative thereto, and any such action or proceedings
instituted by the Trustee shall be brought in its own name as trustee of an
express trust, and any recovery of judgment (except for any amounts payable to
the Trustee pursuant to Section 7.06) shall be for the ratable benefit of the
Holders of all the Debt Securities or Coupons in respect of which such action
was taken.
In case of an Event of Default hereunder the Trustee may in its
discretion proceed to protect and enforce the rights vested in it by this
Indenture by such appropriate judicial proceedings as the Trustee shall deem
most effectual to protect and enforce any of such rights, either at law or in
equity or in bankruptcy or otherwise, whether for the specific enforcement of
any covenant or agreement contained in this Indenture or in aid of the exercise
of any power granted in this Indenture, or to enforce any other legal or
equitable right vested in the Trustee by this Indenture or by law.
Section 6.03 Application of Moneys Collected by Trustee. Any
moneys or other property collected by the Trustee pursuant to Section 6.02 with
respect to Debt Securities and Coupons, if any, of any series shall be applied,
after giving effect to the provisions of Article 12, if applicable, in the
order following, at the date or dates fixed by the Trustee for the distribution
of such moneys or other property, upon presentation of the several Debt
Securities or Coupons of such series in respect of which moneys or other
property have been collected, and the notation thereon of the payment, if only
partially paid, and upon surrender thereof if fully paid:
FIRST: To the payment of all money due the Trustee pursuant
to Section 7.06;
SECOND: In case the principal of the Outstanding Debt
Securities in respect of which such moneys have been collected shall
not have become due, to the payment of interest on the Debt Securities
or Coupons of such series in the order of the maturity of the
installments of such interest, with interest (to the extent that such
interest has been collected by the Trustee) upon the overdue
installments of interest at the rate or Yield to Maturity (in the case
of Original Issue Discount Debt Securities) borne by the Debt
Securities or Coupons of such series, such payments to be made ratably
to the Persons entitled thereto, without discrimination or preference;
THIRD: In case the principal of the Outstanding Debt
Securities in respect of which such moneys have been collected shall
have become due, by declaration or otherwise, to the payment of the
whole amount then owing and unpaid upon the Debt Securities or Coupons
of such series for principal and premium, if any, and interest, with
interest on the overdue
49
<PAGE> 57
principal and premium, if any, and (to the extent that such interest
has been collected by the Trustee) upon overdue installments of
interest at the rate or Yield to Maturity (in the case of Original
Issue Discount Debt Securities) borne by the Debt Securities or
Coupons of such series; and, in case such moneys shall be insufficient
to pay in full the whole amount so due and unpaid upon the Debt
Securities and Coupons of such series, then to the payment of such
principal and premium, if any, and interest, without preference or
priority of principal and premium, if any, over interest, or of
interest over principal and premium, if any, or of any installment of
interest over any other installment of interest, or of any Debt
Security or Coupon of such series over any Debt Security or Coupon of
such series, ratably to the aggregate of such principal and premium,
if any, and interest; and
FOURTH: The remainder, if any, shall be paid to the Company,
its successors or assigns, or to whomsoever may be lawfully entitled
to receive the same, or as a court of competent jurisdiction may
direct.
The Trustee may fix a record date and payment date for any payment to
Holders pursuant to this Section 6.03. At least 15 days before such record
date, the Company shall mail to each Holder and the Trustee a notice that
states the record date, the payment date and amount to be paid.
Section 6.04 Limitation on Suits by Holders. No Holder of any
Debt Security or Coupon of any series shall have any right by virtue or by
availing of any provision of this Indenture to institute any action or
proceeding at law or in equity or in bankruptcy or otherwise, upon or under or
with respect to this Indenture, or for the appointment of a receiver or
trustee, or for any other remedy hereunder, unless such Holder previously shall
have given to the Trustee written notice of an Event of Default with respect to
Debt Securities of that same series and of the continuance thereof and unless
the Holders of not less than 25% in aggregate principal amount of the
Outstanding Debt Securities of that series shall have made written request upon
the Trustee to institute such action or proceedings in respect of such Event of
Default in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs, expenses
and liabilities to be Incurred therein or thereby, and the Trustee, for 60 days
after its receipt of such notice, request and offer of indemnity shall have
failed to institute any such action or proceedings and no direction
inconsistent with such written request shall have been given to the Trustee
pursuant to Section 6.06; it being understood and intended, and being expressly
covenanted by the Holder of every Debt Security or Coupon with every other
Holder and the Trustee, that no one or more Holders shall have any right in any
manner whatever by virtue or by availing of any provision of this Indenture to
affect, disturb or prejudice the rights of any Holders, or to obtain or seek to
obtain priority over or preference to any other such Holder, or to enforce any
right under this Indenture, except in the manner herein provided and for the
equal, ratable and common benefit of all such Holders. For the protection and
enforcement of the provisions of this Section 6.04, each and every Holder and
the Trustee shall be entitled to such relief as can be given either at law or
in equity.
Notwithstanding any other provision in this Indenture, however, the
right of any Holder of any Debt Security or Coupon to receive payment of the
principal of, and premium, if any, and
50
<PAGE> 58
(subject to Section 2.12) interest on, such Debt Security or Coupon, on or
after the respective due dates expressed in such Debt Security, and to
institute suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
Holder.
Section 6.05 Remedies Cumulative; Delay or Omission in Exercise of
Rights Not a Waiver of Default. All powers and remedies given by this Article
6 to the Trustee or to the Holders shall, to the extent permitted by law, be
deemed cumulative and not exclusive of any other powers and remedies available
to the Trustee or the Holders, by judicial proceedings or otherwise, to enforce
the performance or observance of the covenants and agreements contained in this
Indenture, and no delay or omission of the Trustee or of any Holder to exercise
any right or power accruing upon any Default occurring and continuing as
aforesaid, shall impair any such right or power, or shall be construed to be a
waiver of any such Default or an acquiescence therein; and, subject to the
provisions of Section 6.04, every power and remedy given by this Article 6 or
by law to the Trustee or to the Holders may be exercised from time to time, and
as often as shall be deemed expedient, by the Trustee or by the Holders.
Section 6.06 Rights of Holders of Majority in Principal Amount of
Debt Securities to Direct Trustee and to Waive Default. The Holders of a
majority in aggregate principal amount of the Debt Securities of any series at
the time Outstanding shall have the right to direct the time, method, and place
of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee, with respect to the
Debt Securities of such series; provided, however, that such direction shall
not be otherwise than in accordance with law and the provisions of this
Indenture, and that subject to the provisions of Section 7.01, the Trustee
shall have the right to decline to follow any such direction if the Trustee,
being advised by counsel, shall determine that the action so directed may not
lawfully be taken, or if the Trustee shall by a responsible officer or officers
determine that the action so directed would involve it in personal liability or
would be unjustly prejudicial to Holders of Debt Securities of such series not
taking part in such direction; and provided, further, however, that nothing in
this Indenture contained shall impair the right of the Trustee to take any
action deemed proper by the Trustee and which is not inconsistent with such
direction by such Holders. Prior to the acceleration of the maturity of the
Debt Securities of any series, as provided in Section 6.01, the Holders of a
majority in aggregate principal amount of the Debt Securities of that series at
the time Outstanding may on behalf of the Holders of all the Debt Securities
and any related Coupons of that series waive any past Default or Event of
Default and its consequences for that series specified in the terms thereof as
contemplated by Section 2.03, except (a) a Default in the payment of the
principal of, and premium, if any, or interest on, any of the Debt Securities
or in the payment of any related Coupon and (b) a Default in respect of a
provision that under Section 9.02 cannot be amended without the consent of each
Holder affected thereby. In case of any such waiver, such Default shall cease
to exist, any Event of Default arising therefrom shall be deemed to have been
cured for every purpose of this Indenture, and the Company, the Trustee and the
Holders of the Debt Securities of that series shall be restored to their former
positions and rights hereunder, respectively; but no such waiver shall extend
to any subsequent or other Default or impair any right consequent thereon.
51
<PAGE> 59
Section 6.07 Trustee to Give Notice of Defaults Known to It, but
May Withhold Such Notice in Certain Circumstances. The Trustee shall, within
90 days after the occurrence of a Default known to it with respect to a series
of Debt Securities or Coupons, if any, give to the Holders thereof, in the
manner provided in Section 13.03, notice of all Defaults with respect to such
series known to the Trustee, unless such Defaults shall have been cured or
waived before the giving of such notice; provided, that, except in the case of
Default in the payment of the principal of, or premium, if any, or interest on,
any of the Debt Securities or Coupons of such series or in the making of any
sinking fund payment with respect to the Debt Securities of such series, the
Trustee shall be protected in withholding such notice if and so long as the
board of directors, the executive committee or a committee of directors or
responsible officers of the Trustee in good faith determine that the
withholding of such notice is in the interests of the Holders thereof.
Section 6.08 Requirement of an Undertaking To Pay Costs in Certain
Suits under the Indenture or Against the Trustee. All parties to this
Indenture agree, and each Holder of any Debt Security or Coupon by his
acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Trustee for any action taken
or omitted by it as Trustee, the filing by any party litigant in such suit of
an undertaking to pay the costs of such suit in the manner and to the extent
provided in the Trust Indenture Act, and that such court may in its discretion
assess reasonable costs, including reasonable attorneys' fees, against any
party litigant in such suit, having due regard to the merits and good faith of
the claims or defenses made by such party litigant; but the provisions of this
Section 6.08 shall not apply to any suit instituted by the Trustee, to any suit
instituted by any Holder, or group of Holders, holding in the aggregate more
than ten percent in principal amount of the Outstanding Debt Securities of that
series or to any suit instituted by any Holder for the enforcement of the
payment of the principal of, or premium, if any, or interest on, any Debt
Security or Coupon on or after the due date for such payment expressed in such
Debt Security or Coupon.
ARTICLE 7
CONCERNING THE TRUSTEE
Section 7.01 Certain Duties and Responsibilities. The Trustee,
prior to the occurrence of an Event of Default and after the curing or waiving
of all Events of Default which may have occurred, undertakes to perform such
duties and only such duties as are specifically set forth in this Indenture.
In case an Event of Default has occurred (which has not been cured or waived),
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.
No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own wilful misconduct, except that:
52
<PAGE> 60
(a) this subsection shall not be construed to limit the
effect of the first paragraph of this Section 7.01;
(b) prior to the occurrence of an Event of Default with
respect to the Debt Securities of a series and after the curing or
waiving of all Events of Default with respect to such series which may
have occurred:
(i) the duties and obligations of the Trustee
with respect to Debt Securities and Coupons, if any, of any
series shall be determined solely by the express provisions of
this Indenture, and the Trustee shall not be liable except for
the performance of such duties and obligations with respect to
such series as are specifically set forth in this Indenture,
and no implied covenants or obligations with respect to such
series shall be read into this Indenture against the Trustee;
and
(ii) in the absence of bad faith on the part of
the Trustee, the Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished
to the Trustee and conforming to the requirements of this
Indenture; but in the case of any such certificates or
opinions which by any provision hereof are specifically
required to be furnished to the Trustee, the Trustee shall be
under a duty to examine the same to determine whether or not
they conform to the requirements of this Indenture; but the
Trustee shall examine the evidence furnished to it pursuant to
Section 5.03 to determine whether or not such evidence
conforms to the requirement of this Indenture;
(c) the Trustee shall not be liable for an error of
judgment made in good faith by a responsible officer, unless it shall
be proved that the Trustee was negligent in ascertaining the pertinent
facts; and
(d) the Trustee shall not be liable with respect to any
action taken or omitted to be taken by it with respect to Debt
Securities of any series in good faith in accordance with the
direction of the Holders of not less than a majority in aggregate
principal amount of the Outstanding Debt Securities of that series
relating to the time, method and place of conducting any proceeding
for any remedy available to the Trustee, or exercising any trust or
power conferred upon the Trustee, under this Indenture with respect to
Debt Securities of such series.
None of the provisions of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any Personal financial
liability in the performance of any of its duties hereunder, or in the exercise
of any of its rights or powers, if there shall be reasonable grounds for
believing that repayment of such funds or adequate indemnity against such risk
or liability is not reasonably assured to it.
53
<PAGE> 61
Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section.
Section 7.02 Certain Rights of Trustee. Except as otherwise
provided in Section 7.01:
(a) the Trustee may rely and shall be protected in acting
or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note or other paper or document believed by it
to be genuine and to have been signed or presented by the proper party
or parties;
(b) any request, direction, order or demand of the
Company mentioned herein shall be sufficiently evidenced by a Company
Order (unless other evidence in respect thereof be herein specifically
prescribed); and any resolution of the Board of Directors may be
evidenced to the Trustee by a copy thereof certified by the Secretary
or an Assistant Secretary of the Company;
(c) the Trustee may consult with counsel, and the advice
of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken or
suffered or omitted by it hereunder in good faith and in accordance
with such advice or Opinion of Counsel;
(d) the Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at the
request, order or direction of any of the Holders of Debt Securities
or Coupons of any series pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities
which may be Incurred therein or thereby;
(e) the Trustee shall not be liable for any action taken
or omitted by it in good faith and reasonably believed by it to be
authorized or within the discretion or rights or powers conferred upon
it by this Indenture;
(f) prior to the occurrence of an Event of Default and
after the curing of all Events of Default which may have occurred, the
Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, approval
or other paper or document, unless requested in writing to do so by
the Holders of a majority in aggregate principal amount of the then
Outstanding Debt Securities of a series affected by such matter;
provided, however, that if the payment within a reasonable time to the
Trustee of the costs, expenses or liabilities likely to be Incurred by
it in the making of such investigation is not, in the opinion of the
Trustee, reasonably assured to the Trustee by the security afforded to
it by the terms of this Indenture, the Trustee may require reasonable
indemnity against such costs, expenses or liabilities as a condition
to so proceeding. The reasonable expense of
54
<PAGE> 62
every such investigation shall be paid by the Company or, if paid by
the Trustee, shall be repaid by the Company upon demand;
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney
appointed by it with due care hereunder; and
(h) if any property other than cash shall at any time be
subject to a Lien in favor of the Holders, the Trustee, if and to the
extent authorized by a receivership or bankruptcy court of competent
jurisdiction or by the supplemental instrument subjecting such
property to such Lien, shall be entitled to make advances for the
purpose of preserving such property or of discharging tax Liens or
other prior Liens or encumbrances thereon.
Section 7.03 Trustee Not Liable for Recitals in Indenture or in
Debt Securities. The recitals contained herein, in the Debt Securities (except
the Trustee's certificate of authentication) and in any Coupons shall be taken
as the statements of the Company, and the Trustee assumes no responsibility for
the correctness of the same. The Trustee makes no representations as to the
validity or sufficiency of this Indenture or of the Debt Securities or Coupons,
if any, of any series, except that the Trustee represents that it is duly
authorized to execute and deliver this Indenture, authenticate the Debt
Securities and perform its obligations hereunder, and that the statements made
by it or to be made by it in a Statement of Eligibility and Qualification on
Form T-1 supplied to the Company are true and accurate. The Trustee shall not
be accountable for the use or application by the Company of any of the Debt
Securities or of the proceeds thereof.
Section 7.04 Trustee, Paying Agent or Registrar May Own Debt
Securities. The Trustee or any paying agent or Registrar, in its individual or
any other capacity, may become the owner or pledgee of Debt Securities or
Coupons and, subject to the provisions of the Trust Indenture Act relating to
conflicts of interest and preferential claims, may otherwise deal with the
Company with the same rights it would have if it were not Trustee, paying agent
or Registrar.
Section 7.05 Moneys Received by Trustee to Be Held in Trust.
Subject to the provisions of Section 11.05, all moneys received by the Trustee
shall, until used or applied as herein provided, be held in trust for the
purposes for which they were received, but need not be segregated from other
funds except to the extent required by law. The Trustee shall be under no
liability for interest on any moneys received by it hereunder. So long as no
Event of Default shall have occurred and be continuing, all interest allowed on
any such moneys shall be paid from time to time to the Company upon a Company
Order.
Section 7.06 Compensation and Reimbursement. The Company
covenants and agrees to pay in Dollars to the Trustee from time to time, and
the Trustee shall be entitled to, reasonable compensation for all services
rendered by it hereunder (which shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust), and, except as
otherwise
55
<PAGE> 63
expressly provided herein, the Company will pay or reimburse in Dollars the
Trustee upon its request for all reasonable expenses, disbursements and
advances Incurred or made by the Trustee in accordance with any of the
provisions of this Indenture (including the reasonable compensation and the
expenses and disbursements of its agents, attorneys and counsel and of all
Persons not regularly in its employ) except any such expense, disbursement or
advances as may arise from its negligence or bad faith. The Company also
covenants to indemnify in Dollars the Trustee for, and to hold it harmless
against, any loss, liability or expense Incurred without negligence, wilful
misconduct or bad faith on the part of the Trustee, arising out of or in
connection with the acceptance or administration of this trust or trusts
hereunder, including the reasonable costs and expenses of defending itself
against any claim of liability in connection with the exercise or performance
of any of its powers or duties hereunder. The obligations of the Company under
this Section 7.06 to compensate and indemnify the Trustee and to pay or
reimburse the Trustee for expenses, disbursements and advances shall constitute
additional indebtedness hereunder and shall survive the satisfaction and
discharge of this Indenture. The Company and the Holders agree that such
additional indebtedness shall be secured by a Lien prior to that of the Debt
Securities and Coupons, if any, upon all property and funds held or collected
by the Trustee, as such, except funds held in trust for the payment of
principal of, and premium, if any, or interest on, particular Debt Securities
and Coupons.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(g) or (h) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any bankruptcy, insolvency, reorganization or other
similar law.
Section 7.07 Right of Trustee to Rely on an Officers' Certificate
Where No Other Evidence Specifically Prescribed. Except as otherwise provided
in Section 7.01, whenever in the administration of the provisions of this
Indenture the Trustee shall deem it necessary or desirable that a matter be
proved or established prior to taking or suffering or omitting any action
hereunder, such matter (unless other evidence in respect thereof be herein
specifically prescribed) may, in the absence of negligence or bad faith on the
part of the Trustee, be deemed to be conclusively proved and established by an
Officers' Certificate delivered to the Trustee and such certificate, in the
absence of negligence or bad faith on the part of the Trustee, shall be full
warrant to the Trustee for any action taken, suffered or omitted by it under
the provisions of this Indenture upon the faith thereof.
Section 7.08 Separate Trustee; Replacement of Trustee. The
Company may, but need not, appoint a separate Trustee for any one or more
series of Debt Securities. The Trustee may resign with respect to one or more
or all series of Debt Securities at any time by giving notice to the Company.
The Holders of a majority in principal amount of the Debt Securities of a
particular series
56
<PAGE> 64
may remove the Trustee for such series and only such series by so notifying the
Trustee and may appoint a successor Trustee. The Company shall remove the
Trustee if:
(a) the Trustee fails to comply with Section 7.10;
(b) The Trustee is adjudged bankrupt or insolvent;
(c) a receiver or other public officer takes charge of
the Trustee or its property; or
(d) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns, is removed by the Company or by the Holders of
a majority in principal amount of the Debt Securities of a particular series
and such Holders do not reasonably promptly appoint a successor Trustee, or if
a vacancy exists in the office of Trustee for any reason (the Trustee in such
event being referred to herein as the retiring Trustee), the Company shall
promptly appoint a successor Trustee. No resignation or removal of the Trustee
and no appointment of a successor Trustee shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of this Section 7.08.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon 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. The successor Trustee shall mail a notice of its
succession to Holders of Debt Securities of each applicable series. 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 7.06.
If a successor Trustee does not take office within 60 days after the
retiring Trustee gives notice of resignation or is removed, the retiring
Trustee or the Holders of 25% in principal amount of the Debt Securities of any
applicable series may petition any court of competent jurisdiction for the
appointment of a successor Trustee for the Debt Securities of such series.
If the Trustee fails to comply with Section 7.10, any Holder of Debt
Securities of any applicable series may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee for the Debt Securities of such series.
Notwithstanding the replacement of the Trustee pursuant to this
Section 7.08, the Company's obligations under Section 7.06 shall continue for
the benefit of the retiring Trustee.
In the case of the appointment hereunder of a separate or successor
trustee with respect to the Debt Securities of one or more series, the Company,
any retiring Trustee and each successor or separate Trustee with respect to the
Debt Securities of any applicable series shall execute and deliver an Indenture
supplemental hereto (a) which shall contain such provisions as shall be deemed
57
<PAGE> 65
necessary or desirable to confirm that all the rights, powers, trusts and
duties of any retiring Trustee with respect to the Debt Securities of any
series as to which any such retiring Trustee is not retiring shall continue to
be vested in such retiring Trustee and (b) that shall add to or change any of
the provisions of this Indenture as shall be necessary to provide for or
facilitate the administration of the trusts hereunder by more than one trustee,
it being understood that nothing herein or in such supplemental Indenture shall
constitute such Trustees co-trustees of the same trust and that each such
separate, retiring or successor Trustee shall be Trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder administered by
any other such Trustee.
Section 7.09 Successor Trustee by Merger. If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all its corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation or banking
association without any further act shall be the successor Trustee.
In case at the time such successor or successors by merger, conversion
or consolidation to the Trustee shall succeed to the trusts created by this
Indenture any of the Debt Securities shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Debt Securities so
authenticated; and in case at that time any of the Debt Securities shall not
have been authenticated, any successor to the Trustee may authenticate such
Debt Securities either in the name of any predecessor hereunder or in the name
of the successor to the Trustee; and in all such cases such certificates shall
have the full force which it is anywhere in the Debt Securities or in this
Indenture provided that the certificate of the Trustee shall have.
Section 7.10 Eligibility; Disqualification. The Trustee shall at
all times satisfy the requirements of Section 310(a) of the Trust Indenture
Act. The Trustee shall have a combined capital and surplus of at least
$50,000,000 as set forth in its most recent published annual report of
condition. No obligor upon the Debt Securities or Coupons, if any, of a
particular series or Person directly or indirectly controlling, controlled by
or under common control with such obligor shall serve as Trustee upon the Debt
Securities and Coupons of such series. The Trustee shall comply with Section
310(b) of the Trust Indenture Act; provided, however, that there shall be
excluded from the operation of Section 310(b)(1) of the Trust Indenture Act
this Indenture or any indenture or indentures under which other securities or
certificates of interest or participation in other securities of the Company
are outstanding if the requirements for such exclusion set forth in Section
310(b)(1) of the Trust Indenture Act are met.
Section 7.11 Preferential Collection of Claims Against Company.
The Trustee shall comply with Section 311(a) of the Trust Indenture Act,
excluding any creditor relationship listed in Section 311(b) of the Trust
Indenture Act. A Trustee who has resigned or been removed shall be subject to
Section 311(a) of the Trust Indenture Act to the extent indicated therein.
Section 7.12 Compliance with Tax Laws. The Trustee hereby agrees
to comply with all U.S. Federal income tax information reporting and
withholding requirements applicable to it with
58
<PAGE> 66
respect to payments of premium (if any) and interest on the Debt Securities,
whether acting as Trustee, Registrar, paying agent or otherwise with respect to
the Debt Securities.
ARTICLE 8
CONCERNING THE HOLDERS
Section 8.01 Evidence of Action by Holders. Whenever in this
Indenture it is provided that the Holders of a specified percentage in
aggregate principal amount of the Debt Securities of any or all series may take
action (including the making of any demand or request, the giving of any
direction, notice, consent or waiver or the taking of any other action) the
fact that at the time of taking any such action the Holders of such specified
percentage have joined therein may be evidenced (a) by any instrument or any
number of instruments of similar tenor executed by Holders in Person or by
agent or proxy appointed in writing, (b) by the record of the Holders voting in
favor thereof at any meeting of Holders duly called and held in accordance with
the provisions of Section 5.02 or (c) by a combination of such instrument or
instruments and any such record of such a meeting of Holders.
Section 8.02 Proof of Execution of Instruments and of Holding of
Debt Securities. Subject to the provisions of Sections 7.01, 7.02 and 13.11,
proof of the execution of any instrument by a Holder or his agent or proxy
shall be sufficient if made in accordance with such reasonable rules and
regulations as may be prescribed by the Trustee or in such manner as shall be
satisfactory to the Trustee.
The ownership of Registered Securities of any series shall be proved
by the Debt Security Register or by a certificate of the Registrar for such
series.
The ownership of Bearer Securities shall be proved by production of
such Bearer Securities or by a certificate executed by any bank or trust
company, which certificate shall be dated and shall state on the date thereof a
Bearer Security bearing a specified identifying number or other mark was
deposited with or exhibited to the Person executing such certificate by the
Person named in such certificate, or by any other proof of possession
reasonably satisfactory to the Trustee. The holding by the Person named in any
such certificate of any Bearer Security specified therein shall be presumed to
continue for a period of one year unless at the time of determination of such
holding (a) another certificate bearing a later date issued in respect of the
same Bearer Security shall be produced, (b) such Bearer Security shall be
produced by some other Person, (c) such Bearer Security shall have been
registered on the Debt Security Register, if, pursuant to Section 2.03, such
Bearer Security can be so registered, or (d) such Bearer Security shall have
been canceled or paid.
The Trustee may require such additional proof of any matter referred
to in this Section 8.02 as it shall deem necessary.
59
<PAGE> 67
Section 8.03 Who May Be Deemed Owner of Debt Securities. Prior to
due presentment for registration of transfer of any Registered Security, the
Company, the Trustee, any paying agent and any Registrar may deem and treat the
Person in whose name any Registered Security shall be registered upon the books
of the Company as the absolute owner of such Registered Security (whether or
not such Registered Security shall be overdue and notwithstanding any notation
of ownership or other writing thereon) for the purpose of receiving payment of
or on account of the principal of and premium, if any, and (subject to Section
2.03) interest on such Registered Security and for all other purposes, and
neither the Company nor the Trustee nor any paying agent nor any Registrar
shall be affected by any notice to the contrary; and all such payments so made
to any such Holder for the time being, or upon his order, shall be valid and,
to the extent of the sum or sums so paid, effectual to satisfy and discharge
the liability for moneys payable upon any such Registered Security.
The Company, the Trustee and any paying agent may deem and treat the
Holder of any Bearer Security or Coupon as the absolute owner of such Bearer
Security or Coupon (whether or not such Debt Security shall be overdue and
notwithstanding any notation of ownership or other writing thereon) for the
purpose of receiving payment of or on account of the principal of and premium,
if any, and (subject to Section 2.03) interest on such Bearer Security or
Coupon and for all other purposes, and neither the Company nor the Trustee nor
any paying agent shall be affected by any notice to the contrary; and all such
payments so made to any such Holder for the time being, or upon his order,
shall be valid and, to the extent of the sum or sums so paid, effectual to
satisfy and discharge the liability for moneys payable upon any such Bearer
Security or Coupon.
None of the Company, the Trustee, any paying agent or the Registrar
will have any responsibility or liability for any aspect of the records
relating to or payments made on account of beneficial ownership interests in a
Global Security or for maintaining, supervising or reviewing any records
relating to such beneficial ownership interests.
Section 8.04 Instruments Executed by Holders Bind Future Holders.
At any time prior to (but not after) the evidencing to the Trustee, as provided
in Section 8.01, of the taking of any action by the Holders of the percentage
in aggregate principal amount of the Debt Securities of any series specified in
this Indenture in connection with such action and subject to the following
paragraph, any Holder of a Debt Security which is shown by the evidence to be
included in the Debt Securities the Holders of which have consented to such
action may, by filing written notice with the Trustee at its corporate trust
office and upon proof of holding as provided in Section 8.02, revoke such
action so far as concerns such Debt Security. Except as aforesaid any such
action taken by the Holder of any Debt Security shall be conclusive and binding
upon such Holder and upon all future Holders and owners of such Debt Security
and all past, present and future Holders of Coupons, if any, appertaining
thereto, and of any Debt Security issued upon transfer thereof or in exchange
or substitution therefor, irrespective of whether or not any notation in regard
thereto is made upon such Debt Security or such other Debt Securities or
Coupons. Any action taken by the Holders of the percentage in aggregate
principal amount of the Debt Securities of any series specified in this
60
<PAGE> 68
Indenture in connection with such action shall be conclusively binding upon the
Company, the Trustee and the Holders of all the Securities and Coupons of such
series.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders of Registered Securities entitled to
give their consent or take any other action required or permitted to be taken
pursuant to this Indenture. If a record date is fixed, then notwithstanding
the immediately preceding paragraph, those Persons who were Holders of
Registered Securities at such record date (or their duly designated proxies),
and only those Persons, shall be entitled to give such consent or to revoke any
consent previously given or to take any such action, whether or not such
Persons continue to be Holders of Registered Securities after such record date.
No such consent shall be valid or effective for more than 120 days after such
record date unless the consent of the Holders of the percentage in aggregate
principal amount of the Debt Securities of such series specified in this
Indenture shall have been received within such 120-day period.
ARTICLE 9
SUPPLEMENTAL INDENTURES
Section 9.01 Purposes for Which Supplemental Indenture May Be
Entered into Without Consent of Holders. The Company, when authorized by a
resolution of the Board of Directors, and the Trustee may from time to time and
at any time, without the consent of Holders, enter into an Indenture or
Indentures supplemental hereto (which shall conform to the provisions of the
Trust Indenture Act as in force at the date of the execution thereof) for one
or more of the following purposes:
(a) to evidence the succession pursuant to Article 10 of
another Person to the Company, or successive successions, and the
assumption by the Successor Company (as defined in Section 10.01) of
the covenants, agreements and obligations of the Company in this
Indenture and in the Debt Securities;
(b) to surrender any right or power herein conferred upon
the Company, to add to the covenants of the Company such further
covenants, restrictions, conditions or provisions for the protection
of the Holders of all or any series of Debt Securities and the
Coupons, if any, appertaining thereto (and if such covenants are to be
for the benefit of less than all series of Debt Securities, stating
that such covenants are expressly being included solely for the
benefit of such series) as the Board of Directors shall consider to be
for the protection of the Holders of such Debt Securities, and to make
the occurrence, or the occurrence and continuance, of a Default in any
of such additional covenants, restrictions, conditions or provisions a
Default or an Event of Default permitting the enforcement of all or
any of the several remedies provided in this Indenture; provided, that
in respect of any such additional covenant, restriction, condition or
provision such supplemental Indenture may provide for a particular
period of grace after Default (which period may be shorter or
61
<PAGE> 69
longer than that allowed in the case of other Defaults) or may provide
for an immediate enforcement upon such Default or may limit the
remedies available to the Trustee upon such Default or may limit the
right of the Holders of a majority in aggregate principal amount of
any or all series of Debt Securities to waive such default;
(c) to cure any ambiguity or to correct or supplement any
provision contained herein, in any supplemental Indenture or in any
Debt Securities of any series that may be defective or inconsistent
with any other provision contained herein, in any supplemental
Indenture or in the Debt Securities of such series; to convey,
transfer, assign, mortgage or pledge any property to or with the
Trustee, or to make such other provisions in regard to matters or
questions arising under this Indenture as shall not adversely affect
the interests of any Holders of Debt Securities or Coupons of any
series;
(d) to modify or amend this Indenture in such a manner as
to permit the qualification of this Indenture or any Indenture
supplemental hereto under the Trust Indenture Act as then in effect,
except that nothing herein contained shall permit or authorize the
inclusion in any Indenture supplemental hereto of the provisions
referred to in Section 316(a)(2) of the Trust Indenture Act;
(e) to add to or change any of the provisions of this
Indenture to provide that Bearer Securities may be registerable as to
principal, to change or eliminate any restrictions on the payment of
principal of, or premium, if any, on, Registered Securities or of
principal of, or premium, if any, or interest on, Bearer Securities or
to permit Registered Securities to be exchanged for Bearer Securities;
provided, that any such action shall not adversely affect the
interests of the Holders of Debt Securities or any Coupons of any
series in any material respect or permit or facilitate the issuance of
Debt Securities of any series in uncertificated form;
(f) to comply with Article 10;
(g) in the case of any Debt Securities and Coupons, if
any, appertaining thereto subordinated pursuant to Article 12, and
subject to the penultimate paragraph of this Section 9.01, to make any
change in Article 12 that would limit or terminate the benefits
available to any holder of Senior Indebtedness (or Representatives
therefor) under Article 12;
(h) to add Guarantees with respect to the Debt Securities
or to secure the Debt Securities;
(i) to make any change that does not adversely affect the
rights of any Holder;
(j) to add to, change or eliminate any of the provisions
of this Indenture in respect of one or more series of Debt Securities;
provided, however, that any such addition, change or elimination not
otherwise permitted under this Section 9.01 shall (i) neither
62
<PAGE> 70
(A) apply to any Debt Security of any series created prior to the
execution of such supplemental indenture and entitled to the benefit
of such provision nor (B) modify the rights of the Holder of any such
Debt Security with respect to such provision or (ii) shall become
effective only when there is no such Debt Security Outstanding;
(k) to evidence and provide for the acceptance of
appointment hereunder by a successor or separate Trustee with respect
to the Debt Securities of one or more series and to add to or change
any of the provisions of this Indenture as shall be necessary to
provide for or facilitate the administration of the trusts hereunder
by more than one Trustee; and
(l) to establish the form or terms of Debt Securities and
Coupons, if any, of any series as permitted by Sections 2.01 and 2.03.
The Trustee is hereby authorized to join with the Company in the
execution of any such supplemental Indenture, to make any further appropriate
agreements and stipulations which may be therein contained and to accept the
conveyance, transfer, assignment, mortgage or pledge of any property
thereunder, but the Trustee shall not be obligated to enter into any such
supplemental Indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
Any supplemental Indenture authorized by the provisions of this
Section 9.01 may be executed by the Company and the Trustee without the consent
of the Holders of any of the Debt Securities or Coupons, if any, appertaining
thereto at the time Outstanding, notwithstanding any of the provisions of
Section 9.02.
In the case of Debt Securities or Coupons, if any, appertaining
thereto subordinated pursuant to Article 12, an amendment under this Section
9.01 may not make any change that adversely affects the rights under Article 12
of any holder of Senior Indebtedness then outstanding unless the holders of
such Senior Indebtedness (or any group or Representative thereof authorized to
give a consent) consent to such change.
After an amendment under this Section 9.01 becomes effective, the
Company shall mail to Holders of Debt Securities of each series affected
thereby a notice briefly describing such amendment. The failure to give such
notice to all such Holders, or any defect therein, shall not impair or affect
the validity of an amendment under this Section 9.01.
Section 9.02 Modification of Indenture with Consent of Holders of
Debt Securities. Without notice to any Holder but with the consent (evidenced
as provided in Section 8.01) of the Holders of not less than a majority in
aggregate principal amount of the Outstanding Debt Securities of each series
affected by such supplemental Indenture, the Company, when authorized by a
resolution of the Board of Directors, and the Trustee may from time to time and
at any time enter into an Indenture or Indentures supplemental hereto (which
shall conform to the provisions of the Trust Indenture Act as in force at the
date of execution thereof) for the purpose of adding any
63
<PAGE> 71
provisions to or changing in any manner or eliminating any of the provisions of
this Indenture or of any supplemental Indenture or of modifying in any manner
the rights of the Holders of the Debt Securities of such series; provided, that
no such supplemental Indenture, without the consent of the Holders of each Debt
Security so affected, shall (a) reduce the percentage in principal amount of
Debt Securities of any series whose Holders must consent to an amendment; (b)
reduce the rate of or extend the time for payment of interest on any Debt
Security or Coupon or reduce the amount of any payment to be made with respect
to any Coupon; (c) reduce the principal of or extend the Stated Maturity of any
Debt Security; (d) reduce the premium payable upon the redemption of any Debt
Security or change the time at which any Debt Security may or shall be redeemed
in accordance with Article 3; (e) make any Debt Security or Coupon payable in
Currency other than that stated in the Debt Security; (f) in the case of any
Debt Security or Coupons, if any, appertaining thereto subordinated pursuant to
Article 12, make any change in Article 12 that adversely affects the rights of
any Holder under Article 12; (g) release any security that may have been
granted in respect of the Debt Securities; (h) make any change in Section 6.06
or this Section 9.02; (i) change any obligation of the Company to pay
additional interest pursuant to Section 4.06; or (j) limit the obligation of
the Company to maintain a paying agency outside the United States for payment
on Bearer Securities as provided in Section 4.02.
A supplemental Indenture which changes or eliminates any covenant or
other provision of this Indenture which has been expressly included solely for
the benefit of one or more particular series of Debt Securities and Coupons, if
any, or which modifies the rights of the Holders of Debt Securities and Coupons
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 Debt
Securities and Coupons, if any, of any other series.
Upon the request of the Company, accompanied by a copy of a resolution
of the Board of Directors authorizing the execution of any such supplemental
Indenture, and upon the filing with the Trustee of evidence of the consent of
Holders as aforesaid, the Trustee shall join with the Company in the execution
of such supplemental Indenture unless such supplemental Indenture affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise,
in which case the Trustee may in its discretion but shall not be obligated to
enter into such supplemental Indenture.
It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed supplemental
Indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
In the case of any Debt Securities or Coupons, if any, appertaining
thereto, subordinated pursuant to Article 12, an amendment under this Section
9.02 may not make any change that adversely affects the rights under Article 12
of any holder of Senior Indebtedness then outstanding unless the holders of
such Senior Indebtedness (or any group or Representative thereof authorized to
give a consent) consent to such change.
64
<PAGE> 72
After an amendment under this Section 9.02 becomes effective, the
Company shall mail to Holders of Debt Securities of each series affected
thereby a notice briefly describing such amendment. The failure to give such
notice to all such Holders, or any defect therein, shall not impair or affect
the validity of an amendment under this Section 9.02.
Section 9.03 Effect of Supplemental Indentures. Upon the
execution of any supplemental Indenture pursuant to the provisions of this
Article 9, this Indenture shall be and be deemed to be modified and amended in
accordance therewith and the respective rights, limitations of rights,
obligations, duties and immunities under this Indenture of the Trustee, the
Company and the Holders shall thereafter be determined, exercised and enforced
hereunder subject in all respects to such modifications and amendments, and all
the terms and conditions of any such supplemental Indenture shall be and be
deemed to be part of the terms and conditions of this Indenture for any and all
purposes.
The Trustee, subject to the provisions of Sections 7.01 and 7.02, may
accept an Officers' Certificate and an Opinion of Counsel as conclusive
evidence that any such supplemental Indenture complies with the provisions of
this Article 9.
Section 9.04 Debt Securities May Bear Notation of Changes by
Supplemental Indentures. Debt Securities and Coupons, if any, of any series
authenticated and delivered after the execution of any supplemental Indenture
pursuant to the provisions of this Article 9 may, and shall if required by the
Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental Indenture. New Debt Securities and Coupons
of any series so modified as to conform, in the opinion of the Trustee and the
Board of Directors, to any modification of this Indenture contained in any such
supplemental Indenture may be prepared and executed by the Company,
authenticated by the Trustee and delivered in exchange for the Debt Securities
and Coupons of such series then Outstanding. Failure to make the appropriate
notation or to issue a new Debt Security or Coupon of such series shall not
affect the validity of such amendment.
Section 9.05 Payment for Consent. Neither the Company nor any
Affiliate of the Company shall, directly or indirectly, pay or cause to be paid
any consideration, whether by way of interest, fee or otherwise, to any Holder
for or as an inducement to any consent, waiver or amendment of any of the terms
or provisions of this Indenture or the Debt Securities or Coupons, if any,
appertaining thereto unless such consideration is offered to be paid to all
Holders that so consent, waive or agree to amend in the time frame set forth in
solicitation documents relating to such consent, waiver or agreement.
65
<PAGE> 73
ARTICLE 10
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
Section 10.01 Consolidations and Mergers of the Company. The
Company shall not consolidate with or merge with or into any Person, or convey,
transfer or lease all or substantially all its assets, unless: (a) either (i)
the Company shall be the continuing Person in the case of a merger or (ii) the
resulting, surviving or transferee Person if other than the Company (the
"Successor Company") shall be a corporation organized and existing under the
laws of the United States, any State thereof or the District of Columbia and
the Successor Company shall expressly assume, by an Indenture supplemental
hereto, executed and delivered to the Trustee, in form satisfactory to the
Trustee, all the obligations of the Company under the Debt Securities and
Coupons, if any, according to their tenor, and this Indenture; (b) immediately
after giving effect to such transaction (and treating any Indebtedness which
becomes an obligation of the Successor Company or any Subsidiary of the Company
as a result of such transaction as having been Incurred by the Successor
Company or such Subsidiary at the time of such transaction), no Default or
Event of Default would occur or be continuing; (c) the Successor Company waives
any right to redeem any Bearer Security under circumstances in which the
Successor Company would be entitled to redeem such Bearer Security but the
Company would not have been so entitled to redeem if the consolidation, merger,
conveyance, transfer or lease had not occurred; and (d) the Company shall have
delivered to the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that such consolidation, merger or transfer and such supplemental
Indenture (if any) comply with this Indenture.
Section 10.02 Rights and Duties of Successor Corporation. In case
of any consolidation or merger, or conveyance or transfer of the assets of the
Company as an entirety or virtually as an entirety in accordance with Section
10.01, the Successor Company shall succeed to and be substituted for the
Company, with the same effect as if it had been named herein as the party of
the first part, and the predecessor corporation shall be relieved of any
further obligation under the Indenture and the Securities. The Successor
Company thereupon may cause to be signed, and may issue either in its own name
or in the name of the Company, any or all the Debt Securities issuable
hereunder which theretofore shall not have been signed by the Company and
delivered to the Trustee; and, upon the order of the Successor Company, instead
of the Company, and subject to all the terms, conditions and limitations in
this Indenture prescribed, the Trustee shall authenticate and shall deliver any
Debt Securities and Coupons, if any, appertaining thereto, which previously
shall have been signed and delivered by the officers of the Company to the
Trustee for authentication, and any Debt Securities and Coupons, if any,
appertaining thereto, which the Successor Company thereafter shall cause to be
signed and delivered to the Trustee for that purpose. All the Debt Securities
and Coupons, if any, appertaining thereto so issued shall in all respects have
the same legal rank and benefit under this Indenture as the Debt Securities and
Coupons, if any, appertaining thereto theretofore or thereafter issued in
accordance with the terms of this Indenture as though all such Debt Securities
and Coupons had been issued at the date of the execution hereof.
66
<PAGE> 74
In case of any such consolidation, merger, sale or conveyance such
changes in phraseology and form (but not in substance) may be made in the Debt
Securities and Coupons, if any, appertaining thereto thereafter to be issued as
may be appropriate.
ARTICLE 11
SATISFACTION AND DISCHARGE;
INDENTURE; DEFEASANCE; UNCLAIMED MONEYS
Section 11.01 Applicability of Article. If, pursuant to Section
2.03, provision is made for the defeasance of Debt Securities of a series and
if the Debt Securities of such series are Registered Securities and denominated
and payable only in Dollars (except as provided pursuant to Section 2.03), then
the provisions of this Article 11 relating to defeasance of Debt Securities
shall be applicable except as otherwise specified pursuant to Section 2.03 for
Debt Securities of such series. Defeasance provisions, if any, for Debt
Securities denominated in a Foreign Currency or for Bearer Securities may be
specified pursuant to Section 2.03.
Section 11.02 Satisfaction and Discharge of Indenture; Defeasance.
(a) If at any time (i) the Company shall have delivered to the
Trustee for cancelation all Debt Securities of any series theretofore
authenticated and delivered (other than (A) Coupons appertaining to Bearer
Securities of such series called for redemption and maturing after the relevant
redemption date, surrender of which has been waived, (B) any Debt Securities
and Coupons of such series which shall have been destroyed, lost or stolen and
which shall have been replaced or paid as provided in Section 2.09 and (C) Debt
Securities and Coupons for whose payment money has theretofore been deposited
in trust and thereafter repaid to the Company as provided in Section 11.05) or
(ii) all Debt Securities and the Coupons, if any, of such series not
theretofore delivered to the Trustee for cancelation shall have become due and
payable, or are by their terms to become due and payable within one year or are
to be called for redemption within one year under arrangements satisfactory to
the Trustee for the giving of notice of redemption, and the Company shall
deposit with the Trustee as trust funds the entire amount in the Currency in
which such Debt Securities are denominated (except as otherwise provided
pursuant to Section 2.03) sufficient to pay at maturity or upon redemption all
Debt Securities of such series not theretofore delivered to the Trustee for
cancelation, including principal and premium, if any, and interest due or to
become due on such date of maturity or redemption date, as the case may be, and
if in either case the Company shall also pay or cause to be paid all other sums
payable hereunder by the Company, then this Indenture shall cease to be of
further effect (except as to any surviving rights of registration of transfer
or exchange of such Debt Securities herein expressly provided for and rights to
receive payments of principal of, and premium, if any, and interest on, such
Debt Securities and any right to receive additional interest as provided in
Section 4.06) with respect to the Debt Securities of such series, and the
Trustee, on demand of the Company accompanied by an Officers' Certificate and
an Opinion of Counsel and at the cost and
67
<PAGE> 75
expense of the Company, shall execute proper instruments acknowledging
satisfaction of and discharging this Indenture.
(b) Subject to Sections 11.02(c), 11.03 and 11.07, the Company at
any time may terminate, with respect to Debt Securities of a particular series,
(i) all its obligations under the Debt Securities of such series and this
Indenture with respect to the Debt Securities of such series ("legal defeasance
option") or (ii) its obligations with respect to the Debt Securities of such
series under clause (iii) of Section 10.01 and the related operation of Section
6.01(d) and the operation of Sections 6.01(e), (f), (i) and (j) ("covenant
defeasance option"). The Company may exercise its legal defeasance option
notwithstanding its prior exercise of its covenant defeasance option.
If the Company exercises its legal defeasance option, payment of the
Debt Securities of the defeased series may not be accelerated because of an
Event of Default. If the Company exercises its covenant defeasance option,
payment of the Debt Securities of the defeased series may not be accelerated
because of an Event of Default specified in Sections 6.01(d), (e), (f), (i) and
(j) (except to the extent covenants or agreements referenced in such Sections
remain applicable).
Upon satisfaction of the conditions set forth herein and upon request
of the Company, the Trustee shall acknowledge in writing the discharge of those
obligations that the Company terminates.
(c) Notwithstanding clauses (a) and (b) above, the Company's
obligations in Sections 2.07, 2.09, 4.02, 4.04, 5.01, 7.06, 7.10, 11.05, 11.06
and 11.07 shall survive until the Debt Securities of the defeased series have
been paid in full. Thereafter, the Company's obligations in Sections 7.06,
11.05 and 11.06 shall survive.
Section 11.03 Conditions of Defeasance. The Company may exercise
its legal defeasance option or its covenant defeasance option with respect to
Debt Securities of a particular series only if:
(a) the Company irrevocably deposits in trust with the
Trustee money or U.S. Government Obligations for the payment of
principal of, and premium, if any, and interest on, the Debt
Securities of such series to maturity or redemption, as the case may
be;
(b) the Company delivers to the Trustee a certificate
from a nationally recognized firm of independent accountants
expressing their opinion that the payments of principal and interest
when due and without reinvestment on the deposited U.S. Government
Obligations plus any deposited money without investment will provide
cash at such times and in such amounts as will be sufficient to pay
the principal, premium and interest when due on all the Debt
Securities of such series to maturity or redemption, as the case may
be;
(c) 123 days pass after the deposit is made and during
the 123-day period no Default specified in Section 6.01(g) or (h) with
respect to the Company occurs which is continuing at the end of the
period;
68
<PAGE> 76
(d) no Default has occurred and is continuing on the date
of such deposit and after giving effect thereto;
(e) the deposit does not constitute a default under any
other agreement binding on the Company and, if the Debt Securities of
such series are subordinated pursuant to Article 12, is not prohibited
by Article 12;
(f) the Company delivers to the Trustee an Opinion of
Counsel to the effect that the trust resulting from the deposit does
not constitute, or is qualified as, a regulated investment company
under the Investment Company Act of 1940;
(g) in the event of the legal defeasance option, the
Company shall have delivered to the Trustee an Opinion of Counsel
stating that (i) the Company has received from the Internal Revenue
Service a ruling, or (ii) since the date of this Indenture there has
been a change in the applicable Federal income tax law, in either case
of the effect that, and based thereon such Opinion of Counsel shall
confirm that, the Holders of Debt Securities of such series will not
recognize income, gain or loss for Federal income tax purposes as a
result of such defeasance and will be subject to Federal income tax on
the same amounts, in the same manner and at the same times as would
have been the case if such defeasance had not occurred;
(h) in the event of the covenant defeasance option, the
Company shall have delivered to the Trustee an Opinion of Counsel to
the effect that the Holders of Debt Securities of such series will not
recognize income, gain or loss for Federal income tax purposes as a
result of such covenant defeasance and will be subject to Federal
income tax on the same amounts, in the same manner and at the same
times as would have been the case if such covenant defeasance had not
occurred; and
(i) the Company delivers to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent to the defeasance and discharge of the Debt
Securities of such series as contemplated by this Article 11 have been
complied with.
Before or after a deposit, the Company may make arrangements
satisfactory to the Trustee for the redemption of Debt Securities of such
series at a future date in accordance with Article 3.
Section 11.04 Application of Trust Money. The Trustee shall hold
in trust money or U.S. Government Obligations deposited with it pursuant to
this Article 11. It shall apply the deposited money and the money from U.S.
Government Obligations through any paying agent and in accordance with this
Indenture to the payment of principal of, and premium, if any, and interest on,
the Debt Securities and Coupons, if any, of the defeased series. In the event
the Debt Securities and Coupons, if any, of the defeased series are
subordinated pursuant to Article 12, money and securities so held in trust are
not subject to Article 12.
69
<PAGE> 77
Section 11.05 Repayment to Company. The Trustee and any paying
agent shall promptly turn over to the Company upon request any excess money or
securities held by them at any time.
Subject to any applicable abandoned property law, the Trustee and any
paying agent shall pay to the Company upon request any money held by them for
the payment of principal, premium or interest that remains unclaimed for two
years, and, thereafter, Holders entitled to such money must look to the Company
for payment as general creditors.
Section 11.06 Indemnity for U.S. Government Obligations. The
Company shall pay and shall indemnify the Trustee and the Holders against any
tax, fee or other change imposed on or assessed against deposited U.S.
Government Obligations or the principal and interest received on such U.S.
Government Obligations.
Section 11.07 Reinstatement. If the Trustee or any paying agent is
unable to apply any money or U.S. Government Obligations in accordance with
this Article 11 by reason of any legal proceeding or by reason of any order or
judgment of any court or government authority enjoining, restraining or
otherwise prohibiting such application, the Company's obligations under this
Indenture and the Debt Securities of the defeased series shall be revived and
reinstated as though no deposit had occurred pursuant to this Article 11 until
such time as the Trustee or any paying agent is permitted to apply all such
money or U.S. Government Obligations in accordance with this Article 11.
ARTICLE 12
SUBORDINATION OF DEBT SECURITIES
Section 12.01 Applicability of Article; Agreement To Subordinate.
The provisions of this Article 12 shall be applicable to the Debt Securities of
any series (Debt Securities of such series referred to in this Article 12 as
"Subordinated Debt Securities") designated, pursuant to Section 2.03, as
subordinated to Senior Indebtedness. Each Holder by accepting a Subordinated
Debt Security agrees that the Indebtedness evidenced by such Subordinated Debt
Security is subordinated in right of payment, to the extent and in the manner
provided in this Article 12, to the prior payment of all Senior Indebtedness
and that the subordination is for the benefit of and enforceable by the holders
of Senior Indebtedness. All provisions of this Article 12 shall be subject to
Section 12.12.
Section 12.02 Liquidation, Dissolution, Bankruptcy. Upon any
payment or distribution of the assets of the Company to creditors upon a total
or partial liquidation or a total or partial dissolution of the Company or in a
bankruptcy, reorganization, insolvency, receivership or similar proceeding
relating to the Company or its property:
(a) holders of Senior Indebtedness shall be entitled to
receive payment in full in cash of the Senior Indebtedness (including
interest (if any), accruing on or after the
70
<PAGE> 78
commencement of a proceeding in bankruptcy, whether or not allowed as
a claim against the Company in such bankruptcy proceeding) before
Holders of Subordinated Debt Securities shall be entitled to receive
any payment of principal of, or premium, if any, or interest on, the
Subordinated Debt Securities; and
(b) until the Senior Indebtedness is paid in full, any
distribution to which Holders of Subordinated Debt Securities would be
entitled but for this Article 12 shall be made to holders of Senior
Indebtedness as their interests may appear, except that such Holders
may receive shares of stock and any debt securities that are
subordinated to Senior Indebtedness to at least the same extent as the
Subordinated Debt Securities.
Section 12.03 Default on Senior Indebtedness. The Company may not
pay the principal of, or premium, if any, or interest on, the Subordinated Debt
Securities or make any deposit pursuant to Article 11 and may not repurchase,
redeem or otherwise retire (except, in the case of Subordinated Debt Securities
that provide for a mandatory sinking fund pursuant to Section 3.05, by the
delivery of Subordinated Debt Securities by the Company to the Trustee pursuant
to the first paragraph of Section 3.06) any Subordinated Debt Securities
(collectively, "pay the Subordinated Debt Securities") if (a) any principal,
premium or interest in respect of Senior Indebtedness is not paid within any
applicable grace period (including at maturity) or (b) any other default on
Senior Indebtedness occurs and the maturity of such Senior Indebtedness is
accelerated in accordance with its terms unless, in either case, (i) the
default has been cured or waived and any such acceleration has been rescinded
or (ii) such Senior Indebtedness has been paid in full in cash; provided,
however, that the Company may pay the Subordinated Debt Securities without
regard to the foregoing if the Company and the Trustee receive written notice
approving such payment from the Representative of each issue of Designated
Senior Indebtedness. During the continuance of any default (other than a
default described in clause (a) or (b) of the preceding sentence) with respect
to any Senior Indebtedness pursuant to which the maturity thereof may be
accelerated immediately without further notice (except such notice as may be
required to effect such acceleration) or the expiration of any applicable grace
periods, the Company may not pay the Subordinated Debt Securities for a period
(a "Payment Blockage Period") commencing upon the receipt by the Company and
the Trustee of written notice of such default from the Representative of any
Designated Senior Indebtedness specifying an election to effect a Payment
Blockage Period (a "Blockage Notice") and ending 179 days thereafter (or
earlier if such Payment Blockage Period is terminated (i) by written notice to
the Trustee and the Company from the Person or Persons who gave such Blockage
Notice, (ii) by repayment in full in cash of such Designated Senior
Indebtedness or (iii) because the default giving rise to such Blockage Notice
is no longer continuing). Notwithstanding the provisions described in the
immediately preceding sentence (but subject to the provisions contained in the
first sentence of this Section 12.03), unless the holders of such Designated
Senior Indebtedness or the Representative of such holders shall have
accelerated the maturity of such Designated Senior Indebtedness, the Company
may resume payments on the Subordinated Debt Securities after such Payment
Blockage Period. Not more than one Blockage Notice may be given in any
consecutive 360-day period, irrespective of the number of defaults with respect
to any number of issues of Senior Indebtedness during such period; provided,
however, that if any Blockage Notice within such 360-day period is
71
<PAGE> 79
given by or on behalf of any holders of Designated Senior Indebtedness (other
than the Bank Indebtedness), the Representative of the Bank Indebtedness may
give another Blockage Notice within such period; provided, further, however,
that in no event may the total number of days during which any Payment Blockage
Period or Periods is in effect exceed 179 days in the aggregate during any 360
consecutive day period. For purposes of this Section 12.03, no default or
event of default which existed or was continuing on the date of the
commencement of any Payment Blockage Period with respect to the Senior
Indebtedness initiating such Payment Blockage Period shall be, or be made, the
basis of the commencement of a subsequent Payment Blockage Period by the
Representative of such Senior Indebtedness, whether or not within a period of
360 consecutive days, unless such default or event of default shall have been
cured or waived for a period of not less than 90 consecutive days.
Section 12.04 Acceleration of Payment of Debt Securities. If
payment of the Subordinated Debt Securities is accelerated because of an Event
of Default, the Company or the Trustee shall promptly notify the holders of the
Designated Senior Indebtedness (or their Representatives) of the acceleration.
Section 12.05 When Distribution Must Be Paid Over. If a
distribution is made to Holders of Subordinated Debt Securities that because of
this Article 12 should not have been made to them, the Holders who receive such
distribution shall hold it in trust for holders of Senior Indebtedness and pay
it over to them as their interests may appear.
Section 12.06 Subrogation. After all Senior Indebtedness is paid
in full and until the Subordinated Debt Securities are paid in full, Holders of
Subordinated Debt Securities shall be subrogated to the rights of holders of
Senior Indebtedness to receive distributions applicable to Senior Indebtedness.
A distribution made under this Article 12 to holders of Senior Indebtedness
which otherwise would have been made to Holders of Subordinated Debt Securities
is not, as between the Company and such Holders, a payment by the Company on
Senior Indebtedness.
Section 12.07 Relative Rights. This Article 12 defines the
relative rights of Holders of Subordinated Debt Securities and holders of
Senior Indebtedness. Nothing in this Indenture shall:
(a) impair, as between the Company and Holders of either
Subordinated Debt Securities or Debt Securities, the obligation of the
Company, which is absolute and unconditional, to pay principal of, and
premium, if any, and interest on, the Subordinated Debt Securities and
the Debt Securities in accordance with their terms; or
(b) prevent the Trustee or any Holder of either
Subordinated Debt Securities or Debt Securities from exercising its
available remedies upon a Default, subject to the rights of holders of
Senior Indebtedness to receive distributions otherwise payable to
Holders of Subordinated Debt Securities.
72
<PAGE> 80
Section 12.08 Subordination May Not Be Impaired by Company. No
right of any holder of Senior Indebtedness to enforce the subordination of the
Indebtedness evidenced by the Subordinated Debt Securities shall be impaired by
any act or failure to act by the Company or by its failure to comply with this
Indenture.
Section 12.09 Rights of Trustee and Paying Agent. Notwithstanding
Section 12.03, the Trustee or any paying agent may continue to make payments on
Subordinated Debt Securities and shall not be charged with knowledge of the
existence of facts that would prohibit the making of any such payments unless,
not less than two business days prior to the date of such payment, a
responsible officer of the Trustee receives notice satisfactory to it that
payments may not be made under this Article 12. The Company, the Registrar,
any paying agent, a Representative or a holder of Senior Indebtedness may give
the notice; provided, however, that, if an issue of Senior Indebtedness has a
Representative, only the Representative may give the notice.
The Trustee in its individual or any other capacity may hold Senior
Indebtedness with the same rights it would have if it were not Trustee. The
Registrar and any paying agent may do the same with like rights. The Trustee
shall be entitled to all the rights set forth in this Article 12 with respect
to any Senior Indebtedness which may at any time be held by it, to the same
extent as any other holder of Senior Indebtedness; and nothing in Article 7
shall deprive the Trustee of any of its rights as such holder. Nothing in this
Article 12 shall apply to claims of, or payments to, the Trustee under or
pursuant to Section 7.06.
Section 12.10 Distribution or Notice to Representative. Whenever a
distribution is to be made or a notice given to holders of Senior Indebtedness,
the distribution may be made and the notice given to their Representative (if
any).
Section 12.11 Article 12 Not to Prevent Defaults or Limit Right to
Accelerate. The failure to make a payment pursuant to the Debt Securities by
reason of any provision in this Article 12 shall not be construed as preventing
the occurrence of a Default. Nothing in this Article 12 shall have any effect
on the right of the Holders or the Trustee to accelerate the maturity of either
the Subordinated Debt Securities or the Debt Securities, as the case may be.
Section 12.12 Trust Moneys Not Subordinated. Notwithstanding
anything contained herein to the contrary, payments from money or the proceeds
of U.S. Government Obligations held in trust under Article 11 by the Trustee
for the payment of principal of, and premium, if any, and interest on, the
Subordinated Debt Securities or the Debt Securities shall not be subordinated
to the prior payment of any Senior Indebtedness or subject to the restrictions
set forth in this Article 12, and none of the Holders thereof shall be
obligated to pay over any such amount to the Company or any holder of Senior
Indebtedness of the Company or any other creditor of the Company.
Section 12.13 Trustee Entitled to Rely. Upon any payment or
distribution pursuant to this Article 12, the Trustee and the Holders shall be
entitled to rely (a) upon any order or decree of a court of competent
jurisdiction in which any proceedings of the nature referred to in Section
12.02
73
<PAGE> 81
are pending, (b) upon a certificate of the liquidating trustee or agent or
other Person making such payment or distribution to the Trustee or to such
Holders or (c) upon the Representatives for the holders of Senior Indebtedness
for the purpose of ascertaining the Persons entitled to participate in such
payment or distribution, the holders of the Senior Indebtedness and other
Indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto or
to this Article 12. In the event that the Trustee determines, in good faith,
that evidence is required with respect to the right of any Person as a holder
of Senior Indebtedness to participate in any payment or distribution pursuant
to this Article 12, the Trustee may request such Person to furnish evidence to
the reasonable satisfaction of the Trustee as to the amount of Senior
Indebtedness held by such Person, the extent to which such Person is entitled
to participate in such payment or distribution and other facts pertinent to the
rights of such Person under this Article 12, and, if such evidence is not
furnished, the Trustee may defer any payment to such Person pending judicial
determination as to the right of such Person to receive such payment. The
provisions of Sections 7.01 and 7.02 shall be applicable to all actions or
omissions of actions by the Trustee pursuant to this Article 12.
Section 12.14 Trustee to Effectuate Subordination. Each Holder by
accepting a Subordinated Debt Security authorizes and directs the Trustee on
his behalf to take such action as may be necessary or appropriate to
acknowledge or effectuate the subordination between the Holders of Subordinated
Debt Securities and the holders of Senior Indebtedness as provided in this
Article 12 and appoints the Trustee as attorney-in-fact for any and all such
purposes.
Section 12.15 Trustee Not Fiduciary for Holders of Senior
Indebtedness. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness and shall not be liable to any such holders if
it shall mistakenly pay over or distribute to Holders of Subordinated Debt
Securities or the Company or any other Person, money or assets to which any
holders of Senior Indebtedness shall be entitled by virtue of this Article 12
or otherwise.
Section 12.16 Reliance by Holders of Senior Indebtedness on
Subordination Provisions. Each Holder by accepting a Subordinated Debt
Security acknowledges and agrees that the foregoing subordination provisions
are, and are intended to be, an inducement and a consideration to each holder
of any Senior Indebtedness, whether such Senior Indebtedness was created or
acquired before or after the issuance of the Subordinated Debt Securities, to
acquire and continue to hold, or to continue to hold, such Senior Indebtedness
and such holder of Senior Indebtedness shall be deemed conclusively to have
relied on such subordination provisions in acquiring and continuing to hold, or
in continuing to hold, such Senior Indebtedness.
74
<PAGE> 82
ARTICLE 13
MISCELLANEOUS PROVISIONS
Section 13.01 Successors and Assigns of Company Bound by Indenture.
All the covenants, stipulations, promises and agreements in this Indenture
contained by or in behalf of the Company or the Trustee shall bind its
successors and assigns, whether so expressed or not.
Section 13.02 Acts of Board, Committee or Officer of Successor
Company Valid. Any act or proceeding by any provision of this Indenture
authorized or required to be done or performed by any board, committee or
officer of the Company shall and may be done and performed with like force and
effect by the like board, committee or officer of any Successor Company.
Section 13.03 Required Notices or Demands. Except as otherwise
expressly provided in this Indenture, any notice or demand which by any
provision of this Indenture is required or permitted to be given or served by
the Trustee or by the Holders to or on the Company may be given or served by
being deposited postage prepaid in a post office letter box in the United
States addressed (until another address is filed by the Company with the
Trustee) as follows: Quaker State Corporation, 225 East John Carpenter
Freeway, Irving, Texas 75062, Attention: Chief Financial Officer. Except as
otherwise expressly provided in this Indenture, any notice, direction, request
or demand by the Company or by any Holder to or upon the Trustee may be given
or made, for all purposes, by being deposited postage prepaid in a post office
letter box in the United States addressed to the corporate trust office of the
Trustee initially at . The Company or the Trustee
by notice to the other may designate additional or different addresses for
subsequent notices or communications.
Any notice required or permitted to a Registered Holder by the
Company or the Trustee pursuant to the provisions of this Indenture shall be
deemed to be properly mailed by being deposited postage prepaid in a post
office letter box in the United States addressed to such Holder at the address
of such Holder as shown on the Debt Security Register. Any report pursuant to
Section 313 of the Trust Indenture Act shall be transmitted in compliance with
subsection (c) therein.
Any notice required or permitted to a Bearer Holder by the Company or
the Trustee pursuant to this Indenture shall be deemed to be properly given if
published on two separate business days in an Authorized Newspaper or
Newspapers in such Place or Places of Payment specified pursuant to Section
2.03, the first such publication to be not earlier than the earliest date and
not later than two business days prior to the latest date prescribed for the
giving of such notice. Notwithstanding the foregoing, any notice to Holders of
Floating Rate Debt Securities regarding the determination of a periodic rate of
interest, if such notice is required pursuant to Section 2.03, shall be
sufficiently given if given in the manner specified pursuant to Section 2.03.
In the event of suspension of regular mail service or by reason of any
other cause it shall be impracticable to give notice by mail, then such
notification as shall be given with the approval of the Trustee shall
constitute sufficient notice for every purpose hereunder.
75
<PAGE> 83
In the event of suspension of publication of any Authorized Newspaper
or by reason of any other cause it shall be impracticable to give notice by
publication, then such notification as shall be given with the approval of the
Trustee shall constitute sufficient notice for every purpose hereunder.
Failure to mail a notice or communication to a Holder or any defect in
it or any defect in any notice by publication as to a Holder shall not affect
the sufficiency of such notice with respect to other Holders. If a notice or
communication is mailed or published in the manner provided above, it is
conclusively presumed duly given.
Section 13.04 Indenture and Debt Securities to Be Construed in
Accordance with the Laws of the State of New York. This Indenture, each Debt
Security and each Coupon shall be deemed to be New York contracts, and for all
purposes shall be construed in accordance with the laws of said State (without
reference to principles of conflicts of law).
Section 13.05 Officers' Certificate and Opinion of Counsel to Be
Furnished upon Application or Demand by the Company. Upon any application or
demand by the Company to the Trustee to take any action under any of the
provisions of this Indenture, the Company shall furnish to the Trustee an
Officers' Certificate stating that all conditions precedent provided for in
this Indenture relating to the proposed action have been complied with and an
Opinion of Counsel stating that, in the opinion of such counsel, all such
conditions precedent have been complied with, except that in the case of any
such application or demand as to which the furnishing of such document is
specifically required by any provision of this Indenture relating to such
particular application or demand, no additional certificate or opinion need be
furnished.
Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or
covenant provided for in this Indenture shall include (a) a statement that the
Person making such certificate or opinion has read such covenant or condition,
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based, (c) a statement that, in the opinion of such
Person, he has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant or
condition has been complied with and (d) a statement as to whether or not, in
the opinion of such Person, such condition or covenant has been complied with.
Section 13.06 Payments Due on Legal Holidays. In any case where
the date of maturity of interest on or principal of and premium, if any, on the
Debt Securities of a series or the date fixed for redemption or repayment of
any Debt Security or the making of any sinking fund payment shall not be a
business day at any Place of Payment for the Debt Securities of such series,
then payment of interest or principal and premium, if any, or the making of
such sinking fund payment need not be made on such date at such Place of
Payment, but may be made on the next succeeding business day at such Place of
Payment with the same force and effect as if made on the date of maturity or
the date fixed for redemption, and no interest shall accrue for the period
after such date. If a record date is not a business day, the record date shall
not be affected.
76
<PAGE> 84
Section 13.07 Provisions Required by Trust Indenture Act to
Control. If and to the extent that any provision of this Indenture limits,
qualifies or conflicts with another provision included in this Indenture which
is required to be included in this Indenture by any of Sections 310 to 318,
inclusive, of the Trust Indenture Act, such required provision shall control.
Section 13.08 Computation of Interest on Debt Securities.
Interest, if any, on the Debt Securities shall be computed on the basis of a
360-day year of twelve 30-day months, except as may otherwise be provided
pursuant to Section 2.03.
Section 13.09 Rules by Trustee, Paying Agent and Registrar. The
Trustee may make reasonable rules for action by or a meeting of Holders. The
Registrar and any paying agent may make reasonable rules for their functions.
Section 13.10 No Recourse Against Others. An incorporator or any
past, present or future director, officer, employee or stockholder, as such, of
the Company shall not have any liability for any obligations of the Company
under the Debt Securities, the Coupons or this Indenture or for any claim based
on, in respect of or by reason of such obligations or their creation. By
accepting a Debt Security or Coupon, each Holder shall waive and release all
such liability. The waiver and release shall be part of the consideration for
the issue of the Debt Securities and Coupons.
Section 13.11 Severability. In case any provision in this
Indenture, the Debt Securities or the Coupons shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
Section 13.12 Effect of Headings. The article and section headings
herein and in the Table of Contents are for convenience only and shall not
affect the construction hereof.
Section 13.13 Indenture May Be Executed in Counterparts. This
Indenture may be executed in any number of counterparts, each of which shall be
an original; but such counterparts shall together constitute but one and the
same instrument.
The Trustee hereby accepts the trusts in this Indenture upon the terms
and conditions herein set forth.
77
<PAGE> 85
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly signed as of the date first written above.
QUAKER STATE CORPORATION
By:
-----------------------------------
Name:
Title:
--------------------------------------
By:
-----------------------------------
Name:
Title:
78
<PAGE> 1
EXHIBIT 5.1
[Letterhead of Vinson & Elkins L.L.P.]
April 9, 1998
Quaker State Corporation
225 East John Carpenter Freeway
Irving, Texas 75062
Re: Quaker State Corporation
Registration Statement on Form S-3 (No. 333-33133)
Debt Securities
Capital Stock, par value $1.00 per share
Warrants
Ladies and Gentlemen:
We have acted as counsel for Quaker State Corporation, a Delaware
corporation (the "Company"), in connection with the registration under the
Securities Act of 1933 (the "Securities Act") on a Registration Statement on
Form S-3 (No. 333-33133) (the "Registration Statement") of the offer and sale
from time to time pursuant to Rule 415 under the Securities Act of the
following securities for an aggregate initial offering price not to exceed
$400,000,000: (i) debt securities of the Company (the "Debt Securities"); (ii)
shares of capital stock, par value $1.00 per share, of the Company (the
"Capital Stock"); and (iii) warrants to purchase Debt Securities or Capital
Stock (the "Warrants" and, together with the Debt Securities and Capital
Stock, the "Offered Securities").
For purposes of rendering the opinions contained in this letter, we
have reviewed those agreements, records, documents, and matters of law as we
have deemed relevant in order to render the opinions set forth herein, including
but not limited to (a) the Composite Certificate of Incorporation and the Bylaws
of the Company, (b) resolutions adopted by the Board of Directors of the
Company, and (c) the form of Indenture filed as Exhibit 4.3 to the Registration
Statement to be executed by the Company and the trustee (the "Indenture"),
pursuant to which Debt Securities may be issued.
As to certain questions of fact material to our opinions, we have
relied upon certificates from officers of the Company and other persons, as
appropriate, and upon certificates of public officials.
<PAGE> 2
Quaker State Corporation
April 9, 1998
Page 2
Based upon and subject to the foregoing and subject further to the
assumptions, exceptions and qualifications hereinafter stated, we express the
following opinions:
1. With respect to shares of Capital Stock, when both (A) the
Board of Directors of the Company or, to the extent permitted by Section 141(c)
of the General Corporation Law of the State of Delaware, a duly constituted and
acting committee thereof (such Board of Directors or committee being
hereinafter referred to as the "Board") has taken all necessary corporate
action to approve the issuance of and the terms of the offering of the shares
of Capital Stock and related matters and (B) certificates representing the
shares of Capital Stock have been duly executed, countersigned, registered and
delivered either (i) in accordance with the applicable definitive purchase,
underwriting or similar agreement approved by the Board upon payment of the
consideration therefor (not less than the par value of the Capital Stock)
provided for therein or (ii) upon conversion or exercise of any other Offered
Security, in accordance with the terms of such Offered Security or the
instrument governing such Offered Security providing for such conversion or
exercise as approved by the Board, for the consideration approved by the Board
(not less than the par value of the Capital Stock), then the shares of Capital
Stock will be legally issued, fully paid and nonassessable.
2. With respect to Debt Securities to be issued under the
Indenture, when (A) the Indenture has been duly authorized and validly executed
and delivered to the trustee by the Company, (B) the Indenture has been duly
qualified under the Trust Indenture Act of 1939, (C) the Board has taken all
necessary corporate action to approve the issuance and terms of such Debt
Securities, the terms of the offering thereof and related matters, and (D) such
Debt Securities have been duly executed, authenticated, issued and delivered in
accordance with the provisions of the Indenture and the applicable definitive
purchase, underwriting or similar agreement approved by the Board upon payment
of the consideration therefor provided for therein, such Debt Securities will be
legally issued and will constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms, except as such
enforcement is subject to any applicable bankruptcy, insolvency, reorganization
or other law relating to or affecting creditors' rights generally and general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
3. With respect to the Warrants, when (A) the Board has taken
all necessary corporate action to approve the creation of and the issuance and
terms of the Warrants, the terms of the offering thereof, and related matters,
(B) the warrant agreement or agreements relating to the Warrants have been duly
authorized and validly executed and delivered by the Company and the warrant
agent appointed by the Company, and (C) the Warrants or certificates
representing the Warrants have been duly executed, countersigned, registered
and delivered in accordance with the appropriate warrant agreement or
agreements and the applicable definitive purchase, underwriting or similar
agreement approved by the Board upon payment of the consideration therefor
provided for therein, the Warrants will be legally issued.
<PAGE> 3
Quaker State Corporation
April 9, 1998
Page 3
The opinions expressed above are subject in all respects to the
following assumptions, exceptions and qualifications:
a. We have assumed (i) all information contained in all
documents reviewed by us is true and correct, (ii) all signatures on all
documents reviewed by us are genuine, (iii) all documents submitted to us as
originals are authentic and complete, (iv) all documents submitted to us as
certified or photostatic copies conform to authentic originals thereof, (v) each
natural person signing any document reviewed by us had the legal capacity to do
so, (vi) each person signing in a representative capacity any document reviewed
by us had authority to sign in such capacity, and (vii) the laws of any
jurisdiction other than Texas that govern any of the documents reviewed by us or
referenced in this opinion letter (other than the Company's Composite
Certificate of Incorporation and Bylaws) do not modify the terms that appear in
any such document.
b. We have assumed that (i) the Registration Statement and any
amendments thereto (including post-effective amendments) will have become
effective and comply with all applicable laws; (ii) the Registration Statement
will be effective and will comply with all applicable laws at the time the
Offered Securities are offered or issued as contemplated by the Registration
Statement (if such offering or issuance requires the delivery of a prospectus
under the Securities Act or pursuant to any other law); (iii) a Prospectus
Supplement will have been prepared and filed with the Securities and Exchange
Commission describing the Offered Securities offered thereby and will comply
with all applicable laws; (iv) all Offered Securities will be issued and sold
in compliance with applicable federal and state securities laws and in the
manner stated in the Registration Statement and the appropriate Prospectus
Supplement; (v) a definitive purchase, underwriting or similar agreement with
respect to any Offered Securities offered or issued will have been duly
authorized and validly executed and delivered by the Company and the other
parties thereto; and (vi) any Offered Securities issuable upon conversion,
exchange or exercise of any Offered Security being offered or issued will be
duly authorized, created and, if appropriate, reserved for issuance upon such
conversion, exchange or exercise.
c. In rendering the opinion in paragraph 2, we have assumed that
the trustee is or, at the time the Indenture is signed, will be qualified to
act as trustee under the Indenture and that the trustee has or will have duly
executed and delivered the Indenture.
d. We express no opinion with respect to (i) the enforceability
of provisions in the Indenture or any other agreement or instrument with
respect to delay or omission of enforcement of rights or remedies, or waivers
of defenses, or waivers of benefits of stay, extension, moratorium, redemption,
statutes of limitation, or other nonwaivable benefits bestowed by operation of
law; or (ii) the enforceability of indemnification or contribution provisions
to the extent they purport to
<PAGE> 4
Quaker State Corporation
April 9,1998
Page 4
relate to liabilities resulting from or based upon negligence or any violation
of federal or state securities or blue sky laws.
e. We express no opinion as to the requirements of or compliance
with federal or state securities laws or regulations.
f. We note that the Indenture by its terms purports to be
governed by the laws of the State of New York and that the terms of the
Warrants, when determined, may be governed by the laws of a jurisdiction other
than the State of Texas or other than the General Corporation Law of the State
of Delaware. While we express no opinion with respect to the laws of the State
of New York or such other jurisdictions in rendering these opinions, we have
assumed that the internal laws of the State of New York and such other
jurisdictions are the same as the internal laws of the State of Texas. We have
not conducted any analysis to determine whether that assumption is correct.
g. The opinions expressed in this letter are limited to the laws
of the State of Texas, the General Corporation Law of the State of Delaware,
and the federal laws of the United States of America. You should be aware that
we are not admitted to the practice of law in the State of Delaware.
We consent to the filing of this opinion of counsel as Exhibit 5.1 to
the Registration Statement. We also consent to the reference to this firm
under the heading "Legal Opinions" in the Prospectus forming a part of the
Registration Statement. In giving this consent, we do not admit that this firm
is in the category of persons whose consent is required under Section 7 of the
Securities Act or the rules and regulations of the Securities and Exchange
Commission promulgated thereunder.
We disclaim any duty to advise you regarding any changes in, or
otherwise communicate with you with respect to, the matters addressed herein.
Very truly yours,
/s/ Vinson & Elkins L.L.P.
<PAGE> 1
EXHIBIT 12.1
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
QUAKER STATE CORPORATION AND SUBSIDIARIES
(IN THOUSANDS)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------------------------------
1997 1996 1995 1994 1993
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Interest expense............................. 26,913 12,609 7,178 5,059 5,588
Interest factor of rental expense(1)......... 11,586 9,120 8,311 6,973 6,908
------- ------- ------- ------- -------
Total fixed charges.......................... $38,499 $21,729 $15,489 $12,032 $12,496
======= ======= ======= ======= =======
Income from continuing operations
before income taxes........................ $(11,389) $17,551 $(5,723) $ 3,912 $ 3,794
Fixed charges................................ 38,499 21,729 15,489 12,032 12,496
------- ------- ------- ------- -------
Total earnings............................... $27,110 $39,280 $ 9,766 $15,944 $16,290
======= ======= ======= ======= =======
Ratio of earnings to fixed charges........... .7 1.8 .6 1.3 1.3
======= ======= ======= ======= =======
</TABLE>
- ---------------
(1) Interest factor of rental expense computed based on; (a) average interest
factor from a sample of leases for operations representing in excess of 50%
of rentals from continuing operations, and (b) one-third factor of rentals
for other operations.
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Amendment No. 1 to the
registration statement of Quaker State Corporation on Form S-3 (No. 333-33133)
of our report dated January 27, 1998, on our audits of the consolidated
financial statements and financial statement schedule of Quaker State
Corporation and Subsidiaries as of December 31, 1997 and for each of the three
years in the period ended December 31, 1997, which report is included in the
Quaker State Corporation Annual Report on Form 10-K for the year ended December
31, 1997. We also consent to the reference to our firm under the caption
"Experts."
/s/ COOPERS & LYBRAND L.L.P.
------------------------------------
Coopers & Lybrand L.L.P.
Dallas, Texas
April 9, 1998
