<PAGE>
As filed with the Securities and Exchange Commission on February 9, 1995
Registration No. 33-57347
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
_________________
THE ROUSE COMPANY
(Exact name of registrant as specified in its charter)
Maryland 52-0735512
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
The Rouse Company
10275 Little Patuxent Parkway
Columbia, Maryland 21044-3456
(410) 992-6000
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
_________________
Richard G. McCauley
Senior Vice President,
General Counsel and Secretary
The Rouse Company
10275 Little Patuxent Parkway
Columbia, Maryland 21044-3456
(410) 992-6000
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Copies to:
Timothy E. Peterson, Esq. Joseph C. Shenker, Esq.
Fried, Frank, Harris, Shriver & Jacobson Sullivan & Cromwell
One New York Plaza 250 Park Avenue
New York, New York 10004 New York, New York 10177
(212) 859-8000 (212) 558-4000
_________________________________________________________
Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this form are being offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, please check the following box. [X]
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 this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
================================================================================
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+ Information contained herein is subject to completion or amendment. A +
+ registration statement relating to these securities has been filed with +
+ the Securities and Exchange Commission. These securities may not be sold +
+ nor may offers to buy be accepted prior to the time the registration +
+ statement becomes effective. This prospectus shall not constitute an +
+ offer to sell or the solicitation of an offer to buy nor shall there be +
+ any sale of these securities in any State in which such offer, +
+ solicitation or sale would be unlawful prior to registration or +
+ qualification under the securities laws of any such State. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED FEBRUARY 9, 1995
THE ROUSE COMPANY
Debt Securities
______________
The Company may from time to time offer Debt Securities consisting of
debentures, notes and/or other unsecured evidences of indebtedness in one
or more series at an aggregate initial offering price not to exceed
$150,000,000. The Debt Securities may be offered as separate series in
amounts, at prices and on terms to be determined at the time of sale. The
accompanying Prospectus Supplement sets forth with regard to the Debt
Securities in respect of which this Prospectus is being delivered the
title, aggregate principal amount, denominations (which may be in United
States dollars, in any other currency or in composite currencies),
maturity, rate, if any (which may be fixed or variable), and time of
payment of any interest, any terms for redemption at the option of the
Company or the holder, any terms for sinking fund payments, any listing on
a securities exchange and the initial public offering price and any other
terms in connection with the offering and sale of such Debt Securities.
The Company may sell Debt Securities to or through underwriters, and also
may sell Debt Securities directly to other purchasers or through agents.
The accompanying Prospectus Supplement sets forth the names of any
underwriters or agents involved in the sale of the Debt Securities in
respect of which this Prospectus is being delivered, the principal amounts,
if any, to be purchased by underwriters and the compensation, if any, of
such underwriters or agents.
_____________________
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 ATTORNEY GENERAL OF THE STATE OF NEW YORK
HAS NOT PASSED ON OR ENDORSED THE MERITS OF THIS OFFERING.
ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
____________________
The date of this Prospectus is February 9, 1995.
<PAGE>
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS THAT STABILIZE OR MAINTAIN THE MARKET PRICE OF THE DEBT
SECURITIES OFFERED HEREBY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE
PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.
AVAILABLE INFORMATION
The Rouse Company (the "Company") is subject to the informational
requirements of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and, in accordance therewith, files reports and other
information with the Securities and Exchange Commission (the "Commission").
Such reports, proxy and information statements and other information filed
with the Commission can be inspected and copied at the Public Reference
Room of the Commission, Room 1024, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549; and its regional offices located at Suite 1400,
Northwestern Atrium Center, 500 West Madison Street, Chicago, Illinois
60661; and 7 World Trade Center, New York, New York 10048. Copies of such
material can be obtained from the Public Reference Room of the Commission,
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, at
prescribed rates.
The Company has filed with the Commission a registration statement on
Form S-3 (herein, together with all amendments and exhibits, referred to as
the "Registration Statement") under the Securities Act of 1933, as amended
(the "Act"). This Prospectus does 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, reference is hereby made to the Registration Statement.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company hereby incorporates by reference into this Prospectus
the following documents filed with the Commission: its Annual Report on
Form 10-K for the fiscal year ended December 31, 1993, its Quarterly
Reports on Form 10-Q for the quarters ended March 31, 1994, June 30, 1994
and September 30, 1994 and its Report by Issuer of Securities Quoted on
NASDAQ Interdealer Quotation System on Form 10-C, filed January 10, 1995.
All other documents 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 Debt
Securities shall be deemed incorporated by reference in this Prospectus and
to be a part hereof from the date of the filing of such documents. See
"Available Information." Any statement contained in a document
incorporated or deemed to be incorporated herein by reference shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
-2-
<PAGE>
The Company will provide without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered upon request of any
such person, a copy of any or all of the foregoing documents incorporated
herein by reference (other than exhibits to such documents not specifically
incorporated by reference). Written or telephone requests should be
directed to David L. Tripp, Vice President and Director of Investor
Relations, The Rouse Company, 10275 Little Patuxent Parkway, Columbia,
Maryland 21044-3456, Telephone: (410) 992-6000.
-3-
<PAGE>
THE COMPANY
The Company and Its Business
The Rouse Company (the "Company" or "Rouse") is one of the largest
publicly-traded real estate companies in the United States. The Company
develops, acquires, owns and manages income-producing properties across the
United States. The Company also develops and sells land, almost
exclusively related to activities in Columbia, Maryland.
Operating Properties
The Company manages a portfolio of operating properties totalling more
than 58 million square feet in almost 200 buildings, classified into two
business categories: (i) retail centers and (ii) office, mixed-use and
other properties.
Retail Centers. At November 30, 1994, the Company managed 77 retail
centers totalling 46,286,000 square feet of space and including 149
department stores and 20,995,000 square feet of small store gross leasable
area (GLA). Included in the 77 retail centers are eight Columbia village
centers (848,000 sq. ft.) and five centers (636,000 sq. ft. of small shops)
that are parts of large, mixed-use projects. The remaining 64 centers
include 55 regional malls (17,864,000 sq. ft. of mall space) that primarily
are in the suburbs of major metropolitan areas and have three or more
department stores attached, and also include nine specialty retail centers
(1,647,000 sq. ft.) that are in the downtowns of major cities and do not
have department stores attached. Major retail properties owned and managed
by the Company include Willowbrook, Woodbridge Center and Paramus Park in
New Jersey and Faneuil Hall Marketplace, South Street Seaport and
Harborplace in the downtowns of Boston, New York and Baltimore.
The majority of the Company's revenues, Earnings Before Depreciation and
Deferred Taxes (EBDT), and Current Value Shareholders' Equity is derived
from its retail centers, particularly those where the Company has a
significant ownership interest in the centers. The 64 retail centers
(excluding eight Columbia village centers and five mixed-use projects)
include 43 centers where the Company has ownership interests ranging from
37% to 100%. In the remaining 21 centers, the Company's ownership interest
is generally 10% or less, and the Company normally receives fees for
management, leasing and development activities and an incentive
participation in the growth of the centers' cash flows and values.
Office, Mixed-Use and Other Properties. At November 30, 1994, the
Company managed more than 100 office/industrial buildings totalling
approximately 11,990,000 square feet of gross leasable area. Of this
total, 1,842,000 square feet is located in seven buildings which are part
of major mixed-use projects in Phoenix, Baltimore, Seattle and Portland;
3,056,000 square feet is located in Columbia in projects that are wholly-
owned; 728,000 square feet is located at Owings Mills, Maryland in four
buildings that are jointly-owned; 637,000 square feet is located at or near
retail centers; and the remaining 5,727,000 square feet is primarily
located in the Baltimore-Washington corridor and is part of a joint venture
owned by the Company (5%) and Teachers Insurance and Annuity Association of
America (95%).
-4-
<PAGE>
The Company owns and manages two hotels, one each in Baltimore and
Columbia, and has an ownership position in a third hotel in Baltimore.
Land Sales
The Company, through its subsidiaries and affiliates, develops and sells
land primarily in and around Columbia, Maryland, which is a new town
launched by the Company in 1962. Today, Columbia has a population of more
than 75,000 and is home to 2,500 businesses which employ 55,000 people.
There are presently approximately 2,000 acres of net saleable land
available for residential, commercial and industrial uses. Subsidiaries of
the Company may develop and own certain projects in Columbia, primarily
retail centers and office buildings.
Development
The majority of the Company's operating properties were developed by the
Company or its subsidiaries. At the present time, the Company has publicly
announced that it is developing two major new regional shopping centers (in
Orlando, Florida and Spartanburg, South Carolina); three expansions to
existing retail centers (Oakwood Center in New Orleans, Mall St. Matthews
in Louisville and The Citadel in Colorado Springs); and is investigating
additional new retail center developments, expansions and potential
acquisitions. Any such new retail center developments, expansions or
acquisitions will be funded using cash generated from operations, from the
issuance of additional equity securities or from the proceeds of any
additional indebtedness.
USE OF PROCEEDS
Unless otherwise indicated in the accompanying Prospectus Supplement, the
net proceeds from the issuance of the Debt Securities offered hereby will
be used for general corporate purposes, including the repayment of existing
indebtedness.
-5-
<PAGE>
SELECTED FINANCIAL DATA
The following selected financial information of the Company for
the years ended December 31, 1993, 1992 and 1991, and the nine months ended
September 30, 1994 and 1993 was derived from the Company's consolidated
financial statements contained in its Annual Report on Form 10-K for the
year ended December 31, 1993 and its Quarterly Report on Form 10-Q for the
quarter ended September 30, 1994 and is qualified in its entirety by such
documents. See "Incorporation of Certain Documents by Reference." The
selected financial information of the Company for the years ended December
31, 1990 and 1989 was derived from the audited consolidated financial
statements of the Company for such periods which have not been incorporated
herein by reference. Results for the nine months ended September 30, 1994
and 1993 are unaudited. Results for the nine months ended September 30,
1994 are not necessarily indicative of results for the year ended December
31, 1994.
<TABLE>
<CAPTION>
Nine months ended
September 30, Year ended December 31,
----------------------- --------------------------------------------------------------
1994 1993 1993 1992 1991 1990 1989
---------- ---------- ---------- ---------- ---------- ---------- ----------
(in thousands, except ratios and per share data)
<S> <C> <C> <C> <C> <C> <C> <C>
Operating results:
Revenues from continuing operations.... $ 498,846 $ 472,963 $ 646,805 $ 597,105 $ 573,498 $ 529,570 $ 498,100
Earnings (loss) from continuing
operations............................ 2,445 (2,031) (1,291) (15,849) 2,424 (1,165) 10,361
Earnings (loss) from continuing operations
available for common shareholders
(per share of common stock)........... (.16) (.22) (.27) (.33) .05 (.07) .16
Earnings before depreciation and deferred
taxes from operations (EBDT).......... 67,115 53,066 78,281 52,282 46,820 50,290 57,084
Net cash provided (used):
By operating activities.............. 79,008 49,245 101,149 66,630 67,226 35,057 60,039
In investing activities.............. (143,272) (123,271) (154,446) (144,836) (96,210) (248,532) (307,128)
By financing activities.............. 41,086 58,215 47,068 98,914 17,271 246,968 167,312
Ratio of earnings to fixed
charges (1)(2)........................ 1.04 -- 1.01 -- -- -- --
Consolidated coverage ratio (3)........ 1.42 1.34 1.37 1.25 1.24 1.29 1.37
Total assets-cost basis................ 2,897,922 2,851,397 2,874,982 2,726,281 2,637,452 2,614,877 2,299,615
Total assets-current value basis (4)... -- -- 4,588,636 4,217,819 4,174,093 4,362,153 4,129,645
Debt, capital leases and redeemable
Preferred stock....................... 2,550,453 2,468,975 2,473,596 2,498,983 2,374,527 2,344,095 1,995,769
Shareholders' equity (deficit):
Historical cost basis................ 80,763 125,029 113,151 (34,848) 17,328 25,339 52,951
Current value basis (4).............. -- -- 1,525,606 1,188,896 1,274,070 1,470,088 1,730,075
Shareholders' equity (deficit) per share
of common stock:
Historical cost basis (5).............. 1.42 2.19 1.98 (.74) .36 .53 1.10
Current value basis (4)(5)........... -- -- 26.75 25.50 26.60 30.10 34.80
Cash dividends per share of common
stock................................. .51 .45 .62 .60 .60 .60 .56
Market price per share of common stock at
end of period (6)..................... 19.13 20.25 17.75 18.00 18.25 14.50 26.00
Weighted average common shares
outstanding........................... 47,563 47,363 47,411 47,994 48,157 48,019 47,910
Number of common shares outstanding
at end of period...................... 47,568 47,534 47,562 47,292 48,193 48,130 47,973
</TABLE>
-6-
<PAGE>
___________________
(1) The ratio of earnings to fixed charges is computed by dividing fixed
charges into net earnings (loss) before income taxes, extraordinary loss
and cumulative effect of change in accounting principle, adjusted for
minority interest in earnings, amortization of interest costs previously
capitalized and certain other items, plus fixed charges other than
capitalized interest. Fixed charges include interest costs, the
estimated interest component of rent expense and certain other items.
(2) Total fixed charges exceeded the Company's earnings available for fixed
charges by $66,000 for the nine months ended September 30, 1993,
$29,449,000, $10,347,000, $24,575,000 and $354,000 for the years ended
December 31, 1992, 1991, 1990 and 1989, respectively.
(3) Consolidated coverage ratio is the ratio of EBDT plus consolidated
interest expense to consolidated interest expense. Consolidated
interest expense includes dividends on redeemable Preferred Stock
(retired for financial reporting purposes in 1990), which is included
because the stock was subject to mandatory redemption requirements for
cash.
(4) Current value basis financial information is not presented for interim
periods.
(5) Historical cost basis shareholders' equity per share of common stock and
current value basis shareholders' equity per share of common stock
assume the conversion of the Series A Convertible Preferred Stock.
(6) The market price per share of common stock of the Company as of the
close of business on February 8, 1995 was $19.00 per share.
-7-
<PAGE>
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 the Prospectus Supplement (the "Offered Debt
Securities") 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 Offered Debt Securities.
The Offered Debt Securities are to be issued under an Indenture (the
"Indenture") between the Company and The First National Bank of Chicago, as
trustee (the "Trustee"), a copy of which Indenture is filed as an exhibit to
the Registration Statement. The following summaries of certain provisions of
the Indenture and the Debt Securities do not purport to be complete and are
subject to, and are qualified in their entirety by reference to, all
provisions of the Indenture, including the definitions therein of certain
terms and of those terms made a part thereof by the Trust Indenture Act.
Wherever particular provisions or defined terms of the Indenture are referred
to, such provisions or defined terms are incorporated herein by reference.
Certain defined terms in the Indenture are capitalized herein.
General
The Debt Securities will be unsecured obligations of the Company.
The Debt Securities to be offered by this Prospectus are limited to
$150,000,000 in aggregate issue price. The Indenture does not limit the
amount of Debt Securities that may be issued thereunder and provides that
Debt Securities may be issued thereunder from time to time in one or more
series. All Debt Securities of one series need not be issued at the same
time and, unless otherwise provided, a series may be reopened, without the
consent of any Holder, for issuances of additional Debt Securities of such
series. (Section 301) The Indenture provides that there may be more than one
Trustee thereunder, each with respect to one or more series of Debt
Securities.
Reference is made to the Prospectus Supplement relating to the Offered
Debt Securities for the following terms, where applicable, of the Offered
Debt Securities: (1) the title of the Offered Debt Securities or series of
which they are a part; (2) any limit on the aggregate principal amount of the
Offered Debt Securities; (3) the date or dates, or the method or methods, if
any, by which such date or dates shall be determined, on which the principal
of such Offered Debt Securities will be payable; (4) the rate or rates (which
may be fixed or variable) at which the Offered Debt Securities will bear
interest, if any, the date or dates from which such interest will accrue, the
Interest Payment Dates on which any such interest will be payable and the
Regular Record Date for any such interest payable on any Interest Payment
Date; (5) the place or places where the principal of and any premium and
interest on such Offered Debt Securities will be payable; (6) the period or
periods within which, the price or prices at which and the terms and
conditions upon which such Offered Debt Securities may be redeemed, in whole
or in part, at the option of the Company; (7) the obligation, if any, of the
Company to redeem or purchase any of such Offered Debt Securities pursuant to
any sinking fund or analogous provisions or at the option of a Holder
thereof, and the period or periods within which, the price or
-8-
<PAGE>
prices at which and the terms and conditions on which any of such Offered
Debt Securities will be redeemed or purchased, in whole or in part, pursuant
to any such obligation; (8) the denominations in which such Offered Debt
Securities will be issuable, if other than denominations of $1,000 and any
integral multiple thereof; (9) if other than the currency of the United
States of America, the currency, currencies or currency units in which the
principal of or any premium or interest on such Offered Debt Securities will
be payable (and the manner in which the equivalent of the principal amount
thereof in the currency of the United States of America is to be determined
for any purpose, including for the purpose of determining the principal
amount deemed to be Outstanding at any time); (10) if the amount of payments
of principal of or any premium or interest on such Offered Debt Securities
may be determined with reference to an index or pursuant to a formula, the
manner in which such amounts will be determined; (11) if the principal of or
any premium or interest on such Offered Debt Securities is to be payable, at
the election of the Company or a Holder thereof, in one or more currencies or
currency units other than those in which the Offered Debt Securities are
stated to be payable, the currency, currencies or currency units in which
payment of any such amount as to which such election is made will be payable,
and the periods within which and the terms and conditions upon which such
election is to be made; (12) if other than the principal amount thereof, the
portion of the principal amount of such Offered Debt Securities which will be
payable upon declaration of acceleration of the Maturity thereof; (13) if
applicable, that such Offered Debt Securities are defeasible as provided in
the Indenture; (14) whether such Offered Debt Securities will be issuable in
whole or in part in the form of one or more Global Securities and, if so, the
Depositary or Depositaries for such Global Security or Global Securities and
any circumstances other than those described under "Global Securities" in
which any such Global Security may be transferred to, and registered and
exchanged for Securities registered in the name of a Person other than the
Depositary for such Global Security or a nominee thereof and in which any
such transfer may be registered; (15) any addition to, or modification or
deletion of, any Events of Default or covenants provided for with respect to
the Offered Debt Securities; (16) the terms, if any, pursuant to which the
Offered Debt Securities will be made subordinate and subject in right of
payment to the prior payment in full of all Senior Indebtedness of the
Company, and the definition of any such Senior Indebtedness; and (17) any
other terms of such Securities not inconsistent with the provisions of the
Indenture. (Section 301)
Unless otherwise indicated in the Prospectus Supplement relating to
Offered Debt Securities, principal of and premium, if any, and interest, if
any, on the Debt Securities will be payable, and the Debt Securities will be
exchangeable and transfers thereof will be registrable, at the office of the
Trustee at its principal executive offices (see "Concerning the Trustee"),
provided that, at the option of the Company, payment of interest may be made
by check mailed to the address of the Person entitled thereto as it appears
in the Security Register. (Sections 301, 305 and 1002). Any payment of
principal and premium, if any, and interest, if any, required to be made on
an Interest Payment Date, Redemption Date or at Maturity which is not a
Business Day need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made on the
Interest Payment Date, Redemption Date or at Maturity, as the case may be,
and no interest shall accrue for the period from and after such Interest
Payment Date, Redemption Date or Maturity. (Section 113)
-9-
<PAGE>
Unless otherwise indicated in the Prospectus Supplement relating to
Offered Debt Securities, the Debt Securities will be issued only in fully
registered form, without coupons, in denominations of $1,000 or any integral
multiple thereof. (Section 302). No service charge will be made for any
transfer or exchange of the Debt Securities, but the Company may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. (Section 305)
Debt Securities may be issued under the Indenture as Original Issue
Discount Securities to be offered and sold at a substantial discount from
their stated principal amount. In addition, under Treasury Regulations it is
possible that Debt Securities which are offered and sold at their stated
principal amount would, under certain circumstances, be treated as issued at
an original issue discount for federal income tax purposes. Federal income
tax consequences and other special considerations applicable to any such
Original Issue Discount Securities (or other Debt Securities treated as
issued at an original issue discount) will be described in the Prospectus
Supplement relating thereto. "Original Issue Discount Security" means a
security, including any security that does not provide for the payment of
interest prior to Maturity, which is issued at a price lower than the
principal amount thereof and which provides that upon redemption or
acceleration of the Stated Maturity thereof an amount less than the principal
amount thereof shall become due and payable. (Section 101)
Global Securities
The Debt Securities of a series may be issued in the form of one or more
Global Securities that will be deposited with a Depository or its nominee
identified in the Prospectus Supplement relating to the Offered Debt
Securities. In such a case, one or more Global Securities will be issued in
a denomination or aggregate denominations equal to the portion of the
aggregate principal amount of Outstanding Debt Securities of the series to be
represented by such Global Security or Securities. Unless and until it is
exchanged in whole or in part for Debt Securities in definitive registered
form, a Global Security may not be registered for transfer or exchange except
as a whole by the Depository for such Global Security to a nominee of such
Depository and except in the circumstances described in the Prospectus
Supplement relating to the Offered Debt Securities. (Sections 204 and 305).
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 series.
Certain Covenants
Limitation on the Incurrence of Debt. The Company and its consolidated
Subsidiaries may not incur any Debt if, after giving effect to such
Incurrence, the Ratio Calculation is less than 1.1 to 1.
Notwithstanding the foregoing paragraph, the Company and its
consolidated Subsidiaries may incur the following additional Debt without
regard to the foregoing limitation (although the additional Debt so Incurred
will be included in the determination of the Consolidated Coverage Ratio
thereafter): (i) the Debt Securities issued under the Indenture not to exceed
an aggregate issue price of $150,000,000; (ii) intercompany Debt
(representing Debt to which the only parties are the Company and any of its
consolidated Subsidiaries (but only so long as such Debt is held solely by
any of the Company and its consolidated Subsidiaries)); (iii) any drawings or
redrawings under lines of credit
-10-
<PAGE>
existing on the date of the Indenture and any new lines of credit or
replacements, amendments or extensions of existing lines of credit, provided,
however, that the maximum amount that may be drawn under all lines of credit
pursuant to this clause (iii) may not at any time exceed the maximum amount
that may be drawn under all lines of credit that exist as of the date of the
Indenture; (iv) refinancings, renewals, refundings or extensions of any Debt,
in any case in an amount not to exceed the principal amount of the Debt so
refinanced plus any prepayment premium or accrued interest, provided that (a)
such refinancing Debt is either (I) Debt of the Company that ranks pari passu
with or junior to the Debt being refinanced, (II) Debt of a Subsidiary that
the Company or another Subsidiary guarantees or (III) Debt of a Subsidiary
and (b) such refinancing Debt (giving effect to any right of the holder
thereof to require, directly or indirectly, an early repayment, defeasance or
retirement of such Debt) either has a weighted average life equal to or
longer than the remaining weighted average life of the Debt being refinanced
or has a minimum term of five years; (v) third party Debt of a Subsidiary,
including Debt of a Subsidiary that carries a Company guarantee of repayment,
directly relating to the development of projects or the expansion, renovation
or improvement of existing properties; (vi) third party Debt of a Subsidiary
directly relating to the acquisition of assets; (vii) reimbursement
obligations under letters of credit, bankers' acceptances or similar
facilities, provided that at the time of Incurring any additional obligations
pursuant to this clause (vii) the amount of all such obligations, whether or
not currently due, aggregate at any time less than 5% of Consolidated Net
Tangible Assets at such date; (viii) Debt that by its terms is subordinate in
right of payment to any of the other Debt of the Company; provided however,
that, pursuant to clauses (i) through (ix), the aggregate issue price of such
subordinated Debt may not at any time exceed the aggregate principal amount
of such subordinated Debt as of the date of the Indenture plus $100,000,000;
(ix) Attributable Debt; and (x) in addition to Debt referred to in clauses
(i) through (ix) above, Debt in the aggregate principal amount of $50,000,000
which is to be used only for working capital purposes. (Section 1008)
Limitation on Sale/Leaseback Transactions. The Company will not, nor
will it permit any Restricted Subsidiary to, enter into any arrangement with
any bank, insurance company or other lender or investor (not including the
Company or any consolidated Subsidiary) or to which any such lender or
investor is a party, providing for the leasing by the Company or any such
Restricted Subsidiary for a period, including renewals, in excess of three
years, of any Principal Property owned by the Company or such Restricted
Subsidiary, which has been or is to be sold or transferred more than one year
after either the acquisition thereof or the completion of construction and
commencement of full operation thereof by the Company or any such Restricted
Subsidiary, to such lender or investor or to any Person to whom funds have
been or are to be advanced by such lender or investor on the security of such
Principal Property (herein referred to as a "Sale/Leaseback Transaction")
unless (A) the aggregate amount of Attributable Debt for the proposed and all
existing Sale/Leaseback Transactions is less than 10% of Consolidated Net
Tangible Assets and (B) if the Ratio Calculation is less than 1.1 to 1 after
giving effect to the proposed Sale/Leaseback Transaction, the Company and its
subsidiaries, within 270 days after the sale or transfer shall have been made
by the Company or by any such Restricted Subsidiary, must apply an amount
equal to the net proceeds of the sale of the Principal Property sold and
leased back pursuant to such arrangement to either (or a combination of) (x)
the purchase of property, facilities or equipment (other than the property,
facilities or equipment involved in such Sale/Leaseback Transaction) or (y)
the retirement of Debt of the Company or a Restricted Subsidiary, including
the Debt Securities, which either has an initial term of greater than 12
months or is a bona
-11-
<PAGE>
fide acquisition loan or a construction or bridge loan entered in connection
with a construction project or other real estate development. (Section 1009)
Consolidation, Merger, Sale, Conveyance and Lease. The Indenture permits
the Company to consolidate or merge with or into any other entity or
entities, or to sell, convey or lease all or substantially all of its Assets
to any other entity authorized to acquire and operate the same; provided,
however, (i) that the Person (if other than the Company) formed by such
consolidation, or into which the Company is merged or which acquires or
leases substantially all of the Assets of the Company, expressly assumes the
Company's obligations on the Debt Securities and under the Indenture, (ii)
that the Company or such successor entity shall not immediately after such
consolidation or merger, or such sale, conveyance or lease, be in default in
the performance of any covenant or condition of the Indenture, (iii) that the
Company or such successor entity shall not, immediately after giving effect
to such consolidation or merger, or such sale, conveyance or lease, have a
Ratio Calculation of less than 1.1 to 1 and (iv) that certain other
conditions are met. (Section 801)
Provision of Financial Information. The Indenture provides that,
whether or not the Company is subject to Section 13(a) or 15(d) of the
Exchange Act, the Company will, to the extent permitted under the Exchange
Act, file with the Commission the annual reports, quarterly reports and other
documents which the Company would have been required to file with the
Commission pursuant to such Section 13(a) or 15(d) ("Financial Statements")
if the Company were so subject, such documents to be filed with the
Commission on or prior to the respective dates (the "Required Filing Dates")
by which the Company would have been required so to file such documents if
the Company were so subject. The Company will also in any event (x) within
15 days of each Required Filing Date (i) transmit by mail to all Holders, as
their names and addresses appear in the Security Register, without cost to
such Holders and (ii) file with the Trustee copies of the annual reports,
quarterly reports and other documents which the Company would have been
required to file with the Commission pursuant to Section 13(a) or 15(d) of
the Exchange Act if the Company were subject to such Sections and (y) if
filing such documents by the Company with the Commission is not permitted
under the Exchange Act, promptly upon written request and payment of the
reasonable cost of duplication and delivery, supply copies of such documents
to any prospective Holder. (Section 1011)
Certain Definitions
"Asset" means, with respect to one or more transactions occurring within
any 12-month period, any asset or group of assets of the Company or its
Subsidiaries (including, but not limited to, all balance sheet items and all
intangible assets including management contracts, goodwill and trade secrets)
with a fair market or book value, whichever is larger, greater than 5% of
Consolidated Net Tangible Assets on the date of such transaction.
"Attributable Debt" shall mean, as to any particular lease under which
the Company or any Restricted Subsidiary is at the time liable, at any date
as of which the amount thereof is to be determined, the lesser of (i) the
fair value of the property subject to such lease (as determined by certain
officers of the Company as set forth in the Indenture) or (ii) the total net
amount of rent required to be paid by the Company under such lease during the
remaining term thereof, discounted
-12-
<PAGE>
from the respective due dates thereof to such date at the rate of interest
per annum equal to 8.5%, compounded semi-annually. The net amount of rent
required to be paid under any such lease for any such period shall be the
amount of the rent payable by the lessee with respect to such period, after
excluding amounts required to be paid on account of maintenance and repairs,
insurance, taxes, assessments, water rates and similar charges. In the case
of any lease which is terminable by the lessee upon the payment of a penalty,
such net amount shall also include the amount of such penalty, but no rent
shall be considered as required to be paid under such lease subsequent to the
first date upon which it may be so terminated.
"Capital Lease Obligations" of any Person means the obligations to pay
rent or other amounts under a lease of (or other Debt arrangements conveying
the right to use) real or personal property of such Person which are required
to be classified and accounted for as a capital lease or a liability on the
face of a balance sheet of such Person in accordance with generally accepted
accounting principles, and the amount of such obligations shall be the
capitalized amount thereof in accordance with generally accepted accounting
principles and the stated maturity thereof shall be the date of the last
payment of rent or any other amount due under such lease prior to the first
date upon which such lease may be terminated by the lessee without payment of
a penalty.
"Consolidated Coverage Ratio" of any Person means for any period the
ratio of (i) EBDT for such period plus Consolidated Interest Expense for the
same period for such Person to (ii) Consolidated Interest Expense for the
same period for such Person.
"Consolidated Interest Expense" means with respect to any Person for any
period the Consolidated Interest Expense included in a consolidated income
statement (without deduction of consolidated interest income) of such Person
for such period (based on the accounting principles reflected in the
Company's Consolidated Statement of Operations for the nine months ended
September 30, 1994 contained in the Company's Form 10-Q for such period),
including, without limitation or duplication (or, to the extent not so
included, with the addition of) (i) the portion of any rental obligation in
respect of any Capital Lease Obligation allocable to interest expense in
accordance with generally accepted accounting principles; (ii) the
amortization of Debt discounts; (iii) any payments or fees (other than up-
front fees) with respect to letters of credit, bankers' acceptances or
similar facilities; (iv) fees (other than up-front fees) with respect to
interest rate swap or similar agreements, or foreign currency hedge, exchange
or similar agreements; (v) the interest portion of any rental obligation with
respect to any Sale/Leaseback Transaction (determined as if such obligations
were treated as a Capital Lease Obligation); and (vi) any dividends
attributable to any equity security which may be converted into a debt
security of the Company at any time or is mandatorily redeemable for cash
within 20 years from its initial issuance.
"Consolidated Net Tangible Assets" shall mean the aggregate amount of
assets (less applicable reserves and other property deductible items) after
deducting therefrom (i) all current liabilities (excluding any thereof which
are by their terms extendible or renewable at the option of the obligor
thereon to a time more than 12 months after the time as of which the amount
thereof is being computed and excluding current maturities of long-term
indebtedness and Capital Lease Obligations) and (ii) all
-13-
<PAGE>
goodwill, all as shown in the consolidated balance sheet of the Company and
its Subsidiaries as of the end of the latest fiscal quarter for which
consolidated Financial Statements are available.
"Debt" means (without duplication), with respect to any Person, (i)
every obligation of such Person for money borrowed, (ii) every obligation of
such Person evidenced by bonds, debentures, notes or other similar
instruments, including obligations incurred in connection with the
acquisition of property, assets or businesses, excluding any trade payments
and other accrued current liabilities arising in the ordinary course of
business, (iii) every currently due reimbursement obligation of such Person
with respect to letters of credit, bankers' acceptances or similar facilities
issued for the account of such Person, (iv) every obligation of such Person
issued or assumed as the deferred purchase price of property (but excluding
trade accounts payable and other accrued current liabilities arising in the
ordinary course of business which are not overdue by more than 90 days or
which are being contested in good faith), (v) every Capital Lease Obligation
of such Person, (vi) the maximum fixed redemption or repurchase price of any
equity security which may be converted into a debt security of such Person at
any time or is mandatorily redeemable for cash within 20 years from its
initial issuance, and (vii) every obligation of the type referred to in
clauses (i) through (vi) of another Person and all dividends of another
Person the payment of which, in either case, such Person has guaranteed or
for which such Person is responsible or liable, directly or indirectly, as
obligor, guarantor or otherwise.
"EBDT" shall mean Earnings Before Depreciation and Deferred Taxes from
Operations for the Company and its consolidated Subsidiaries based on the
accounting principles reflected in the Company's Consolidated Statement of
Operations for the nine months ended September 30, 1994 contained in the
Company's Form 10-Q for such period, and assuming that any dividends paid on
any equity security shall not be deducted in calculating EBDT unless such
equity security may be converted into a debt security at any time or is
mandatorily redeemable for cash within 20 years from its initial issuance.
"Incur" means, with respect to any Debt or other obligation of any
Person, to create, issue, incur (by conversion, exchange or otherwise),
assume, guarantee or otherwise become liable in respect of such Debt or other
obligation or the recording, as required pursuant to generally accepted
accounting principles or otherwise, of any such Debt or other obligation on
the balance sheet of any such Person (and "incurrence," "incurred,"
"incurrable" and "incurring" shall have meanings correlative to the
foregoing); provided that a change in generally accepted accounting
principles that results in an obligation of such Person that exists at such
time becoming Debt shall not be deemed an incurrence of such Debt.
"Principal Property" shall mean any land, and any building, structure or
other facility, together with the land upon which it is erected and fixtures
comprising a part thereof, in each case the net book value of which on the
date as of which the determination is being made exceeds 2% of Consolidated
Net Tangible Assets at such date; provided, however, that Principal Property
shall not include (i) any building, structure or facility which, in the
opinion of the Board of Directors of the Company, is not of material
importance to the total business conducted by the Company and its
Subsidiaries as an entirety or (ii) any portion of a particular building,
structure or facility which, in the opinion of the
-14-
<PAGE>
Board of Directors of the Company, is not of material importance to the use
or operation of such building, structure or facility.
"Ratio Calculation" shall mean that, immediately after either the
Incurrence of such Debt or the sale of or other disposal of such Asset, as
the case may be, the Company, or its agent, shall calculate the Consolidated
Coverage Ratio for the four full fiscal quarter period preceding such
Incurrence, sale or disposal for which consolidated Financial Statements are
available. In making such calculation, (a) the Consolidated Interest Expense
attributable to interest on any Debt to be Incurred bearing a floating
interest rate shall be computed on a pro forma basis as if the rate in effect
on the date of computation had been the applicable rate for the entire period
and (b) with respect to any Debt which bears, at the option of the Company, a
fixed or floating rate of interest, the Company shall apply the same rate for
purposes of calculating the Consolidated Coverage Ratio as it chooses to
apply to the Debt. In addition, such calculation shall be performed using
the consolidated Financial Statements which shall be reformulated on a pro
forma basis as if such Debt had been incurred or such Asset had been sold or
otherwise disposed of, as the case may be, at the beginning of such four
fiscal quarter period. Such reformulation shall give effect, as if the
relevant event had occurred at the beginning of such four fiscal quarter
period, to any actual use of proceeds of such Debt being incurred or Asset
being sold or disposed of and to any Incurrences or repayments of Debt and
other sales, disposals or acquisitions of Assets occurring after the end of
the last quarter for which there are consolidated Financial Statements
available. If any portion of the proceeds has not been used, it shall be
assumed that such portion of the proceeds was invested in one-year Treasury
bills on the first day of such four fiscal quarter period.
"Restricted Subsidiary" shall mean any subsidiary of the Company which
has a 50% or greater ownership interest in a Principal Property or
Properties.
Events of Default
The following are Events of Default under the Indenture with respect to
Debt Securities of any series: (a) failure to pay principal of or premium,
if any, on any Debt Security of that series when due; (b) failure to pay any
interest on any Debt Security of that series when due, continued for 30 days;
(c) failure to deposit any sinking fund payment, when due, in respect of any
Debt Security of that series; (d) failure to perform any other covenant of
the Company in the Indenture (other than a covenant included in the Indenture
solely for the benefit of a series of Debt Securities other than that
series), continued for 60 days after written notice as provided in the
Indenture; (e) certain events in bankruptcy, insolvency or reorganization;
(f) a default under any bond, debenture, note, mortgage, indenture or other
evidence of indebtedness for money borrowed by the Company (or by any
Subsidiary, the repayment of which the Company has guaranteed or for which
the Company is directly responsible or liable as obligor or guarantor) having
an aggregate principal amount outstanding of at least $10,000,000, whether
such indebtedness now exists or shall hereafter be created, which default
shall have resulted in such indebtedness being declared due and payable prior
to the date on which it would otherwise have become due and payable, without
such acceleration having been rescinded or annulled within 10 days after
written notice as provided in the Indenture; and (g) any other Event of
Default provided with respect to Debt Securities of that series. (Section
501). No Event of Default with
-15-
<PAGE>
respect to a particular series of Debt Securities issued under the Indenture
necessarily constitutes an Event of Default with respect to any other series
of Debt Securities issued thereunder.
The Trustee shall, within 90 days after the occurrence of a default with
respect to Debt Securities of any series, give all holders of Debt Securities
of such series then outstanding notice of all uncured defaults known to it
(the term default to mean the events specified above without grace periods);
provided that, except in the case of a default in the payment of principal of
(and premium, if any, on) or interest on, if any, any Debt Security of any
series, or in the payment of any sinking fund installment with respect to
Debt Securities of any series, the Trustee shall be protected in withholding
such notice if it in good faith determines that the withholding of such
notice is in the interest of all holders of Debt Securities of such series
then outstanding. (Trust Indenture Act of 1939)
If an Event of Default with respect to Outstanding Debt Securities of
any series shall occur and be continuing, either the Trustee or the Holders
of at least 25% in aggregate principal amount of the Outstanding Debt
Securities of that series may declare the principal amount (or, if the Debt
Securities of that series are Original Issue Discount Securities, such
portion of the principal amount as may be specified in the terms of that
series) of all the Debt Securities of that series to be due and payable
immediately. At any time after a declaration of acceleration with respect to
Debt Securities of any series has been made, but before a judgment or decree
based on acceleration has been obtained, the Holders of a majority in
principal amount of the Outstanding Debt Securities of that series may, under
certain circumstances, rescind and annul such acceleration. (Section 502).
For information as to waiver of defaults, see "Modification and Waiver."
Reference is made to the Prospectus Supplement relating to each series
of Offered Debt Securities which are Original Issue Discount Securities for
the particular provisions relating to acceleration of the Maturity of a
portion of the principal amount of such Original Issue Discount Securities
upon the occurrence of an Event of Default and the continuation thereof.
The Indenture provides that the Trustee will be under no obligation,
subject to the duty of the Trustee during the default to act with the
required standard of care, to exercise any of its rights or powers under the
Indenture at the request or direction of any of the Holders, unless such
Holders shall have offered to the Trustee reasonable indemnity. (Section
601). Subject to such provisions for indemnification of the Trustee, the
Holders of a majority in principal amount of the Outstanding Debt Securities
of any series will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee, with respect to the
Debt Securities of that series. (Section 512)
The Company will furnish to the Trustee annually a certificate as to
compliance by the Company with all conditions and covenants under the
Indenture. (Section 1004)
Defeasance
The Prospectus Supplement will state if any defeasance provision will
apply to the Offered Debt Securities.
-16-
<PAGE>
Defeasance and Discharge
The Indenture provides that, if applicable, the Company will be
discharged from any and all obligations in respect of the Debt Securities of
any series (except for certain obligations to register the transfer or
exchange of Debt Securities of such series, to replace stolen, lost or
mutilated Debt Securities of such series, to maintain paying agencies and to
hold monies for payment in trust) upon the deposit with the Trustee, in
trust, of money and/or U.S. Government Obligations (as defined) which through
the payment of interest and principal in respect thereof in accordance with
their terms will provide money in an amount sufficient to pay the principal
of and any premium and interest on the Debt Securities of such series on the
respective Stated Maturities in accordance with the terms of the Indenture
and the Debt Securities of such series. Such a trust may only be established
if, among other things, the Company has delivered to the Trustee an Opinion
of Counsel to the effect that the Company has received from, or there has
been published by, the Internal Revenue Service a ruling, or there has been a
change in tax law, in either case to the effect that Holders of the Debt
Securities of such series will not recognize income, gain or loss for federal
income tax purposes as a result of such deposit, defeasance and discharge and
will be subject to federal income tax on the same amount and in the same
manner and at the same times as would have been the case if such deposit,
defeasance and discharge had not occurred. (Sections 1302 and 1304)
Defeasance of Certain Covenants and Certain Events of Default
The Indenture provides that, if applicable, the Company shall be
released from its obligations with respect to such Debt Securities then
outstanding under Sections 1005 through 1009, inclusive, Section 1011 and
Section 801 of the Indenture and such other obligations as shall be set forth
in any supplemental indenture for the Debt Securities, and the occurrence of
an Event of Default specified in Sections 501(3), 501(4) (with respect to any
of Sections 1005 through 1009, inclusive, Section 1011 and Section 801 and
such other obligations), 501(5) and 501(8) of the Indenture shall be deemed
not to result in an Event of Default, upon the deposit with the Trustee, in
trust, of money and/or U.S. Government Obligations (as defined) which through
the payment of interest and principal in respect thereof in accordance with
their terms will provide money in an amount sufficient to pay the principal
of and any premium and interest on the Debt Securities of such series on the
Stated Maturities in accordance with the terms of the Indenture and the Debt
Securities of such series. The obligations of the Company under the
Indenture and the Debt Securities of such series other than with respect to
the covenants referred to above and the Events of Default other than the
Event of Default referred to above shall remain in full force and effect.
Such a trust may only be established if, among other things, the Company has
delivered to the Trustee an Opinion of Counsel (who may be an employee of or
counsel for the Company) to the effect that the Holders of the Debt
Securities of such series will not recognize income, gain or loss for federal
income tax purposes as a result of such deposit and defeasance of certain
covenants and Events of Default and will be subject to federal income tax on
the same amount and in the same manner and at the same times as would have
been the case if such deposit and defeasance had not occurred. In the event
the Company exercises this option with respect to the Debt Securities of any
series as described above and the Debt Securities of such series are declared
due and payable because of the occurrence of any Event of Default, the amount
of money and U.S. Government Obligations on deposit with the Trustee will be
sufficient to pay amounts due on the Debt Securities
-17-
<PAGE>
of such series at the time of their Stated Maturity but may not be sufficient
to pay amounts due on the Debt Securities of such series at the time of the
acceleration resulting from such Event of Default. However, the Company
shall remain liable for such payments. (Sections 1303 and 1304)
Modification and Waiver
Modifications and amendments of the Indenture may be made by the Company
and the Trustee with the consent of the Holders of a majority in principal
amount of the Outstanding Debt Securities of each series affected by such
modification or amendment; provided, however, that no such modification or
amendment may, without the consent of the Holder of each Outstanding Debt
Security affected thereby, (a) change the Stated Maturity of the principal
of, or any installment of principal of or interest on, any Debt Security, (b)
reduce the principal amount of, or any premium or interest on, any Debt
Security, (c) reduce the amount of principal of an Original Issue Discount
Security or other Security payable upon acceleration of the Maturity thereof,
(d) change the place or currency of payment of principal of, or any premium
or interest on, any Debt Security, (e) impair the right to institute suit for
the enforcement of any payment on or with respect to any Debt Security, (f)
reduce the percentage in principal amount of Outstanding Debt Securities of
any series, the consent of whose Holders is required for modification or
amendment of the Indenture, (g) reduce the percentage in principal amount of
Outstanding Debt Securities of any series necessary for waiver of certain
defaults or (h) modify such provisions with respect to modification and
waiver. (Section 902)
The Holders of a majority in principal amount of the Outstanding Debt
Securities of any series may on behalf of the Holders of all Debt Securities
of that series waive, insofar as that series is concerned, compliance by the
Company with certain restrictive provisions of the Indenture. (Section
1012). The Holders of a majority in principal amount of the Outstanding Debt
Securities of any series may on behalf of the Holders of all Debt Securities
of that series waive any past default under the Indenture with respect to
that series, except a default in the payment of the principal of or premium,
if any, or interest on any Debt Security of that series or in respect of a
provision which under the Indenture cannot be modified or amended without the
consent of the Holder of each Outstanding Debt Security of that series
affected. (Section 513)
Governing Law
The Indenture and the Debt Securities will be governed by, and construed
in accordance with, the law of the State of New York, but without regard to
principles of conflicts of law. (Section 112)
-18-
<PAGE>
Concerning the Trustee
The First National Bank of Chicago, a national banking association duly
organized and existing under the laws of the United States of America, with
its principal offices at One First National Plaza, Suite 0126, Chicago,
Illinois 60670, will act as Trustee for the benefit of the Holders of the
Debt Securities under the Indenture. The Trustee also serves as the trustee
under the indenture in respect of the Company's $120,000,000 8.50% Notes due
January 15, 2003. The Company maintains other banking relationships with the
Trustee in the ordinary course of business, including maintaining a line of
credit with and obtaining loans from the Trustee.
PLAN OF DISTRIBUTION
The Company may sell Debt Securities to or through underwriters, and
also may sell Debt Securities directly to other purchasers or through agents.
Such underwriters may also act as agents.
The distribution of the Debt Securities, if any, may be effected from
time to time in one or more transactions at a fixed price or prices, which
may be changed, or at market prices prevailing at the time of sale, at prices
related to such prevailing market prices or at negotiated prices.
In connection with the sale of Debt Securities, underwriters may receive
compensation from the Company or from purchasers of Debt Securities for whom
they may act as agents, in the form of discounts, concessions or commissions.
Underwriters may sell Debt Securities to or through dealers, and such dealers
may receive compensation in the form of discounts, concessions or commissions
from the underwriters and/or commissions from the purchasers for whom they
may act as agents. Underwriters, dealers and agents that participate in the
distribution of Debt 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 Debt Securities by them may be deemed to be underwriting
discounts and commissions, under the Act. Any such underwriter or agent will
be identified, and any such compensation received from the Company will be
described, in the Prospectus Supplement accompanying this Prospectus.
Under agreements which may be entered into by the Company, underwriters
and agents who participate in the distribution of Debt Securities may be
entitled to indemnification by the Company against certain liabilities,
including liabilities under the Act.
If so indicated in the Prospectus Supplement accompanying this
Prospectus, the Company will authorize underwriters or other persons acting
as the Company's agents to solicit offers by certain institutions to purchase
Debt Securities from the Company pursuant to contracts providing for payment
and delivery on a future date. Institutions with which such contracts may be
made include commercial and savings banks, insurance companies, pension
funds, investment companies, educational and charitable institutions and
others, but in all cases such institutions must be approved by the Company.
The obligations of any purchaser under any such contract will be subject to
the condition that the purchase of the Offered Debt Securities shall not at
the time of delivery be prohibited under the laws
-19-
<PAGE>
of the jurisdiction to which such purchaser is subject. The underwriters and
such other agents will not have any responsibility in respect of the validity
or performance of such contracts.
Certain of the underwriters or agents and their associates may engage in
transactions with and perform services for the Company in the ordinary course
of business.
LEGAL MATTERS
Unless otherwise indicated in the Prospectus Supplement relating to the
Offered Debt Securities, the validity of the Debt Securities will be passed
upon for the Company by Fried, Frank, Harris, Shriver & Jacobson (a
partnership including professional corporations), One New York Plaza, New
York, New York, and for the Underwriters by Sullivan & Cromwell, 250 Park
Avenue, New York, New York. Fried, Frank, Harris, Shriver & Jacobson and
Sullivan & Cromwell may rely upon Richard G. McCauley, Esq., Senior Vice-
President, General Counsel and Secretary of the Company, with respect to
certain matters governed by laws of the State of Maryland. As of December
31, 1994, Mr. McCauley was the direct owner of 105,037 shares of the
Company's Common Stock (excluding shares of the Company's Common Stock held
in his account under the Company's 401(k) Savings Plan), certain family
members owned 21,295 shares (as to which shares he disclaims beneficial
ownership) and he held options to purchase 112,500 shares, of which options
to purchase 39,500 shares were presently exercisable.
EXPERTS
The audited consolidated financial statements and schedules
incorporated herein by reference are incorporated by reference in reliance
upon (1) the report of KPMG Peat Marwick LLP, independent certified public
accountants, incorporated herein by reference, and the authority of that firm
as experts in accounting and auditing, and (2) with respect to the current
value basis financial statements, the report of Landauer Associates, Inc.,
real estate counselors and consultants, incorporated herein by reference, and
upon the authority of that firm as experts in real estate consultation. The
report of KPMG Peat Marwick LLP covering the December 31, 1991 financial
statements refers to a change in the Company's method of accounting for
income taxes.
-20-
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following is an itemized statement of estimated expenses (other
than underwriting discounts and commissions) to be incurred in connection
with the sale of the Debt Securities. Except for the registration fee, the
amounts listed below are estimates.
<TABLE>
<S> <C>
Registration Fee-Securities and Exchange Commission.. $ 51,725
Legal fees and disbursements......................... 80,000
Accounting fees and disbursements.................... 7,000
Blue Sky fees and expenses (including legal fees).... 26,000
Printing and Engraving Expenses...................... 90,000
Fees and Expenses of Trustee......................... 5,000
Rating Agency fees................................... 165,000
Miscellaneous........................................ 25,000
--------
TOTAL $449,725
========
</TABLE>
All of the foregoing expenses will be borne by the Company.
Item 15. Indemnification of Directors and Officers.
Article XIII of the By-laws of the Company provides that directors and
officers of the Company shall be indemnified by the Company to the fullest
extent permitted by Maryland law as now or hereafter in force, including the
advance of related expenses. If any determination is required under
applicable law as to whether a director or officer is entitled to
indemnification, such determination shall be made by independent legal
counsel retained by the Company and appointed by either the Board of
Directors or the Chief Executive Officer. A copy of Section 2-418 of the
Corporations and Associations Article of the Annotated Code of Maryland is
included as an Exhibit to this Registration Statement.
The Company maintains directors and officers insurance on behalf of its
directors, officers and certain other persons against any liability asserted
against them in any such capacity. The form of Underwriting Agreement
contained in Exhibit 1 provides for indemnification of the directors and
officers signing the Registration Statement and certain controlling persons
of the Company against certain liabilities, including certain liabilities
under the Securities Act of 1933, as amended, in certain instances by each
underwriter participating in an offering of Debt Securities.
II-1
<PAGE>
Item 16. Exhibits
The following exhibits are filed as part of this Registration Statement
(including by incorporation by reference from documents that are found in
Commission File number 0-1743):
1.1 Form of Distribution Agreement.
1.2 Form of Underwriting Agreement.
4.1 Form of Indenture between the Company and the Trustee.
4.2 Form of Debt Securities (included in Exhibit 4.1 at pages 19
through 25).
4.3 Form of Medium-Term Note (Fixed Rate).
4.4 Form of Medium-Term Note (Floating Rate).
5.1 Opinion and Consent of Fried, Frank, Harris, Shriver & Jacobson.
5.2 Opinion and Consent of Richard G. McCauley, Esq. (attached to
Exhibit 5.1 above).
12.1 Statement of Computation of Ratio of Earnings to Fixed Charges.
12.2 Statement of Computation of Consolidated Coverage Ratio.
23.1 Consent of KPMG Peat Marwick LLP.
23.2 Consent of Landauer Associates, Inc.
23.3 Consent of Fried, Frank, Harris, Shriver & Jacobson (included in
Exhibit 5.1 above).
23.4 Consent of Richard G. McCauley, Esq. (included in Exhibit 5.2
above).
24.1 Power of Attorney, dated March 16, 1993.*
24.2 Power of Attorney, dated September 24, 1992 (which is incorporated
by reference from the Exhibits to the Company's Form S-3
Registration Statement (No. 33-52458)).
24.3 Power of Attorney, dated December 3, 1992 (which is incorporated
by reference from the Exhibits to the Company's Form S-3
Registration Statement (No. 33-52458)).
25.1 Statement of Eligibility and Qualification of The First National
Bank of Chicago, as Trustee, on Form T-1.
99.1 Section 2-418 of the Corporations and Associations Article of the
Annotated Code of Maryland (which is incorporated by reference from
the Exhibits to the Company's Form
S-3 Registration Statement (33-56646)).
______________
* Previously filed.
Item 17. Undertakings.
Undertakings to Update Annually. The undersigned registrant hereby
undertakes:
(1) to file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) to include any Prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
II-2
<PAGE>
(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; and
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement;
Provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if
the Registration Statement is on Form S-3 or Form S-8, and the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed by the registrant pursuant to Section 13
or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in the Registration Statement;
(2) that, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new Registration Statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof; and
(3) to remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
Incorporation of Subsequent Exchange Act Documents. The undersigned
registrant hereby undertakes that, for purposes of determining any liability
under the Securities Act of 1933, each filing of the registrant's annual
report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange
Act of 1934 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.
Indemnification. Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the provisions referred to
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 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 Act and
will be governed by the final adjudication of such issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Company 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 the Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the County of Howard and the State
of Maryland, on the 9th day of February, 1995.
THE ROUSE COMPANY
By: /s/ Mathias J. DeVito
---------------------------------------------
Mathias J. DeVito
Chairman of the Board,
Chief Executive Officer
and Director
Pursuant to the requirements of the Securities Act of 1933, this
Amendment No. 1 to the Registration Statement has been signed by the
following persons in the capacities and on the date indicated.
Principal Executive Officers:
/s/ Mathias J. DeVito Chairman of the Board, February 9, 1995
------------------------------- Chief Executive Officer
Mathias J. DeVito and Director
/s/ Anthony W. Deering President, Chief Operating February 9, 1995
------------------------------- Officer and Director
Anthony W. Deering
Principal Financial Officer:
/s/ Jeffrey H. Donahue Senior Vice President and February 9, 1995
------------------------------- Chief Financial Officer
Jeffrey H. Donahue
Principal Accounting Officer:
/s/ George L. Yungmann Senior Vice President February 9, 1995
------------------------------- and Controller
George L. Yungmann
II-4
<PAGE>
THE BOARD OF DIRECTORS
David H. Benson, Jeremiah E. Casey, Anthony W. Deering, Rohit M. Desai,
Mathias J. DeVito, Juanita T. James, Thomas J. McHugh, Hanne M. Merriman,
Roger W. Schipke and Alexander B. Trowbridge.
/s/ Mathias J. DeVito For himself and as February 9, 1995
------------------------------- Attorney-in-Fact for the
Mathias J. DeVito above-named members
of the Board of Directors
II-5
<PAGE>
EXHIBIT INDEX
Exhibit Page
Number Description No.
- ------- ----------- ----
1.1 Form of Distribution Agreement.
1.2 Form of Underwriting Agreement.
4.1 Form of Indenture between the Company and the Trustee.
4.2 Form of Debt Securities (included in Exhibit 4.1 at pages 19 through
25).
4.3 Form of Medium-Term Note (Fixed Rate).
4.4 Form of Medium-Term Note (Floating Rate).
5.1 Opinion and Consent of Fried, Frank, Harris, Shriver & Jacobson.
5.2 Opinion and Consent of Richard G. McCauley, Esq. (attached to Exhibit 5.1
above).
12.1 Statement of Computation of Ratio of Earnings to Fixed Charges.
12.2 Statement of Computation of Consolidated Coverage Ratio.
23.1 Consent of KPMG Peat Marwick LLP.
23.2 Consent of Landauer Associates, Inc.
23.3 Consent of Fried, Frank, Harris, Shriver & Jacobson (included in
Exhibit 5.1 above).
23.4 Consent of Richard G. McCauley, Esq. (included in Exhibit 5.2 above).
24.1 Power of Attorney, dated March 16, 1993.*
24.2 Power of Attorney, dated September 24, 1992 (which is incorporated by
reference from the Exhibits to the Company's Form S-3 Registration
Statement (No. 33-52458)).
24.3 Power of Attorney, dated December 3, 1992 (which is incorporated by
reference from the Exhibits to the Company's Form S-3 Registration
Statement (No. 33-52458)).
25.1 Statement of Eligibility and Qualification of The First National Bank
of Chicago, as Trustee, on Form T-1.
99.1 Section 2-418 of the Corporations and Associations Article of the
Annotated Code of Maryland (which is incorporated by reference from the
Exhibits to the Company's Form S-3 Registration Statement (33-56646)).
_______________
* Previously filed.
<PAGE>
Exhibit 1.1
THE ROUSE COMPANY
$150,000,000
MEDIUM-TERM NOTES
DISTRIBUTION AGREEMENT
----------------------
.............. , 1995
[Name(s) and address(es)
of Agent(s)]
Ladies and Gentlemen:
The Rouse Company, a Maryland corporation (the "Company"), proposes to issue
and sell from time to time its Medium-Term Notes (the "Securities") in an
aggregate amount up to $150,000,000 and agrees with each of you (individually,
an "Agent", and collectively, the "Agents") as set forth in this Agreement.
Subject to the terms and conditions stated herein and to the reservation by
the Company of the right to sell Securities directly on its own behalf, the
Company hereby (i) appoints each Agent as an agent of the Company for the
purpose of soliciting and receiving offers to purchase Securities from the
Company pursuant to Section 2(a) hereof and (ii) agrees that, except as
otherwise contemplated herein, whenever it determines to sell Securities
directly to any Agent as principal, it will enter into a separate agreement
(each, a "Terms Agreement"), substantially in the form of Annex I hereto,
relating to such sale in accordance with Section 2(b) hereof. This Distribution
Agreement shall not be construed to create either an obligation on the part of
the Company to sell any Securities or an obligation of any of the Agents to
purchase Securities as principal.
The Securities will be issued under an indenture, dated as of
....................., 1995 (the "Indenture"), between the Company and The First
National Bank of Chicago, as Trustee (the "Trustee"). The Securities shall have
the maturity ranges, interest rates, if any, redemption provisions and other
terms set forth in the Prospectus referred to below as it may be amended or
supplemented from time to time. The Securities will be issued, and the terms
and rights thereof established, from time to time by the Company in accordance
with the Indenture.
1. The Company represents and warrants to, and agrees with, each Agent that:
(a) A registration statement on Form S-3 (File No. 33-57347) in respect
of the Securities has been filed with the Securities and Exchange
Commission (the "Commission"); such registration statement and any
post-effective amendment thereto, each in the form heretofore delivered
or to be delivered to such Agent, excluding exhibits to such registration
statement, but including all documents incorporated by reference in the
prospectus included therein, have been declared effective by the
Commission in such form; no other document with respect to such
registration statement or document incorporated by reference therein has
heretofore been filed or transmitted for filing with the Commission
(other than the prospectuses filed pursuant to Rule 424(b) of the rules
and regulations of the Commission under the Securities Act of 1933, as
amended (the "Act"), each in the form heretofore delivered to the
Agents); and no stop order
<PAGE>
suspending the effectiveness of such registration statement has been
issued and no proceeding for that purpose has been initiated or
threatened by the Commission (any preliminary prospectus included in
such registration statement or filed with the Commission pursuant to
Rule 424(a) of the rules and regulations of the Commission under the
Act, are hereinafter called a "Preliminary Prospectus"; the various
parts of such registration statement, including all exhibits thereto
and the documents incorporated by reference in the prospectus contained
in the registration statement at the time such part of the registration
statement became effective, but excluding the Statement of Eligibility
and Qualification of the Trustee on Form T-1 ("Form T-1"), each as
amended at the time such part of the registration statement became
effective, is hereinafter collectively called the "Registration
Statement"; the prospectus (including, if applicable, any prospectus
supplement) relating to the Securities, in the form in which it has most
recently been filed, or transmitted for filing, with the Commission on or
prior to the date of this Agreement, is hereinafter called the
"Prospectus"; any reference herein to any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to the applicable form under
the Act, as of the date of such Preliminary Prospectus or Prospectus, as
the case may be; any reference to any amendment or supplement to any
Preliminary Prospectus or the Prospectus, including any supplement to the
Prospectus that sets forth only the terms of a particular issue of the
Securities (a "Pricing Supplement"), shall be deemed to refer to and
include any documents filed after the date of such Preliminary Prospectus
or Prospectus, as the case may be, under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and incorporated therein by
reference; any reference to any amendment to the Registration Statement
shall be deemed to refer to and include any annual report of the Company
filed pursuant to Section 13(a) or 15(d) of the Exchange Act after the
effective date of the Registration Statement that is incorporated by
reference in the Registration Statement; and any reference to the
Prospectus as amended or supplemented shall be deemed to refer to and
include the Prospectus as amended or supplemented (including by the
applicable Pricing Supplement filed in accordance with Section 4(a)
hereof) in relation to Securities to be sold pursuant to this Agreement,
in the form filed or transmitted for filing with the Commission pursuant
to Rule 424(b) under the Act and in accordance with Section 4(a) hereof,
including any documents incorporated by reference therein as of the date
of such filing);
(b)The documents incorporated by reference in the Prospectus, when they
became effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder, and none of such documents contained an untrue
statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading; and any further documents so filed and incorporated by
reference in the Prospectus, or any further amendment or supplement
thereto, when such documents become effective or are filed with the
Commission, as the case may be, will conform in all material respects
to the requirements of the Act or the Exchange Act, as applicable, and
the rules and regulations of the Commission thereunder and will not
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading;
(c)The Registration Statement and the Prospectus conform, and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements
of the Act and the Trust Indenture Act of 1939, as amended (the
2
<PAGE>
"Trust Indenture Act"), and the rules and regulations of the Commission
thereunder and do not and will not, as of the applicable effective date
as to the Registration Statement and any amendment thereto and as of the
applicable filing date as to the Prospectus and any amendment or
supplement thereto, contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading; provided, however, that
this representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information
furnished in writing to the Company by any Agent expressly for use in the
Prospectus as amended or supplemented to relate to a particular issuance
of Securities;
(d)The Company and its subsidiaries, taken as a whole, have not
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus any material
loss or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than
as set forth or contemplated in the Prospectus; and, since the respective
dates as of which information is given in the Registration Statement and
the Prospectus, there has not been any change in the capital stock (other
than issuances of capital stock upon exercise of options and stock
appreciation rights and upon conversions of convertible securities, in
each case which were outstanding as of the date of the latest audited
financial statements included or incorporated by reference in the
Prospectus), or any material and adverse change in the long-term debt
of the Company and its subsidiaries, taken as a whole, or any material
adverse change, or any development involving a prospective material
adverse change, in or affecting the general affairs, management, current
value basis shareholders' equity or results of operations (based on
Earnings Before Depreciation and Deferred Taxes from Operations) of the
Company and its subsidiaries, taken as a whole, otherwise than as set
forth or contemplated in the Prospectus;
(e)The Company and its subsidiaries have, or in those cases where such
subsidiary is a general partner in a partnership, such partnership has,
good and marketable fee simple and/or leasehold title (as the case may
be) to all real property (except for those lesser estates in real
property which, in the aggregate, are not material in value to the
Company and its subsidiaries), subject only to (A) those liens and
encumbrances which have been reflected generally or in the aggregate in
the financial statements of the Company as disclosed in the Prospectus or
as are described specifically, generally or in the aggregate in the
Prospectus, or (B) such liens and encumbrances (i) not required by
generally accepted accounting principles to be disclosed in the financial
statements of the Company, which (a) if all material covenants and
conditions thereof are observed or performed, will not materially
interfere with the use made or proposed to be made of such property by
the Company and its subsidiaries or (b) are reasonable and customary
with regard to the normal operation of land and improvements held for
commercial purposes by first class owners and operators of commercial
real estate, or (ii) which were incurred after the date of the latest
audited financial statements included or incorporated by reference in
the Prospectus in the ordinary course of business (including financings)
and which, in the aggregate (on a net basis), are not material to the
Company and its subsidiaries, taken as a whole. The Company and its
subsidiaries have title to the personal property owned by it or them and,
subject to the continued performance of the material covenants and
conditions of liens and encumbrances thereon, have the right to use such
without interference in the normal course of business;
3
<PAGE>
(f) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of Maryland, with power and
authority (corporate and other) to own its properties and conduct its
business as described in the Prospectus, and has been duly qualified as a
foreign corporation for the transaction of business and is in good
standing under the laws of each other jurisdiction in which the failure
so to qualify and maintain good standing would have a material adverse
effect on the Company and its subsidiaries, taken as a whole; and each
subsidiary of the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation except for such failures to maintain good
standing as would not have a material adverse effect on the Company and
its subsidiaries, taken as a whole;
(g) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company
have been duly and validly authorized and issued and are fully paid and
non-assessable; and all of the issued shares of capital stock of each
subsidiary of the Company have been duly and validly authorized and
issued, are fully paid and non-assessable and are owned (with exceptions
that are not material to the Company and its subsidiaries, taken as a
whole) directly or indirectly by the Company, free and clear of all
liens, encumbrances or claims (collectively, "Liens") except (i) Liens
relating to debt which has been disclosed specifically, generally or in
the aggregate in the Prospectus or incurred after the date of the latest
audited financial statements included or incorporated by reference in the
Prospectus in the ordinary course of business (including financings),
(ii) Liens incurred in the ordinary course of business which are not
materially adverse to the operations of the Company and its subsidiaries,
taken as a whole, and (iii) restrictions on the transfer or use of the
stock of any subsidiary under any partnership, joint venture or lease
agreements to which the Company or any of its subsidiaries is a party;
(h) The Securities have been duly authorized, and, when issued and
delivered pursuant to this Agreement and any Terms Agreement, will have
been duly executed, authenticated, issued and delivered and will
constitute valid and legally binding obligations of the Company entitled
to the benefits provided by the Indenture, which will be substantially
in the form filed as an exhibit to the Registration Statement; the
Indenture has been duly authorized and duly qualified under the Trust
Indenture Act and constitutes a valid and legally binding instrument,
enforceable in accordance with its terms, subject, as to enforcement,
to bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and to
general equity principles; and the Indenture conforms and the Securities
of any particular issuance of Securities will conform to the descriptions
thereof contained in the Prospectus as amended or supplemented to relate
to such issuance of Securities;
(i) The issue and sale of the Securities, the compliance by the
Company with all of the provisions of the Securities, the Indenture, this
Agreement and any Terms Agreement, and the consummation of the
transactions herein and therein contemplated will not conflict with or
result in a breach or violation of any of the terms or provisions of,
or constitute a default under, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which the Company or
any of its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject except for such conflict,
breach, violation or default which does not have a material adverse
effect on the Company and its subsidiaries, taken as a whole, nor will
such action result in any violation of the provisions of the Articles of
Incorporation or the Bylaws of
4
<PAGE>
the Company or any statute or any order, rule or regulation of any court
or governmental agency or body having jurisdiction over the Company or
any of its subsidiaries or any of their properties; and no consent,
approval, authorization, order, registration or qualification of or with
any court or governmental agency or body is required for the solicitation
of offers to purchase Securities, the issue and sale of the Securities
or the consummation by the Company of the other transactions contemplated
by this Agreement, any Terms Agreement or the Indenture, except such as
have been, or will have been prior to the Commencement Date (as defined
in Section 3 hereof), obtained under the Act or the Trust Indenture Act
and such consents, approvals, authorizations, orders, registrations or
qualifications as may be required under state securities or Blue Sky laws
in connection with the solicitation by such Agent of offers to purchase
Securities from the Company and with purchases of Securities by such
Agent as principal, as the case may be, in each case in the manner
contemplated hereby;
(j) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its
subsidiaries is a party or to which any property of the Company or any
of its subsidiaries is subject, which are likely, individually or in the
aggregate, to have a material adverse effect on the Company and its
subsidiaries taken as a whole, and, to the best of the Company's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(k) The Company is not, and after giving effect to each offering and
sale of the Securities will not be, an "investment company" or an entity
"controlled" by an "investment company", as such terms are defined in the
Investment Company Act of 1940, as amended (the "Investment Company
Act");
(l) Neither the Company nor any of its affiliates does business with
the government of Cuba or with any person or affiliate located in Cuba
within the meaning of Section 517.075, Florida Statutes;
(m) Immediately after any sale of Securities by the Company hereunder
or under any Terms Agreement, the aggregate amount of Securities which
shall have been issued and sold by the Company hereunder or under any
Terms Agreement and of any debt securities of the Company (other than
such Securities) that shall have been issued and sold pursuant to the
Registration Statement will not exceed the amount of debt securities
registered under the Registration Statement; and
(n) KPMG Peat Marwick LLP, who have certified certain financial
statements of the Company and its subsidiaries, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder.
2. (a) On the basis of the representations and warranties herein
contained, and subject to the terms and conditions herein set forth, each
of the Agents hereby severally and not jointly agrees, as agent of the
Company, to use its reasonable efforts to solicit and receive offers to
purchase the Securities from the Company upon the terms and conditions
set forth in the Prospectus as amended or supplemented from time to time.
So long as this Agreement shall remain in effect with respect to any
Agent, the Company shall not, without the consent of such Agent, solicit
or accept offers to purchase, or sell, any debt securities with a
maturity at the time of original issuance of more than 9 months except
pursuant to this Agreement, any Terms Agreement, or except pursuant to a
private placement not constituting a public offering under
5
<PAGE>
the Act or except in connection with a firm commitment underwriting
pursuant to an underwriting agreement that does not provide for a continuous
offering of medium-term debt securities. However, the Company reserves the
right to sell, and may solicit and accept offers to purchase, Securities
directly on its own behalf in transactions with persons other than
broker-dealers, and, in the case of any such sale not resulting from a
solicitation made by any Agent, no commission will be payable with respect
to such sale. These provisions shall not limit Section 4(f) hereof or any
similar provision included in any Terms Agreement.
Procedural details relating to the issue and delivery of Securities,
the solicitation of offers to purchase Securities and the payment in each
case therefor shall be as set forth in the Administrative Procedure attached
hereto as Annex II as it may be amended from time to time by written
agreement between the Agents and the Company (the "Administrative
Procedure"). The provisions of the Administrative Procedure shall apply to
all transactions contemplated hereunder other than those made pursuant to a
Terms Agreement. Each Agent and the Company agree to perform the respective
duties and obligations specifically provided to be performed by each of them
in the Administrative Procedure. The Company will furnish to the Trustee a
copy of the Administrative Procedure as from time to time in effect.
The Company reserves the right, in its sole discretion, to instruct the
Agents to suspend at any time, for any period of time or permanently, the
solicitation of offers to purchase the Securities. As soon as practicable,
but in any event not later than one business day in New York City, after
receipt of notice from the Company, the Agents will suspend solicitation of
offers to purchase Securities from the Company until such time as the
Company has advised the Agents that such solicitation may be resumed.
During such period, the Company shall not be required to comply with the
provisions of Sections 4(h), 4(i), 4(j) and 4(k). Upon advising the Agents
that such solicitation may be resumed, however, the Company shall
simultaneously provide the documents required to be delivered by Sections
4(h), 4(i), 4(j) and 4(k) if such documents would have otherwise been
required to be delivered during such period, and the Agents shall have no
obligation to solicit offers to purchase the Securities until such documents
have been received by the Agents. In addition, any failure by the Company
to comply with its obligations hereunder, including without limitation its
obligations to deliver the documents required by Sections 4(h), 4(i), 4(j)
and 4(k), shall automatically terminate the Agents' obligations hereunder,
including without limitation its obligations to solicit offers to purchase
the Securities hereunder as agent or to purchase Securities hereunder as
principal.
The Company may authorize any other firm (an "Additional Agent") to
act as its agent to solicit offers for the purchase of Securities upon
reasonable prior notice to such Agents as are at the time parties to this
Agreement. Each Additional Agent shall execute a copy of this Agreement
and become a party hereto. From and after the time such Additional Agent
shall have executed a copy of this Agreement, the term "Agent" as used
in this Agreement shall mean the Agent and Additional Agent.
The Company agrees to pay each Agent a commission (which may be in
the form of a discount), at the time of settlement of any sale of a
Security by the Company as a result of a solicitation made by such Agent,
in an amount equal to the following applicable percentage of the principal
amount (or for Original Issue Discount Notes that do not currently pay
interest, the issue price) of such Security sold:
6
<PAGE>
<TABLE>
<CAPTION>
Commission
(percentage of
aggregate
principal amount (or for
Original Issue Discount
Notes that do not
currently pay interest, the
issue price)
Range of Maturities of Securities sold)
------------------- -------------------
<S> <C>
From 9 months to less than 1 year .125%
From 1 year to less than 18 months .150%
From 18 months to less than 2 years .200%
From 2 years to less than 3 years .250%
From 3 years to less than 4 years .350%
From 4 years to less than 5 years .450%
From 5 years to less than 6 years .500%
From 6 years to less than 7 years .550%
From 7 years to less than 10 years .600%
From 10 years to less than 15 years .625%
From 15 years to less than 20 years .675%
From 20 years to 30 years .750%
From more than 30 years to less than 50 years .875%
50 years and more 1.000%
</TABLE>
(b) Each sale of Securities to any Agent as principal shall be made in
accordance with the terms of this Agreement and (unless the Company and such
Agent shall otherwise agree) a Terms Agreement which will provide for the
sale of such Securities to, and the purchase thereof by, such Agent; a Terms
Agreement may also specify certain provisions relating to the reoffering of
such Securities by such Agent; the commitment of any Agent to purchase
Securities as principal, whether pursuant to any Terms Agreement or
otherwise, shall be deemed to have been made on the basis of the
representations and warranties of the Company herein contained and shall be
subject to the terms and conditions herein set forth; each Terms Agreement
shall specify the principal amount of Securities to be purchased by any
Agent pursuant thereto, the price to be paid to the Company for such
Securities, any provisions relating to rights of, and default by,
underwriters acting together with such Agent in the reoffering of the
Securities and the time and date and place of delivery of and payment for
such Securities; and such Terms Agreement shall also specify any
requirements for opinions of counsel, accountants' letters and officers'
certificates pursuant to Section 4 hereof. Each Agent proposes to offer
Securities purchased by it as principal for sale at prevailing market prices
or prices related thereto at the time of sale, which may be equal to,
greater than or less than the price at which such Securities are purchased
by such Agent from the Company.
For each sale of Securities to an Agent as principal that is not made
pursuant to a Terms Agreement, the procedural details relating to the issue
and delivery of such Securities and
7
<PAGE>
payment therefor shall be as set forth in the Administrative Procedure.
For each such sale of Securities to an Agent as principal that is not
made pursuant to a Terms Agreement, the Company agrees to pay such Agent
a commission (or grant an equivalent discount) as provided in Section
2(a) hereof and in accordance with the schedule set forth therein.
Each time and date of delivery of and payment for Securities to be
purchased by an Agent as principal, whether set forth in a Terms
Agreement or in accordance with the Administrative Procedure, is referred
to herein as a "Time of Delivery".
(c) Each Agent agrees, with respect to any Security denominated in a
currency other than U.S. dollars, as agent, directly or indirectly, not
to solicit offers to purchase, and as principal under any Terms Agreement
or otherwise, directly or indirectly, not to offer, sell or deliver, such
Security in, or to residents of, the country issuing such currency,
except as permitted by applicable law.
3. The documents required to be delivered pursuant to Section 6 hereof on
the Commencement Date (as defined below) shall be delivered to the Agents at
the offices of Sullivan & Cromwell, 125 Broad Street, New York, New York, at
11:00 a.m., New York City time, on the date of this Agreement, which date and
time of such delivery may be postponed by agreement between the Agents and the
Company but in no event shall be later than the day prior to the date on which
solicitation of offers to purchase Securities is commenced or on which any Terms
Agreement is executed (such time and date being referred to herein as the
"Commencement Date").
4. The Company covenants and agrees with each Agent:
(a) (i) To make no amendment or supplement to the Registration
Statement or the Prospectus (A) prior to the Commencement Date which
shall be disapproved by any Agent promptly after reasonable notice
thereof or (B) after the date of any Terms Agreement or other agreement
by an Agent to purchase Securities as principal and prior to the related
Time of Delivery which shall be disapproved by any Agent party to such
Terms Agreement or so purchasing as principal promptly after reasonable
notice thereof; (ii) to prepare, with respect to any Securities to be
sold through or to such Agent pursuant to this Agreement, a Pricing
Supplement with respect to such Securities in a form previously approved
by such Agent and to file such Pricing Supplement pursuant to Rule
424(b)(3) under the Act not later than the close of business of the
Commission on the fifth business day after the date on which such Pricing
Supplement is first used; (iii) to make no amendment or supplement to the
Registration Statement or Prospectus, other than any Pricing Supplement,
at any time prior to having afforded each Agent a reasonable
opportunity to review and comment thereon; (iv) to file promptly all
reports and any definitive proxy or information statements required to be
filed by the Company with the Commission pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act for so long as the delivery of a
prospectus is required in connection with the offering or sale of the
Securities, and during such same period to advise such Agent, promptly
after the Company receives notice thereof, of the time when any amendment
to the Registration Statement has been filed or has become effective or
any supplement to the Prospectus or any amended Prospectus (other than
any Pricing Supplement that relates to Securities not purchased through
or by such Agent) has been filed with the Commission, of the issuance
by the Commission of any stop order or of any order preventing or
suspending the use of any prospectus relating to the Securities, of the
suspension of the qualification of the Securities for offering or sale
in any jurisdiction, of the initiation or threatening of any proceeding
for any such
8
<PAGE>
purpose, or of any request by the Commission for the amendment or
supplement of the Registration Statement or Prospectus or for additional
information; and (v) in the event of the issuance of any such stop order
or of any such order preventing or suspending the use of any such
prospectus or suspending any such qualification, to use promptly its best
efforts to obtain its withdrawal;
(b) Promptly from time to time to take such action as such Agent may
reasonably request to qualify the Securities for offering and sale
under the securities laws of such jurisdictions as such Agent may request
and to comply with such laws so as to permit the continuance of sales and
dealings therein for as long as may be necessary to complete the
distribution or sale of the Securities; provided, however, that in
connection therewith the Company shall not be required to qualify as a
foreign corporation or to file a general consent to service of process
in any jurisdiction;
(c) To furnish such Agent with copies of the Registration Statement
and each amendment thereto, with copies of the Prospectus as each time
amended or supplemented, other than any Pricing Supplement (except as
provided in the Administrative Procedure), in the form in which it is
filed with the Commission pursuant to Rule 424 under the Act, and with
copies of the documents incorporated by reference therein, all in such
quantities as such Agent may reasonably request from time to time; and,
if the delivery of a prospectus is required at any time in connection
with the offering or sale of the Securities (including Securities
purchased from the Company by such Agent as principal) and if at such
time any event shall have occurred as a result of which the Prospectus as
then amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made when such Prospectus is delivered, not misleading,
or, if for any other reason it shall be necessary during such same period
to amend or supplement the Prospectus or to file under the Exchange Act
any document incorporated by reference in the Prospectus in order to
comply with the Act, the Exchange Act or the Trust Indenture Act, to
notify such Agent and request such Agent, in its capacity as agent of
the Company, to suspend solicitation of offers to purchase Securities
from the Company (and, if so notified, such Agent shall cease such
solicitations as soon as practicable, but in any event not later than
one business day later); and if the Company shall decide to amend or
supplement the Registration Statement or the Prospectus as then amended
or supplemented, to so advise such Agent promptly by telephone (with
confirmation in writing) and to prepare and cause to be filed promptly
with the Commission an amendment or supplement to the Registration
Statement or the Prospectus as then amended or supplemented that will
correct such statement or omission or effect such compliance; provided,
however, that if during such same period such Agent continues to own
Securities purchased from the Company by such Agent as principal or
such Agent is otherwise required to deliver a prospectus in respect of
transactions in the Securities, the Company shall promptly prepare and
file with the Commission such an amendment or supplement;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule 158(c)
under the Act), an earnings statement of the Company and its subsidiaries
(which need not be audited) complying with Section 11(a) of the Act and
the rules and regulations of the Commission thereunder (including, at
the option of the Company, Rule 158);
9
<PAGE>
(e) So long as any Securities are outstanding, to furnish to such Agent
copies of all reports or other communications (financial or other)
furnished generally to shareholders, and deliver to such Agent (i) as
soon as they are available, copies of any reports and financial
statements furnished to or filed with the Commission or any national
securities exchange on which any class of securities of the Company is
listed; and (ii) such additional information concerning the business
and financial condition of the Company as such Agent may from time to
time reasonably request (such financial statements to be on a
consolidated basis to the extent the accounts of the Company and its
subsidiaries are consolidated in reports furnished to its shareholders
generally or to the Commission);
(f) That, from the date of any Terms Agreement with such Agent or other
agreement by such Agent to purchase Securities as principal and
continuing to and including the later of (i) the termination of the
trading restrictions for the Securities purchased thereunder, as
notified to the Company by such Agent and (ii) the related Time of
Delivery, not to offer, sell, contract to sell or otherwise dispose
of any debt securities of the Company which both mature more than
9 months after such Time of Delivery and are substantially similar
to the Securities, without the prior written consent of such Agent;
(g) That each acceptance by the Company of an offer to purchase
Securities hereunder (including any purchase by such Agent as principal
not pursuant to a Terms Agreement), and each execution and delivery by
the Company of a Terms Agreement with such Agent, shall be deemed to be
an affirmation to such Agent that the representations and warranties of
the Company contained in or made pursuant to this Agreement are true and
correct as of the date of such acceptance or of such Terms Agreement, as
the case may be, as though made at and as of such date, and an
undertaking that such representations and warranties will be true and
correct as of the settlement date for the Securities relating to such
acceptance or as of the Time of Delivery relating to such sale, as the
case may be, as though made at and as of such date (except that such
representations and warranties shall be deemed to relate to the
Registration Statement and the Prospectus as amended and supplemented
relating to such Securities);
(h) That reasonably in advance of each time the Registration Statement
or the Prospectus shall be amended or supplemented (other than by a
Pricing Supplement), each time a document filed under the Act or the
Exchange Act is incorporated by reference into the Prospectus, and each
time the Company sells Securities to such Agent as principal pursuant to
a Terms Agreement and such Terms Agreement specifies the delivery of an
opinion or opinions by Sullivan & Cromwell, counsel to the Agents, as a
condition to the purchase of Securities pursuant to such Terms Agreement,
the Company shall furnish to such counsel such papers and information as
they may reasonably request to enable them to furnish to such Agent the
opinion or opinions referred to in Section 6(b) hereof;
(i) That each time the Registration Statement or the Prospectus shall
be amended or supplemented (other than by a Pricing Supplement), each
time a document filed under the Act or the Exchange Act is incorporated
by reference into the Prospectus and each time the Company sells
Securities to such Agent as principal pursuant to a Terms Agreement and
such Terms Agreement specifies the delivery of an opinion under this
Section 4(i) as a condition to the purchase of Securities pursuant to
such Terms Agreement, the Company shall furnish or cause to be furnished
forthwith to such Agent a written opinion of Richard G. McCauley,
10
<PAGE>
general counsel of the Company, and Fried, Frank, Harris, Shriver &
Jacobson, special counsel for the Company, or other counsel for the
Company satisfactory to such Agent, dated the date of such amendment,
supplement, incorporation or Time of Delivery relating to such sale, as
the case may be, in form satisfactory to such Agent, to the effect that
such Agent may rely on the opinion of such counsel referred to in Section
6(c) and Section 6(d) hereof which was last furnished to such Agent to
the same extent as though it were dated the date of such letter
authorizing reliance (except that the statements in such last opinion
shall be deemed to relate to the Registration Statement and the
Prospectus as amended and supplemented to such date) or, in lieu of such
opinion, an opinion of the same tenor as the opinion of such counsel
referred to in Section 6(c) and Section 6(d) hereof but modified to
relate to the Registration Statement and the Prospectus as amended and
supplemented to such date;
(j) That each time the Registration Statement or the Prospectus shall
be amended or supplemented and each time that a document filed under the
Act or the Exchange Act is incorporated by reference into the Prospectus,
in either case to set forth financial information included in or derived
from the Company's consolidated financial statements or accounting
records, and each time the Company sells Securities to such Agent as
principal pursuant to a Terms Agreement and such Terms Agreement
specifies the delivery of a letter under this Section 4(j) as a condition
to the purchase of Securities pursuant to such Terms Agreement, the
Company shall cause the independent certified public accountants who have
certified the financial statements of the Company and its subsidiaries
included or incorporated by reference in the Registration Statement, or
such other independent certified public accountants as are reasonably
satisfactory to such Agent, forthwith to furnish such Agent a letter,
dated the date of such amendment, supplement, incorporation or Time of
Delivery relating to such sale, as the case may be, in form satisfactory
to such Agent, of the same tenor as the letter referred to in Section
6(e) hereof but modified to relate to the Registration Statement and the
Prospectus as amended or supplemented to the date of such letter, with
such changes as may be necessary to reflect changes in the financial
statements and other information derived from the accounting records of
the Company, to the extent such financial statements and other
information are available as of a date not more than five business days
prior to the date of such letter; provided, however, that, with respect
to any financial information or other matter, such letter may reconfirm
as true and correct at such date as though made at and as of such date,
rather than repeat, statements with respect to such financial information
or other matter made in the letter referred to in Section 6(e) hereof
which was last furnished to such Agent;
(k) That each time the Registration Statement or the Prospectus shall
be amended or supplemented (other than by a Pricing Supplement), each
time a document filed under the Act or the Exchange Act is incorporated
by reference into the Prospectus and each time the Company sells
Securities to such Agent as principal and the applicable Terms Agreement
specifies the delivery of a certificate under this Section 4(k) as a
condition to the purchase of Securities pursuant to such Terms Agreement,
the Company shall (and with respect to any filings other than a Form
10-Q, Form 10-K and Form 8-K and any amendments thereto, upon the request
of such Agent) furnish or cause to be furnished forthwith to such Agent a
certificate, dated the date of such supplement, amendment, incorporation
or Time of Delivery relating to such sale, as the case may be, in such
form and executed by such officers of the Company as shall be
satisfactory to such Agent, to the effect that the statements contained
in the certificates referred to in Section 6(j) hereof which were last
furnished to such Agent are true and correct at such date as though made
at and as of such date (except that such statements shall be deemed to
relate to the Registration Statement
11
<PAGE>
and the Prospectus as amended and supplemented to such date) or, in lieu
of such certificate, certificates of the same tenor as the certificates
referred to in said Section 6(j) but modified to relate to the
Registration Statement and the Prospectus as amended and supplemented to
such date; and
(l) To offer to any person who has agreed to purchase Securities from
the Company as the result of an offer to purchase solicited by such Agent
the right to refuse to purchase and pay for such Securities if, on the
related settlement date fixed pursuant to the Administrative Procedure,
any condition set forth in Section 6(a), 6(f), 6(g) or 6(h) hereof shall
not have been satisfied (it being understood that the judgment of such
person with respect to the impracticability or inadvisability of such
purchase of Securities shall be substituted, for purposes of this Section
4(l), for the respective judgments of an Agent with respect to certain
matters referred to in such Sections 6(f) and 6(h), and that such Agent
shall have no duty or obligation whatsoever to exercise the judgment
permitted under such Sections 6(f) and 6(h) on behalf of any such
person).
5. The Company covenants and agrees with each Agent that the Company will
pay or cause to be paid the following: (i) the fees, disbursements and expenses
of the Company's counsel and accountants in connection with the registration of
the Securities under the Act and all other expenses in connection with the
preparation, printing and filing of the Registration Statement, any Preliminary
Prospectus, the Prospectus and any Pricing Supplements and all other amendments
and supplements thereto and the mailing and delivering of copies thereof to such
Agent; (ii) the reasonable fees, disbursements and expenses of counsel for the
Agents in connection with the establishment of the program contemplated hereby,
any opinions to be rendered by such counsel hereunder and under any Terms
Agreement and the transactions contemplated hereunder and under any Terms
Agreement; (iii) the cost of printing, producing or reproducing this Agreement,
any Terms Agreement, any Indenture, any Blue Sky and Legal Investment Memoranda,
closing documents (including any compilations thereof) and any other documents
so long as such documents have been approved by the Company in connection with
the offering, purchase, sale and delivery of the Securities; (iv) all expenses
in connection with the qualification of the Securities for offering and sale
under state securities laws as provided in Section 4(b) hereof, including the
fees and disbursements of Fried, Frank, Harris, Shriver & Jacobson in connection
with such qualification and in connection with the Blue Sky and legal investment
surveys; (v) any fees charged by securities rating services for rating the
Securities; (vi) any filing fees incident to, and the reasonable fees and
disbursements of Fried, Frank, Harris, Shriver & Jacobson in connection with,
any required review by the National Association of Securities Dealers, Inc. of
the terms of the sale of the Securities; (vii) the cost of preparing the
Securities; (viii) the reasonable fees and expenses of any Trustee and any agent
of any Trustee and any transfer or paying agent of the Company and the
reasonable fees and disbursements of counsel for any Trustee or such agent in
connection with any Indenture and the Securities; (ix) any advertising expenses
connected with the solicitation of offers to purchase and the sale of Securities
so long as such advertising expenses have been approved by the Company; and (x)
all other costs and expenses incident to the performance of its obligations
hereunder which are not otherwise specifically provided for in this Section.
Except as provided in Sections 7 and 8 hereof, each Agent shall pay all other
expenses it incurs.
6. The obligation of any Agent, as agent of the Company, at any time
("Solicitation Time") to solicit offers to purchase the Securities and the
obligation of any Agent to purchase Securities as principal, pursuant to any
Terms Agreement or otherwise, shall in each case be subject, in such Agent's
12
<PAGE>
discretion, to the condition that all representations and warranties and other
statements of the Company herein (and, in the case of an obligation of an Agent
under a Terms Agreement, in or incorporated by reference in such Terms
Agreement) are true and correct at and as of the Commencement Date and any
applicable date referred to in Section 4(k) hereof that is prior to such
Solicitation Time or Time of Delivery, as the case may be, and at and as of such
Solicitation Time or Time of Delivery, as the case may be, the condition that
prior to such Solicitation Time or Time of Delivery, as the case may be, the
Company shall have performed all of its obligations hereunder theretofore to be
performed, and the following additional conditions:
(a) (i) With respect to any Securities sold at or prior to such
Solicitation Time or Time of Delivery, as the case may be, the Prospectus
as amended or supplemented (including the Pricing Supplement) with
respect to such Securities shall have been filed with the Commission
pursuant to Rule 424(b) under the Act within the applicable time period
prescribed for such filing by the rules and regulations under the Act and
in accordance with Section 4(a) hereof; (ii) no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by
the Commission; and (iii) all requests for additional information on the
part of the Commission shall have been complied with to the reasonable
satisfaction of such Agent;
(b) Sullivan & Cromwell, counsel to the Agents, shall have furnished to
such Agent (i) such opinion or opinions, dated the Commencement Date,
with respect to the incorporation of the Company, the validity of the
Indenture, the Securities, the Registration Statement, the Prospectus,
and such other related matters as such Agent may reasonably request, and
(ii) if and to the extent requested by such Agent, with respect to each
applicable date referred to in Section 4(h) hereof that is on or prior to
such Solicitation Time or Time of Delivery, as the case may be, an
opinion or opinions, dated such applicable date, to the effect that such
Agent may rely on the opinion or opinions which were last furnished to
such Agent pursuant to this Section 6(b) to the same extent as though it
or they were dated the date of such letter authorizing reliance (except
that the statements in such last opinion or opinions shall be deemed to
relate to the Registration Statement and the Prospectus as amended and
supplemented to such date) or, in any case, in lieu of such an opinion or
opinions, an opinion or opinions of the same tenor as the opinion or
opinions referred to in clause (i) but modified to relate to the
Registration Statement and the Prospectus as amended and supplemented to
such date; and in each case such counsel shall have received such papers
and information as they may reasonably request to enable them to pass
upon such matters;
(c) Richard G. McCauley, Senior Vice President and General Counsel of
the Company or other counsel for the Company satisfactory to such Agent,
shall have furnished to such Agent his written opinion (which may be
limited to the laws of the State of Maryland and, with respect to clauses
(xii) and (xiii) below, the Federal Securities laws), dated the
Commencement Date and each applicable date referred to in Section 4(i)
hereof that is on or prior to such Solicitation Time or Time of Delivery,
as the case may be, in form and substance reasonably satisfactory to such
Agent, to the effect that:
(i) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of
Maryland, with corporate power and authority to own its properties
and conduct its business as described in the Prospectus as amended or
supplemented;
13
<PAGE>
(ii) The Company has an authorized capitalization as set forth in
the Prospectus as amended or supplemented, and all of the issued
shares of capital stock of the Company have been duly and validly
authorized and issued and are fully paid and non-assessable;
(iii) The Company has been duly qualified as a foreign corporation
for the transaction of business and is in good standing under the
laws of each other jurisdiction in which the failure so to qualify
and maintain good standing would have a material adverse effect on
the Company and its subsidiaries taken as a whole (such counsel being
entitled to rely in respect of the opinion in this clause upon
opinions of local counsel and in respect of matters of fact upon
certificates of officers of the Company, provided that such counsel
shall state that he believes that both such Agent and he are
justified in relying upon such opinions and certificates);
(iv) Each Significant Subsidiary (as defined below) of the Company
that is incorporated under the laws of the State of Maryland has been
duly incorporated and is validly existing as a corporation in good
standing under the laws of the State of Maryland; and all of the
issued shares of capital stock of each such subsidiary have been duly
and validly authorized and issued, are fully paid and non-assessable,
and are owned (with exceptions that are not material to the Company
and its subsidiaries, taken as a whole) directly or indirectly by the
Company, free and clear of all liens, encumbrances or claims
(collectively "Liens") except (i) Liens relating to debt which has
been disclosed specifically, generally or in the aggregate in the
Prospectus as amended or supplemented or incurred after the date of
the latest audited financial statements included or incorporated by
reference in the Prospectus as amended or supplemented in the
ordinary course of business (including financings), (ii) Liens
incurred in the ordinary course of business which are not materially
adverse to the operations of the Company and its subsidiaries, taken
as a whole, or (iii) restrictions on the transfer or use of the stock
of any subsidiary under any partnership, joint venture agreements or
lease agreements to which the Company or any of its subsidiaries is a
party (such counsel being entitled to rely in respect of the opinion
in this clause upon opinions of local counsel and in respect of
matters of fact upon certificates of officers of the Company or its
subsidiaries, provided that such counsel shall state that he believes
that both such Agent and he are justified in relying upon such
opinions and certificates); "Significant Subsidiary" is defined to be
any subsidiary of the Company that holds assets that have a value, on
a current value basis, in excess of 3% of the Company's Total Common
Stock and Other Shareholders' Equity, on a current value basis, as
reported in the Company's most recent Annual Report on Form 10-K or
Annual Report to Shareholders.
(v) To the best of such counsel's knowledge and other than as set
forth in the Prospectus as amended or supplemented, there are no
legal or governmental proceedings pending to which the Company or any
of its subsidiaries is a party or of which any property of the
Company or any of its subsidiaries is the subject which is likely,
individually or in the aggregate, to have a material adverse effect
on the Company and its subsidiaries, taken as a whole, and, to the
best of such counsel's knowledge, no such proceedings are threatened
or contemplated by governmental authorities or threatened by others;
14
<PAGE>
(vi) This Agreement and any applicable Terms Agreement have been
duly authorized, executed and delivered by the Company;
(vii) The Securities have been duly authorized;
(viii) The Indenture has been duly authorized, executed and
delivered by the Company;
(ix) To the best of such counsel's knowledge, the issue and sale
of the Securities and the compliance by the Company with all of the
provisions of the Securities, the Indenture, this Agreement and any
Terms Agreement, and the consummation of the transactions herein and
therein contemplated will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement
or other agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of
the Company or any of its subsidiaries is subject except for any such
conflict, breach, violation or default which does not have a material
adverse effect on the Company and its subsidiaries, taken as a whole,
nor will such actions result in any violation of the provisions of
the Articles of Incorporation or Bylaws of the Company or any statute
or any order, rule or regulation known to such counsel of any court
or governmental agency or body having jurisdiction over the Company
or any of its properties;
(x) To the best of such counsel's knowledge, no consent,
approval, authorization, order, registration or qualification of or
with any court or governmental agency or body is required for the
solicitation of offers to purchase Securities, issue and sale of the
Securities or the consummation by the Company of the other
transactions contemplated by this Agreement, any Terms Agreement or
the Indenture, except such as have been, or will have been prior to
the Commencement Date, obtained under the Act or the Trust Indenture
Act and such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky
laws in connection with the solicitation by the Agents of offers to
purchase Securities from the Company and with purchases of Securities
by an Agent as principal, as the case may be, in each case in the
manner contemplated hereby;
(xi) The Company is not and, after giving effect to the offering
and sale of the Securities, will not be an "investment company" or an
entity "controlled" by an "investment company", as such terms are
defined in the Investment Company Act;
(xii) The documents incorporated by reference in the Prospectus as
amended or supplemented (other than the financial statements and
related notes and schedules therein and other financial data included
therein or omitted therefrom, as to which such counsel need express
no opinion), when they were filed with the Commission appear on their
face to be appropriately responsive, in all material respects, to the
requirements of the Exchange Act and the rules and regulations of the
Commission thereunder; and nothing has come to his attention to cause
him to believe that any of such documents, when they were so filed
contained an untrue statement of a material fact or omitted to state
a material fact necessary in order to make the statements therein, in
the light of
15
<PAGE>
the circumstances under which they were made when such documents were
so filed, not misleading; and
(xiii) Nothing has come to his attention to cause him to believe
that, as of its effective date, the Registration Statement or any
further amendment or supplement thereto made by the Company prior to
the date of such opinion (other than the financial statements and
related notes and schedules therein and other financial data included
therein or excluded therefrom and Form T-1, as to which such counsel
need express no opinion) contained an untrue statement of a material
fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or
that, as of the date of such opinion, the Prospectus as amended or
supplemented or any further amendment or supplement thereto made by
the Company prior to the date of such opinion (other than the
financial statements and related notes and schedules therein and
other financial data included therein or excluded therefrom and
Form T-1, as to which such counsel need express no opinion) contained
an untrue statement of a material fact or omitted to state a material
fact necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading; and he does
not know of any amendment to the Registration Statement required to
be filed or any contracts or other documents of a character required
to be filed as an exhibit to the Registration Statement or required
to be incorporated by reference into the Prospectus as amended or
supplemented or required to be described in the Registration
Statement or the Prospectus as amended or supplemented which are not
filed or incorporated by reference or described as required.
(d) Fried, Frank, Harris, Shriver & Jacobson, special counsel for the
Company, or other counsel for the Company satisfactory to such Agent,
shall have furnished to such Agent their written opinion (which will be
limited to the laws of the State of New York and Federal laws and may
rely on an opinion of Richard G. McCauley, or other counsel for the
Company reasonably satisfactory to such Agent, as to the laws of the
State of Maryland), dated the Commencement Date and each applicable date
referred to in Section 4(i) hereof that is on or prior to such
Solicitation Time or Time of Delivery, as the case may be, in form and
substance reasonably satisfactory to such Agent, to the effect that:
(i) The Securities, when duly executed, authenticated, issued and
delivered by the Company, will constitute valid and binding
obligations of the Company, enforceable against the Company in
accordance with their terms;
(ii) The Indenture constitutes a valid and binding obligation of
the Company, enforceable against the Company in accordance with its
terms;
(iii) The Indenture has been qualified under the Trust Indenture
Act;
(iv) The Indenture conforms, and the Securities will conform, in
all material respects to the descriptions thereof contained in the
Prospectus as amended or supplemented; and
(v) At the time the Registration Statement was declared effective
by the Commission, the Registration Statement and the Prospectus
(other than (a) the financial statements, notes and schedules
thereto, (b) other financial data and statistical
16
<PAGE>
information included therein, (c) the documents incorporated by
reference therein and (d) the Form T-1, included therein, as to which
such counsel need not express an opinion), appeared on their face to
be responsive as to form in all material respects to the requirements
of the Act and the Trust Indenture Act and the rules and regulations
promulgated thereunder.
The opinion set forth in paragraphs (i) and (ii) above is subject to:
(i) applicable bankruptcy, insolvency, reorganization, fraudulent
transfer, moratorium or other laws now or hereafter in effect
affecting creditors' rights generally; and
(ii) general principles of equity (including, without limitation,
standards of materiality, good faith, fair dealing and
reasonableness) whether such principles are considered in a
proceeding in equity or at law;
(e) Not later than 10:00 a.m., New York City time, on the Commencement
Date and on each applicable date referred to in Section 4(j) hereof that
is on or prior to such Solicitation Time or Time of Delivery, as the case
may be, the independent certified public accountants who have certified
the financial statements of the Company and its subsidiaries included or
incorporated by reference in the Registration Statement, as amended or
supplemented, or such other independent certified public accountants as
are reasonably satisfactory to such Agent, shall have furnished to such
Agent a letter, dated the Commencement Date or such applicable date, as
the case may be, in form and substance reasonably satisfactory to such
Agent, to the effect set forth in Annex III hereto;
(f) (i) The Company and its subsidiaries, taken as a whole, have not
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus as amended or
supplemented prior to the date of the Pricing Supplement relating to the
Securities to be delivered at the relevant Time of Delivery any material
loss or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than
as set forth or contemplated in the Prospectus as amended or supplemented
prior to the date of the Pricing Supplement relating to the Securities to
be delivered at the relevant Time of Delivery and (ii) since the
respective dates as of which information is given in the Prospectus as
amended or supplemented prior to the date of the Pricing Supplement
relating to the Securities to be delivered at the relevant Time of
Delivery there shall not have been any change in the capital stock (other
than issuance of capital stock upon exercise of options and stock
appreciation rights and upon conversion of convertible securities, in
each case which were outstanding as of the date of the latest audited
financial statements included or incorporated by reference in the
Prospectus as amended or supplemented prior to the date of the Pricing
Statement relating to the Securities to be delivered at the relevant Time
of Delivery) or any material adverse change in the long-term debt of the
Company and its subsidiaries, taken as a whole, or any material adverse
change, or any development involving a prospective material adverse
change, in or affecting the general affairs, management, current value
basis shareholders' equity or results of operations (based on Earnings
Before Depreciation and Deferred Taxes from Operations) of the Company
and its subsidiaries, taken as a whole, otherwise than as set forth or
contemplated in the Prospectus as amended or supplemented prior to the
date of the Pricing Supplement relating to the Securities to be delivered
at the relevant Time of Delivery, the effect of which, in any
17
<PAGE>
such case described in clause (i) or (ii), is in the judgment of such
Agent so material and adverse as to make it impracticable or inadvisable
to proceed with the solicitation by such Agent of offers to purchase
Securities from the Company or the purchase by such Agent of Securities
from the Company as principal, as the case may be, on the terms and in
the manner contemplated in the Prospectus as amended or supplemented
prior to the date of the Pricing Supplement relating to the Securities to
be delivered at the relevant Time of Delivery;
(g) On or after the date hereof (i) no downgrading shall have occurred
in the rating accorded the Company's debt securities by any "nationally
recognized statistical rating organization", as that term is defined by
the Commission for purposes of Rule 436(g)(2) under the Act and (ii) no
such organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating
of any of the Company's debt securities;
(h) On or after the date hereof there shall not have occurred any of
the following: (i) a suspension or material limitation in trading in
securities generally on the New York Stock Exchange; (ii) a general
moratorium on commercial banking activities in New York declared by
either Federal or New York State authorities; or (iii) the outbreak or
escalation of hostilities involving the United States or the declaration
by the United States of a national emergency or war, if the effect of any
such event specified in this clause (iii) in such Agent's reasonable
judgment makes it impracticable or inadvisable to proceed with the public
offering or the delivery of the Securities on the terms and in the manner
contemplated by the Prospectus; and
(i) With respect to any Security denominated in a currency other than
the U.S. dollar, more than one currency or a composite currency or any
Security the principal or interest of which is indexed to such currency,
currencies or composite currency, there shall not have occurred a
suspension or material limitation in foreign exchange trading in such
currency, currencies or composite currency by major international banks,
a general moratorium on commercial banking activities in the country or
countries issuing such currency, currencies or composite currency, the
outbreak or escalation of hostilities involving, the occurrence of any
material adverse change in the existing financial, political or economic
conditions of, or the declaration of war or a national emergency by, the
country or countries issuing such currency, currencies or composite
currency or the imposition or proposal of exchange controls by any
governmental authority in the country or countries issuing such currency,
currencies or composite currency; and
(j) The Company shall have furnished or caused to be furnished to such
Agent certificates of officers of the Company dated the Commencement Date
and each applicable date referred to in Section 4(k) hereof that is on or
prior to such Solicitation Time or Time of Delivery, as the case may be,
in such form and executed by such officers of the Company as shall be
satisfactory to such Agent, as to the accuracy of the representations and
warranties of the Company herein at and as of the Commencement Date or
such applicable date, as the case may be, as to the performance by the
Company of all of its obligations hereunder to be performed at or prior
to the Commencement Date or such applicable date, as the case may be, as
to the matters set forth in subsections (a) and (f) of this Section 6,
and as to such other matters as such Agent may reasonably request.
To the extent that any conditions set forth in paragraph (g), (h)
or (i) in this Section 6 are not satisfied and are so specified in a
written notice to such Agent from the Company, such Agent will notify the
Company in writing as soon as practicable whether such Agent will waive
the condition so specified in the Company's notice as a prerequisite to
such Agent's obligations to (A) solicit offers to purchase the Securities
and/or (B) purchase Securities as principal, pursuant to any Terms
Agreement or otherwise.
7. (a) The Company will indemnify and hold harmless each Agent against
any losses, claims, damages or liabilities, joint or several, to which
such Agent may become subject, under the Act
18
<PAGE>
or otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon an untrue
statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement, the Prospectus, the
Prospectus as amended or supplemented or any other prospectus relating to
the Securities, or any amendment or supplement thereto, or arise out of
or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, and will reimburse such Agent for any
legal or other expenses reasonably incurred by it in connection with
investigating or defending any such action or claim as such expenses are
incurred; provided, however, that the Company shall not be liable in any
such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary
Prospectus, the Registration Statement, the Prospectus, the Prospectus as
amended or supplemented or any other prospectus relating to the
Securities, or any such amendment or supplement, in reliance upon and in
conformity with written information furnished to the Company by such
Agent expressly for use therein.
(b) Each Agent will indemnify and hold harmless the Company against
anyb)Each Agent will indemnify and hold harmless the Company against any
losses, claims, damages or liabilities to which the Company may become
subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or
are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, the Registration
Statement, the Prospectus, the Prospectus as amended or supplemented or
any other prospectus relating to the Securities, or any amendment or
supplement thereto, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was
made in any Preliminary Prospectus, the Registration Statement, the
Prospectus, the Prospectus as amended or supplemented or any other
prospectus relating to the Securities, or any such amendment or
supplement, in reliance upon and in conformity with written information
furnished to the Company by such Agent expressly for use therein; and
will reimburse the Company for any legal or other expenses reasonably
incurred by the Company in connection with investigating or defending any
such action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under such subsection, notify the
indemnifying party in writing of the commencement thereof; but the
omission so to notify the indemnifying party shall not relieve it from
any liability which it may have to any indemnified party otherwise than
under such subsection. In case any such action shall be brought against
any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with
any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall
not, except with the consent of the indemnified party, be counsel to the
indemnifying party), and, after notice from the indemnifying party to
such indemnified party of its election so to assume the defense thereof,
the indemnifying party shall not be liable to such indemnified party
under such subsection for any
19
<PAGE>
legal expenses of other counsel or any other expenses, in each case
subsequently incurred by such indemnified party, in connection with the
defense thereof other than reasonable costs of investigation. No
indemnifying party shall, without the written consent of the indemnified
party, effect the settlement or compromise of, or consent to the entry of
any judgment with respect to, any pending or threatened action or claim
in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential
party to such action or claim), unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party
from all liability arising out of such action or claim and (ii) does not
include a statement as to, or an admission of, fault, culpability or a
failure to act, by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then
each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect the relative benefits received by the Company on
the one hand and each Agent on the other from the offering of the
Securities to which such loss, claim, damage or liability (or action in
respect thereof) relates. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law or if
the indemnified party failed to give the notice required under subsection
(c) above, then each indemnifying party shall contribute to such amount
paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the
relative fault of the Company on the one hand and each Agent on the other
in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities (or actions in respect thereof),
as well as any other relevant equitable considerations. The relative
benefits received by the Company on the one hand and each Agent on the
other shall be deemed to be in the same proportion as the total net
proceeds from the sale of Securities (before deducting expenses) received
by the Company bear to the total commissions or discounts received by
such Agent in respect thereof. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state
a material fact required to be stated therein or necessary in order to
make the statements therein not misleading relates to information
supplied by the Company on the one hand or by any Agent on the other and
the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company
and each Agent agree that it would not be just and equitable if
contribution pursuant to this subsection (d) were determined by per
capita allocation (even if all Agents were treated as one entity for such
purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above in this subsection (d).
The amount paid or payable by an indemnified party as a result of the
losses, claims, damages or liabilities (or actions in respect thereof)
referred to above in this subsection (d) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), an Agent shall not
be required to contribute any amount in excess of the amount by which the
total public offering price at which the Securities purchased by or
through it were sold exceeds the amount of any damages which such Agent
has otherwise been required to pay by reason of such untrue or alleged
untrue
20
<PAGE>
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall
be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The obligations of each of the Agents under
this subsection (d) to contribute are several in proportion to the
respective purchases made by or through it to which such loss, claim,
damage or liability (or action in respect thereof) relates and are not
joint.
(e) The obligations of the Company under this Section 7 shall be in
addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls any Agent within the meaning of the Act; and the obligations of
each Agent under this Section 7 shall be in addition to any liability
which such Agent may otherwise have and shall extend, upon the same terms
and conditions, to each officer and director of the Company and to each
person, if any, who controls the Company within the meaning of the Act.
8. Each Agent, in soliciting offers to purchase Securities from the Company
and in performing the other obligations of such Agent hereunder (other than in
respect of any purchase by an Agent as principal, pursuant to a Terms Agreement
or otherwise), is acting solely as agent for the Company and not as principal.
Each Agent will make reasonable efforts to assist the Company in obtaining
performance by each purchaser whose offer to purchase Securities from the
Company was solicited by such Agent and has been accepted by the Company, but
such Agent shall not have any liability to the Company in the event such
purchase is not consummated for any reason. If the Company shall default on its
obligation to deliver Securities to a purchaser whose offer it has accepted, the
Company shall (i) hold each Agent harmless against any loss, claim or damage
arising from or as a result of such default by the Company and (ii)
notwithstanding such default, pay to the Agent that solicited such offer any
commission to which it would be entitled in connection with such sale.
9. The respective indemnities, agreements, representations, warranties and
other statements by any Agent and the Company set forth in or made pursuant to
this Agreement shall remain in full force and effect regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Agent or any controlling person of any Agent, or the Company, or any
officer or director or any controlling person of the Company, and shall survive
each delivery of and payment for any of the Securities.
10.The provisions of this Agreement relating to the solicitation of offers
to purchase Securities from the Company may be suspended or terminated at any
time by the Company as to any Agent or by any Agent as to such Agent upon the
giving of written notice of such suspension or termination to such Agent or the
Company, as the case may be. In the event of such suspension or termination with
respect to any Agent, (x) this Agreement shall remain in full force and effect
with respect to any Agent as to which such suspension or termination has not
occurred, (y) this Agreement shall remain in full force and effect with respect
to the rights and obligations of any party which have previously accrued or
which relate to Securities which are already issued, agreed to be issued or the
subject of a pending offer at the time of such suspension or termination and (z)
in any event, this Agreement shall remain in full force and effect insofar as
the fourth paragraph of Section 2(a), and Sections 4(d), 4(e), 5, 7, 8 and 9
hereof are concerned.
11.Except as otherwise specifically provided herein or in the
Administrative Procedure, all statements, requests, notices and advice hereunder
shall be in writing, or by telephone if promptly confirmed in writing, and if to
[name(s) of Agent(s)] shall be sufficient in all respects when delivered
21
<PAGE>
or sent by telex, facsimile transmission or registered mail to [address(es),
telex no(s). and facsimile transmission no(s). of Agent(s)], and if to the
Company shall be sufficient in all respects when delivered or sent by facsimile
transmission or registered mail to The Rouse Company, 10275 Little Patuxent
Parkway, Columbia, Maryland 21044, Attention: Treasurer, with a copy to the
General Counsel, Facsimile Transmission No. (410) 992-6392.
12. This Agreement and any Terms Agreement shall be binding upon, and inure
solely to the benefit of, each Agent and the Company, and to the extent provided
in Sections 7, 8 and 9 hereof, the officers and directors of the Company and any
person who controls any Agent or the Company, and their respective personal
representatives, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement or any Terms Agreement. No
purchaser of any of the Securities through or from any Agent hereunder shall be
deemed a successor or assign by reason merely of such purchase.
13. Time shall be of the essence in this Agreement and any Terms Agreement.
As used herein, the term "business day" shall mean any day when the Commission's
office in Washington, D.C. is open for business.
14. THIS AGREEMENT AND ANY TERMS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
15. This Agreement and any Terms Agreement may be executed by any one or
more of the parties hereto and thereto in any number of counterparts, each of
which shall be an original, but all of such respective counterparts shall
together constitute one and the same instrument.
If the foregoing is in accordance with your understanding, please sign and
return to us ...... counterparts hereof, whereupon this letter and the
acceptance by each of you thereof shall constitute a binding agreement between
the Company and each of you in accordance with its terms.
Very truly yours,
The Rouse Company
By: .............................
Name:
Title:
Accepted in New York, New York,
as of the date hereof:
[[Name(s) of Agent(s)]
22
<PAGE>
By:.............................
Name:
Title: ]
23
<PAGE>
ANNEX I
THE ROUSE COMPANY
Medium-Term Notes
Terms Agreement
---------------
................. , 19..
[Name(s) and Address(es)
of Agent(s)]
Ladies and Gentlemen:
The Rouse Company (the "Company") proposes, subject to the terms and
conditions stated herein and in the Distribution Agreement, dated
......................., 1995 (the "Distribution Agreement"), between the
Company on the one hand and [Name(s) of Agent(s)] (the "Agents") on the other,
to issue and sell to [Name(s) of Agent(s)] the securities specified in the
Schedule hereto (the "Purchased Securities"). Each of the provisions of the
Distribution Agreement not specifically related to the solicitation by the
Agents, as agents of the Company, of offers to purchase Securities is
incorporated herein by reference in its entirety, and shall be deemed to be part
of this Terms Agreement to the same extent as if such provisions had been set
forth in full herein. Nothing contained herein or in the Distribution Agreement
shall make any party hereto an agent of the Company or make such party subject
to the provisions therein relating to the solicitation of offers to purchase
Securities from the Company, solely by virtue of its execution of this Terms
Agreement. Each of the representations and warranties set forth therein shall
be deemed to have been made at and as of the date of this Terms Agreement,
except that each representation and warranty in Section 1 of the Distribution
Agreement which makes reference to the Prospectus shall be deemed to be a
representation and warranty as of the date of the Distribution Agreement in
relation to the Prospectus (as therein defined), and also a representation and
warranty as of the date of this Terms Agreement in relation to the Prospectus as
amended and supplemented to relate to the Purchased Securities.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Purchased Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the Distribution
Agreement incorporated herein by reference, the Company agrees to issue and sell
to [Name(s) of Agent(s)] and [Name(s) of Agent(s)] agrees to purchase from the
Company the Purchased Securities, at the time and place, in the principal amount
and at the purchase price set forth in the Schedule hereto.
I-1
<PAGE>
If the foregoing is in accordance with your understanding, please sign and
return to us ...... counterparts hereof, and upon acceptance hereof by you this
letter and such acceptance hereof, including those provisions of the
Distribution Agreement incorporated herein by reference, shall constitute a
binding agreement between you and the Company.
The Rouse Company
By: .............................
Name:
Title:
Accepted:
[[Name(s) of Agent(s)]
By: .............................
Name:
Title: ]
I-2
<PAGE>
Schedule to Annex I
Title of Purchased Securities:
Medium-Term Notes
Aggregate Principal Amount:
[$.................... or units of other Specified Currency]
[Price to Public:]
Purchase Price by [Name(s) of Agent(s)]:
% of the principal amount (or for Original Issue Discount Notes that do not
currently pay interest, the issue price) of the Purchased Securities[, plus
accrued interest from ............... to ...............] [and accrued
amortization, if any, from ................. to ................]
Method of and Specified Funds for Payment of Purchase Price:
[By certified or official bank check or checks, payable to the order of the
Company, in [[New York] Clearing House] [immediately available] funds]
[By wire transfer to a bank account specified by the Company in [next day]
[immediately available] funds]
Indenture:
Indenture, dated as of ....................., 1995, between the Company and
The First National Bank of Chicago, as Trustee
Time of Delivery:
Closing Location for Delivery of Securities:
Maturity:
Interest Rate:
[ %]
Interest Payment Dates:
[months and dates]
<PAGE>
Documents to be Delivered:
The following documents referred to in the Distribution Agreement shall be
delivered as a condition to the Closing:
(1) The opinion or opinions of counsel to the Agents referred to in Section
4(h).
(2) The opinions of counsels to the Company referred to in Section 4(i).
(3) The accountants' letter referred to in Section 4(j).
(4) The officers' certificate referred to in Section 4(k).
Other Provisions (including Syndicate Provisions, if applicable):
<PAGE>
ANNEX II
THE ROUSE COMPANY
Administrative Procedure
------------------------
This Administrative Procedure relates to the Securities defined in the
Distribution Agreement, dated ......................, 1995 (the "Distribution
Agreement"), between The Rouse Company (the "Company") and [Name(s) of Agent(s)]
(together, the "Agents"), to which this Administrative Procedure is attached as
Annex II. Defined terms used herein and not defined herein shall have the
meanings given such terms in the Distribution Agreement, the Prospectus as
amended or supplemented or the Indenture.
The procedures to be followed with respect to the settlement of sales of
Securities directly by the Company to purchasers solicited by an Agent, as
agent, are set forth below. The terms and settlement details related to a
purchase of Securities by an Agent, as principal, from the Company will be set
forth in a Terms Agreement pursuant to the Distribution Agreement, unless the
Company and such Agent otherwise agree as provided in Section 2(b) of the
Distribution Agreement, in which case the procedures to be followed in respect
of the settlement of such sale will be as set forth below. An Agent, in
relation to a purchase of a Security by a purchaser solicited by such Agent, is
referred to herein as the "Selling Agent" and, in relation to a purchase of a
Security by such Agent as principal other than pursuant to a Terms Agreement, as
the "Purchasing Agent".
The Company will advise each Agent in writing of those persons with whom
such Agent is to communicate regarding offers to purchase Securities and the
related settlement details.
Each Security will be issued only in fully registered form and will be
represented by either a global security (a "Global Security") delivered to the
Trustee, as agent for The Depository Trust Company (the "Depositary") and
recorded in the book-entry system maintained by the Depositary (a "Book-Entry
Security") or a certificate issued in definitive form (a "Certificated
Security") delivered to a person designated by an Agent, as set forth in the
applicable Pricing Supplement. An owner of a Book-Entry Security will not be
entitled to receive a certificate representing such a Security, except as
provided in the Indenture.
Book-Entry Securities will be issued in accordance with the Administrative
Procedure set forth in Part I hereof, and Certificated Securities will be issued
in accordance with the Administrative Procedure set forth in Part II hereof.
PART I: ADMINISTRATIVE PROCEDURE FOR BOOK-ENTRY SECURITIES
- -----------------------------------------------------------
In connection with the qualification of the Book-Entry Securities for
eligibility in the book-entry system maintained by the Depositary, the Trustee
will perform the custodial, document control and administrative functions
described below, in accordance with its respective obligations under a Letter of
Representation from the Company and the Trustee to the Depositary, dated the
date hereof, and a Medium-Term Note Certificate Agreement between the Trustee
and the Depositary, dated as of .................., 1995 (the "Certificate
Agreement"), and its obligations as a participant in the Depositary, including
the Depositary's Same-Day Funds Settlement System ("SDFS").
Posting Rates by the Company:
II-1
<PAGE>
The Company and the Agents will discuss from time to time the rates of
interest per annum to be borne by and the maturity of Book-Entry Securities that
may be sold as a result of the solicitation of offers by an Agent. The Company
may establish a fixed set of interest rates and maturities for an offering
period ("posting"). If the Company decides to change already posted rates, it
will promptly advise the Agents to suspend solicitation of offers until the new
posted rates have been established with the Agents.
Acceptance of Offers by the Company:
Each Agent will promptly advise the Company by telephone or other
appropriate means of all reasonable offers to purchase Book-Entry Securities,
other than those rejected by such Agent. Each Agent may, in its discretion
reasonably exercised, reject any offer received by it in whole or in part. Each
Agent also may make offers to the Company to purchase Book-Entry Securities as a
Purchasing Agent. The Company will have the sole right to accept offers to
purchase Book-Entry Securities and may reject any such offer in whole or in
part.
The Company will promptly notify the Agent or Purchasing Agent, as the case
may be, of its acceptance or rejection of an offer to purchase Book-Entry
Securities. If the Company accepts an offer to purchase Book-Entry Securities,
it will confirm such acceptance in writing to the Selling Agent or Purchasing
Agent, as the case may be, and the Trustee.
Communication of Sale Information to the Company by Agent and Settlement
Procedures:
A. After the acceptance of an offer by the Company, the Selling Agent or
Purchasing Agent, as the case may be, will communicate promptly, but in no event
later than the time set forth under "Settlement Procedure Timetable" below, the
following details of the terms of such offer (the "Sale Information") to the
Company by telephone (confirmed in writing) or by facsimile transmission or
other acceptable written means:
(1) Principal Amount of Book-Entry Securities to be purchased;
(2) If a Fixed Rate Book-Entry Security, the interest rate and initial
interest payment date;
(3) Trade Date;
(4) Settlement Date;
(5) Maturity Date;
(6) Specified Currency and, if the Specified Currency is other than U.S.
dollars, the applicable Exchange Rate for such Specified Currency (it
being understood that currently the Depositary accepts deposits of
Global Securities denominated in U.S. dollars only);
(7) Indexed Currency, the Base Rate and the Exchange Rate Determination
Date, if applicable;
(8) Issue Price;
(9) Selling Agent's commission or Purchasing Agent's discount, as the
case may be;
(10) Net Proceeds to the Company;
(11) If a redeemable Book-Entry Security, such of the following as are
applicable:
II-2
<PAGE>
(i) Redemption Commencement Date,
(ii) Initial Redemption Price (% of par), and
(iii) Amount (% of par) that the Redemption Price shall decline (but
not below par) on each anniversary of the Redemption
Commencement Date;
(12) If a Floating Rate Book-Entry Security, such of the following as are
applicable:
(i) Interest Rate Basis,
(ii) Index Maturity,
(iii) Spread or Spread Multiplier,
(iv) Maximum Rate,
(v) Minimum Rate,
(vi) Initial Interest Rate,
(vii) Interest Reset Dates,
(viii) Calculation Dates,
(ix) Interest Determination Dates,
(x) Interest Payment Dates,
(xi) Regular Record Dates, and
(xii) Calculation Agent;
(13) Name, address and taxpayer identification number of the registered
owner(s);
(14) Denomination of certificates to be delivered at settlement;
(15) Book-Entry Security or Certificated Security; and
(16) Selling Agent or Purchasing Agent.
B. After receiving the Sale Information from the Selling Agent or
Purchasing Agent, as the case may be, the Company will communicate such Sale
Information to the Trustee by facsimile transmission or other acceptable written
means. The Trustee will assign a CUSIP number to the Global Security from a
list of CUSIP numbers previously delivered to the Trustee by the Company
representing such Book-Entry Security and then advise the Company and the
Selling Agent or Purchasing Agent, as the case may be, of such CUSIP number.
C. The Trustee will enter a pending deposit message through the
Depositary's Participant Terminal System, providing the following settlement
information to the Depositary, and the Depositary shall forward such information
to such Agent and Standard & Poor's Corporation:
(1) The applicable Sale Information;
(2) CUSIP number of the Global Security representing such Book-Entry
Security;
(3) Whether such Global Security will represent any other Book-Entry
Security (to the extent known at such time);
II-3
<PAGE>
(4) Number of the participant account maintained by the Depositary on
behalf of the Selling Agent or Purchasing Agent, as the case may be,
which number will be supplied by such Selling Agent or Purchasing
Agent;
(5) The interest payment period; and
(6) Initial Interest Payment Date for such Book-Entry Security, number
of days by which such date succeeds the record date for the
Depositary's purposes (or, in the case of Floating Rate Securities
which reset daily or weekly, the date five calendar days immediately
preceding the applicable Interest Payment Date and, in the case of
all other Book-Entry Securities, the Regular Record Date, as defined
in the Security) and, if calculable at that time, the amount of
interest payable on such Interest Payment Date.
D. The Trustee will complete and authenticate the Global Security
previously delivered by the Company representing such Book-Entry Security.
E. The Depositary will credit such Book-Entry Security to the Trustee's
participant account at the Depositary.
F. The Trustee will enter an SDFS deliver order through the Depositary's
Participant Terminal System instructing the Depositary to (i) debit such Book-
Entry Security to the Trustee's participant account and credit such Book-Entry
Security to such Agent's participant account and (ii) debit such Agent's
settlement account and credit the Trustee's settlement account for an amount
equal to the price of such Book-Entry Security less such Agent's commission.
The entry of such a deliver order shall constitute a representation and warranty
by the Trustee to the Depositary that (a) the Global Security representing such
Book-Entry Security has been issued and authenticated and (b) the Trustee is
holding such Global Security pursuant to the Certificate Agreement.
G. Such Agent will enter an SDFS deliver order through the Depositary's
Participant Terminal System instructing the Depositary (i) to debit such Book-
Entry Security to such Agent's participant account and credit such Book-Entry
Security to the participant accounts of the Participants with respect to such
Book-Entry Security and (ii) to debit the settlement accounts of such
Participants and credit the settlement account of such Agent for an amount equal
to the price of such Book-Entry Security.
H. Transfers of funds in accordance with SDFS deliver orders described in
Settlement Procedures "F" and "G" will be settled in accordance with SDFS
operating procedures in effect on the settlement date.
I. Upon confirmation of receipt of funds, the Trustee will transfer to the
account of the Company maintained at [Name of Bank], New York, New York, or such
other account as the Company may have previously specified to the Trustee, in
funds available for immediate use in the amount transferred to the Trustee in
accordance with Settlement Procedure "F".
J. Upon request, the Trustee will send to the Company a statement setting
forth the principal amount of Book-Entry Securities outstanding as of that date
under the Indenture.
K. Such Agent will confirm the purchase of such Book-Entry Security to the
purchaser either by transmitting to the Participants with respect to such Book-
Entry Security a confirmation order or orders through the Depositary's
institutional delivery system or by mailing a written confirmation to such
purchaser.
II-4
<PAGE>
L. The Depositary will, at any time, upon request of the Company or the
Trustee, promptly furnish to the Company or the Trustee a list of the names and
addresses of the participants for whom the Depositary has credited Book-Entry
Securities.
Preparation of Pricing Supplement:
If the Company accepts an offer to purchase a Book-Entry Security, it will
prepare a Pricing Supplement reflecting the terms of such Book-Entry Security
and arrange to have delivered to the Selling Agent or Purchasing Agent, as the
case may be, at least ten copies of such Pricing Supplement, not later than 5:00
p.m., New York City time, on the Business Day following the Trade Date (as
defined below), or if the Company and the purchaser agree to settlement on the
Business Day following the date of acceptance of such offer, not later than
noon, New York City time, on such date. The Company will arrange to have ten
Pricing Supplements filed with the Commission not later than the close of
business of the Commission on the fifth Business Day following the date on which
such Pricing Supplement is first used.
Delivery of Confirmation and Prospectus to Purchaser by Selling Agent:
The Selling Agent will deliver to the purchaser of a Book-Entry Security a
written confirmation of the sale and delivery and payment instructions. In
addition, the Selling Agent will deliver to such purchaser or its agent the
Prospectus as amended or supplemented (including the Pricing Supplement) in
relation to such Book-Entry Security prior to or together with the earlier of
the delivery to such purchaser or its agent of (a) the confirmation of sale or
(b) the Book-Entry Security.
Date of Settlement:
The receipt by the Company of immediately available funds in payment for a
Book-Entry Security and the authentication and issuance of the Global Security
representing such Book-Entry Security shall constitute "settlement" with respect
to such Book-Entry Security. All orders of Book-Entry Securities solicited by a
Selling Agent or made by a Purchasing Agent and accepted by the Company on a
particular date (the "Trade Date") will be settled on a date (the "Settlement
Date") which is the fifth Business Day after the Trade Date pursuant to the
"Settlement Procedure Timetable" set forth below, unless the Company and the
purchaser agree to settlement on another Business Day which shall be no earlier
than the next Business Day after the Trade Date.
Settlement Procedure Timetable:
For orders of Book-Entry Securities solicited by a Selling Agent and
accepted by the Company for settlement on the fifth Business Day after the Trade
Date, Settlement Procedures "A" through "I" set forth above shall be completed
as soon as possible but not later than the respective times (New York City time)
set forth below:
<TABLE>
<CAPTION>
Settlement
Procedure Time
- --------- ----
<S> <C> <C>
A 5:00 p.m. on the Business Day following the
Trade Date or 10:00 a.m. on the
Business Day prior to the Settlement
Date, whichever is earlier
B 12:00 noon on the second Business Day immediately
preceding the Settlement Date
C 2:00 p.m. on the second Business Day immediately
preceding the Settlement Date
</TABLE>
II-5
<PAGE>
<TABLE>
<S> <C> <C>
D 9:00 a.m. on the Settlement Date
E 10:00 a.m. on the Settlement Date
F-G 2:00 p.m. on the Settlement Date
H 4:45 p.m. on the Settlement Date
I 5:00 p.m. on the Settlement Date
</TABLE>
If the initial interest rate for a Floating Rate Book-Entry Security has not
been determined at the time that Settlement Procedure "A" is completed,
Settlement Procedures "B" and "C" shall be completed as soon as such rate has
been determined but no later than 2:00 p.m. on the second Business Day
immediately preceding the Settlement Date. Settlement Procedure "H" is subject
to extension in accordance with any extension of Fedwire closing deadlines and
in the other events specified in the SDFS operating procedures in effect on the
Settlement Date.
If settlement of a Book-Entry Security is rescheduled or canceled, the
Trustee, upon obtaining knowledge thereof, will deliver to the Depositary,
through the Depositary's Participant Terminal System, a cancellation message to
such effect by no later than 2:00 p.m. on the Business Day immediately preceding
the scheduled Settlement Date.
Failure to Settle:
If the Trustee fails to enter an SDFS deliver order with respect to a Book-
Entry Security pursuant to Settlement Procedure "F", the Trustee may deliver to
the Depositary, through the Depositary's Participant Terminal System, as soon as
practicable a withdrawal message instructing the Depositary to debit such Book-
Entry Security to the Trustee's participant account, provided that the Trustee's
participant account contains a principal amount of the Global Security
representing such Book-Entry Security that is at least equal to the principal
amount to be debited. If a withdrawal message is processed with respect to all
the Book-Entry Securities represented by a Global Security, the Trustee will
mark such Global Security "canceled", make appropriate entries in the Trustee's
records and send such canceled Global Security to the Company. The CUSIP number
assigned to such Global Security shall, in accordance with CUSIP Service Bureau
procedures, be canceled and not immediately reassigned. If a withdrawal message
is processed with respect to one or more, but not all, of the Book-Entry
Securities represented by a Global Security, the Trustee will exchange such
Global Security for two Global Securities, one of which shall represent such
Book-Entry Security or Securities and shall be canceled immediately after
issuance and the other of which shall represent the remaining Book-Entry
Securities previously represented by the surrendered Global Security and shall
bear the CUSIP number of the surrendered Global Security.
If the purchase price for any Book-Entry Security is not timely paid to the
participants with respect to such Book-Entry Security by the beneficial
purchaser thereof (or a person, including an indirect participant in the
Depositary, acting on behalf of such purchaser), such participants and, in turn,
the Agent for such Book-Entry Security may enter deliver orders through the
Depositary's Participant Terminal System debiting such Book-Entry Security to
such participant's account and crediting such Book-Entry Security to such
Agent's account and then debiting such Book-Entry Security to such Agent's
participant account and crediting such Book-Entry Security to the Trustee's
participant account and shall notify the Company and the Trustee thereof.
Thereafter, the Trustee will (i) immediately notify the Company of such order
and the Company shall transfer to such Agent funds available for immediate use
in an amount equal to the price of such Book-Entry Security which was credited
to the account of the Company maintained at the Trustee in accordance with
Settlement Procedure I, and (ii) deliver the withdrawal message and take the
related actions described in the preceding paragraph.
II-6
<PAGE>
If such failure shall have occurred for any reason other than default by the
applicable Agent to perform its obligations hereunder or under the Distribution
Agreement, the Company will reimburse such Agent on an equitable basis for the
loss of its use of funds during the period when the funds were credited to the
account of the Company.
Notwithstanding the foregoing, upon any failure to settle with respect to a
Book-Entry Security, the Depositary may take any actions in accordance with its
SDFS operating procedures then in effect. In the event of a failure to settle
with respect to one or more, but not all, of the Book-Entry Securities to have
been represented by a Global Security, the Trustee will provide, in accordance
with Settlement Procedure "D", for the authentication and issuance of a Global
Security representing the other Book-Entry Securities to have been represented
by such Global Security and will make appropriate entries in its records. The
Company will, from time to time, furnish the Trustee with a sufficient quantity
of Securities.
PART II: ADMINISTRATIVE PROCEDURE FOR CERTIFICATED SECURITIES
- --------------------------------------------------------------
Posting Rates by Company:
The Company and the Agents will discuss from time to time the rates of
interest per annum to be borne by and the maturity of Certificated Securities
that may be sold as a result of the solicitation of offers by an Agent. The
Company may establish a fixed set of interest rates and maturities for an
offering period ("posting"). If the Company decides to change already posted
rates, it will promptly advise the Agents to suspend solicitation of offers
until the new posted rates have been established with the Agents.
Acceptance of Offers by Company:
Each Agent will promptly advise the Company by telephone or other
appropriate means of all reasonable offers to purchase Certificated Securities,
other than those rejected by such Agent. Each Agent may, in its discretion
reasonably exercised, reject any offer received by it in whole or in part. Each
Agent also may make offers to the Company to purchase Certificated Securities as
a Purchasing Agent. The Company will have the sole right to accept offers to
purchase Certificated Securities and may reject any such offer in whole or in
part.
The Company will promptly notify the Selling Agent or Purchasing Agent, as
the case may be, of its acceptance or rejection of an offer to purchase
Certificated Securities. If the Company accepts an offer to purchase
Certificated Securities, it will confirm such acceptance in writing to the
Selling Agent or Purchasing Agent, as the case may be, and the Trustee.
Communication of Sale Information to Company by Agent:
After the acceptance of an offer by the Company, the Selling Agent or
Purchasing Agent, as the case may be, will communicate the following details of
the terms of such offer (the "Sale Information") to the Company by telephone
(confirmed in writing) or by facsimile transmission or other acceptable written
means:
(1) Principal Amount of Certificated Securities to be purchased;
(2) If a Fixed Rate Certificated Security, the interest rate and initial
interest payment date;
(3) Trade Date;
II-7
<PAGE>
(4) Settlement Date;
(5) Maturity Date;
(6) Specified Currency and, if the Specified Currency is other than U.S.
dollars, the applicable Exchange Rate for such Specified Currency;
(7) Indexed Currency, the Base Rate and the Exchange Rate Determination
Date, if applicable;
(8) Issue Price;
(9) Selling Agent's commission or Purchasing Agent's discount, as the
case may be;
(10) Net Proceeds to the Company;
(11) If a redeemable Certificated Security, such of the following as are
applicable:
(i) Redemption Commencement Date,
(ii) Initial Redemption Price (% of par), and
(iii) Amount (% of par) that the Redemption Price shall decline (but
not below par) on each anniversary of the Redemption
Commencement Date;
(12) If a Floating Rate Certificated Security, such of the
following as are applicable:
(i) Interest Rate Basis,
(ii) Index Maturity,
(iii) Spread or Spread Multiplier,
(iv) Maximum Rate,
(v) Minimum Rate,
(vi) Initial Interest Rate,
(vii) Interest Reset Dates,
(viii) Calculation Dates,
(ix) Interest Determination Dates,
(x) Interest Payment Dates,
(xi) Regular Record Dates, and
(xii) Calculation Agent;
(13) Name, address and taxpayer identification number of the registered
owner(s);
(14) Denomination of certificates to be delivered at settlement;
(15) Book-Entry Security or Certificated Security; and
(16) Selling Agent or Purchasing Agent.
Preparation of Pricing Supplement by Company:
II-8
<PAGE>
If the Company accepts an offer to purchase a Certificated Security, it will
prepare a Pricing Supplement reflecting the terms of such Certificated Security
and arrange to have delivered to the Selling Agent or Purchasing Agent, as the
case may be, at least ten copies of such Pricing Supplement, not later than 5:00
p.m., New York City time, on the Business Day following the Trade Date, or if
the Company and the purchaser agree to settlement on the date of acceptance of
such offer, not later than noon, New York City time, on such date. The Company
will arrange to have ten Pricing Supplements filed with the Commission not later
than the close of business of the Commission on the fifth Business Day following
the date on which such Pricing Supplement is first used.
Delivery of Confirmation and Prospectus to Purchaser by Selling Agent:
The Selling Agent will deliver to the purchaser of a Certificated Security a
written confirmation of the sale and delivery and payment instructions. In
addition, the Selling Agent will deliver to such purchaser or its agent the
Prospectus as amended or supplemented (including the Pricing Supplement) in
relation to such Certificated Security prior to or together with the earlier of
the delivery to such purchaser or its agent of (a) the confirmation of sale or
(b) the Certificated Security.
Date of Settlement:
All offers of Certificated Securities solicited by a Selling Agent or made
by a Purchasing Agent and accepted by the Company will be settled on a date (the
"Settlement Date") which is the fifth Business Day after the date of acceptance
of such offer, unless the Company and the purchaser agree to settlement (a) on
another Business Day after the acceptance of such offer or (b) with respect to
an offer accepted by the Company prior to 10:00 a.m., New York City time, on the
date of such acceptance.
Instruction from Company to Trustee for Preparation of Certificated Securities:
After receiving the Sale Information from the Selling Agent or Purchasing
Agent, as the case may be, the Company will communicate such Sale Information to
the Trustee by telephone (confirmed in writing) or by facsimile transmission or
other acceptable written means.
The Company will instruct the Trustee by facsimile transmission or other
acceptable written means to authenticate and deliver the Certificated Securities
no later than 2:15 p.m., New York City time, on the Settlement Date. Such
instruction will be given by the Company prior to 3:00 p.m., New York City time,
on the Business Day immediately preceding the Settlement Date unless the
Settlement Date is the date of acceptance by the Company of the offer to
purchase Certificated Securities in which case such instruction will be given by
the Company by 11:00 a.m., New York City time.
Preparation and Delivery of Certificated Securities by Trustee and Receipt of
Payment Therefor:
The Trustee will prepare each Certificated Security and appropriate receipts
that will serve as the documentary control of the transaction.
In the case of a sale of Certificated Securities to a purchaser solicited by
a Selling Agent, the Trustee will, by 2:15 p.m., New York City time, on the
Settlement Date, deliver the Certificated Securities to the Selling Agent for
the benefit of the purchaser of such Certificated Securities against delivery by
the Selling Agent of a receipt therefor. On the Settlement Date the Selling
Agent will deliver payment for such Certificated Securities in immediately
available funds to the Company in an amount equal to the issue price of the
Certificated Securities less the Selling Agent's commission;
II-9
<PAGE>
provided that the Selling Agent reserves the right to withhold payment for which
it has not received funds from the purchaser. The Company shall not use any
proceeds advanced by a Selling Agent to acquire securities.
In the case of a sale of Certificated Securities to a Purchasing Agent, the
Trustee will, by 2:15 p.m., New York City time, on the Settlement Date, deliver
the Certificated Securities to the Purchasing Agent against delivery of payment
for such Certificated Securities in immediately available funds to the Company
in an amount equal to the issue price of the Certificated Securities less the
Purchasing Agent's discount.
Failure of Purchaser to Pay Selling Agent:
If a purchaser (other than a Purchasing Agent) fails to make payment to the
Selling Agent for a Certificated Security, the Selling Agent will promptly
notify the Trustee and the Company thereof by telephone (confirmed in writing)
or by facsimile transmission or other acceptable written means. The Selling
Agent will immediately return the Certificated Security to the Trustee.
Immediately upon receipt of such Certificated Security by the Trustee, the
Company will return to the Selling Agent an amount equal to the amount
previously paid to the Company in respect of such Certificated Security. The
Company will reimburse the Selling Agent on an equitable basis for its loss of
the use of funds during the period when they were credited to the account of the
Company.
The Trustee will cancel the Certificated Security in respect of which the
failure occurred, make appropriate entries in its records and, unless otherwise
instructed by the Company, destroy the Certificated Security.
II-10
<PAGE>
ANNEX III
Accountants' Letter
-------------------
Pursuant to Sections 4(j) and 6(d), as the case may be, of the Distribution
Agreement, the Company's independent certified public accountants shall furnish
letters to the effect that:
(i) They are independent certified public accountants with respect to
the Company and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules audited (and, if applicable,
financial forecasts and/or pro forma financial information) examined by
them and included or incorporated by reference in the Registration
Statement or the Prospectus comply as to form in all material respects
with the applicable accounting requirements of the Act or the Exchange
Act, as applicable, and the related published rules and regulations
thereunder; and, if applicable, they have made a review in accordance
with standards established by the American Institute of Certified Public
Accountants of the consolidated interim financial statements, selected
financial data, pro forma financial information, financial forecasts
and/or condensed financial statements derived from audited financial
statements of the Company for the periods specified in such letter, as
indicated in their reports thereon, copies of which have been
[separately] furnished to the Agents [and are attached hereto];
(iii) They have made a review in accordance with standards established
by the American Institute of Certified Public Accountants of the
unaudited condensed consolidated statements of income, consolidated
balance sheets and consolidated statements of cash flows included in the
Prospectus and/or included in the Company's quarterly report on Form 10-Q
incorporated by reference into the Prospectus as indicated in their
reports thereon copies of which [have been separately furnished to the
Agents] [are attached hereto]; and on the basis of specified procedures
including inquiries of officials of the Company who have responsibility
for financial and accounting matters regarding whether the unaudited
condensed consolidated financial statements referred to in paragraph
(vi)(A)(i) below comply as to form in all material respects with the
applicable accounting requirements of the [Act and the Exchange] Act and
the related published rules and regulations, nothing came to their
attention that caused them to believe that the unaudited condensed
consolidated financial statements do not comply as to form in all
material respects with the applicable accounting requirements of the [Act
and the Exchange] Act and the related published rules and regulations;
(iv) The unaudited selected financial information with respect to the
consolidated results of operations and financial position of the Company
for the five most recent fiscal years included in the Prospectus and
included or incorporated by reference in Item 6 of the Company's Annual
Report on Form 10-K for the most recent fiscal year agrees with the
corresponding amounts (after restatement where applicable) in the audited
consolidated financial statements for five such fiscal years which were
included or incorporated by reference in the Company's Annual Reports on
Form 10-K for such fiscal years;
III-1
<PAGE>
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K and
on the basis of limited procedures specified in such letter nothing came
to their attention as a result of the foregoing procedures that caused
them to believe that this information does not conform in all material
respects with the disclosure requirements of Items 301, 302, 402 and
503(d), respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and its subsidiaries, inspection of
the minute books of the Company and its subsidiaries since the date of
the latest audited financial statements included or incorporated by
reference in the Prospectus, inquiries of officials of the Company and
its subsidiaries responsible for financial and accounting matters and
such other inquiries and procedures as may be specified in such letter,
nothing came to their attention that caused them to believe that:
(A) (i) the unaudited condensed consolidated statements of
income, consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus and/or included or incorporated
by reference in the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus do not comply as to form
in all material respects with the applicable accounting requirements
of the Exchange Act and the related published rules and regulations,
or (ii) any material modifications should be made to the unaudited
condensed consolidated statements of income, consolidated balance
sheets and consolidated statements of cash flows included in the
Prospectus or included in the Company's Quarterly Reports on Form 10-
Q incorporated by reference in the Prospectus for them to be in
conformity with generally accepted accounting principles;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited consolidated financial statements from which
such data and items were derived, and any such unaudited data and
items were not determined on a basis substantially consistent with
the basis for the corresponding amounts in the audited consolidated
financial statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent fiscal year;
(C) the unaudited financial statements which were not included in
the Prospectus but from which were derived the unaudited condensed
financial statements referred to in clause (A) and any unaudited
income statement data and balance sheet items included in the
Prospectus and referred to in Clause (B) were not determined on a
basis substantially consistent with the basis for the audited
financial statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent fiscal year;
(D) any unaudited pro forma consolidated condensed financial
statements included or incorporated by reference in the Prospectus do
not comply as to form in all material respects with the applicable
accounting requirements of the Act and the published rules and
regulations thereunder or the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of
those statements;
III-2
<PAGE>
(E) as of a specified date (where practicable not more than five
days prior to the date of such letter), there have been any changes
in the consolidated capital stock (other than issuances of capital
stock upon exercise of options and stock appreciation rights, upon
earn-outs of performance shares and upon conversions of convertible
securities, in each case which were outstanding on the date of the
latest balance sheet included or incorporated by reference in the
Prospectus) or any increase in excess of 1% in the consolidated long-
term debt of the Company and its subsidiaries, or any decreases in
consolidated net current assets or other items specified by the
Agents, or any increases in any items specified by the Agents, in
each case as compared with amounts shown in the latest balance sheet
included or incorporated by reference in the Prospectus, except in
each case for changes, increases or decreases which the Prospectus
discloses have occurred or may occur or which are described in such
letter; and
(F) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus to
the specified date referred to in Clause (E) there were any decreases
in consolidated earnings before depreciation and deferred taxes from
operations or other items specified by the Agents, or any increases
in any items specified by the Agents, in each case as compared with
the comparable period of the preceding year and with any other period
of corresponding length specified by the Agents, except in each case
for increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter; and
(vii) In addition to the audit referred to in their report(s) included
or incorporated by reference in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other procedures
referred to in paragraphs (iii) and (vi) above, they have carried out
certain specified procedures, not constituting an audit in accordance
with generally accepted auditing standards, with respect to certain
amounts, percentages and financial information specified by the Agents
which are derived from the general accounting records of the Company and
its subsidiaries, which appear in the Prospectus (excluding documents
incorporated by reference), or in Part II of, or in exhibits and
schedules to, the Registration Statement specified by the Agents or in
documents incorporated by reference in the Prospectus specified by the
Agents, and have compared certain of such amounts, percentages and
financial information with the accounting records of the Company and its
subsidiaries and have found them to be in agreement.
All references in this Annex III to the Prospectus shall be deemed to refer
to the Prospectus (including the documents incorporated by reference therein) as
defined in the Distribution Agreement as of the Commencement Date referred to in
Section 6(d) thereof and to the Prospectus as amended or supplemented (including
the documents incorporated by reference therein) as of the date of the
amendment, supplement, incorporation or the Time of Delivery relating to the
Terms Agreement requiring the delivery of such letter under Section 4(j)
thereof.
III-3
<PAGE>
Exhibit 1.2
THE ROUSE COMPANY
DEBT SECURITIES
UNDERWRITING AGREEMENT
----------------------
...... , 1995
To the Representatives of the
several Underwriters named in the
respective Pricing Agreements
hereinafter described.
Ladies and Gentlemen:
From time to time The Rouse Company, a Maryland corporation (the
"Company"), proposes to enter into one or more Pricing Agreements (each a
"Pricing Agreement") in the form of Annex I hereto, with such additions and
deletions as the parties thereto may determine, and, subject to the terms and
conditions stated herein and therein, to issue and sell to the firms named in
Schedule I to the applicable Pricing Agreement (such firms constituting the
"Underwriters" with respect to such Pricing Agreement and the securities
specified therein) certain of its debt securities (the "Securities") specified
in Schedule II to such Pricing Agreement (with respect to such Pricing
Agreement, the "Designated Securities").
The terms and rights of any particular issuance of Designated Securities
shall be as specified in the Pricing Agreement relating thereto and in or
pursuant to the indenture (the "Indenture") identified in such Pricing
Agreement.
1. Particular sales of Designated Securities may be made from time to time
to the Underwriters of such Securities, for whom the firms designated as
representatives of the Underwriters of such Securities in the Pricing Agreement
relating thereto will act as representatives (the "Representatives"). The term
"Representatives" also refers to a single firm acting as sole representative of
the Underwriters and to an Underwriter or Underwriters who act without any firm
being designated as its or their representatives. This Underwriting Agreement
shall not be construed as an obligation of the Company to sell any of the
Securities or as an obligation of any of the Underwriters to purchase the
Securities. The obligation of the Company to issue and sell any of the
Securities and the obligation of any of the Underwriters to purchase any of the
Securities shall be evidenced by the Pricing Agreement with respect to the
Designated Securities specified therein. Each Pricing Agreement shall specify
the aggregate principal amount of such Designated Securities, the initial public
offering price of such Designated Securities, the purchase price to the
Underwriters of such Designated Securities, the names of the Underwriters of
such Designated Securities, the names of the Representatives of such
Underwriters and the principal amount of such Designated Securities to be
purchased by each Underwriter and shall set forth the date, time and manner of
delivery of such Designated Securities and payment therefor. The Pricing
Agreement shall also specify (to the extent not set forth in the Indenture and
the registration statement and prospectus with respect thereto) the terms of
such Designated Securities. A Pricing Agreement shall be in the form of an
executed writing (which may be in counterparts), and may be evidenced by an
exchange of telegraphic communications or any other rapid transmission device
designed to produce a written record of communications transmitted. The
obligations of the Underwriters under this Agreement and each Pricing Agreement
shall be several and not joint.
<PAGE>
2. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(a) A registration statement on Form S-3 (File No. 33-57347) in
respect of the Securities has been filed with the Securities and Exchange
Commission (the "Commission"); such registration statement and any post-
effective amendment thereto, each in the form heretofore delivered or to be
delivered to such the Representatives, excluding exhibits to such registration
statement, but including all documents incorporated by reference in the
prospectus included therein, have been declared effective by the Commission in
such form; no other document with respect to such registration statement or
document incorporated by reference therein has heretofore been filed or
transmitted for filing with the Commission (other than the prospectuses filed
pursuant to Rule 424(b) of the rules and regulations of the Commission under
the Securities Act of 1933, as amended (the "Act"), each in the form
heretofore delivered to the Representatives); and no stop order suspending the
effectiveness of such registration statement has been issued and no proceeding
for that purpose has been initiated or threatened by the Commission (any
preliminary prospectus included in such registration statement or filed with
the Commission pursuant to Rule 424(a) of the rules and regulations of the
Commission under the Act, are hereinafter called a "Preliminary Prospectus";
the various parts of such registration statement, including all exhibits
thereto and the documents incorporated by reference in the prospectus
contained in the registration statement at the time such part of the
registration statement became effective, but excluding the Statement of
Eligibility and Qualification of the Trustee on Form T-1 ("Form T-1), each as
amended at the time such part of the registration statement became effective,
are hereinafter collectively called the "Registration Statement"; the
prospectus relating to the Securities, in the form in which it has most
recently been filed, or transmitted for filing, with the Commission on or
prior to the date of this Agreement, is hereinafter called the "Prospectus";
any reference herein to any Preliminary Prospectus or the Prospectus shall be
deemed to refer to and include the documents incorporated by reference therein
pursuant to the applicable form under the Act, as of the date of such
Preliminary Prospectus or Prospectus, as the case may be; any reference to any
amendment or supplement to any Preliminary Prospectus or the Prospectus shall
be deemed to refer to and include any documents filed after the date of such
Preliminary Prospectus or Prospectus, as the case may be, under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and incorporated
therein by reference; any reference to any amendment to the Registration
Statement shall be deemed to refer to and include any annual report of the
Company filed pursuant to Section 13(a) or 15(d) of the Exchange Act after the
effective date of the Registration Statement that is incorporated by reference
in the Registration Statement; and any reference to the Prospectus as amended
or supplemented shall be deemed to refer to and include the Prospectus as
amended or supplemented in relation to the applicable Designated Securities in
the form filed or transmitted for filing with the Commission pursuant to Rule
424(b) under the Act and in accordance with Section 5(a) hereof, including any
documents incorporated by reference therein as of the date of such filing);
(b) The documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the Commission
thereunder, and none of such documents contained an untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading; and any
further documents so filed and incorporated by reference in the Prospectus, or
any further amendment or supplement thereto, when such documents become
effective or are filed with the Commission, as the case may be, will conform
in all material respects to the requirements of the Act or the Exchange Act,
as applicable, and the rules and regulations of the Commission thereunder and
will not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading;
(c) The Registration Statement and the Prospectus conform, and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of the
Act and the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"), and the rules and regulations of the
-2-
<PAGE>
Commission thereunder and do not and will not, as of the applicable effective
date as to the Registration Statement and any amendment thereto and as of the
applicable filing date as to the Prospectus and any amendment or supplement
thereto, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; provided, however, that this representation
and warranty shall not apply to any statements or omissions made in reliance
upon and in conformity with information furnished in writing to the Company by
an Underwriter of Designated Securities through the Representatives expressly
for use in the Prospectus as amended or supplemented to relate to such
Securities;
(d) The Company and its subsidiaries, taken as a whole, have not
sustained since the date of the latest audited financial statements included
or incorporated by reference in the Prospectus any material loss or
interference with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus; and, since the respective dates as of which
information is given in the Registration Statement and the Prospectus, there
has not been any change in the capital stock (other than issuances of capital
stock upon exercise of options and stock appreciation rights and upon
conversions of convertible securities, in each case which were outstanding as
of the date of the latest audited financial statements included or
incorporated by reference in the Prospectus), or any material and adverse
change in the long-term debt of the Company and its subsidiaries, taken as a
whole, or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general affairs,
management, current value basis shareholders' equity or results of operations
(based on Earnings Before Depreciation and Deferred Taxes from Operations) of
the Company and its subsidiaries, taken as a whole, otherwise than as set
forth or contemplated in the Prospectus;
(e) The Company and its subsidiaries have, or in those cases where
such subsidiary is a general partner in a partnership, such partnership has,
good and marketable fee simple and/or leasehold title (as the case may be) to
all real property (except for those lesser estates in real property which, in
the aggregate, are not material in value to the Company and its subsidiaries),
subject only to (A) those liens and encumbrances which have been reflected
generally or in the aggregate in the financial statements of the Company as
disclosed in the Prospectus or as are described specifically, generally or in
the aggregate in the Prospectus, or (B) such liens and encumbrances (i) not
required by generally accepted accounting principles to be disclosed in the
financial statements of the Company, which (a) if all material covenants and
conditions thereof are observed or performed, will not materially interfere
with the use made or proposed to be made of such property by the Company and
its subsidiaries or (b) are reasonable and customary with regard to the normal
operation of land and improvements held for commercial purposes by first class
owners and operators of commercial real estate, or (ii) which were incurred
after the date of the latest audited financial statements included or
incorporated by reference in the Prospectus in the ordinary course of business
(including financings) and which, in the aggregate (on a net basis), are not
material to the Company and its subsidiaries, taken as a whole. The Company
and its subsidiaries have title to the personal property owned by it or them
and, subject to the continued performance of the material covenants and
conditions of liens and encumbrances thereon, have the right to use such
without interference in the normal course of business;
(f) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of Maryland, with power and
authority (corporate and other) to own its properties and conduct its business
as described in the Prospectus, and has been duly qualified as a foreign
corporation for the transaction of business and is in good standing under the
laws of each other jurisdiction in which the failure so to qualify and
maintain good standing would have a material adverse effect on the Company and
its subsidiaries, taken as a whole; and each subsidiary of the Company has
been duly incorporated and is validly existing as a corporation in good
standing under the laws of its jurisdiction of incorporation except for such
failures to maintain good standing as would not have a material adverse effect
on the Company and its subsidiaries, taken as a whole;
-3-
<PAGE>
(g) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company have
been duly and validly authorized and issued and are fully paid and non-
assessable; and all of the issued shares of capital stock of each subsidiary
of the Company have been duly and validly authorized and issued, are fully
paid and non-assessable and are owned (with exceptions that are not material
to the Company and its subsidiaries, taken as a whole) directly or indirectly
by the Company, free and clear of all liens, encumbrances or claims
(collectively, "Liens") except (i) Liens relating to debt which has been
disclosed specifically, generally or in the aggregate in the Prospectus or
incurred after the date of the latest audited financial statements included or
incorporated by reference in the Prospectus in the ordinary course of business
(including financings), (ii) Liens incurred in the ordinary course of business
which are not materially adverse to the operations of the Company and its
subsidiaries, taken as a whole, and (iii) restrictions on the transfer or use
of the stock of any subsidiary under any partnership, joint venture or lease
agreements to which the Company or any of its subsidiaries is a party;
(h) The Securities have been duly authorized, and, when Designated
Securities are issued and delivered pursuant to this Agreement and the Pricing
Agreement with respect to such Designated Securities, such Designated
Securities will have been duly executed, authenticated, issued and delivered
and will constitute valid and legally binding obligations of the Company
entitled to the benefits provided by the Indenture, which will be
substantially in the form filed as an exhibit to the Registration Statement;
the Indenture has been duly authorized and duly qualified under the Trust
Indenture Act and, at the Time of Delivery for such Designated Securities (as
defined in Section 4 hereof), the Indenture will constitute a valid and
legally binding instrument, enforceable in accordance with its terms, subject,
as to enforcement, to bankruptcy, insolvency, reorganization and other laws of
general applicability relating to or affecting creditors' rights and to
general equity principles; and the Indenture conforms and the Designated
Securities will conform to the descriptions thereof contained in the
Prospectus as amended or supplemented to relate to such issuance of
Securities;
(i) The issue and sale of the Securities, the compliance by the
Company with all of the provisions of the Securities, the Indenture, this
Agreement and any Pricing Agreement, and the consummation of the transactions
herein and therein contemplated will not conflict with or result in a breach
or violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any of its subsidiaries is a
party or by which the Company or any of its subsidiaries is bound or to which
any of the property or assets of the Company or any of its subsidiaries is
subject except for such conflict, breach, violation or default which does not
have a material adverse effect on the Company and its subsidiaries, taken as a
whole, nor will such action result in any violation of the provisions of the
Articles of Incorporation or the Bylaws of the Company or any statute or any
order, rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
properties; and no consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body is required
for the issue and sale of the Securities or the consummation by the Company of
the other transactions contemplated by this Agreement, any Pricing Agreement
or the Indenture, except such as have been, or will have been prior to the
Time of Delivery, obtained under the Act or the Trust Indenture Act and such
consents, approvals, authorizations, orders, registrations or qualifications
as may be required under state securities or Blue Sky laws in connection with
the purchase and distribution of the Securities by the Underwriters;
(j) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its
subsidiaries is a party or to which any property of the Company or any of its
subsidiaries is subject, which are likely, individually or in the aggregate,
to have a material adverse effect on the Company and its subsidiaries taken as
a whole, and, to the best of the Company's knowledge, no such proceedings are
threatened or contemplated by governmental authorities or threatened by
others;
-4-
<PAGE>
(k) The Company is not, and after giving effect to each offering and
sale of the Securities will not be, an "investment company" or an entity
"controlled" by an "investment company", as such terms are defined in the
Investment Company Act of 1940, as amended (the "Investment Company Act");
(l) Neither the Company nor any of its affiliates does business with
the government of Cuba or with any person or affiliate located in Cuba within
the meaning of Section 517.075, Florida Statutes; and
(m) KPMG Peat Marwick LLP, who have certified certain financial
statements of the Company and its subsidiaries, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder.
3. Upon the execution of the Pricing Agreement applicable to any
Designated Securities and authorization by the Representatives of the release of
such Designated Securities, the several Underwriters propose to offer such
Designated Securities for sale upon the terms and conditions set forth in the
Prospectus as amended or supplemented.
4. Designated Securities to be purchased by each Underwriter pursuant to
the Pricing Agreement relating thereto, in the form specified in such Pricing
Agreement, and in such authorized denominations and registered in such names as
the Representatives may request upon at least forty-eight hours' prior notice to
the Company, shall be delivered by or on behalf of the Company to the
Representatives for the account of such Underwriter, against payment by such
Underwriter or on its behalf of the purchase price therefor by certified or
official bank check or checks, payable to the order of the Company in the funds
specified in such Pricing Agreement, all in the manner and at the place and time
and date specified in such Pricing Agreement or at such other place and time and
date as the Representatives and the Company may agree upon in writing, such time
and date being herein called the "Time of Delivery" for such Securities.
5. The Company agrees with each of the Underwriters of any Designated
Securities:
(a) To prepare the Prospectus as amended or supplemented in relation
to the applicable Designated Securities in a form approved by the
Representatives and to file such Prospectus pursuant to Rule 424(b) under the
Act no later than the Commission's close of business on the second business
day following the execution and delivery of the Pricing Agreement relating to
the applicable Designated Securities or, if applicable, such earlier time as
may be required by Rule 424(b); to make no further amendment or any supplement
to the Registration Statement or Prospectus as amended or supplemented after
the date of the Pricing Agreement relating to such Securities and prior to the
Time of Delivery for such Securities which shall be disapproved by the
Representatives for such Securities promptly after reasonable notice thereof;
to advise the Representatives promptly of any such amendment or supplement
after such Time of Delivery and furnish the Representatives with copies
thereof; to file promptly all reports and any definitive proxy or information
statements required to be filed by the Company with the Commission pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act for so long as the
delivery of a prospectus is required in connection with the offering or sale
of such Securities, and during such same period to advise the Representatives,
promptly after it receives notice thereof, of the time when any amendment to
the Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed with the
Commission, of the issuance by the Commission of any stop order or any order
preventing or suspending the use of any prospectus relating to the Securities,
of the suspension of the qualification of such Securities for offering or sale
in any jurisdiction, of the initiation or threatening of any proceeding for
any such purpose, or of any request by the Commission for the amending or
supplementing of the Registration Statement or Prospectus or for additional
information; and, in the event of the issuance of any such stop order or of
any such order preventing or suspending the use of any prospectus relating to
the Securities or suspending any such qualification, to promptly use its best
efforts to obtain the withdrawal of such order;
-5-
<PAGE>
(b) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify such Securities for offering
and sale under the securities laws of such jurisdictions as the
Representatives may request and to comply with such laws so as to permit the
continuance of sales and dealings therein for as long as may be necessary to
complete the distribution of such Securities; provided, however, that in
connection therewith the Company shall not be required to qualify as a foreign
corporation or to file a general consent to service of process in any
jurisdiction;
(c) To furnish the Underwriters with copies of the Prospectus as
amended or supplemented in such quantities as the Representatives may from
time to time reasonably request, and, if the delivery of a prospectus is
required at any time in connection with the offering or sale of the Securities
and if at such time any event shall have occurred as a result of which the
Prospectus as then amended or supplemented would include an untrue statement
of a material fact or omit to state any material fact necessary in order to
make the statements therein, in the light of the circumstances under which
they were made when such Prospectus is delivered, not misleading, or, if for
any other reason it shall be necessary during such same period to amend or
supplement the Prospectus or to file under the Exchange Act any document
incorporated by reference in the Prospectus in order to comply with the Act,
the Exchange Act or the Trust Indenture Act, to notify the Representatives and
upon their request to file such document and to prepare and furnish without
charge to each Underwriter and to any dealer in securities as many copies as
the Representatives may from time to time reasonably request of an amended
Prospectus or a supplement to the Prospectus which will correct such statement
or omission or effect such compliance;
(d) During the period beginning from the date of the Pricing
Agreement for such Designated Securities and continuing to and including the
later of (i) the termination of trading restrictions for such Designated
Securities, as notified to the Company by the Representatives and (ii) the
Time of Delivery for such Designated Securities, not to offer, sell, contract
to sell or otherwise dispose of any debt securities of the Company which
mature more than one year after such Time of Delivery and which are
substantially similar to such Designated Securities, without the prior written
consent of the Representatives; and
(e) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule 158(c) under
the Act), an earnings statement of the Company and its subsidiaries (which
need not be audited) complying with Section 11(a) of the Act and the rules and
regulations of the Commission thereunder (including, at the option of the
Company, Rule 158).
6. The Company covenants and agrees with the several Underwriters that the
Company will pay or cause to be paid the following: (i) the fees, disbursements
and expenses of the Company's counsel and accountants in connection with the
registration of the Securities under the Act and all other expenses in
connection with the preparation, printing and filing of the Registration
Statement, any Preliminary Prospectus and the Prospectus and all other
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing and producing
any Agreement among Underwriters, this Agreement, any Pricing Agreement, any
Indenture, any Blue Sky and Legal Investment Memoranda, closing documents
(including any compilations thereof) and any other documents so long as such
documents have been approved by the Company in connection with the offering,
purchase, sale and delivery of the Securities; (iii) all expenses in connection
with the qualification of the Securities for offering and sale under state
securities laws as provided in Section 5(b) hereof, including the fees and
disbursements of Fried, Frank, Harris, Shriver & Jacobson in connection with
such qualification and in connection with the Blue Sky and legal investment
surveys; (iv) any fees charged by securities rating services for rating the
Securities; (v) any filing fees incident to, and the reasonable fees and
disbursements of Fried, Frank, Harris, Shriver & Jacobson in connection with,
any required review by the National Association of Securities Dealers, Inc. of
the terms of the sale of the Securities; (vi) the cost of preparing the
Securities; (vii) the reasonable fees and expenses of any Trustee and any agent
of any
-6-
<PAGE>
Trustee and any transfer or paying agent of the Company and the reasonable fees
and disbursements of counsel for any Trustee or such agent in connection with
any Indenture and the Securities; and (viii) all other costs and expenses
incident to the performance of its obligations hereunder which are not otherwise
specifically provided for in this Section. It is understood, however, that,
except as provided in this Section, and Sections 8 and 11 hereof, the
Underwriters will pay all of their own costs and expenses, including the fees of
their counsel, transfer taxes on resale of any of the Securities by them, and
any advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters of any Designated Securities under
the Pricing Agreement relating to such Designated Securities shall be subject,
in the Representatives' discretion, to the condition that all representations
and warranties and other statements of the Company in or incorporated by
reference in the Pricing Agreement relating to such Designated Securities are
true and correct at and as of the Time of Delivery for such Designated
Securities the condition that prior to such Time of Delivery the Company shall
have performed all of its obligations hereunder theretofore to be performed, and
the following additional conditions:
(a) (i) The Prospectus as amended or supplemented in relation to the
applicable Designated Securities shall have been filed with the Commission
pursuant to Rule 424(b) under the Act within the applicable time period
prescribed for such filing by the rules and regulations under the Act and
in accordance with Section 5(a) hereof; (ii) no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have
been issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and (iii) all requests for additional
information on the part of the Commission shall have been complied with to
the reasonable satisfaction of the Representatives;
(b) Sullivan & Cromwell, counsel for the Underwriters, shall have
furnished to the Representatives such opinion or opinions, dated the Time
of Delivery, with respect to the incorporation of the Company, the validity
of the Indenture, the Securities, the Registration Statement, the
Prospectus, and such other related matters as the Representatives may
reasonably request, and such counsel shall have received such papers and
information as they may reasonably request to enable them to pass upon such
matters;
(c) Richard G. McCauley, Senior Vice President and General Counsel of
the Company, or other counsel for the Company satisfactory to the
Representatives, shall have furnished to the Representatives his written
opinion (which may be limited to the laws of the State of Maryland and,
with respect to clauses (xii) and (xiii) below, the Federal Securities
laws), dated the Time of Delivery in form and substance reasonably
satisfactory to the Representatives, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Maryland, with corporate power and authority to own its properties and
conduct its business as described in the Prospectus as amended or
supplemented;
(ii) The Company has an authorized capitalization as set forth
in the Prospectus as amended or supplemented, and all of the issued
shares of capital stock of the Company have been duly and validly
authorized and issued and are fully paid and non-assessable;
(iii) The Company has been duly qualified as a foreign
corporation for the transaction of business and is in good standing under
the laws of each other jurisdiction in which the failure so to qualify
and maintain good standing would have a material adverse effect on the
Company and its subsidiaries, taken as a whole (such counsel being
entitled to rely in respect of the opinion in this clause upon opinions
of local counsel and in respect of matters of fact upon certificates of
officers of the Company, provided that such
-7-
<PAGE>
counsel shall state that he believes that both such Agent and he are
justified in relying upon such opinions and certificates);
(iv) Each Significant Subsidiary (as defined below) of the
Company that is incorporated under the laws of the State of Maryland has
been duly incorporated and is validly existing as a corporation in good
standing under the laws of the State of Maryland; and all of the issued
shares of capital stock of each such subsidiary have been duly and
validly authorized and issued, are fully paid and non-assessable, and are
owned (with exceptions that are not material to the Company and its
subsidiaries, taken as a whole) directly or indirectly by the Company,
free and clear of all liens, encumbrances or claims (collectively
"Liens") except (i) Liens relating to debt which has been disclosed
specifically, generally or in the aggregate in the Prospectus as amended
or supplemented or incurred after the date of the latest audited
financial statements included or incorporated by reference in the
Prospectus as amended or supplemented in the ordinary course of business
(including financings), (ii) Liens incurred in the ordinary course of
business which are not materially adverse to the operations of the
Company and its subsidiaries, taken as a whole, or (iii) restrictions on
the transfer or use of the stock of any subsidiary under any partnership,
joint venture agreements or lease agreements to which the Company or any
of its subsidiaries is a party (such counsel being entitled to rely in
respect of the opinion in this clause upon opinions of local counsel and
in respect of matters of fact upon certificates of officers of the
Company or its subsidiaries, provided that such counsel shall state that
he believes that both such Agent and he are justified in relying upon
such opinions and certificates); "Significant Subsidiary" is defined to
be any subsidiary of the Company that holds assets that have a value, on
a current value basis, in excess of 3% of the Company's Total Common
Stock and Other Shareholders' Equity, on a current value basis, as
reported in the Company's most recent Annual Report on Form 10-K or
Annual Report to Shareholders;
(v) To the best of such counsel's knowledge and other than as
set forth in the Prospectus as amended or supplemented, there are no
legal or governmental proceedings pending to which the Company or any of
its subsidiaries is a party or of which any property of the Company or
any of its subsidiaries is the subject which is likely, individually or
in the aggregate, to have a material adverse effect on the Company and
its subsidiaries, taken as a whole, and, to the best of such counsel's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(vi) This Agreement and the Pricing Agreement with respect to
the Designated Securities have been duly authorized, executed and
delivered by the Company;
(vii) The Designated Securities have been duly authorized;
(viii) The Indenture has been duly authorized, executed and
delivered by the Company;
(ix) To the best of such counsel's knowledge, the issue and sale
of the Designated Securities and the compliance by the Company with all
of the provisions of the Designated Securities, the Indenture, this
Agreement and any Pricing Agreement, and the consummation of the
transactions herein and therein contemplated will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company or any of
its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject except for any such
conflict, breach, violation or default which does not have a material
adverse effect on the Company and its subsidiaries, taken as a whole, nor
will such actions result in any violation
-8-
<PAGE>
of the provisions of the Articles of Incorporation or Bylaws of the
Company or any statute or any order, rule or regulation known to such
counsel of any court or governmental agency or body having jurisdiction
over the Company or any of its properties;
(x) To the best of such counsel's knowledge, no consent,
approval, authorization, order, registration or qualification of or with
any court or governmental agency or body is required for the issue and
sale of the Designated Securities or the consummation by the Company of
the other transactions contemplated by this Agreement, such Pricing
Agreement or the Indenture, except such as have been obtained under the
Act or the Trust Indenture Act and such consents, approvals,
authorizations, registrations or qualifications as may be required under
state securities or Blue Sky laws in connection with the purchase and
distribution of the Designated Securities by the Underwriters;
(xi) The Company is not an "investment company" or an entity
"controlled" by an "investment company", as such terms are defined in the
Investment Company Act;
(xii) The documents incorporated by reference in the Prospectus
as amended or supplemented (other than the financial statements and
related notes and schedules therein and other financial data included
therein or omitted therefrom, as to which such counsel need express no
opinion), when they were filed with the Commission appear on their face
to be appropriately responsive, in all material respects, to the
requirements of the Exchange Act and the rules and regulations of the
Commission thereunder; and nothing has come to his attention to cause him
to believe that any of such documents, when they were so filed contained
an untrue statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made when such documents were so
filed, not misleading; and
(xiii) Nothing has come to his attention to cause him to believe
that, as of its effective date, the Registration Statement or any further
amendment or supplement thereto made by the Company prior to the Time of
Delivery (other than the financial statements and related notes and
schedules therein and other financial data included therein or excluded
therefrom and Form T-1, as to which such counsel need express no opinion)
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading or that, as of the date of such
opinion, the Prospectus as amended or supplemented or any further
amendment or supplement thereto made by the Company prior to the Time of
Delivery (other than the financial statements and related notes and
schedules therein and other financial data included therein or excluded
therefrom and the Form T-1, as to which such counsel need express no
opinion) contained an untrue statement of a material fact or omitted to
state a material fact necessary to make the statements therein, in light
of the circumstances in which they were made, not misleading; and he does
not know of any amendment to the Registration Statement required to be
filed or any contracts or other documents of a character required to be
filed as an exhibit to the Registration Statement or required to be
incorporated by reference into the Prospectus as amended or supplemented
or required to be described in the Registration Statement or the
Prospectus as amended or supplemented which are not filed or incorporated
by reference or described as required.
(d) Fried, Frank, Harris, Shriver & Jacobson, special counsel for the
Company, or other counsel for the Company satisfactory to the Representatives,
shall have furnished to the Representatives their written opinion (which will
be limited to the laws of the State of New York and Federal laws and may rely
on an opinion of Richard G.
-9-
<PAGE>
McCauley, or other counsel for the Company reasonably satisfactory to such
Agent, as to the laws of the State of Maryland), dated the Time of Delivery in
form and substance reasonably satisfactory to such Agent, to the effect that:
(i) The Designated Securities, when duly executed,
authenticated, issued and delivered by the Company, will constitute valid
and binding obligations of the Company, enforceable against the Company
in accordance with their terms;
(ii) The Indenture constitutes a valid and binding obligation of
the Company, enforceable against the Company in accordance with its
terms;
(iii) The Indenture has been qualified under the Trust Indenture
Act;
(iv) The Indenture conforms, and the Designated Securities will
conform, in all material respects to the descriptions thereof contained
in the Prospectus as amended or supplemented; and
(v) At the time the Registration Statement was declared
effective by the Commission, the Registration Statement and the
Prospectus (other than (a) the financial statements, notes and schedules
thereto, (b) other financial data and statistical information included
therein, (c) the documents incorporated by reference therein and (d) the
Form T-1, included therein, as to which such counsel need not express an
opinion), appeared on their face to be responsive as to form in all
material respects to the requirements of the Act and the Trust Indenture
Act and the rules and regulations promulgated thereunder.
The opinion set forth in paragraphs (i) and (ii) above is subject to:
(i) applicable bankruptcy, insolvency, reorganization,
fraudulent transfer, moratorium or other laws now or hereafter in effect
affecting creditors' rights generally; and
(ii) general principles of equity (including, without
limitation, standards of materiality, good faith, fair dealing and
reasonableness) whether such principles are considered in a proceeding in
equity or at law;
(e) On the date of the Pricing Agreement for such Designated
Securities at a time prior to the execution of the Pricing Agreement with
respect to such Designated Securities and at the Time of Delivery for such
Designated Securities, the independent certified public accountants of the
Company who have certified the financial statements of the Company and its
subsidiaries included or incorporated by reference in the Registration
Statement, as amended or supplemented, or such other independent certified
public accountants as are reasonably satisfactory to the Representatives,
shall have furnished to the Representatives a letter, dated the effective date
of the Registration Statement or the date of the most recent report filed with
the Commission containing financial statements and incorporated by reference
in the Registration Statement, if the date of such report is later than such
effective date, and a letter dated such Time of Delivery, respectively, to the
effect set forth in Annex II hereto, and with respect to such letter dated
such Time of Delivery, as to such other matters as the Representatives may
reasonably request and in form and substance satisfactory to the
Representatives;
(f) (i) The Company and its subsidiaries, taken as a whole, have not
sustained since the date of the latest audited financial statements included
or incorporated by reference in the Prospectus as amended or supplemented
prior to the date of the Pricing Agreement relating to the Designated
Securities any material loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or
from any labor dispute
-10-
<PAGE>
or court or governmental action, order or decree, otherwise than as set forth
or contemplated in the Prospectus as amended or supplemented prior to the date
of the Pricing Agreement relating to the Designated Securities and (ii) since
the respective dates as of which information is given in the Prospectus as
amended or supplemented prior to the date of the Pricing Agreement relating to
the Designated Securities there shall not have been any change in the capital
stock (other than issuance of capital stock upon exercise of options and stock
appreciation rights and upon conversion of convertible securities, in each
case which were outstanding as of the date of the latest audited financial
statements included or incorporated by reference in the Prospectus as amended
or supplemented prior to the date of the Pricing Agreement relating to the
Designated Securities) or any material adverse change in the long-term debt of
the Company and its subsidiaries, taken as a whole, or any material adverse
change, or any development involving a prospective material adverse change, in
or affecting the general affairs, management, current value basis
shareholders' equity or results of operations (based on Earnings Before
Depreciation and Deferred Taxes from Operations) of the Company and its
subsidiaries, taken as a whole, otherwise than as set forth or contemplated in
the Prospectus as first amended or supplemented relating to the Designated
Securities, the effect of which, in any such case described in clause (i) or
(ii), is in the judgment of the Representatives so material and adverse as to
make it impracticable or inadvisable to proceed with the public offering or
the delivery of the Designated Securities on the terms and in the manner
contemplated in the Prospectus as first amended or supplemented prior to the
date of the Pricing Agreement relating to the Designated Securities;
(g) On or after the date hereof (i) no downgrading shall have occurred
in the rating accorded the Company's debt securities by any "nationally
recognized statistical rating organization", as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the Act and (ii) no such
organization shall have publicly announced that it has under surveillance or
review, with possible negative implications, its rating of any of the
Company's debt securities;
(h) On or after the date of the Pricing Agreement relating to the
Designated Securities there shall not have occurred any of the following: (i)
a suspension or material limitation in trading in securities generally on the
New York Stock Exchange; (ii) a general moratorium on commercial banking
activities in New York declared by either Federal or New York State
authorities; or (iii) the outbreak or escalation of hostilities involving the
United States or the declaration by the United States of a national emergency
or war, if the effect of any such event specified in this clause (iii) in the
Representatives' reasonable judgment makes it impracticable or inadvisable to
proceed with the public offering or the delivery of the Designated Securities
on the terms and in the manner contemplated in the Prospectus as first amended
or supplemented relating to the Designated Securities; and
(i) The Company shall have furnished or caused to be furnished to the
Representatives at the Time of Delivery for the Designated Securities a
certificate or certificates of officers of the Company in such form and
executed by such officers of the Company as shall be satisfactory to the
Representatives, as to the accuracy of the representations and warranties of
the Company herein at and as of such Time of Delivery, as to the performance
by the Company of all of its obligations hereunder to be performed at or prior
to such Time of Delivery, as to the matters set forth in subsections (a) and
(f) of this Section, and as to such other matters as the Representatives may
reasonably request.
8. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Securities, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will
reimburse each Underwriter
-11-
<PAGE>
for any legal or other expenses reasonably incurred by such Underwriter in
connection with investigating or defending any such action or claim as such
expenses are incurred; provided, however, that the Company shall not be liable
in any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in any Preliminary Prospectus, any
preliminary prospectus supplement, the Registration Statement, the Prospectus as
amended or supplemented and any other prospectus relating to the Securities, or
any such amendment or supplement, in reliance upon and in conformity with
written information furnished to the Company by any Underwriter of Designated
Securities through the Representatives expressly for use in the Prospectus as
amended or supplemented relating to such Securities.
(b) Each Underwriter will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, any preliminary prospectus supplement,
the Registration Statement, the Prospectus as amended or supplemented and any
other prospectus relating to the Securities, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Securities, or any such
amendment or supplement, in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through the
Representatives expressly for use therein; and will reimburse the Company for
any legal or other expenses reasonably incurred by the Company in connection
with investigating or defending any such action or claim as such expenses are
incurred.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified party, in connection with the defense thereof other
than reasonable costs of investigation. No indemnifying party shall, without the
written consent of the indemnified party, effect the settlement or compromise
of, or consent to the entry of any judgment with respect to, any pending or
threatened action or claim in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified party is an actual or
potential party to such action or claim), unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all
liability arising out of such action or claim and (ii) does not include a
statement as to, or an admission of, fault, culpability or a failure to act, by
or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Underwriters
of the Designated Securities on the other from the offering of the Designated
Securities to which such loss, claim, damage or liability (or action in respect
thereof) relates.
-12-
<PAGE>
If, however, the allocation provided by the immediately preceding sentence is
not permitted by applicable law or if the indemnified party failed to give the
notice required under subsection (c) above, then each indemnifying party shall
contribute to such amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of the Company on the one hand and the Underwriters of the
Designated Securities on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions in respect thereof), as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and such Underwriters on the other shall be deemed to be in the same proportion
as the total net proceeds from such offering (before deducting expenses)
received by the Company bear to the total commissions or discounts received by
such Underwriters in respect thereof. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
required to be stated therein or necessary in order to make the statements
therein not misleading relates to information supplied by the Company on the one
hand or by any such Underwriters on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and the Underwriters agree that it would not
be just and equitable if contribution pursuant to this subsection (d) were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above in this
subsection (d). The amount paid or payable by an indemnified party as a result
of the losses, claims, damages or liabilities (or actions in respect thereof)
referred to above in this subsection (d) shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total public offering
price at which the applicable Designated Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The obligations of the Underwriters
of Designated Securities in the subsection (d) to contribute are several in
proportion to their respective underwriting obligations with respect to such
Securities and not joint.
(e) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section 8 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each officer and director of the Company and to each
person, if any, who controls the Company within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to purchase
the Designated Securities which it has agreed to purchase under the Pricing
Agreement relating to such Designated Securities, the Representatives may in
their discretion arrange for themselves or another party or other parties to
purchase such Designated Securities on the terms contained herein. If within
thirty-six hours after such default by any Underwriter the Representatives do
not arrange for the purchase of such Designated Securities, then the Company
shall be entitled to a further period of thirty-six hours within which to
procure another party or other parties satisfactory to the Representatives to
purchase such Designated Securities on such terms. In the event that, within the
respective prescribed period, the Representatives notify the Company that they
have so arranged for the purchase of such Designated Securities, or the Company
notifies the Representatives that it has so arranged for the purchase of such
Designated Securities, the Representatives or the Company shall have the right
to postpone the Time of Delivery for such Designated Securities for a period of
not more than seven days, in order to effect whatever changes may thereby be
made necessary in the Registration Statement or the Prospectus as amended or
supplemented, or in any other documents or arrangements, and the Company agrees
to file promptly any amendments or supplements to the Registration Statement or
the Prospectus which in the opinion of the Representatives may thereby be made
necessary. The term "Underwriter" as used in
-13-
<PAGE>
this Agreement shall include any person substituted under this Section with like
effect as if such person had originally been a party to the Pricing Agreement
with respect to such Designated Securities.
(b) If, after giving effect to any arrangements for the purchase of
the Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Company as provided in subsection (a) above, the
aggregate principal amount of such Designated Securities which remains
unpurchased does not exceed one-eleventh of the aggregate principal amount of
the Designated Securities, then the Company shall have the right to require each
non-defaulting Underwriter to purchase the principal amount of Designated
Securities which such Underwriter agreed to purchase under the Pricing Agreement
relating to such Designated Securities and, in addition, to require each non-
defaulting Underwriter to purchase its pro-rata share (based on the principal
amount of Designated Securities which such Underwriter agreed to purchase under
such Pricing Agreement) of the Designated Securities of such defaulting
Underwriter or Underwriters for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
(c) If, after giving effect to any arrangements for the purchase of
the Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Company as provided in subsection (a) above, the
aggregate principal amount of Designated Securities which remains unpurchased
exceeds one-eleventh of the aggregate principal amount of the Designated
Securities as referred to in subsection (b) above, or if the Company shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Designated Securities of a defaulting Underwriter or
Underwriters, then the Pricing Agreement relating to such Designated Securities
shall thereupon terminate, without liability on the part of any non-defaulting
Underwriter or the Company, except for the expenses to be borne by the Company
and the Underwriters as provided in Section 6 hereof and the indemnity and
contribution agreements in Section 8 hereof; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations,
warranties and other statements of the Company and the several Underwriters, as
set forth in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless of
any investigation (or any statement as to the results thereof) made by or on
behalf of any Underwriter or any controlling person of any Underwriter, or the
Company, or any officer or director or controlling person of the Company, and
shall survive delivery of and payment for the Securities.
11. If any Pricing Agreement shall be terminated pursuant to Section 9
hereof, the Company shall not then be under any liability to any Underwriter
with respect to the Designated Securities covered by such Pricing Agreement
except as provided in Sections 6 and 8 hereof; but, if for any other reason,
Designated Securities are not delivered by or on behalf of the Company as
provided herein, the Company will reimburse the Underwriters through the
Representatives for all out-of-pocket expenses approved in writing by the
Representatives, including fees and disbursements of counsel, reasonably
incurred by the Underwriters in making preparations for the purchase, sale and
delivery of such Designated Securities, but the Company shall then be under no
further liability to any Underwriter with respect to such Designated Securities
except as provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, the Representatives of the Underwriters
of Designated Securities shall act on behalf of each of such Underwriters, and
the parties hereto shall be entitled to act and rely upon any statement,
request, notice or agreement on behalf of any Underwriter made or given by such
Representatives jointly or by such of the Representatives, if any, as may be
designated for such purpose in the Pricing Agreement.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Representatives as set forth in the
Pricing Agreement; and if to the Company shall be delivered or sent by mail,
telex or facsimile transmission to the address of the Company set forth in the
Registration Statement, Attention: Secretary; provided, however, that any notice
to an Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by
mail, telex or facsimile transmission to such Underwriter at its
-14-
<PAGE>
address set forth in its Underwriters' Questionnaire, or telex constituting such
Questionnaire, which address will be supplied to the Company by the
Representatives upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. This Agreement and each Pricing Agreement shall be binding upon,
and inure solely to the benefit of, the Underwriters, the Company and, to the
extent provided in Sections 8 and 10 hereof, the officers and directors of the
Company and each person who controls the Company or any Underwriter, and their
respective heirs, executors, administrators, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this
Agreement or any such Pricing Agreement. No purchaser of any of the Securities
from any Underwriter shall be deemed a successor or assign by reason merely of
such purchase.
14. Time shall be of the essence of each Pricing Agreement. As used
herein, "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. THIS AGREEMENT AND EACH PRICING AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
16. This Agreement and each Pricing Agreement may be executed by any
one or more of the parties hereto and thereto in any number of counterparts,
each of which shall be deemed to be an original, but all such respective
counterparts shall together constitute one and the same instrument.
Very truly yours,
THE ROUSE COMPANY
By: ______________________
Name:
Title:
-15-
<PAGE>
ANNEX I
Pricing Agreement
-----------------
_________________, 19__
[Name(s) of Representative(s)]
As Representatives of the several
Underwriters-named in Schedule I hereto
Ladies and Gentlemen:
The Rouse Company, a Maryland corporation (the "Company"), proposes,
subject to the terms and conditions stated herein and in the Underwriting
Agreement, dated ____________, 1995 (the "Underwriting Agreement"), to issue and
sell to the Underwriters named in Schedule I hereto (the "Underwriters") the
Securities specified in Schedule II hereto (the "Designated Securities"). Each
of the provisions of the Underwriting Agreement is incorporated herein by
reference in its entirety, and shall be deemed to be a part of this Agreement to
the same extent as if such provisions had been set forth in full herein, and
each of the representations and warranties set forth therein shall be deemed to
have been made at and as of the date of this Pricing Agreement, except that each
representation and warranty which refers to the Prospectus in Section 2 of the
Underwriting Agreement shall be deemed to be a representation or warranty as of
the date of the Underwriting Agreement in relation to the Prospectus (as therein
defined), and also a representation and warranty as of the date of this Pricing
Agreement in relation to the Prospectus as amended or supplemented relating to
the Designated Securities which are the subject of this Pricing Agreement. Each
reference to the Representatives herein and in the provisions of the
Underwriting Agreement so incorporated by reference shall be deemed to refer to
you. Unless otherwise defined herein, terms defined in the Underwriting
Agreement are used herein as therein defined. The Representatives designated to
act on behalf of the Representatives and on behalf of the Underwriters of the
Designated Securities pursuant to Section 12 of the Underwriting Agreement and
the address of the Representatives referred to in such Section 12 are set forth
at the end of Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Company agrees to
issue and sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at the time and place
and at the purchase price to the Underwriters set forth in Schedule II hereto,
the principal amount of Designated Securities set forth opposite the name of
such Underwriter in Schedule I hereto.
If the foregoing is in accordance with your understanding, please sign and
return to us [one for the Company and one for each of the Representatives plus
one for each counsel] counterparts hereof, and upon acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof,
including the provisions of the Underwriting Agreement incorporated herein by
reference, shall constitute a binding agreement between each of the Underwriters
and the Company.
I-1
<PAGE>
It is understood that your acceptance of this letter on behalf of each of the
Underwriters is or will be pursuant to the authority set forth in a form of
Agreement among Underwriters, the form of which shall be submitted to the
Company for examination, upon request, but without warranty on the part of the
Representatives as to the authority of the signers thereof.
Very truly yours,
THE ROUSE COMPANY
By: _______________________________
Name:
Title:
Accepted as of the date hereof:
[Name(s) of Representatives]
By: ___________________________
Name:
Title:
On behalf of each of the Underwriters
I-2
<PAGE>
SCHEDULE I
Principal Amount
of Designated
Securities
to be
Underwriter Purchased
----------- ---------
____________________
Total................................ ====================
<PAGE>
SCHEDULE II
TITLE OF DESIGNATED SECURITIES:
[ %] [Floating Rate] [Zero Coupon] [Notes]
[Debentures] due ,
AGGREGATE PRINCIPAL AMOUNT:
[$]
PRICE TO PUBLIC:
% of the principal amount (or for Original Issue Discount Securities
that do not currently pay interest, the issue price) of the Designated
Securities, plus accrued interest[, if any,] from to [and accrued
amortization[, if any,] from to ]
PURCHASE PRICE BY UNDERWRITERS:
% of the principal amount of the Designated Securities, plus
accrued interest from to [and accrued amortization[, if any,] from
to ]
FORM OF DESIGNATED SECURITIES:
[Definitive form to be made available for checking and packaging at least
twenty-four hours prior to the Time of Delivery at the office of [The
Depository Trust Company or its designated custodian] [the
Representatives]]
[Book-entry only form represented by one or more global securities
depostied with The Depository Trust Company ("DTC") or its designated
custodian, to be made available for checking by the Representatives at
least twenty-four hours prior to the Time of Delivery at the office of
DTC.]
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:
[New York] Clearing House (next day) funds
TIME OF DELIVERY:
a.m. (New York City time), , 19
INDENTURE:
Indenture dated , 1995, between the Company and The
First National Bank of Chicago, as Trustee
MATURITY:
INTEREST RATE:
[ %] [Zero Coupon] [See Floating Rate Provisions]
INTEREST PAYMENT DATES:
[months and dates, commencing ................, 19..]
REDEMPTION PROVISIONS:
[No provisions for redemption]
[The Designated Securities may be redeemed, otherwise than through the
sinking fund, in whole or in part at the option of the Company, in the
amount of [$ ] or an integral multiple thereof,
<PAGE>
[on or after , at the following redemption prices (expressed in
percentages of principal amount). If [redeemed on or before , %, and
if] redeemed during the 12-month period beginning .
REDEMPTION
YEAR PRICE
---- ----------
and thereafter at 100% of their principal amount, together in each case
with accrued interest to the redemption date.]
[on any interest payment date falling on or after , , at the
election of the Company, at a redemption price equal to the principal
amount thereof, plus accrued interest to the date of redemption.]]
[Other possible redemption provisions, such as mandatory redemption upon
occurrence of certain events or redemption for changes in tax law]
[Restriction on refunding]
SINKING FUND PROVISIONS:
[No sinking fund provisions]
[The Designated Securities are entitled to the benefit of a sinking
fund to retire [$ ] principal amount of Designated
Securities on in each of the years through
at 100% of their principal amount plus accrued interest[,
together with [cumulative] [noncumulative] redemptions at the option
of the Company to retire an additional [$ ] principal amount
of Designated Securities in the years through
at 100% of their principal amount plus accrued interest.]
[If Designated Securities are extendable debt securities, insert--
EXTENDABLE PROVISIONS:
Designated Securities are repayable on , [insert
date and years], at the option of the holder, at their principal
amount with accrued interest. The initial annual interest rate will
be %, and thereafter the annual interest rate will be adjusted
on , and to a rate not less than % of the
effective annual interest rate on U.S. Treasury obligations with
-year maturities as of the [insert date 15 days prior to maturity
date] prior to such [insert maturity date].]
[If Designated Securities are floating rate debt securities, insert--
FLOATING RATE PROVISIONS:
Initial annual interest rate will be % through [and
thereafter will be adjusted [monthly] [on each , ,
and ] [to an annual rate of % above the average rate for
-year [month][securities][certificates of deposit] issued by
and [insert names of banks].] [and the annual interest rate
[thereafter] [from
-2-
<PAGE>
through ] will be the interest yield equivalent of the
weekly average per annum market discount rate for -month
Treasury bills plus % of Interest Differential (the excess,
if any, of (i) the then current weekly average per annum secondary
market yield for -month certificates of deposit over (ii) the
then current interest yield equivalent of the weekly average per
annum market discount rate for -month Treasury bills); [from
and thereafter the rate will be the then current interest yield
equivalent plus % of Interest Differential].]
DEFEASANCE PROVISIONS:
CLOSING LOCATION FOR DELIVERY OF DESIGNATED SECURITIES:
ADDITIONAL CLOSING CONDITIONS:
NAMES AND ADDRESSES OF REPRESENTATIVES:
Designated Representatives:
Address for Notices, etc.:
[OTHER TERMS]* :
- --------------------------------
/*/ A DESCRIPTION OF PARTICULAR TAX, ACCOUNTING OR OTHER UNUSUAL FEATURES
(SUCH AS THE ADDITION OF EVENT RISK PROVISIONS) OF THE DESIGNATED SECURITIES
SHOULD BE SET FORTH, OR REFERENCED TO AN ATTACHED AND ACCOMPANYING DESCRIPTION,
IF NECESSARY, TO ENSURE AGREEMENT AS TO THE TERMS OF THE DESIGNATED SECURITIES
TO BE PURCHASED AND SOLD. SUCH A DESCRIPTION MIGHT APPROPRIATELY BE IN THE FORM
IN WHICH SUCH FEATURES WILL BE DESCRIBED IN THE PROSPECTUS SUPPLEMENT FOR THE
OFFERING.
-3-
<PAGE>
ANNEX II
Accountants' Letter
-------------------
Pursuant to Section 7(d) of the Underwriting Agreement, the Company's
independent certified public accountants shall furnish letters to the effect
that:
(i) They are independent certified public accountants with respect to
the Company and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules audited (and, if applicable, financial
forecasts and/or pro forma financial information) examined by them and
included or incorporated by reference in the Registration Statement or the
Prospectus comply as to form in all material respects with the applicable
accounting requirements of the Act or the Exchange Act, as applicable, and
the related published rules and regulations thereunder; and, if applicable,
they have made a review in accordance with standards established by the
American Institute of Certified Public Accountants of the consolidated
interim financial statements, selected financial data, pro forma financial
information, financial forecasts and/or condensed financial statements
derived from audited financial statements of the Company for the periods
specified in such letter, as indicated in their reports thereon, copies of
which have been [separately] furnished to the Representatives [and are
attached hereto];
(iii) They have made a review in accordance with standards established
by the American Institute of Certified Public Accountants of the unaudited
condensed consolidated statements of income, consolidated balance sheets
and consolidated statements of cash flows included in the Prospectus and/or
included in the Company's quarterly report on Form 10-Q incorporated by
reference into the Prospectus as indicated in their reports thereon copies
of which [have been separately furnished to the Representatives] [are
attached hereto]; and on the basis of specified procedures including
inquiries of officials of the Company who have responsibility for financial
and accounting matters regarding whether the unaudited condensed
consolidated financial statements referred to in paragraph (vi)(A)(i) below
comply as to form in all material respects with the applicable accounting
requirements of the [Act and the Exchange] Act and the related published
rules and regulations, nothing came to their attention that caused them to
believe that the unaudited condensed consolidated financial statements do
not comply as to form in all material respects with the applicable
accounting requirements of the [Act and the Exchange] Act and the related
published rules and regulations;
(iv) The unaudited selected financial information with respect to the
consolidated results of operations and financial position of the Company
for the five most recent fiscal years included in the Prospectus and
included or incorporated by reference in Item 6 of the Company's Annual
Report on Form 10-K for the most recent fiscal year agrees with the
corresponding amounts (after restatement where applicable) in the audited
consolidated financial statements for five such fiscal years which were
included or
II-1
<PAGE>
incorporated by reference in the Company's Annual Reports on Form 10-K for
such fiscal years;
(v) They have compared the information in the Prospectus under selected
captions with the disclosure requirements of Regulation S-K and on the
basis of limited procedures specified in such letter nothing came to their
attention as a result of the foregoing procedures that caused them to
believe that this information does not conform in all material respects
with the disclosure requirements of Items 301, 302, 402 and 503(d),
respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an examination
in accordance with generally accepted auditing standards, consisting of a
reading of the unaudited financial statements and other information
referred to below, a reading of the latest available interim financial
statements of the Company and its subsidiaries, inspection of the minute
books of the Company and its subsidiaries since the date of the latest
audited financial statements included or incorporated by reference in the
Prospectus, inquiries of officials of the Company and its subsidiaries
responsible for financial and accounting matters and such other inquiries
and procedures as may be specified in such letter, nothing came to their
attention that caused them to believe that:
(A) (i) the unaudited condensed consolidated statements of
income, consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus and/or included or incorporated
by reference in the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus do not comply as to form
in all material respects with the applicable accounting requirements
of the Exchange Act and the related published rules and regulations,
or (ii) any material modifications should be made to the unaudited
condensed consolidated statements of income, consolidated balance
sheets and consolidated statements of cash flows included in the
Prospectus or included in the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus for them to be in
conformity with generally accepted accounting principles;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited consolidated financial statements from which
such data and items were derived, and any such unaudited data and
items were not determined on a basis substantially consistent with the
basis for the corresponding amounts in the audited consolidated
financial statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent fiscal year;
(C) the unaudited financial statements which were not included
in the Prospectus but from which were derived the unaudited condensed
financial statements referred to in clause (A) and any unaudited
income statement data and balance sheet items included in the
Prospectus and referred to in Clause (B) were not determined on a
basis substantially consistent with the basis for the
II-2
<PAGE>
audited financial statements included or incorporated by reference in
the Company's Annual Report on Form 10-K for the most recent fiscal
year;
(D) any unaudited pro forma consolidated condensed financial
statements included or incorporated by reference in the Prospectus do
not comply as to form in all material respects with the applicable
accounting requirements of the Act and the published rules and
regulations thereunder or the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of those
statements;
(E) as of a specified date (where practicable not more than
five days prior to the date of such letter), there have been any
changes in the consolidated capital stock (other than issuances of
capital stock upon exercise of options and stock appreciation rights,
upon earn-outs of performance shares and upon conversions of
convertible securities, in each case which were outstanding on the
date of the latest balance sheet included or incorporated by reference
in the Prospectus) or any increase in excess of 1% in the consolidated
long-term debt of the Company and its subsidiaries, or any decreases
in consolidated net current assets or other items specified by the
Representatives, or any increases in any items specified by the
Representatives, in each case as compared with amounts shown in the
latest balance sheet included or incorporated by reference in the
Prospectus, except in each case for changes, increases or decreases
which the Prospectus discloses have occurred or may occur or which are
described in such letter; and
(F) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus to
the specified date referred to in Clause (E) there were any decreases
in consolidated earnings before depreciation and deferred taxes from
operations or other items specified by the Representatives, or any
increases in any items specified by the Representatives, in each case
as compared with the comparable period of the preceding year and with
any other period of corresponding length specified by the
Representatives, except in each case for increases or decreases which
the Prospectus discloses have occurred or may occur or which are
described in such letter; and
(vii) In addition to the audit referred to in their report(s) included
or incorporated by reference in the Prospectus and the limited procedures,
inspection of minute books, inquiries and other procedures referred to in
paragraphs (iii) and (vi) above, they have carried out certain specified
procedures, not constituting an audit in accordance with generally accepted
auditing standards, with respect to certain amounts, percentages and
financial information specified by the Representatives which are derived
from the general accounting records of the Company and its subsidiaries,
which appear in the Prospectus (excluding documents incorporated by
reference), or in Part II of, or in exhibits and schedules to, the
Registration Statement specified by the Representatives or in documents
incorporated by reference in the Prospectus specified by the
Representatives, and have compared certain of such amounts, percentages and
financial information with the accounting records of the Company and its
subsidiaries and have found them to be in agreement.
II-3
<PAGE>
All references in this Annex II to the Prospectus shall be deemed to refer
to the Prospectus (including the documents incorporated by reference therein) as
defined in the Underwriting Agreement as of the date of the letter delivered on
the date of the Pricing Agreement for purposes of such letter and to the
Prospectus as amended or supplemented (including the documents incorporated by
reference therein) in relation to the applicable Designated Securities for
purposes of the letter delivered at the Time of Delivery for such Designated
Securities.
II-4
<PAGE>
Exhibit 4.1
-----------------
THE ROUSE COMPANY
AND
THE FIRST NATIONAL BANK OF CHICAGO
Trustee
-----------------
INDENTURE
Dated as of , 1995
------------
-----------------
<PAGE>
..............................................
Certain Sections of this Indenture relating to
Sections 310 through 318, inclusive, of the
Trust Indenture Act of 1939:
<TABLE>
<CAPTION>
Trust Indenture
Act Section Indenture Section
<S> <C>
(S) 310(a)(1)......................................... 609
(a)(2)......................................... 609
(a)(3)......................................... Not Applicable
(a)(4)......................................... Not Applicable
(b)............................................ 608
610
(S) 311(a)............................................ 613
(b)............................................ 613
(S) 312(a)............................................ 701
702
(b)............................................ 702
(c)............................................ 702
(S) 313(a)............................................ 703
(b)............................................ 703
(c)............................................ 703
(d)............................................ 703
(S) 314(a)............................................ 704
(a)(4)......................................... 101
1004
(b)............................................ Not Applicable
(c)(1)......................................... 102
(c)(2)......................................... 102
(c)(3)......................................... Not Applicable
(d)............................................ Not Applicable
(e)............................................ 102
(S) 315(a)............................................ 601
(b)............................................ 602
(c)............................................ 601
(d)............................................ 601
(e)............................................ 514
(S) 316(a)............................................ 101
(a)(1)(A)...................................... 502
512
(a)(1)(B)...................................... 513
(a)(2)......................................... Not Applicable
(b)............................................ 508
(c)............................................ 104
(S) 317(a)(1)......................................... 503
(a)(2)......................................... 504
(b)............................................ 1003
(S) 318(a)............................................ 107
</TABLE>
- --------------
NOTE: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Indenture.
-2-
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
PARTIES ................................................. 1
RECITALS OF THE COMPANY.................................. 1
ARTICLE ONE
-----------
Definitions and Other Provisions
of General Application
Section 101. Definitions................................ 1
Act 2
Affiliate 2
Asset............................................... 2
Attributable Debt................................... 2
Authenticating Agent................................ 3
Board of Directors.................................. 3
Board Resolution.................................... 3
Business Day........................................ 3
Capital Lease Obligations........................... 3
Commission.......................................... 4
Company 4
Company Request..................................... 4
Consolidated Coverage Ratio......................... 4
Consolidated Interest Expense....................... 4
Consolidated Net Tangible Assets.................... 5
Corporate Trust Office.............................. 5
Corporation......................................... 5
Covenant Defeasance................................. 5
Day Count Fraction.................................. 5
Debt 5
Defaulted Interest.................................. 6
Defeasance.......................................... 6
Defeasible Series................................... 6
Depositary.......................................... 6
EBDT 6
Event of Default.................................... 6
Exchange Act........................................ 6
Financial Statement................................. 6
Global Security..................................... 6
Holder 7
Incur............................................... 7
Indenture 7
Independent Investment Banker....................... 7
Interest............................................ 7
Interest Payment Date............................... 7
Maturity 7
Notice of Default................................... 7
Officers' Certificate............................... 7
Opinion of Counsel.................................. 8
Original Issue Discount Security.................... 8
Outstanding......................................... 8
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Page
----
<S> <C>
Paying Agent........................................ 9
Person 9
Place of Payment.................................... 9
Predecessor Security................................ 9
Principal Property.................................. 10
Ratio Calculation................................... 10
Redemption Date..................................... 11
Redemption Price.................................... 11
Regular Record Date................................. 11
Remaining Life...................................... 11
Required Filing Date................................ 11
Restricted Subsidiary............................... 11
Sale/Leaseback Transaction.......................... 11
Securities.......................................... 11
Security Register................................... 11
Significant Subsidiary.............................. 11
Special Record Date................................. 11
Stated Maturity..................................... 11
Subsidiary.......................................... 12
Treasury Yield...................................... 12
Trustee 12
Trust Indenture Act................................. 13
U.S. Government Obligations......................... 13
Vice President...................................... 13
Section 102. Compliance Certificates and Opinions....... 13
Section 103. Form of Documents Delivered to Trustee..... 14
Section 104. Acts of Holders; Record Dates.............. 14
Section 105. Notices, Etc., to Trustee and Company...... 16
Section 106. Notice to Holders; Waiver.................. 17
Section 107. Conflict with Trust Indenture Act.......... 17
Section 108. Effect of Headings and Table of Contents... 17
Section 109. Successors and Assigns..................... 18
Section 110. Separability Clause........................ 18
Section 111. Benefits of Indenture...................... 18
Section 112. Governing Law.............................. 18
Section 113. Legal Holidays............................. 18
Section 114. Indenture and Debentures Solely Corporate
Obligations................................ 18
ARTICLE TWO
-----------
Security Forms
Section 201. Forms Generally............................ 19
Section 202. Form of Face of Security................... 19
Section 203. Form of Reverse of Security................ 21
Section 204. Form of Legend for Global Securities....... 24
</TABLE>
-ii-
<PAGE>
<TABLE>
<CAPTION>
Page
----
<S> <C>
Section 205. Form of Trustee's Certificate of
Authentication............................. 24
ARTICLE THREE
-------------
The Securities
Section 301. Amount Unlimited; Issuable in Series....... 25
Section 302. Denominations.............................. 28
Section 303. Execution, Authentication, Delivery an..... 28
Section 304. Temporary Securities....................... 30
Section 305. Registration, Registration of
Transfer and Exchange...................... 31
Section 306. Mutilated, Destroyed, Lost and Stolen
Securities................................. 33
Section 307. Payment of Interest; Interest Rights
Preserved.................................. 34
Section 308. Persons Deemed Owners...................... 35
Section 309. Cancellation............................... 35
Section 310. Computation of Interest.................... 36
ARTICLE FOUR
------------
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of
Indenture.................................. 36
Section 402. Application of Trust Money................. 38
ARTICLE FIVE
------------
Remedies
Section 501. Events of Default.......................... 38
Section 502. Acceleration of Maturity; Rescission
and Annulment.............................. 41
Section 503. Collection of Indebtedness and Suits
for Enforcement by Trustee................. 43
Section 504. Trustee May File Proofs of Claim........... 44
Section 505. Trustee May Enforce Claims Without
Possession of Securities................... 44
Section 506. Application of Money Collected............. 45
Section 507. Limitation on Suits........................ 45
Section 508. Unconditional Right of Holders to
Receive Principal, Premium and Interest.... 46
Section 509. Restoration of Rights and Remedies......... 46
Section 510. Rights and Remedies Cumulative............. 46
Section 511. Delay or Omission Not Waiver............... 47
Section 512. Control by Holders......................... 47
</TABLE>
-iii-
<PAGE>
<TABLE>
<CAPTION>
Page
----
<S> <C>
Section 513. Waiver of Past Defaults..................... 48
Section 514. Undertaking for Costs....................... 48
Section 515. Waiver of Usury, Stay or Extension Laws..... 48
ARTICLE SIX
-----------
The Trustee
Section 601. Certain Duties and Responsibilities......... 49
Section 602. Notice of Defaults.......................... 49
Section 603. Certain Rights of Trustee................... 49
Section 604. Not Responsible for Recitals or
Issuance of Securities...................... 51
Section 605. May Hold Securities......................... 51
Section 606. Money Held in Trust......................... 51
Section 607. Compensation and Reimbursement.............. 51
Section 608. Disqualification; Conflicting
Interests................................... 52
Section 609. Corporate Trustee Required;
Eligibility................................. 52
Section 610. Resignation and Removal;
Appointment of Successor.................... 53
Section 611. Acceptance of Appointment by
Successor................................... 55
Section 612. Merger, Conversion, Consolidation
or Succession to Business................... 56
Section 613. Preferential Collection of Claims
Against Company............................. 56
Section 614. Appointment of Authenticating Agent......... 56
ARTICLE SEVEN
-------------
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee
Names and Addresses of Holders.............. 59
Section 702. Preservation of Information;
Communications to Holders................... 59
Section 703. Reports by Trustee.......................... 60
Section 704. Reports by Company.......................... 60
ARTICLE EIGHT
-------------
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. Company May Consolidate, Etc., Only
on Certain Terms............................ 60
Section 802. Successor Substituted....................... 62
</TABLE>
-iv-
<PAGE>
ARTICLE NINE
------------
Supplemental Indentures
<TABLE>
<CAPTION>
Page
----
<S> <C>
Section 901. Supplemental Indentures Without
Consent of Holders.......................... 62
Section 902. Supplemental Indentures with Consent
of Holders.................................. 64
Section 903. Execution of Supplemental Indentures........ 65
Section 904. Effect of Supplemental Indentures........... 65
Section 905. Conformity with Trust Indenture Act......... 65
Section 906. Reference in Securities to
Supplemental Indentures..................... 66
ARTICLE TEN
-----------
Covenants
Section 1001. Payment of Principal, Premium and
Interest.................................... 66
Section 1002. Maintenance of Office or Agency............ 66
Section 1003. Money for Securities Payments to
Be Held in Trust........................... 67
Section 1004. Statement by Officers as to Default........ 68
Section 1005. Existence.................................. 68
Section 1006. Maintenance of Properties.................. 69
Section 1007. Payment of Taxes and Other Claims.......... 69
Section 1008. Limitation on the Incurrence of Debt....... 69
Section 1009. Limitation on Sale/Leaseback
Transactions............................... 70
Section 1011. Provision of Financial Information......... 71
Section 1012. Waiver of Certain Covenants................ 72
ARTICLE ELEVEN
--------------
Redemption of Securities
Section 1101. Applicability of Article................... 72
Section 1102. Election to Redeem; Notice to Trustee...... 72
Section 1103. Selection by Trustee of Securities
to Be Redeemed............................. 73
Section 1104. Notice of Redemption....................... 73
Section 1105. Deposit of Redemption Price................ 74
Section 1106. Securities Payable on Redemption Date...... 74
Section 1107. Securities Redeemed in Part................ 75
</TABLE>
-v-
<PAGE>
ARTICLE TWELVE
--------------
Sinking Funds
<TABLE>
<CAPTION>
Page
----
<S> <C>
Section 1201. Applicability of Article................... 75
Section 1202. Satisfaction of Sinking Fund Payments
with Securities............................ 76
Section 1203. Redemption of Securities for Sinking
Fund....................................... 76
ARTICLE THIRTEEN
----------------
Defeasance and Covenant Defeasance
Section 1301. Company's Option to Effect Defeasance
or Covenant Defeasance..................... 76
Section 1302. Defeasance and Discharge................... 77
Section 1303. Covenant Defeasance........................ 77
Section 1304. Conditions to Defeasance
or Covenant Defeasance..................... 78
Section 1305. Deposited Money and U.S. Government
Obligations to be Held in Trust;
Other Miscellaneous Provisions............. 81
Section 1306. Reinstatement.............................. 81
TESTIMONIUM............................................... 83
SIGNATURES AND SEALS...................................... 84
ACKNOWLEDGMENTS........................................... 84
</TABLE>
-vi-
<PAGE>
PARTIES
INDENTURE, dated as of , 1995, between The Rouse Company, a
----------
corporation duly organized and existing under the laws of the State of Maryland
(herein called the "Company"), having its principal office at 10275 Little
Patuxent Parkway, Columbia, Maryland 21044-3456, and The First National Bank of
Chicago, a National Banking Association duly organized and existing under the
laws of the United States of America, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured
debentures, notes or other evidences of indebtedness (herein called the
"Securities"), to be issued in one or more series as in this Indenture provided.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities or of series thereof, as
follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions.
-----------
For all purposes of this Indenture, except as
otherwise expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act,
<PAGE>
either directly or by reference therein, have the meanings assigned to them
therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles, and, except as otherwise herein expressly provided, the term
"generally accepted accounting principles" with respect to any computation
required or permitted hereunder shall mean such accounting principles as
reflected in the Company's Consolidated Statement of Operations for the
nine months ended September 30, 1994 contained in the Company's Form 10-Q
for such period;
(4) the words "Article" and "Section" refer to an Article and
Section, respectively, of this Indenture; and
(5) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
"Act", when used with respect to any Holder, has the meaning specified
in Section 104.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Asset" means, with respect to one or more transactions occurring
within any 12-month period, any asset or group of assets of the Company or its
Subsidiaries (including, but not limited to, all balance sheet items and all
intangible assets including management contracts, goodwill and trade secrets)
with a fair market or book value, whichever is larger, greater than 5% of
Consolidated Net Tangible Assets on the date of such transaction.
"Attributable Debt" shall mean, as to any particular lease under which
the Company or any Restricted Subsidiary is at the time liable, at any date as
of which
-2-
<PAGE>
the amount thereof is to be determined, the lesser of (i) the fair value of the
property subject to such lease (as certified in an Officers' Certificate) or
(ii) the total new amount of rent required to be paid by the Company under such
lease during the remaining term thereof, discounted from the respective due
dates thereof to such date at the rate of interest per annum equal to 8.5%,
compounded semi-annually. The net amount of rent required to be paid under any
such lease for any such period shall be the amount of the rent payable by the
lessee with respect to such period, after excluding amounts required to be paid
on account of maintenance and repairs, insurance, taxes, assessments, water
rates and similar charges. In the case of any lease which is terminable by the
lessee upon the payment of a penalty, such net amount shall also include the
amount of such penalty, but no rent shall be considered as required to be paid
under such lease subsequent to the first date upon which it may be so
terminated.
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 614 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Board of Directors" means either the board of directors of the
Company or any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Business Day", when used with respect to any Place of Payment, means
a day that is not a Saturday or Sunday and that is not a day on which banking
institutions are generally authorized or obligated by law or executive order to
close in that Place of Payment, the State of Maryland or the City of New York.
"Capital Lease Obligations" of any Person means the obligations to pay
rent or other amounts under a lease of (or other Debt arrangements conveying the
right to use) real or personal property of such Person which are required to be
classified and accounted for as a capital lease or a liability on the face of a
balance sheet of such Person in accordance with generally accepted accounting
principles, and the amount of such obligations shall be the capitalized amount
thereof in accordance with generally accepted accounting principles and the
stated maturity thereof shall be the date of the last payment of rent or any
other amount due under such lease prior to the first date upon which such
-3-
<PAGE>
lease may be terminated by the lessee without payment of a penalty.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act or, if at any time
after the execution of this instrument such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, Vice Chairman,
Chief Executive Officer, Chief Operating Officer, President, one of its Senior
or Executive Vice Presidents, or a Vice President, and by its Treasurer, an
Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered to
the Trustee.
"Consolidated Coverage Ratio" of any Person means for any period the
ratio of (i) EBDT for such period plus Consolidated Interest Expense for the
same period for such Person to (ii) Consolidated Interest Expense for the same
period for such Person.
"Consolidated Interest Expense" means with respect to any Person for
any period the Consolidated Interest Expense included in a consolidated income
statement (without deduction of consolidated interest income) of such Person for
such period (based on the accounting principles reflected in the Company's
Consolidated Statement of Operations for the nine months ended September 30,
1994 contained in the Company's Form 10-Q for such period), including, without
limitation or duplication (or, to the extent not so included, with the addition
of), (i) the portion of any rental obligation in respect of any Capital Lease
Obligation allocable to interest expense in accordance with generally accepted
accounting principles; (ii) the amortization of Debt discounts; (iii) any
payments or fees (other than up-front fees) with respect to letters of credit,
bankers' acceptances or similar facilities; (iv) fees (other than up-front fees)
with respect to interest rate swap or similar agreements, or foreign currency
hedge, exchange or similar agreements; (v) the interest portion of any rental
obligation with respect to any Sale/Leaseback Transaction (determined as if such
obligations were treated as a Capital Lease Obligation); and
-4-
<PAGE>
(vi) any dividends attributable to any equity security which may be converted
into a debt security of the Company at any time or is mandatorily redeemable for
cash within 20 years from its initial issuance.
"Consolidated Net Tangible Assets" shall mean the aggregate amount of
assets (less applicable reserves and other property deductible items) after
deducting therefrom (i) all current liabilities (excluding any thereof which are
by their terms extendible or renewable at the option of the obligor thereon to a
time more than 12 months after the time as of which the amount thereof is being
computed and excluding current maturities of long-term indebtedness and Capital
Lease Obligations) and (ii) all goodwill, all as shown in the consolidated
balance sheet of the Company and its Subsidiaries as of the end of the latest
fiscal quarter for which consolidated Financial Statements are available.
"Corporate Trust Office" means the principal office of the Trustee in
Chicago, Illinois or such other place provided by the Trustee at which at any
particular time its corporate trust business shall be administered.
"Corporation" means a corporation, association, company, joint-stock
company or business trust.
"Covenant Defeasance" has the meaning specified in Section 1303.
"Day Count Fraction" means, the number of days from the Redemption
Date to (but excluding) the next scheduled Interest Payment Date divided by 360
(which assumes a year composed of twelve 30-day months).
"Debt" means (without duplication), with respect to any Person, (i)
every obligation of such Person for money borrowed, (ii) every obligation of
such Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses, excluding any trade payments and other accrued current
liabilities arising in the ordinary course of business, (iii) every currently
due reimbursement obligation of such Person with respect to letters of credit,
bankers' acceptances or similar facilities issued for the account of such
Person, (iv) every obligation of such Person issued or assumed as the deferred
purchase price of property (but excluding trade accounts payable and other
accrued current liabilities arising in the ordinary course of business which are
not overdue by more than 90 days or which are being contested in good faith),
(v) every Capital Lease Obligation of such Person, (vi) the maximum fixed
redemption or repurchase price of any equity security which may be converted
into a debt security of such
-5-
<PAGE>
Person at any time or is mandatorily redeemable for cash within twenty years
from its initial issuance, and (vii) every obligation of the type referred to in
clauses (i) through (vi) of another Person and all dividends of another Person
the payment of which, in either case, such Person has guaranteed or for which
such Person is responsible or liable, directly or indirectly, as obligor,
guarantor or otherwise.
"Defaulted Interest" has the meaning specified in Section 307.
"Defeasance" has the meaning specified in Section 1302.
"Defeasible Series" has the meaning specified in Section 1301.
"Depositary" means, with respect to Securities of any series issuable
in whole or in part in the form of one or more Global Securities, a clearing
agency registered under the Exchange Act that is designated to act as Depositary
for such Securities as contemplated by Section 301.
"EBDT" shall mean Earnings Before Depreciation and Deferred Taxes from
Operations for the Company and its consolidated Subsidiaries based on the
accounting principles reflected in the Company's Consolidated Statement of
Operations for the nine months ended September 30, 1994 contained in the
Company's Form 10-Q for such period, and assuming that any dividends paid on any
equity security shall not be deducted in calculating EBDT unless such equity
security may be converted into a debt security at any time or is mandatorily
redeemable for cash within 20 years from its initial issuance.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, and any statute successor thereto.
"Financial Statement" has the meaning specified in Section 1011.
"Global Security" means a Security that evidences all or part of the
Securities of any series and is authenticated and delivered to, and registered
in the name of, the Depositary for such Securities or a nominee thereof.
-6-
<PAGE>
"Holder" means a Person in whose name a Security is registered in the
Security Register.
"Incur" means, with respect to any Debt or other obligation of any
Person, to create, issue, incur (by conversion, exchange or otherwise), assume,
guarantee or otherwise become liable in respect of such Debt or other obligation
or the recording, as required pursuant to generally accepted accounting
principles or otherwise, of any such Debt or other obligation on the balance
sheet of any such Person (and "incurrence," "incurred," "incurrable" and
"incurring" shall have meanings correlative to the foregoing); provided that a
change in generally accepted accounting principles that results in an obligation
of such Person that exists at such time becoming Debt shall not be deemed an
incurrence of such Debt.
"Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument, and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively. The term "Indenture" shall also include the terms of particular
series of Securities established as contemplated by Section 301.
"Independent Investment Banker" has the meaning specified in Section
203.
"Interest", when used with respect to an Original Issue Discount
Security which by its terms bears interest only after Maturity, means interest
payable after Maturity.
"Interest Payment Date", when used with respect to any Security, means
the Stated Maturity of an instalment of interest on such Security.
"Maturity", when used with respect to any Security, means the date on
which the principal of such Security or an instalment of principal becomes due
and payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, call for redemption or otherwise.
"Notice of Default" means a written notice of the kind specified in
Section 501(4) or (5).
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, Vice Chairman, Chief Executive Officer, Chief Operating Officer,
President, one of its
-7-
<PAGE>
Senior or Executive Vice Presidents, or a Vice President, and by the Treasurer,
an Assistant Treasurer, the Secretary or an Assistant Secretary, of the Company,
and delivered to the Trustee. One of the officers signing an Officers'
Certificate given pursuant to Section 1004 shall be the principal executive,
financial or accounting officer of the Company.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company, and who shall be acceptable to the Trustee.
"Original Issue Discount Security" means a Security, including any
Security that does not provide for the payment of interest prior to Maturity,
which is issued at a price lower than the principal amount thereof and which
provides that upon redemption or acceleration of the Stated Maturity thereof
pursuant to Section 502 an amount less than the principal amount thereof shall
become due and payable.
"Outstanding", when used with respect to Securities, means, as of the
date of determination, all Securities theretofore authenticated and delivered
under this Indenture, except:
------
(1) Securities theretofore cancelled by the Trustee or delivered to
the Trustee for cancellation;
(2) Securities for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Trustee or any Paying Agent
(other than the Company) in trust or set aside and segregated in trust by
the Company (if the Company shall act as its own Paying Agent) for the
Holders of such Securities; provided that, if such Securities are to be
--------
redeemed, notice of such redemption has been duly given pursuant to this
Indenture or provision therefor satisfactory to the Trustee has been made;
(3) Securities as to which Defeasance has been effected pursuant to
Section 1302; and
(4) Securities which have been replaced pursuant to Section 306 or in
exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to
-8-
<PAGE>
it that such Securities are held by a bona fide purchaser in whose hands
such Securities are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
- -------- -------
principal amount of the Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, (A) the principal
amount of an Original Issue Discount Security that shall be deemed to be
Outstanding shall be the amount of the principal thereof that would be due and
payable as of the date of such determination upon acceleration of the Maturity
thereof to such date pursuant to Section 502, (B) the principal amount of a
Security denominated in one or more foreign currencies or currency units shall
be the U.S. dollar equivalent, determined in the manner provided as contemplated
by Section 301 on the date of original issuance of such Security, of the
principal amount (or, in the case of an Original Issue Discount Security, the
U.S. dollar equivalent on the date of original issuance of such Security of the
amount determined as provided in Clause (A) above) of such Security, and (C)
Securities owned by the Company or any other obligor upon the Securities or any
Affiliate of the Company or of such other obligor shall be disregarded and
deemed not to be Outstanding, except that, in determining whether the Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Securities which the Trustee knows to
be so owned shall be so disregarded. Securities so owned which have been
pledged in good faith may be regarded as Outstanding if the pledgee establishes
to the satisfaction of the Trustee the pledgee's right so to act with respect to
such Securities and that the pledgee is not the Company or any other obligor
upon the Securities or any Affiliate of the Company or of such other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal of or any premium or interest on any Securities on behalf of the
Company.
"Person" means any individual, corporation, partnership, joint
venture, trust, unincorporated organization or government or any agency or
political subdivision thereof.
"Place of Payment", when used with respect to the Securities of any
series, means the place or places where the principal of and any premium and
interest on the Securities of that series are payable as specified herein or as
contemplated by Section 301.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of
-9-
<PAGE>
the same debt as that evidenced by such particular Security; and, for the
purposes of this definition, any Security authenticated and delivered under
Section 306 in exchange for or in lieu of a mutilated, destroyed, lost or stolen
Security shall be deemed to evidence the same debt as the mutilated, destroyed,
lost or stolen Security.
"Principal Property" shall mean any land, and any building, structure
or other facility, together with the land upon which it is erected and fixtures
comprising a part thereof, in each case the net book value of which on the date
as of which the determination is being made exceeds 2% of Consolidated Net
Tangible Assets at such date; provided, however, that Principal Property shall
-------- -------
not include (i) any building, structure or facility which, in the opinion of the
Board of Directors as evidenced by a Board Resolution, is not of material
importance to the total business conducted by the Company and its Subsidiaries
as an entirety or (ii) any portion of a particular building, structure or
facility which, in the opinion of the Board of Directors as evidenced by a Board
Resolution, is not of material importance to the use or operation of such
building, structure or facility.
"Ratio Calculation" shall mean that, immediately after either the
Incurrence of such Debt or the sale of or other disposal of such Asset, as the
case may be, the Company, or its agent, shall calculate the Consolidated
Coverage Ratio for the four full fiscal quarter period preceding such
Incurrence, sale or disposal for which consolidated Financial Statements are
available. In making such calculation, (a) the Consolidated Interest Expense
attributable to interest on any Debt to be Incurred bearing a floating interest
rate shall be computed on a pro forma basis as if the rate in effect on the date
of computation had been the applicable rate for the entire period and (b) with
respect to any Debt which bears, at the option of the Company, a fixed or
floating rate of interest, the Company shall apply the same rate for purposes of
calculating the Consolidated Coverage Ratio as it chooses to apply to the Debt.
In addition, such calculation shall be performed using the consolidated
Financial Statements which shall be reformulated on a pro forma basis as if such
Debt had been incurred or such Asset had been sold or otherwise disposed of, as
the case may be, at the beginning of such four fiscal quarter period. Such
reformulation shall give effect, as if the relevant event had occurred at the
beginning of such four fiscal quarter period, to any actual use of proceeds of
such Debt being Incurred or Asset being sold or disposed of and to any
Incurrences or repayments of Debt and other sales, disposals or acquisitions of
Assets occurring after the end of the last quarter for which there are
consolidated Financial Statements available. If any
-10-
<PAGE>
portion of the proceeds has not been used, it shall be assumed that such portion
of the proceeds was invested in one-year Treasury bills on the first day of such
four fiscal quarter period.
"Redemption Date", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Regular Record Date" for the interest payable on any Interest Payment
Date on the Securities of any series means the date specified for that purpose
as contemplated by Section 301.
"Remaining Life" means, for any Security, as of any Determination
Date, the number of years calculated to the nearest one-twelfth obtained by
subtracting such Determination Date from the Maturity Date of such Security.
"Required Filing Date" has the meaning specified in Section 1011.
"Restricted Subsidiary" shall mean any subsidiary of the Company which
has a 50% or greater ownership interest in a Principal Property or properties.
"Sale/Leaseback Transaction" has the meaning specified in Section
1009.
"Securities" has the meaning stated in the first recital of this
Indenture and more particularly means any Securities authenticated and delivered
under this Indenture.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.
"Significant Subsidiary" is any Subsidiary of the Company that holds
assets that had a value, on a current value basis, in excess of 3% of the
Company's Total Common Stock and Other Shareholders' Equity, on a current value
basis, as reported in the Company's most recent Annual Report on Form 10-K or
Annual Report to Shareholders.
"Special Record Date" for the payment of any Defaulted Interest means
a date fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Security or any
instalment of principal thereof or interest
-11-
<PAGE>
thereon, means the date specified in such Security as the fixed date on which
the principal of such Security or such instalment of principal or interest is
due and payable.
"Subsidiary" means a corporation more than 50% of the outstanding
voting stock of which is owned, directly or indirectly, by the Company or by one
or more other Subsidiaries, or by the Company and one or more other
Subsidiaries. For the purposes of this definition, "voting stock" means stock
which ordinarily has voting power for the election of directors, whether at all
times or only so long as no senior class of stock has such voting power by
reason of any contingency.
"Treasury Yield" means either (x) in the case of a Security having a
Maturity Date less than one year after the applicable redemption date, the
average yield to maturity on a government bond equivalent basis of the
applicable United States Treasury Bill due the week of the Maturity Date of such
Security or (y) in the case of a Security having a Maturity Date one year or
more after the applicable Redemption Date, the weekly average yield to maturity
of United States Treasury Notes having a constant maturity as set forth in the
most recent weekly statistical release (or any successor release) published by
the Federal Reserve Bank of New York and designated "H.15(519) Selected Interest
Rates" (the "H.15 Statistical Release"), corresponding to the Remaining Life;
such yield described in this clause (y) to be calculated by the Company or, if
applicable, an Independent Investment Banker, by interpolation (unless the
Remaining Life equals a constant maturity set forth in the H.15 Statistical
Release) on a straight line basis, between the weekly average yields (rounded,
if necessary, to four decimal places) on (i) the United States Treasury Notes
with a constant maturity closest to and greater than the Remaining Life and (ii)
the United States Treasury Notes with a constant maturity closest to and less
than the Remaining Life, or if such weekly average yields are not available, by
interpolation of comparable rates selected by the Company or, if applicable, the
Independent Investment Banker.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean or include each Person who is then a Trustee hereunder, and
if at any time there is more than one such Person, "Trustee" as used with
respect to the Securities of any series shall mean each Trustee with respect to
Securities of that series.
-12-
<PAGE>
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed; provided, however,
-------- -------
that in the event the Trust Indenture Act of 1939 is amended after such date,
"Trust Indenture Act" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939 as so amended.
"U.S. Government Obligations" has the meaning specified in Section
1304.
"Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president".
Section 102. Compliance Certificates and Opinions.
------------------------------------
Upon any application or request by the Company to the Trustee to take
any action under any provision of this Indenture, the Company shall furnish to
the Trustee such certificates and opinions as may be required under the Trust
Indenture Act. Each such certificate or opinion shall be given in the form of
an Officers' Certificate, if to be given by an officer of the Company, or an
Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirements set forth in
this Indenture.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (including certificates
provided for in Section 1004) shall include
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
-13-
<PAGE>
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 103. Form of Documents Delivered to Trustee.
--------------------------------------
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one
such Person, or that they be so certified or covered by only one document,
but one such Person may certify or give an opinion with respect to some
matters and one or more other such Persons as to other matters, and any
such Person may certify or give an opinion as to such matters in one or
several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his certificate or
opinion is based are erroneous. Any such certificate or opinion of counsel
may be based, insofar as it relates to factual matters, upon a certificate
or opinion of, or representations by, an officer or officers of the Company
stating that the information with respect to such factual matters is in the
possession of the Company, unless such counsel knows, or in the exercise of
reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be
consolidated and form one instrument.
Section 104. Acts of Holders; Record Dates.
-----------------------------
Any request, demand, authorization, direction, notice, consent, waiver
or other action provided or permitted by this Indenture to be given or
taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person
or by agent duly appointed in writing; and, except as herein otherwise
expressly provided, such action shall become effective when such instrument
or instruments are delivered to the Trustee and, where it is hereby
expressly required, to the Company. Such instrument or instruments (and
the action embodied therein and evidenced thereby) are herein sometimes
referred to as the "Act" of the Holders
-14-
<PAGE>
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Indenture and (subject to Section 601) conclusive
in favor of the Trustee and the Company, if made in the manner provided in
this Section.
The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer
authorized by law to take acknowledgments of deeds, certifying that the
individual signing such instrument or writing acknowledged to him the
execution thereof. Where such execution is by a signer acting in a
capacity other than his individual capacity, such certificate or affidavit
shall also constitute sufficient proof of his authority. The fact and date
of the execution of any such instrument or writing, or the authority of the
Person executing the same, may also be proved in any other manner which the
Trustee deems sufficient.
The ownership of Securities shall be proved by the Security Register.
Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Holder of any Security shall bind every future Holder
of the same Security and the Holder of every Security issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Trustee
or the Company in reliance thereon, whether or not notation of such action
is made upon such Security.
The Company may, in the circumstances permitted by the Trust Indenture
Act, set any day as the record date for the purpose of determining the
Holders of Outstanding Securities of any series entitled to give or take
any request, demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Indenture to be given or taken
by Holders of Securities of such series. With regard to any record date
set pursuant to this paragraph, the Holders of Outstanding Securities of
the relevant series on such record date (or their duly appointed agents),
and only such Persons, shall be entitled to give or take the relevant
action, whether or not such Holders remain Holders after such record date.
With regard to any action that may be given or taken hereunder only by
Holders of a requisite principal amount of Outstanding Securities of any
series (or their duly appointed agents) and for which a record date is set
pursuant to this paragraph, the Company may, at its option, set an
expiration date after which no
-15-
<PAGE>
such action purported to be given or taken by any Holder shall be effective
hereunder unless given or taken on or prior to such expiration date by
Holders of the requisite principal amount of Outstanding Securities of such
series on such record date (or their duly appointed agents). On or prior
to any expiration date set pursuant to this paragraph, the Company may, on
one or more occasions at its option, extend such date to any later date.
Nothing in this paragraph shall prevent any Holder (or any duly appointed
agent thereof) from giving or taking, after any expiration date, any action
identical to, or, at any time, contrary to or different from, any action
given or taken, or purported to have been given or taken, hereunder by a
Holder on or prior to such date, in which event the Company may set a
record date in respect thereof pursuant to this paragraph. Notwithstanding
the foregoing or the Trust Indenture Act, the Company shall not set a
record date for, and the provisions of this paragraph shall not apply with
respect to, any action to be given or taken by Holders pursuant to Section
501, 502 or 512.
Without limiting the foregoing, a Holder entitled hereunder to give or
take any action hereunder with regard to any particular Security may do so
with regard to all or any part of the principal amount of such Security or
by one or more duly appointed agents each of which may do so pursuant to
such appointment with regard to all or any different part of such principal
amount.
Section 105. Notices, Etc., to Trustee and Company.
-------------------------------------
Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Indenture
to be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder if made, given, furnished or filed in writing
to or with the Trustee at its Corporate Trust Office, Attention: Corporate
Trust Administrator, or
(2) the Company by the Trustee or by any Holder shall be sufficient
for every purpose hereunder (unless otherwise herein expressly provided) if
in writing and mailed, first-class postage prepaid, to the Company
addressed to it at the address of its principal office specified in the
first paragraph of this instrument or at any other address previously
furnished in writing to the Trustee by the Company.
-16-
<PAGE>
Section 106. Notice to Holders; Waiver.
-------------------------
Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at his address as it appears in the Security Register, not later
than the latest date (if any), and not earlier than the earliest date (if any),
prescribed for the giving of such notice. In any case where notice to Holders
is given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders and any notice which is mailed in the
manner herein provided shall be conclusively presumed to have been duly given.
Where this Indenture provides for notice in any manner, such notice may be
waived in writing by the Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Holders shall be filed with the Trustee, but such filing
shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.
Section 107. Conflict with Trust Indenture Act.
---------------------------------
If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act that is required under such Act to be a
part of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act that may be so modified or excluded, the latter provision shall be
deemed to apply to this Indenture as so modified or to be excluded, as the case
may be.
Section 108. Effect of Headings and Table of Contents.
----------------------------------------
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
-17-
<PAGE>
Section 109. Successors and Assigns.
----------------------
All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.
Section 110. Separability Clause.
-------------------
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 111. Benefits of Indenture.
---------------------
Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder and the Holders, any benefit or any legal or equitable right, remedy
or claim under this Indenture.
Section 112. Governing Law.
-------------
This Indenture and the Securities shall be governed by and construed
in accordance with the law of the State of New York, but without regard to
principles of conflicts of law.
Section 113. Legal Holidays.
--------------
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security shall not be a Business Day at any Place of Payment,
then (notwithstanding any other provision of this Indenture or of the Securities
(other than a provision of the Securities of any series which specifically
states that such provision shall apply in lieu of this Section)) payment of
interest or principal (and premium, if any) need not be made at such Place of
Payment on such date, but may be made on the next succeeding Business Day at
such Place of Payment with the same force and effect as if made on the Interest
Payment Date or Redemption Date, or at the Stated Maturity, provided that no
--------
interest shall accrue for the period from and after such Interest Payment Date,
Redemption Date or Stated Maturity, as the case may be.
Section 114. Indenture and Debentures Solely Corporate Obligations.
-----------------------------------------------------
To the extent permissible by law, no recourse for the payment of
principal of (and premium, if any) or interest on any Security or for any claim
based on any
-18-
<PAGE>
Security or on this Indenture, shall be had against any director, officer or
stockholder, as such, past, present or future, of the Company. Any such claim
against any such Person is expressly waived as a condition of, and as
consideration for, the execution of this Indenture and the issue of the
Securities.
ARTICLE TWO
Security Forms
Section 201. Forms Generally.
---------------
The Securities of each series shall be in substantially the form set
forth in this Article, or in such other form as shall be established by or
pursuant to a Board Resolution or in one or more indentures supplemental hereto,
in each case with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by this Indenture, and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or as may, consistently herewith, be determined by the
officers executing such Securities, as evidenced by their execution of the
Securities. If the form of Securities of any series is established by action
taken pursuant to a Board Resolution, a copy of an appropriate record of such
action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the Company
Order contemplated by Section 303 for the authentication and delivery of such
Securities.
The definitive Securities shall be printed, lithographed or engraved
on steel engraved borders or may be produced in any other manner, all as
determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
Section 202. Form of Face of Security.
------------------------
The Rouse Company
_____% Notes due __,____
No. ......... $ ........
The Rouse Company, a corporation duly organized and existing under the
laws of Maryland (herein called the "Company", which term includes any successor
Person under the Indenture hereinafter referred to), for value received, hereby
promises to pay to
-19-
<PAGE>
..............................................., or registered assigns, the
principal sum of .................. ................... Dollars on _______ __,
____ and to pay interest thereon from _______ __, ____ or from the most recent
Interest Payment Date to which interest has been paid or duly provided for,
semi-annually on _______ __ and ____ __ in each year, commencing _____ __,____
at the rate of ....% per annum, until the principal hereof is paid or made
available for payment. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in such Indenture,
be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest, which shall be the ....... or ....... (whether or not a
Business Day), as the case may be, next preceding such Interest Payment Date.
Any such interest not so punctually paid or duly provided for will forthwith
cease to be payable to the Holder on such Regular Record Date and may either be
paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest to be fixed by the Trustee, notice
whereof shall be given to Holders of Securities of this series not less than 10
days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities of this series may be listed, and upon such notice as
may be required by such exchange, all as more fully provided in said Indenture.
Payment of the principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Company maintained for that
purpose in New York, in such coin or currency of the United States of America as
at the time of payment is legal tender for payment of public and private debts;
provided, however, that at the option of the Company payment of interest may be
- -------- -------
made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register.
Reference is hereby made to the further provisions of this Security
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Security
shall not be
-20-
<PAGE>
entitled to any benefit under the Indenture or be valid or obligatory for any
purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated:
The Rouse Company
By......................
Attest:
...........................
Section 203. Form of Reverse of Security.
---------------------------
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one or
more series under an Indenture, dated as of __________, 1995 (herein called the
"Indenture"), between the Company and The First National Bank of Chicago, as
Trustee (herein called the "Trustee", which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee and the
Holders of the Securities and of the terms upon which the Securities are, and
are to be, authenticated and delivered. This Security is one of the series
designated on the face hereof, limited in aggregate principal amount to
$_________.
The Securities are subject to redemption upon not less than 30 days'
notice by mail, at any time, as a whole or in part, at the election of the
Company. Such redemption shall be at a Redemption Price equal to the sum of:
(i) 100% of the outstanding principal amount of each Security to be so redeemed,
(ii) the accrued but unpaid interest thereon from the most recent Interest
Payment Date to (but excluding) the Redemption Date (computed on the basis of a
360 day year composed of twelve 30 day months), and (iii) the Make-Whole
Premium. The "Make-Whole Premium" is equal to the excess, if any, of (a) the
sum of the present values, discounted for all full semi-annual periods at a
discount rate equal to one-half multiplied by the Treasury Yield, provided,
--------
however, that the discount rate for the period from the Redemption Date to the
- -------
next Interest Payment Date shall equal the result of multiplying the
-21-
<PAGE>
Treasury Yield by the Day Count Fraction, of (i) the remaining payments of
interest on such Security (not including any accrued interest as of the
Redemption Date), and (ii) the payment of such principal amount that, but for
such redemption, would have been payable on such Security on the Maturity Date;
over (b) the unpaid principal amount of the Security to be redeemed. The Make-
Whole Premium for any Security to be redeemed will be calculated by the Company,
provided, however, that the Trustee in its discretion may appoint an independent
- -------- -------
investment banking institution of national standing ("Independent Investment
Banker"), and the calculation shall then be performed by the Independent
Investment Banker. However, if an Event of Default shall have occurred and be
continuing, then the Trustee shall appoint an Independent Investment Banker to
perform the calculation. Such redemption shall be made with moneys deposited by
the Company with the Trustee.
In the event of redemption of this Security in part only, a new
Security or Securities of this series and of like tenor for the unredeemed
portion hereof will be issued in the name of the Holder hereof upon the
cancellation hereof.
No sinking fund has been provided for the Securities.
The Indenture contains provisions for defeasance at any time of (1)
the entire indebtedness of this Security or (2) certain restrictive covenants
and Events of Default with respect to this Security, in each case upon
compliance with certain conditions set forth in the Indenture.
If an Event of Default with respect to Securities of this series shall
occur and be continuing, the principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of a majority in principal amount of the Securities at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of a majority in principal amount of the
Securities of each series at the time Outstanding, on behalf of the Holders of
all Securities of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or
-22-
<PAGE>
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange herefor or in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.
As provided in and subject to the provisions of the Indenture, the
Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the appointment of a receiver or trustee or
for any other remedy thereunder, unless such Holder shall have previously given
the Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 25% in principal amount
of the Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable indemnity and the Trustee
shall not have received from the Holders of a majority in principal amount of
Securities of this series at the time Outstanding a direction inconsistent with
such request, and shall have failed to institute any such proceeding, for 60
days after receipt of such notice, request and offer of indemnity. The
foregoing shall not apply to any suit instituted by the Holder of this Security
for the enforcement of any payment of principal hereof or any premium or
interest hereon on or after the respective due dates expressed herein.
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of and any premium and
interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in any place where the principal of and any
premium and interest on this Security are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities of
this series and of like tenor, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees.
-23-
<PAGE>
The Securities of this series are issuable only in registered form
without coupons in denominations of $1,000 and any integral multiple thereof.
As provided in the Indenture and subject to certain limitations therein set
forth, Securities of this series are exchangeable for a like aggregate principal
amount of Securities of this series and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
Section 204. Form of Legend for Global Securities.
------------------------------------
Every Global Security authenticated and delivered hereunder shall bear
a legend in substantially the following form:
This Security is a Global Security within the meaning of the Indenture
hereinafter referred to and is registered in the name of a Depositary or a
nominee thereof. This Security may not be transferred to, or registered or
exchanged for Securities registered in the name of, any Person other than
the Depositary or a nominee thereof and no such transfer may be registered,
except in the limited circumstances described in the Indenture. Every
Security authenticated and delivered upon registration of transfer of, or
in exchange for or in lieu of, this Security shall be a Global Security
subject to the foregoing, except in such limited circumstances.
Section 205. Form of Trustee's Certificate of Authentication.
------------------------------------------------
The Trustee's certificates of authentication shall be in
substantially the following form:
-24-
<PAGE>
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
.............................,
As Trustee
By...........................
Authorized Officer
ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series.
------------------------------------
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There shall
be established in or pursuant to a Board Resolution and, subject to Section
303, set forth, or determined in the manner provided, in an Officers'
Certificate, or established in one or more indentures supplemental hereto,
prior to the issuance of Securities of any series,
(1) the title of the Securities of the series (which shall
distinguish the Securities of the series from Securities of any other
series);
(2) any limit upon the aggregate principal amount of the Securities
of the series which may be authenticated and delivered under this Indenture
(except for Securities authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Securities of the
series pursuant to Section 304, 305, 306, 906 or 1107 and except for any
Securities which, pursuant to Section 303, are deemed never to have been
authenticated and delivered hereunder);
(3) the Person to whom any interest on a Security of the series shall
be payable, if other than the Person in whose name that Security (or one or
more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest;
-25-
<PAGE>
(4) the date or dates, or the method or methods, if any, by which such
date or dates shall be determined, on which the principal of the Securities
of the series is payable;
(5) the rate or rates at which the Securities of the series shall
bear interest, if any, the date or dates from which such interest shall
accrue, the Interest Payment Dates on which any such interest shall be
payable and the Regular Record Date for any interest payable on any
Interest Payment Date;
(6) the place or places where the principal of and any premium and
interest on Securities of the series shall be payable;
(7) the period or periods within which, the price or prices at which
and the terms and conditions upon which Securities of the series may be
redeemed, in whole or in part, at the option of the Company;
(8) the obligation, if any, of the Company to redeem or purchase
Securities of the series pursuant to any sinking fund or analogous
provisions or at the option of a Holder thereof and the period or periods
within which, the price or prices at which and the terms and conditions
upon which Securities of the series shall be redeemed or purchased, in
whole or in part, pursuant to such obligation;
(9) if other than denominations of $1,000 and any integral multiple
thereof, the denominations in which Securities of the series shall be
issuable;
(10) the currency, currencies or currency units in which payment of
the principal of and any premium and interest on any Securities of the
series shall be payable if other than the currency of the United States of
America and the manner of determining the equivalent thereof in the
currency of the United States of America for any purpose, including for
purposes of the definition of "Outstanding" in Section 101;
(11) if the amount of payments of principal of or any premium or
interest on any
-26-
<PAGE>
Securities of the series may be determined with reference to an index or
pursuant to a formula, the manner in which such amounts shall be
determined;
(12) if the principal of or any premium or interest on any Securities
of the series is to be payable, at the election of the Company or a Holder
thereof, in one or more currencies or currency units other than that or
those in which the Securities are stated to be payable, the currency,
currencies or currency units in which payment of the principal of and any
premium and interest on Securities of such series as to which such election
is made shall be payable, and the periods within which and the terms and
conditions upon which such election is to be made;
(13) if other than the principal amount thereof, the portion of the
principal amount of Securities of the series which shall be payable upon
declaration of acceleration of the Maturity thereof pursuant to Section
502;
(14) if applicable, that the Securities of the series shall be
defeasible as provided in Article Thirteen;
(15) if and as applicable, that the Securities of the series shall be
issuable in whole or in part in the form of one or more Global Securities
and, in such case, the Depositary or Depositaries for such Global Security
or Global Securities and any circumstances other than those set forth in
Section 305 in which any such Global Security may be transferred to, and
registered and exchanged for Securities registered in the name of, a Person
other than the Depositary for such Global Security or a nominee thereof and
in which any such transfer may be registered;
(16) any addition to, or modification or deletion of, any Events of
Default or covenants provided for with respect to the Securities;
(17) the terms, if any, pursuant to which the Securities will be made
subordinate and subject in right of payment to the prior payment in full of
all Senior Indebtedness of
-27-
<PAGE>
the Company, and the definition of any such Senior Indebtedness; and
(18) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture, except as permitted by
Section 901(5)).
All Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided in or pursuant
to the Board Resolution referred to above and (subject to Section 303) set
forth, or determined in the manner provided, in the Officers' Certificate
referred to above or in any such indenture supplemental hereto. In addition, all
Securities of any one series need not be issued at the same time and, unless
otherwise so provided by the Company, a series may be reopened for issuance of
additional Securities of such series or to establish additional terms of such
series of Securities.
If any of the terms of the series are established by action taken
pursuant to a Board Resolution, a copy of an appropriate record of such action
shall be certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
Section 302. Denominations.
-------------
The Securities of each series shall be issuable only in registered
form without coupons in such denominations as shall be specified as contemplated
by Section 301. In the absence of any such specified denomination with respect
to the Securities of any series, the Securities of such series shall be issuable
in denominations of $1,000 or any integral multiple thereof.
Section 303. Execution, Authentication, Delivery and
Dating.
---------------------------------------
The Securities shall be executed on behalf of the Company by its
Chairman of the Board, its Vice Chairman of the Board, its President or one of
its Vice Presidents, under its corporate seal reproduced thereon attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold
-28-
<PAGE>
such offices prior to the authentication and delivery of such Securities or did
not hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Securities of any Series executed by the
Company to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities, and the Trustee in accordance
with the Company Order shall authenticate and deliver such Securities. If the
form or terms of the Securities of the series have been established in or
pursuant to one or more Board Resolutions as permitted by Sections 201 and 301,
in authenticating such Securities, and accepting the additional responsibilities
under this Indenture in relation to such Securities, the Trustee shall be
entitled to receive, and (subject to Section 601) shall be fully protected in
relying upon, an Opinion of Counsel stating,
(1) if the form of such Securities has been established by or
pursuant to Board Resolution as permitted by Section 201, that such form
has been established in conformity with the provisions of this Indenture;
(2) if the terms of such Securities have been established by or
pursuant to Board Resolution as permitted by Section 301, that such terms
have been established in conformity with the provisions of this Indenture;
and
(3) that such Securities, when authenticated and delivered by the
Trustee and issued by the Company in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid and
legally binding obligations of the Company enforceable in accordance with
their terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.
-29-
<PAGE>
Notwithstanding the provisions of Section 301 and of the preceding
paragraph, if all Securities of a series are not to be originally issued at one
time, it shall not be necessary to deliver the Officers' Certificate otherwise
required pursuant to Section 301 or the Company Order and Opinion of Counsel
otherwise required pursuant to such preceding paragraph at or prior to the time
of authentication of each Security of such series if such documents are
delivered at or prior to the authentication upon original issuance of the first
Security of such series to be issued.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such Security
has been duly authenticated and delivered hereunder. Notwithstanding the
foregoing, if any Security shall have been authenticated and delivered hereunder
but never issued and sold by the Company, and the Company shall deliver such
Security to the Trustee for cancellation as provided in Section 309, for all
purposes of this Indenture such Security shall be deemed never to have been
authenticated and delivered hereunder and shall never be entitled to the
benefits of this Indenture.
Section 304. Temporary Securities.
--------------------
Pending the preparation of definitive Securities of any series, the
Company may execute, and upon Company Order the Trustee shall authenticate and
deliver, temporary Securities which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Securities may determine, as
evidenced by their execution of such Securities.
If temporary Securities of any series are issued, the Company will
cause definitive Securities of that series to be prepared without unreasonable
delay. After the preparation of definitive Securities of such series, the
temporary Securities of such series shall be exchangeable for definitive
Securities of such series upon surrender of the temporary Securities of such
series at the office or agency of the Company in a Place of Payment for that
series, without charge to the Holder. Upon surrender for cancellation
-30-
<PAGE>
of any one or more temporary Securities of any series the Company shall execute
and the Trustee shall authenticate and deliver in exchange therefor one or more
definitive Securities of the same series, of any authorized denominations and of
a like aggregate principal amount and tenor. Until so exchanged the temporary
Securities of any series shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities of such series and tenor.
Section 305. Registration, Registration of
Transfer and Exchange.
-----------------------------
The Company shall cause to be kept at the Corporate Trust Office of
the Trustee a register (the register maintained in such office and in any other
office or agency of the Company in a Place of Payment being herein sometimes
collectively referred to as the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Securities and of transfers of Securities. The Trustee is
hereby appointed "Security Registrar" for the purpose of registering Securities
and transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security of any
series at the office or agency in a Place of Payment for that series, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Securities of
the same series, of any authorized denominations and of a like aggregate
principal amount and tenor.
At the option of the Holder, Securities of any series may be exchanged
for other Securities of the same series, of any authorized denominations and of
a like aggregate principal amount and tenor, upon surrender of the Securities to
be exchanged at such office or agency. Whenever any Securities are so
surrendered for exchange, the Company shall execute, and the Trustee shall
authenticate and deliver, the Securities which the Holder making the exchange is
entitled to receive.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of transfer
or for exchange shall (if so required by the Company or the Trustee) be duly
endorsed, or be
-31-
<PAGE>
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed, by the Holder thereof or his
attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Securities, other than
exchanges pursuant to Section 304, 906 or 1107 not involving any transfer.
The Company shall not be required (1) to issue, register the transfer
of or exchange Securities of any series during a period beginning at the opening
of business 15 days before the day of the mailing of a notice of redemption of
Securities of that series selected for redemption under Section 1103 and ending
at the close of business on the day of such mailing, or (2) to register the
transfer of or exchange any Security so selected for redemption in whole or in
part, except the unredeemed portion of any Security being redeemed in part.
Notwithstanding any other provision in this Indenture, no Global
Security may be transferred to, or registered or exchanged for Securities
registered in the name of, any Person other than the Depositary for such Global
Security or any nominee thereof, and no such transfer may be registered, unless
(1) such Depositary (A) notifies the Company that it is unwilling or unable to
continue as Depositary for such Global Security or (B) ceases to be a clearing
agency registered under the Exchange Act, (2) the Company executes and delivers
to the Trustee a Company Order that such Global Security shall be so
transferable, registrable and exchangeable, and such transfers shall be
registrable, (3) there shall have occurred and be continuing an Event of Default
with respect to the Securities evidenced by such Global Security or (4) there
shall exist such other circumstances, if any, as have been specified for this
purpose as contemplated by Section 301. Notwithstanding any other provision in
this Indenture, a Global Security to which the restriction set forth in the
preceding sentence shall have ceased to apply may be transferred only to, and
may be registered and exchanged for Securities registered only in the name or
names of, such Person or Persons as the Depositary for such Global Security
shall have directed and no transfer thereof other than such a transfer may be
registered.
Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security to which the
restriction set forth in
-32-
<PAGE>
the first sentence of the preceding paragraph shall apply, whether pursuant to
this Section, Section 304, 306, 906 or 1107 or otherwise, shall be authenticated
and delivered in the form of, and shall be, a Global Security.
Section 306. Mutilated, Destroyed, Lost and Stolen
Securities.
-------------------------------------
If any mutilated Security is surrendered to the Trustee, the Company
shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of the same series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Security
and (ii) such security or indemnity as may be required by them to save each of
them and any agent of either of them harmless, then, in the absence of notice to
the Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and the Trustee shall authenticate and
deliver, in lieu of any such destroyed, lost or stolen Security, a new Security
of the same series and of like tenor and principal amount and bearing a number
not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the Company
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this Section in
exchange for any mutilated Security or in lieu of any destroyed, lost or stolen
Security shall constitute an original additional contractual obligation of the
Company, whether or not the mutilated, destroyed, lost or stolen Security shall
be at any time enforceable by anyone, and shall be entitled to all the benefits
of this Indenture equally and proportionately with any and all other Securities
of that series duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities.
-33-
<PAGE>
Section 307. Payment of Interest; Interest Rights
Preserved.
------------------------------------
Except as otherwise provided as contemplated by Section 301 with
respect to any series of Securities, interest on any Security which is payable,
and is punctually paid or duly provided for, on any Interest Payment Date shall
be paid to the Person in whose name that Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest.
Any interest on any Security of any series which is payable, but is
not punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular Record Date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names the Securities of such series (or their
respective Predecessor Securities) are registered at the close of business
on a Special Record Date for the payment of such Defaulted Interest, which
shall be fixed in the following manner. The Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be paid
on each Security of such series and the date of the proposed payment, and
at the same time the Company shall deposit with the Trustee an amount of
money equal to the aggregate amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satisfactory to the Trustee
for such deposit prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the Persons entitled to
such Defaulted Interest as in this Clause provided. Thereupon the Trustee
shall fix a Special Record Date for the payment of such Defaulted Interest
which shall be not more than 15 days and not less than 10 days prior to the
date of the proposed payment and not less than 10 days after the receipt by
the Trustee of the notice of the proposed payment. The Trustee shall
promptly notify the Company of such Special Record Date and, in the name
and at the expense of the Company, shall cause notice of the proposed
payment of
-34-
<PAGE>
such Defaulted Interest and the Special Record Date therefor to be mailed,
first-class postage prepaid, to each Holder of Securities of such series at
his 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 Securities of such series (or their respective Predecessor Securities)
are registered at the close of business on such Special Record Date and
shall no longer be payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest on the
Securities of any series in any other lawful manner not inconsistent with
the requirements of any securities exchange on which such Securities may be
listed, and upon such notice as may be required by such exchange, if, after
notice given by the Company to the Trustee of the proposed payment pursuant
to this Clause, such manner of payment shall be deemed practicable by the
Trustee.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Security.
Section 308. Persons Deemed Owners.
---------------------
Prior to due presentment of a Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name such Security is registered as the owner of such
Security for the purpose of receiving payment of principal of and any premium
and (subject to Section 307) any interest on such Security and for all other
purposes whatsoever, whether or not such Security be overdue, and neither the
Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.
Section 309. Cancellation.
------------
All Securities surrendered for payment, redemption, registration of
transfer or exchange or for credit
-35-
<PAGE>
against any sinking fund payment shall, if surrendered to any Person other than
the Trustee, be delivered to the Trustee and shall be promptly cancelled by it.
The Company may at any time deliver to the Trustee for cancellation any
Securities previously authenticated and delivered hereunder which the Company
may have acquired in any manner whatsoever, and may deliver to the Trustee (or
to any other Person for delivery to the Trustee) for cancellation any Securities
previously authenticated hereunder which the Company has not issued and sold,
and all Securities so delivered shall be promptly cancelled by the Trustee. No
Securities shall be authenticated in lieu of or in exchange for any Securities
cancelled as provided in this Section, except as expressly permitted by this
Indenture. All cancelled Securities held by the Trustee shall be disposed of as
directed by a Company Order.
Section 310. Computation of Interest.
-----------------------
Except as otherwise specified as contemplated by Section 301 for
Securities of any series, interest on the Securities of each series shall be
computed on the basis of a 360-day year of twelve 30-day months.
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of
Indenture.
-----------------------------
This Indenture shall upon Company Request cease to be of further
effect (except as to any surviving rights of registration of transfer or
exchange of Securities herein expressly provided for), and the Trustee, at the
expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered (other
than (i) Securities which have been destroyed, lost or stolen and which
have been replaced or paid as provided in Section 306 and (ii) Securities
for whose payment money has theretofore been deposited in trust or
segregated and held in trust by the Company and thereafter repaid to the
Company or discharged from such trust, as provided in Section 1003) have
been delivered to the Trustee for cancellation; or
-36-
<PAGE>
(B) all such Securities not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity within
one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the
Company,
and the Company, in the case of (i), (ii) or (iii) above, has deposited or
caused to be deposited with the Trustee as trust funds in trust for the
purpose an amount sufficient to pay and discharge the entire indebtedness
on such Securities not theretofore delivered to the Trustee for
cancellation, for principal and any premium and interest to the date of
such deposit (in the case of Securities which have become due and payable)
or to the Stated Maturity or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of this
Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 607, the obligations of
the Trustee to any Authenticating Agent under Section 614 and, if money shall
have been deposited with the Trustee pursuant to subclause (B) of Clause (1) of
this Section, the obligations of the Trustee under Section 402 and the last
paragraph of Section 1003 shall survive.
-37-
<PAGE>
Section 402. Application of Trust Money.
--------------------------
Subject to provisions of the last paragraph of Section 1003, all money
deposited with the Trustee pursuant to Section 401 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal and any premium and
interest for whose payment such money has been deposited with the Trustee.
ARTICLE FIVE
Remedies
Section 501. Events of Default.
-----------------
"Event of Default", wherever used herein with respect to Securities of
any series, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(1) default in the payment of any interest upon any Security of that
series when it becomes due and payable, and continuance of such default for
a period of 30 days; or
(2) default in the payment of the principal of (or premium, if any,
on) any Security of that series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when and as
due by the terms of a Security of that series; or
(4) default in the performance, or breach, of any covenant or
warranty of the Company in this Indenture (other than a covenant or
warranty a default in whose performance or whose breach is elsewhere in
this Section specifically dealt with or which has expressly been included
in this Indenture solely for the benefit of series of Securities other than
that series), and continuance of such default or breach for a period of 60
days after there has been given,
-38-
<PAGE>
by registered or certified mail, to the Company by the Trustee or to the
Company and the Trustee by the Holders of at least 25% in principal amount
of the Outstanding Securities of that series a written notice specifying
such default or breach and requiring it to be remedied and stating that
such notice is a "Notice of Default" hereunder; or
(5) a default under any bond, debenture, note, mortgage, indenture or
instrument under which there may be issued or by which there may be secured
or evidenced any indebtedness for money borrowed by the Company (or by any
Subsidiary, the repayment of which the Company has guaranteed or for which
the Company is directly responsible or liable as obligor or guarantor)
(including a default with respect to Securities of any series other than
that series) having an aggregate principal amount outstanding of at least
$10,000,000, whether such indebtedness now exists or shall hereafter be
created, which default shall have resulted in such indebtedness being
declared due and payable prior to the date on which it would otherwise have
become due and payable, without such acceleration having been rescinded or
annulled, within a period of 10 days after there 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 principal amount
of the Outstanding Securities of that series a written notice specifying
such default and requiring the Company to cause such acceleration to be
rescinded or annulled and stating that such notice is a "Notice of Default"
hereunder; or
(6) the entry by a court having jurisdiction in the premises of (A) a
decree or order for relief in respect of the Company or its Significant
Subsidiaries in an involuntary case or proceeding under any applicable
Federal or State bankruptcy, insolvency, reorganization or other similar
law or (B) a decree or order adjudging the Company or its Significant
Subsidiaries a bankrupt or insolvent, or approving as properly filed a
petition seeking reorganization, arrangement, adjustment or composition of
or in respect of
-39-
<PAGE>
the Company or its Significant Subsidiaries under any applicable Federal or
State law, or appointing a custodian, receiver, liquidator, assignee,
trustee, sequestrator or other similar official of the Company or its
Significant Subsidiaries or of any substantial part of its property, or
ordering the winding up or liquidation of their affairs, and the
continuance of any such decree or order for relief or any such other decree
or order unstayed and in effect for a period of 60 consecutive days; or
(7) the commencement by the Company or its Significant Subsidiaries
of a voluntary case or proceeding under any applicable Federal or State
bankruptcy, insolvency, reorganization or other similar law or of any other
case or proceeding to be adjudicated a bankrupt or insolvent, or the
consent by them to the entry of a decree or order for relief in respect of
the Company or its Significant Subsidiaries in an involuntary case or
proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or to the commencement of any
bankruptcy or insolvency case or proceeding against them, or the filing by
them of a petition or answer or consent seeking reorganization or relief
under any applicable Federal or State law, or the consent by them to the
filing of such petition or to the appointment of or taking possession by a
custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or its Significant Subsidiaries or of any
substantial part of their property, or the making by them of an assignment
for the benefit of creditors, or the admission by them in writing of their
inability to pay their debts generally as they become due, or the taking of
corporate action by the Company or its Significant Subsidiaries in
furtherance of any such action; or
(8) any other Event of Default provided with respect to Securities of
that series.
-40-
<PAGE>
Upon receipt by the Trustee of any Notice of Default pursuant to this
Section 501 with respect to Securities of any series, a record date shall
automatically and without any other action by any Person be set for the purpose
of determining the Holders of Outstanding Securities of such series entitled to
join in such Notice of Default, which record date shall be the close of business
on the day the Trustee receives such Notice of Default. The Holders of
Outstanding Securities of such series on such record date (or their duly
appointed agents), and only such Persons, shall be entitled to join in such
Notice of Default, whether or not such Holders remain Holders after such record
date; provided that, unless such Notice of Default shall have become effective
--------
by virtue of Holders of the requisite principal amount of Outstanding Securities
of such series on such record date (or their duly appointed agents) having
joined therein on or prior to the 90th day after such record date, such Notice
of Default shall automatically and without any action by any Person be cancelled
and of no further effect. Nothing in this paragraph shall prevent a Holder (or
a duly appointed agent thereof) from giving, before or after the expiration of
such 90-day period, a Notice of Default contrary to or different from, or, after
the expiration of such period, identical to, a Notice of Default that has been
cancelled pursuant to the proviso to the preceding sentence, in which event a
new record date in respect thereof shall be set pursuant to this paragraph.
Section 502. Acceleration of Maturity; Rescission
and Annulment.
------------------------------------
If an Event of Default with respect to Securities of any series at the
time Outstanding occurs and is continuing, then in every such case the Trustee
or the Holders of not less than 25% in principal amount of the Outstanding
Securities of that series may declare the principal amount (or, if any of the
Securities of that series are Original Issue Discount Securities, such portion
of the principal amount of such Securities as may be specified in the terms
thereof) of all of the Securities of that series to be due and payable
immediately, by a notice in writing to the Company (and to the Trustee if given
by Holders), and upon any such declaration such principal amount (or specified
amount) shall become immediately due and payable.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in principal amount of the
Outstanding Securities of that series, by written notice to the Company and the
Trustee, may rescind and annul such declaration and its consequences if
-41-
<PAGE>
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay
(A) all overdue interest on all Securities of that series,
(B) the principal of (and premium, if any, on) any Securities of
that series which have become due otherwise than by such declaration
of acceleration and any interest thereon at the rate or rates
prescribed therefor in such Securities,
(C) to the extent that payment of such interest is lawful,
interest upon overdue interest at the rate or rates prescribed
therefor in such Securities, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel;
and
(2) all Events of Default with respect to Securities of that series,
other than the non-payment of the principal of Securities of that series
which have become due solely by such declaration of acceleration, have been
cured or waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Upon receipt by the Trustee of any declaration of acceleration, or any
rescission and annulment of any such declaration, pursuant to this Section 502
with respect to Securities of any series, a record date shall automatically and
without any other action by any Person be set for the purpose of determining the
Holders of Outstanding Securities of such series entitled to join in such
declaration, or rescission and annulment, as the case may be, which record date
shall be the close of business on the day the Trustee receives such declaration,
or rescission and annulment, as the case may be. The Holders of Outstanding
Securities of such series on such record date (or their duly appointed agents),
and only such Persons, shall be entitled to join in such declaration, or
rescission and annulment, as the case may be, whether or not such Holders remain
Holders after
-42-
<PAGE>
such record date; provided that, unless such declaration, or rescission and
--------
annulment, as the case may be, shall have become effective by virtue of Holders
of the requisite principal amount of Outstanding Securities of such series on
such record date (or their duly appointed agents) having joined therein on or
prior to the 90th day after such record date, such declaration, or rescission
and annulment, as the case may be, shall automatically and without any action by
any Person be cancelled and of no further effect. Nothing in this paragraph
shall prevent a Holder (or a duly appointed agent thereof) from giving, before
or after the expiration of such 90-day period, a declaration of acceleration, or
a rescission and annulment of any such declaration, contrary to or different
from, or, after the expiration of such period, identical to, a declaration, or
rescission and annulment, as the case may be, that has been cancelled pursuant
to the proviso to the preceding sentence, in which event a new record date in
respect thereof shall be set pursuant to this paragraph.
Section 503. Collection of Indebtedness and Suits
for Enforcement by Trustee.
------------------------------------
The Company covenants that if
(1) default is made in the payment of any interest on any Security
when such interest becomes due and payable and such default continues for a
period of 30 days, or
(2) default is made in the payment of the principal of (or premium,
if any, on) any Security at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal and any premium and interest and, to the extent that
payment of such interest shall be legally enforceable, interest on any overdue
principal and premium and on any overdue interest, at the rate or rates
prescribed therefor in such Securities, and, in addition thereto, such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel.
If an Event of Default with respect to Securities of any series occurs
and is continuing, the Trustee may in its discretion proceed to protect and
enforce its rights and the rights of the Holders of Securities of such series by
such appropriate judicial proceedings as the Trustee shall deem most effectual
to protect and enforce any such rights,
-43-
<PAGE>
whether for the specific enforcement of any covenant or agreement in this
Indenture or in aid of the exercise of any power granted herein, or to enforce
any other proper remedy.
Section 504. Trustee May File Proofs of Claim.
--------------------------------
In case of any judicial proceeding relative to the Company (or any
other obligor upon the Securities), its property or its creditors, the Trustee
shall be entitled and empowered, by intervention in such proceeding or
otherwise, to take any and all actions authorized under the Trust Indenture Act
in order to have claims of the Holders and the Trustee allowed in any such
proceeding. In particular, the Trustee shall be authorized to collect and
receive any moneys or other property payable or deliverable on any such claims
and to distribute the same; and any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 607.
No provision of this Indenture shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding; provided,
--------
however, that the Trustee may, on behalf of the Holders, vote for the election
- -------
of a trustee in bankruptcy or similar official and be a member of a creditors'
or other similar committee.
Section 505. Trustee May Enforce Claims Without
Possession of Securities
----------------------------------
All rights of action and claims under this Indenture or the Securities
may be prosecuted and enforced by the Trustee without the possession of any of
the Securities or the production thereof in any proceeding relating thereto, and
any such proceeding instituted by the Trustee shall be brought in its own name
as trustee of an express trust, and any recovery of judgment shall, after
provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.
-44-
<PAGE>
Section 506. Application of Money Collected.
------------------------------
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal or any premium
or interest, upon presentation of the Securities and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section
607; and
SECOND: To the payment of the amounts then due and unpaid for
principal of and any premium and interest on the Securities in respect of
which or for the benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the amounts due
and payable on such Securities for principal and any premium and interest,
respectively.
Section 507. Limitation on Suits.
-------------------
No Holder of any Security of any series shall have any right to
institute any proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any
other remedy hereunder, unless
(1) such Holder has previously given written notice to the Trustee of
a continuing Event of Default with respect to the Securities of that
series;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities of that series shall have made written request to
the Trustee to institute proceedings in respect of such Event of Default in
its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
-45-
<PAGE>
(5) no direction inconsistent with such written request has been
given to the Trustee during such 60-day period by the Holders of a majority
in principal amount of the Outstanding Securities of that series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all of such
Holders.
Section 508. Unconditional Right of Holders to
Receive Principal, Premium and Interest.
---------------------------------------
Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of and any premium and (subject to Section 307)
interest on such Security on the respective Stated Maturities expressed in such
Security (or, in the case of redemption, on the Redemption Date) and to
institute suit for the enforcement of any such payment, and such rights shall
not be impaired without the consent of such Holder.
Section 509. Restoration of Rights and Remedies.
----------------------------------
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
Section 510. Rights and Remedies Cumulative.
------------------------------
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities in the last paragraph
of Section 306, no right or remedy herein conferred upon or reserved to the
Trustee or to the Holders is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition
-46-
<PAGE>
to every other right and remedy given hereunder or now or hereafter existing at
law or in equity or otherwise. The assertion or employment of any right or
remedy hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
Section 511. Delay or Omission Not Waiver.
----------------------------
No delay or omission of the Trustee or of any Holder of any Securities
to exercise any right or remedy accruing upon any Event of Default shall impair
any such right or remedy or constitute a waiver of any such Event of Default or
an acquiescence therein. Every right and remedy given by this Article or by law
to the Trustee or to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders, as the case
may be.
Section 512. Control by Holders.
------------------
The Holders of a majority in principal amount of the Outstanding
Securities of any series shall have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee, with respect to the
Securities of such series, provided that
--------
(1) such direction shall not be in conflict with any rule of law or
with this Indenture, and
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
Upon receipt by the Trustee of any such direction with respect to
Securities of any series, a record date shall automatically and without any
other action by any Person be set for determining the Holders of Outstanding
Securities of such series entitled to join in such direction, which record date
shall be the close of business on the day the Trustee receives such direction.
The Holders of Outstanding Securities of such series on such record date (or
their duly appointed agents), and only such Persons, shall be entitled to join
in such direction, whether or not such Holders remain Holders after such record
date; provided that, unless such direction shall have become effective by virtue
--------
of Holders of the requisite principal amount of Outstanding Securities of such
series on such record date (or their duly appointed agents) having joined
therein on or prior to the 90th day after such record date, such direction shall
automatically and without any action by any Person be cancelled and of no
further effect. Nothing in this
-47-
<PAGE>
paragraph shall prevent Holder (or a duly appointed agent thereof) from giving,
before or after the expiration of such 90-day period, a direction contrary to or
different from, or, after the expiration of such period, identical to, a
direction that has been cancelled pursuant to the proviso to the preceding
sentence, in which event a new record date in respect thereof shall be set
pursuant to this paragraph.
Section 513. Waiver of Past Defaults.
-----------------------
The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series may on behalf of the Holders of all the
Securities of such series waive any past default hereunder with respect to such
series and its consequences, except a default
(1) in the payment of the principal of or any premium or interest on
any Security of such series, or
(2) in respect of a covenant or provision hereof which under Article
Nine cannot be modified or amended without the consent of the Holder of
each Outstanding Security of such series affected.
Upon any such waiver, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.
Section 514. Undertaking for Costs.
---------------------
In any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken, suffered or
omitted by it as Trustee, a court may require any party litigant in such suit to
file an undertaking to pay the costs of such suit, and may assess costs against
any such party litigant, in the manner and to the extent provided in the Trust
Indenture Act; provided that neither this Section nor the Trust Indenture Act
--------
shall be deemed to authorize any court to require such an undertaking or to make
such an assessment in any suit instituted by the Company.
Section 515. Waiver of Usury, Stay or Extension Laws.
---------------------------------------
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any usury, stay or extension law wherever
enacted, now or at any time hereafter in force, which may
-48-
<PAGE>
affect the covenants or the performance of this Indenture; and the Company (to
the extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law and covenants that it will not hinder, delay or impede
the execution of any power herein granted to the Trustee, but will suffer and
permit the execution of every such power as though no such law had been enacted.
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities.
-----------------------------------
The duties and responsibilities of the Trustee shall be as provided by
the Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Indenture shall require the Trustee to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. 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 602. Notice of Defaults.
------------------
If a default occurs hereunder with respect to Securities of any
series, the Trustee shall give the Holders of Securities of such series notice
of such default as and to the extent provided by the Trust Indenture Act;
provided, however, that in the case of any default of the character specified in
- -------- -------
Section 501 with respect to Securities of such series, no such notice to Holders
shall be given until at least 30 days after the occurrence thereof. For the
purpose of this Section, the term "default" means any event which is, or after
notice or lapse of time or both would become, an Event of Default with respect
to Securities of such series.
Section 603. Certain Rights of Trustee.
-------------------------
Subject to the provisions of Section 601:
(1) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request,
-49-
<PAGE>
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to be genuine and to
have been signed or presented by the proper party or parties;
(2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors shall be sufficiently evidenced by a
Board Resolution;
(3) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless
other evidence be herein specifically prescribed) may, in the absence of
bad faith on its part, rely upon an Officers' Certificate;
(4) the Trustee may consult with counsel and the written advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;
(5) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction
of any of the Holders pursuant to this Indenture, unless such Holders shall
have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by it in compliance
with such request or direction;
(6) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it
shall be
-50-
<PAGE>
entitled to examine the books, records and premises of the Company,
personally or by agent or attorney; and
(7) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder.
Section 604. Not Responsible for Recitals or
Issuance of Securities.
-------------------------------
The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements
of the Company, and the Trustee or any Authenticating Agent assumes no
responsibility for their correctness. The Trustee makes no representations
as to the validity or sufficiency of this Indenture or of the Securities.
The Trustee or any Authenticating Agent shall not be accountable for the
use or application by the Company of Securities or the proceeds thereof.
Section 605. May Hold Securities.
-------------------
The Trustee, any Authenticating Agent, any Paying Agent, any
Security Registrar or any other agent of the Company, in its individual or
any other capacity, may become the owner or pledgee of Securities and,
subject to Sections 608 and 613, may otherwise deal with the Company with
the same rights it would have if it were not Trustee, Authenticating Agent,
Paying Agent, Security Registrar or such other agent.
Section 606. Money Held in Trust.
-------------------
Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law. The
Trustee shall be under no liability for interest on any money received by
it hereunder except as otherwise agreed with the Company.
Section 607. Compensation and Reimbursement.
------------------------------
The Company agrees
(1) to pay to the Trustee from time to time compensation for all
services rendered by it hereunder as agreed upon in writing
-51-
<PAGE>
with the Company (which compensation shall not be limited by any provision
of law in regard to the compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision
of this Indenture (including the reasonable compensation and the expenses
and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad
faith; and
(3) to indemnify the Trustee for, and to hold it harmless against,
any loss, liability or expense incurred without negligence or bad faith on
its part, arising out of or in connection with the acceptance or
administration of the trust or trusts hereunder, including the costs and
expenses of defending itself against any claim or liability in connection
with the exercise or performance of any of its powers or duties hereunder.
Section 608. Disqualification; Conflicting
Interests.
-----------------------------
If the Trustee has or shall acquire a conflicting interest within
the meaning of the Trust Indenture Act, the Trustee shall either eliminate
such interest or resign, to the extent and in the manner provided by, and
subject to the provisions of, the Trust Indenture Act and this Indenture.
Section 609. Corporate Trustee Required;
Eligibility.
---------------------------
There shall at all times be one or more Trustees hereunder with
respect to the Securities of each series, at least one of which shall be a
Person that is eligible pursuant to the Trust Indenture Act to act as such
and has a combined capital and surplus of at least $50,000,000. If such
Person publishes reports of condition at least annually, pursuant to law or
to the requirements of said supervising or examining authority, then for
the purposes of this Section, the combined capital and surplus of such
Person shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. If at any time the
Trustee shall cease to be
-52-
<PAGE>
eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.
Section 610. Resignation and Removal;
Appointment of Successor.
------------------------
No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 611.
The Trustee may resign at any time with respect to the Securities
of one or more series by giving written notice thereof to the Company. If
the instrument of acceptance by a successor Trustee required by Section 611
shall not have been delivered to the Trustee within 30 days after the
giving of such notice of resignation, the resigning Trustee may petition
any court of competent jurisdiction for the appointment of a successor
Trustee with respect to the Securities of such series.
The Trustee may be removed at any time with respect to the
Securities of any series by Act of the Holders of a majority in principal
amount of the Outstanding Securities of such series, delivered to the
Trustee and to the Company.
If at any time:
(1) the Trustee shall fail to comply with Section 608 after written
request therefor by the Company or by any Holder who has been a bona fide
Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609 and
shall fail to resign after written request therefor by the Company or by
any such Holder, or
(3) the Trustee shall become incapable of acting or shall be adjudged
a bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of
the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (A) the Company by a Board Resolution may remove the
Trustee with respect to all securities,
-53-
<PAGE>
or (B) subject to Section 514, any Holder who has been a bona fide Holder of a
Security for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the removal
of the Trustee with respect to all Securities and the appointment of a successor
Trustee or Trustees.
If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, with respect
to the Securities of one or more series, the Company, by a Board Resolution,
shall promptly appoint a successor Trustee or Trustees with respect to the
Securities of that or those series (it being understood that any such successor
Trustee may be appointed with respect to the Securities of one or more or all of
such series and that at any time there shall be only one Trustee with respect to
the Securities of any particular series) and shall comply with the applicable
requirements of Section 611. If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a successor Trustee
with respect to the Securities of any Series shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding Securities of such
series delivered to the Company and the retiring Trustee, the successor Trustee
so appointed shall, forthwith upon its acceptance of such appointment in
accordance with the applicable requirements of Section 611, become the successor
Trustee with respect to the Securities of such series and to that extent
supersede the successor Trustee appointed by the Company. If no successor
Trustee with respect to the Securities of any Series shall have been so
appointed by the Company or the Holders and accepted appointment in the manner
required by Section 611, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee with respect to the Securities of such
series.
The Company shall give notice of each resignation and each removal of
the Trustee with respect to the Securities of any series and each appointment of
a successor Trustee with respect to the Securities of any series to all Holders
of Securities of such series in the manner provided in Section 106. Each notice
shall include the name of the successor Trustee with respect to the Securities
of such series and the address of its Corporate Trust Office.
-54-
<PAGE>
Section 611. Acceptance of Appointment by
Successor.
----------------------------
In case of the appointment hereunder of a successor Trustee with
respect to all Securities, every such successor Trustee so appointed shall
execute, acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or removal
of the retiring Trustee shall become effective and such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee; but, on the request
of the Company or the successor Trustee, such retiring Trustee shall, upon
payment of its charges, execute and deliver an instrument transferring to such
successor Trustee all the rights, powers and trusts of the retiring Trustee and
shall duly assign, transfer and deliver to such successor Trustee all property
and money held by such retiring Trustee hereunder.
In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) series, the Company, the
retiring Trustee and each successor Trustee with respect to the Securities of
one or more series shall execute and deliver an indenture supplemental hereto
wherein each successor Trustee shall accept such appointment and which (1) shall
contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Trustee all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of that
or those series to which the appointment of such successor Trustee relates, (2)
if the retiring Trustee is not retiring with respect to all Securities, shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series as to which the retiring
Trustee is not retiring shall continue to be vested in the retiring Trustee, and
(3) shall add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein or
in such supplemental indenture shall constitute such Trustees co-trustees of the
same trust and that each such Trustee shall be trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder administered by
any other such Trustee; and upon the execution and delivery of such supplemental
indenture the resignation or removal of the retiring Trustee shall become
effective to the extent provided therein and each such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring
-55-
<PAGE>
Trustee with respect to the Securities of that or those series to which the
appointment of such successor Trustee relates; but, on request of the Company or
any successor Trustee, such retiring Trustee shall duly assign, transfer and
deliver to such successor Trustee all property and money held by such retiring
Trustee hereunder with respect to the Securities of that or those series to
which the appointment of such successor Trustee relates.
Upon request of any such successor Trustee, the Company shall execute
any and all instruments for more fully and certainly vesting in and confirming
to such successor Trustee all such rights, powers and trusts referred to in
paragraph (a) and (b) of this Section, as the case may be.
No successor Trustee shall accept its appointment unless at the time
of such acceptance such successor Trustee shall be qualified and eligible under
this Article.
Section 612. Merger, Conversion, Consolidation
or Succession to Business.
---------------------------------
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
Section 613. Preferential Collection of Claims
Against Company.
---------------------------------
If and when the Trustee shall be or become a creditor of the Company
(or any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
Section 614. Appointment of Authenticating Agent.
-----------------------------------
The Trustee may appoint an Authenticating Agent or Agents with respect
to one or more series of Securities
-56-
<PAGE>
which shall be authorized to act on behalf of the Trustee to authenticate
Securities of such series issued upon original issue and upon exchange,
registration of transfer or partial redemption thereof or pursuant to Section
306, and Securities so authenticated shall be entitled to the benefits of this
Indenture and shall be valid and obligatory for all purposes as if authenticated
by the Trustee hereunder. Wherever reference is made in this Indenture to the
authentication and delivery of Securities by the Trustee or the Trustee's
certificate of authentication, such reference shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent shall be acceptable to the
Company and shall at all times be a corporation organized and doing business
under the laws of the United States of America, any State thereof or the
District of Columbia, authorized under such laws to act as Authenticating Agent,
having a combined capital and surplus of not less than $50,000,000 (except that
such capital and surplus requirement shall not apply to the First Chicago Trust
Company of New York) and subject to supervision or examination by Federal or
State authority. If such Authenticating Agent publishes reports of condition at
least annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section, the combined capital
and surplus of such Authenticating Agent shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time an Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section, such Authenticating Agent shall
resign immediately in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice thereof
to such Authenticating Agent and to the Company. Upon receiving such a notice
of resignation or upon such a
-57-
<PAGE>
termination, or in case at any time such Authenticating Agent shall cease to be
eligible in accordance with the provisions of this Section, the Trustee may
appoint a successor Authenticating Agent which shall be acceptable to the
Company and shall mail written notice of such appointment by first-class mail,
postage prepaid, to all Holders of Securities of the series with respect to
which such Authenticating Agent will serve, as their names and addresses appear
in the Security Register. Any successor Authenticating Agent upon acceptance of
its appointment hereunder shall become vested with all the rights, powers and
duties of its predecessor hereunder, with like effect as if originally named as
an Authenticating Agent. No successor Authenticating Agent shall be appointed
unless eligible under the provisions of this Section.
The Trustee agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section as agreed to in
writing from time to time with the Company, and the Trustee shall be entitled to
be reimbursed for such payments, subject to the provisions of Section 607.
If an appointment with respect to one or more series is made pursuant
to this Section, the Securities of such series may have endorsed thereon, in
addition to the Trustee's certificate of authentication, an alternative
certificate of authentication in the following form:
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
........................,
As Trustee
By......................,
As Authenticating Agent
By......................
Authorized Officer
-58-
<PAGE>
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee
Names and Addresses of Holders.
------------------------------
The Company will furnish or cause to be furnished
to the Trustee
(1) semi-annually, not later than May 15 and November 15 in each
year, a list for each series of Securities, in such form as the Trustee may
reasonably require, of the names and addresses of the Holders of Securities
of such series as of the preceding April 30 or October 31, as the case may
be, and
(2) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Company of any such request, a list of
similar form and content as of a date not more than 15 days prior to the
time such list is furnished;
excluding from any such list names and addresses received by the Trustee in its
- ---------
capacity as Security Registrar.
Section 702. Preservation of Information;
Communications to Holders.
----------------------------
The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 701 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 701 upon receipt of a new list so furnished.
The rights of the Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Securities, and the
corresponding rights and privileges of the Trustee, shall be as provided by the
Trust Indenture Act.
Every Holder of Securities, by receiving and holding the same, agrees
with the Company and the Trustee that neither the Company nor the Trustee nor
any agent of either of them shall be held accountable by reason of any
disclosure of information as to names and addresses of Holders made pursuant to
the Trust Indenture Act.
-59-
<PAGE>
Section 703. Reports by Trustee.
------------------
The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act at the times and in the manner provided pursuant thereto.
A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange upon which any
Securities are listed, with the Commission and with the Company. The Company
will notify the Trustee when any Securities are listed on any stock exchange.
Section 704. Reports by Company.
------------------
The Company shall file with the Trustee and the Commission, and
transmit to Holders, such information, documents and other reports, and such
summaries thereof, as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided pursuant to such Act; provided that any such
--------
information, documents or reports required to be filed with the Commission
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 shall be
filed with the Trustee within 15 days after the same is so required to be filed
with the Commission.
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. Company May Consolidate, Etc., Only
on Certain Terms.
-----------------------------------
The Company shall not consolidate with or merge into any other Person
or convey, transfer or lease its properties and assets substantially as an
entirety to any Person, and the Company shall not permit any Person to
consolidate with or merge into the Company, unless:
(1) in case the Company shall consolidate with or merge into another
Person or convey, transfer or lease its properties and assets substantially
as an entirety to any Person, the Person formed by such consolidation or
into which the Company is merged or the Person which acquires by conveyance
or transfer, or which leases, the properties and assets of the Company
substantially as an entirety shall be a corporation, partnership or trust,
shall be organized and validly existing under the laws of the United States
-60-
<PAGE>
of America, any State thereof or the District of Columbia and shall
expressly assume, by an indenture supplemental hereto, executed and
delivered to the Trustee, in form satisfactory to the Trustee, the due and
punctual payment of the principal of and any premium and interest on all
the Securities and the performance or observance of every covenant of this
Indenture on the part of the Company to be performed or observed;
(2) immediately after giving effect to such transaction and treating
any indebtedness which becomes an obligation of the Company or any
Subsidiary as a result of such transaction as having been incurred by the
Company or such Subsidiary at the time of such transaction, no Event of
Default, and no event which, after notice or lapse of time or both, would
become an Event of Default, shall have happened and be continuing;
(3) the Company or such successor entity shall, immediately after
giving effect to such consolidation or merger, or such sale, conveyance or
lease, have a Ratio Calculation of 1.1 to 1 or more;
(4) if, as a result of any such consolidation or merger or such
conveyance, transfer or lease, properties or assets of the Company would
become subject to a mortgage, pledge, lien, security interest or other
encumbrance which would not be permitted by this Indenture, the Company or
such successor Person, as the case may be, shall take such steps as shall
be necessary effectively to secure the Securities equally and ratably with
(or prior to) all indebtedness secured thereby; and
(5) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that such consolidation, merger,
conveyance, transfer or lease and, if a supplemental indenture is required
in connection with such transaction, such supplemental indenture comply
with this Article and that all conditions precedent herein provided for
relating to such transaction have been complied with.
-61-
<PAGE>
Section 802. Successor Substituted.
---------------------
Upon any consolidation of the Company with, or merger of the Company
into, any other Person or any conveyance, transfer or lease of the properties
and assets of the Company substantially as an entirety in accordance with
Section 801, the successor Person formed by such consolidation or into which the
Company is merged or to which such conveyance, transfer or lease is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Indenture with the same effect as if such successor
Person had been named as the Company herein, and thereafter, except in the case
of a lease, the predecessor Person shall be relieved of all obligations and
covenants under this Indenture and the Securities.
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without
Consent of Holders.
-------------------------------
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form satisfactory to the
Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the Company and
the assumption by any such successor of the covenants of the Company herein
and in the Securities; or
(2) to add to the covenants of the Company for the benefit of the
Holders of all or any series of Securities (and if such covenants are to be
for the benefit of less than all series of Securities, stating that such
covenants are expressly being included solely for the benefit of such
series) or to surrender any right or power herein conferred upon the
Company; or
(3) to add any additional Events of Default; or
(4) to add to or change any of the provisions of this Indenture to
such extent as shall be necessary to permit or facilitate
-62-
<PAGE>
the issuance of Securities in bearer form, registrable or not registrable
as to principal, and with or without interest coupons, or to permit or
facilitate the issuance of Securities in uncertificated form; or
(5) to add to, change or eliminate any of the provisions of this
Indenture in respect of one or more series of Securities, provided that any
--------
such addition, change or elimination (A) shall neither (i) apply to any
Security of any series created prior to the execution of such supplemental
indenture and entitled to the benefit of such provision nor (ii) modify the
rights of the Holder of any such Security with respect to such provision or
(B) shall become effective only when there is no such Security Outstanding;
or
(6) to secure the Securities; or
(7) to establish the form or terms of Securities of any series as
permitted by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one or
more series and to add to or change any of the provisions of this Indenture
as shall be necessary to provide for or facilitate the administration of
the trusts hereunder by more than one Trustee, pursuant to the requirements
of Section 611; or
(9) to cure any ambiguity, to correct or supplement any provision
herein which may be inconsistent with any other provision herein, or to
make any other provisions with respect to matters or questions arising
under this Indenture, provided that such action pursuant to this clause (9)
--------
shall not adversely affect the interests of the Holders of Securities of
any series in any material respect; or
(10) to comply with the requirements of the Commission in order to
effect or maintain the qualification of this Indenture under the Trust
Indenture Act, as contemplated by Section 905 or otherwise.
-63-
<PAGE>
Section 902. Supplemental Indentures with Consent
of Holders.
------------------------------------
With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company and the
Trustee, the Company, when authorized by a Board Resolution, and the Trustee may
enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of modifying in any manner the rights of the
Holders of Securities of such series under this Indenture; provided, however,
-------- -------
that no such supplemental indenture shall, without the consent of the Holder of
each Outstanding Security affected thereby,
(1) change the Stated Maturity of the principal of, or any instalment
of principal of or interest on, any Security, or reduce the principal
amount thereof or the rate of interest thereon or any premium payable upon
the redemption thereof, or reduce the amount of the principal of an
Original Issue Discount Security that would be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to Section
502, or change any Place of Payment where, or the coin or currency in
which, any Security or any premium or interest thereon is payable, or
impair the right to institute suit for the enforcement of any such payment
on or after the Stated Maturity thereof (or, in the case of redemption, on
or after the Redemption Date), or
(2) reduce the percentage in principal amount of the Outstanding
Securities of any series, the consent of whose Holders is required for any
such supplemental indenture, or the consent of whose Holders is required
for any waiver (of compliance with certain provisions of this Indenture or
certain defaults hereunder and their consequences) provided for in this
Indenture, or
(3) modify any of the provisions of this Section, Section 513 or
Section 1012, except to increase any such percentage or to provide that
certain other provisions of this Indenture cannot be modified or waived
without the consent of the Holder of each Outstanding Security affected
thereby,
-64-
<PAGE>
provided, however, that this clause shall not be deemed to require the
-------- -------
consent of any Holder with respect to changes in the references to "the
Trustee" and concomitant changes in this Section and Section 1012, or the
deletion of this proviso, in accordance with the requirements of Sections
611 and 901(8).
A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which modifies the
rights of the Holders of Securities of such series with respect to such covenant
or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
Section 903. Execution of Supplemental Indentures.
------------------------------------
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 601) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
Section 904. Effect of Supplemental Indentures.
---------------------------------
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
Section 905. Conformity with Trust Indenture Act.
-----------------------------------
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act.
-65-
<PAGE>
Section 906. Reference in Securities to
Supplemental Indentures.
--------------------------
Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and shall
if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Company shall
so determine, new Securities of any series so modified as to conform, in the
opinion of the Trustee and the Company, to any such supplemental indenture may
be prepared and executed by the Company and authenticated and delivered by the
Trustee in exchange for Outstanding Securities of such series.
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest.
------------------------------------------
The Company covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay the principal of and any premium
and interest on the Securities of that series in accordance with the terms of
the Securities and this Indenture.
Section 1002. Maintenance of Office or Agency.
-------------------------------
The Company will maintain in each Place of Payment for any series of
Securities an office or agency where Securities of that series may be presented
or surrendered for payment, where Securities of that series may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Company in respect of the Securities of that series and this Indenture
may be served. The Company will give prompt written notice to the Trustee of
the location, and any change in the location, of such office or agency. If at
any time the Company shall fail to maintain any such required office or agency
or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.
The Company may also from time to time designate one or more other
offices or agencies where the Securities of one or more series may be presented
or surrendered for any or all such purposes and may from time to time rescind
such designations; provided, however, that no such designa-
-------- -------
-66-
<PAGE>
tion or rescission shall in any manner relieve the Company of its obligation to
maintain an office or agency in each Place of Payment for Securities of any
series for such purposes. The Company will give prompt written notice to the
Trustee of any such designation or rescission and of any change in the location
of any such other office or agency.
Section 1003. Money for Securities Payments to
Be Held in Trust.
--------------------------------
If the Company shall at any time act as its own Paying Agent with
respect to any series of Securities, it will, on or before each due date of the
principal of or any premium or interest on any of the Securities of that series,
segregate and hold in trust for the benefit of the Persons entitled thereto a
sum sufficient to pay the principal and any premium and interest so becoming due
until such sums shall be paid to such Persons or otherwise disposed of as herein
provided and will promptly notify the Trustee of its action or failure so to
act.
Whenever the Company shall have one or more Paying Agents for any
series of Securities, it will, prior to each due date of the principal of or any
premium or interest on any Securities of that series, deposit with a Paying
Agent a sum sufficient to pay such amount, such sum to be held as provided by
the Trust Indenture Act, and (unless such Paying Agent is the Trustee) the
Company will promptly notify the Trustee of its action or failure so to act.
The Company will cause each Paying Agent for any series of Securities
other than the Trustee to execute and deliver to the Trustee an instrument in
which such Paying Agent shall agree with the Trustee, subject to the provisions
of this Section, that such Paying Agent will (1) comply with the provisions of
the Trust Indenture Act applicable to it as a Paying Agent and (2) during the
continuance of any default by the Company (or any other obligor upon the
Securities of that series) in the making of any payment in respect of the
Securities of that series, and upon the written request of the Trustee,
forthwith pay to the Trustee all sums held in trust by such Paying Agent for
payment in respect of the Securities of that series.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
-67-
<PAGE>
such Paying Agent shall be released from all further liability with respect to
such money.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of or any premium or
interest on any Security of any series and remaining unclaimed for two years
after such principal, premium or interest has become due and payable shall be
paid to the Company on Company Request, or (if then held by the Company) shall
be discharged from such trust; and the Holder of such Security shall thereafter,
as an unsecured general creditor, look only to the Company for payment thereof,
and all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
-------- -------
required to make any such repayment, may at the expense of the Company cause to
be published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in the City of New
York, notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date of such publication,
any unclaimed balance of such money then remaining will be repaid to the
Company.
Section 1004. Statement by Officers as to Default.
-----------------------------------
The Company will deliver to the Trustee, within 120 days after the end
of each fiscal year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not to the best knowledge of the signers thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions of this Indenture (without regard to any period of
grace or requirement of notice provided hereunder) and, if the Company shall be
in default, specifying all such defaults and the nature and status thereof of
which they may have knowledge.
Section 1005. Existence.
---------
Subject to Article Eight, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its 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.
-68-
<PAGE>
Section 1006. Maintenance of Properties.
-------------------------
The Company will cause all material properties used or useful in the
conduct of its business or the business of any Significant 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
- -------- -------
(i) 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 Significant Subsidiary and not
disadvantageous in any material respect to the Holders or (ii) selling any
properties or taking any action in accordance with Article 8.
Section 1007. 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, (1) all taxes, assessments and
governmental charges levied or imposed upon the Company or any Significant
Subsidiary or upon the income, profits or property of the Company or any
Significant Subsidiary, and (2) 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 Significant 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 1008. Limitation on the Incurrence of Debt.
------------------------------------
The Company and its consolidated Subsidiaries may not Incur any Debt
if, after giving effect to such Incurrence, the Ratio Calculation is less than
1.1 to 1.
Notwithstanding the foregoing paragraph, the Company and its
consolidated Subsidiaries may Incur the following additional Debt without regard
to the foregoing limitation (although the additional Debt so Incurred will be
included in the determination of the Consolidated Coverage Ratio thereafter):
(i) the Securities issued under the Indenture not to exceed an aggregate issue
price of $150,000,000; (ii) intercompany Debt (representing Debt to which the
only parties are the Company and any of its consolidated Subsidiaries (but only
so long as such Debt is
-69-
<PAGE>
held solely by any of the Company and its consolidated Subsidiaries)); (iii) any
drawings or redrawings under lines of credit existing on the date hereof and any
new lines of credit or replacements, amendments or extensions of existing lines
of credit, provided, however, that the maximum amount that may be drawn under
-------- -------
all lines of credit pursuant to this clause (iii) may not at any time exceed the
maximum amount that may be drawn under all lines of credit that exist as of the
date hereof; (iv) refinancings, renewals, refundings or extensions of any Debt,
in any case in an amount not to exceed the principal amount of the Debt so
refinanced plus any prepayment premium or accrued interest, provided that (a)
such refinancing Debt is either (I) Debt of the Company that ranks pari passu
with or junior to the Debt being refinanced, (II) Debt of a Subsidiary that the
Company or another Subsidiary guarantees or (III) Debt of a Subsidiary and (b)
such refinancing Debt (giving effect to any right of the holder thereof to
require, directly or indirectly, an early repayment, defeasance or retirement of
such Debt) either has a weighted average life equal to or longer than the
remaining weighted average life of the Debt being refinanced or has a minimum
term of five years; (v) third party Debt of a Subsidiary, including Debt of a
Subsidiary that carries a Company guarantee of repayment, directly relating to
the development of projects or the expansion, renovation or improvement of
existing properties; (vi) third party Debt of a Subsidiary directly relating to
the acquisition of assets; (vii) reimbursement obligations under letters of
credit, bankers' acceptances or similar facilities, provided that at the time of
Incurring any additional obligations pursuant to this clause (vii) the amount of
all such obligations, whether or not currently due, aggregate at any time less
than 5% of Consolidated Net Tangible Assets at such date; (viii) Debt that by
its terms is subordinate in right of payment to any of the other Debt of the
Company, provided, however, that, pursuant to clauses (i) through (ix), the
-------- -------
aggregate issue price of such subordinated Debt may not at any time exceed the
aggregate principal amount of such subordinated Debt as of the date hereof plus
$100,000,000; (ix) Attributable Debt; and (x) in addition to Debt referred to in
clauses (i) through (ix) above, Debt in the aggregate principal amount of
$50,000,000 which is to be used only for working capital purposes.
Section 1009. Limitation on Sale/Leaseback Transactions.
-----------------------------------------
The Company will not, nor will it permit any Restricted Subsidiary to,
enter into any arrangement with any bank, insurance company or other lender or
investor (not including the Company or any consolidated Subsidiary) or to which
any such lender or investor is a party, providing for the leasing by the Company
or any such Restricted Subsidiary for a period, including renewals, in excess of
three years,
-70-
<PAGE>
of any Principal Property owned by the Company or such Restricted Subsidiary,
which has been or is to be sold or transferred more than one year after either
the acquisition thereof or the completion of construction and commencement of
full operation thereof by the Company or any such Restricted Subsidiary, to such
lender or investor or to any Person to whom funds have been or are to be
advanced by such lender or investor on the security of such Principal Property
(herein referred to as a "Sale/Leaseback Transaction") unless (A) the aggregate
amount of Attributable Debt for the proposed and all existing Sale/Leaseback
Transactions is less than 10% of Consolidated Net Tangible Assets and (B) if the
Ratio Calculation is less than 1.1 to 1 after giving effect to the proposed
Sale/Leaseback Transaction, the Company and its Subsidiaries, within 270 days
after the sale or transfer shall have been made by the Company or by any such
Restricted Subsidiary, must apply an amount equal to the net proceeds of the
sale of the Principal Property sold and leased back pursuant to such arrangement
to either (or a combination of) (x) the purchase of property, facilities or
equipment (other than the property, facilities or equipment involved in such
Sale/Leaseback Transaction) or (y) the retirement of Debt of the Company or a
Restricted Subsidiary, including the Securities, which either has an initial
term of greater than 12 months or is a bona fide acquisition loan or a
construction or bridge loan entered in connection with a construction project or
other real estate development.
Section 1010. [Intentionally Omitted].
Section 1011. Provision of Financial Information.
----------------------------------
Whether or not the Company is subject to Section 13(a) or 15(d) of the
Exchange Act, the Company will, to the extent permitted under the Exchange Act,
file with the Commission the annual reports, quarterly reports and other
documents which the Company would have been required to file with the Commission
pursuant to such Section 13(a) or 15(d) ("Financial Statements") if the Company
were so subject, such documents to be filed with the Commission on or prior to
the respective dates (the "Required Filing Dates") by which the Company would
have been required so to file such documents if the Company were so subject.
The Company will also in any event (x) within 15 days of each Required
Filing Date (i) transmit by mail to all Holders, as their names and addresses
appear in the Security Register, without cost to such Holders and (ii) file with
the Trustee copies of the annual reports, quarterly reports and other documents
which the Company
-71-
<PAGE>
would have been required to file with the Commission pursuant to Section 13(a)
or 15(d) of the Exchange Act if the Company were subject to such Sections and
(y) if filing such documents by the Company with the Commission is not permitted
under the Exchange Act, promptly upon written request and payment of the
reasonable cost of duplication and delivery, supply copies of such documents to
any prospective Holder.
Section 1012. Waiver of Certain Covenants.
---------------------------
The Company may omit in any particular instance to comply with any
term, provision or condition set forth in Sections 1005 to 1011, inclusive, with
respect to the Securities of any series if before the time for such compliance
the Holders of at least a majority in principal amount of the Outstanding
Securities of such series shall, by Act of such Holders, either waive such
compliance in such instance or generally waive compliance with such term,
provision or condition, but no such waiver shall extend to or affect such term,
provision or condition except to the extent so expressly waived, and, until such
waiver shall become effective, the obligations of the Company and the duties of
the Trustee in respect of any such term, provision or condition shall remain in
full force and effect.
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article.
------------------------
Securities of any series which are redeemable before their Stated
Maturity shall be redeemable in accordance with their terms and (except as
otherwise specified as contemplated by Section 301 for Securities of any series)
in accordance with this Article.
Section 1102. Election to Redeem; Notice to Trustee.
-------------------------------------
The election of the Company to redeem any Securities shall be
evidenced by a Board Resolution. In case of any redemption at the election of
the Company of less than all the Securities of any series, the Company shall, at
least 60 days prior to the Redemption Date fixed by the Company (unless a
shorter notice shall be satisfactory to the Trustee), notify the Trustee of such
Redemption Date, of the principal amount of Securities of such series to be
redeemed and, if applicable, of the tenor of the Securities to be redeemed. In
the case of any redemption of Securities prior to the expiration of any
restriction on such redemption provided in the terms of such Securities or
-72-
<PAGE>
elsewhere in this Indenture, the Company shall furnish the Trustee with an
Officers' Certificate evidencing compliance with such restriction.
Section 1103. Selection by Trustee of Securities
to Be Redeemed.
----------------------------------
If less than all the Securities of any series are to be redeemed
(unless all of the Securities of such series and of a specified tenor are to be
redeemed), the particular Securities to be redeemed shall be selected not more
than 60 days prior to the Redemption Date by the Trustee, from the Outstanding
Securities of such series not previously called for redemption, by such method
as the Trustee shall deem fair and appropriate and which may provide for the
selection for redemption of portions (equal to the minimum authorized
denomination for Securities of that series or any integral multiple thereof) of
the principal amount of Securities of such series of a denomination larger than
the minimum authorized denomination for Securities of that series. If less than
all of the Securities of such series and of a specified tenor are to be
redeemed, the particular Securities to be redeemed shall be selected not more
than 60 days prior to the Redemption Date by the Trustee, from the Outstanding
Securities of such series and specified tenor not previously called for
redemption in accordance with the preceding sentence.
The Trustee shall promptly notify the Company in writing of the
Securities selected for redemption and, in the case of any Securities selected
for partial redemption, the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Securities redeemed or to be redeemed only in part, to the
portion of the principal amount of such Securities which has been or is to be
redeemed.
Section 1104. Notice of Redemption.
--------------------
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption
Date, to each Holder of Securities to be redeemed, at his address appearing in
the Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
-73-
<PAGE>
(3) if less than all the Outstanding Securities of any series are to
be redeemed, the identification (and, in the case of partial redemption of
any Securities, the principal amounts) of the particular Securities to be
redeemed,
(4) that on the Redemption Date the Redemption Price will become due
and payable upon each such Security to be redeemed and, if applicable, that
interest thereon will cease to accrue on and after said date,
(5) the place or places where such Securities are to be surrendered
for payment of the Redemption Price, and
(6) that the redemption is for a sinking fund, if such is the case.
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company and shall be irrevocable.
Section 1105. Deposit of Redemption Price.
---------------------------
Prior to any Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 1003) an amount of
money sufficient to pay the Redemption Price of, and (except if the Redemption
Date shall be an Interest Payment Date) accrued interest on, all the Securities
which are to be redeemed on that date.
Section 1106. Securities Payable on Redemption Date.
-------------------------------------
Notice of redemption having been given as aforesaid, the Securities so
to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such Security shall
be paid by the Company at the Redemption Price, together with accrued interest
to the Redemption Date; provided, however, that, unless otherwise specified as
-------- -------
contemplated by Section 301, installments of interest whose Stated Maturity is
on or prior to the Redemption Date shall be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such at the
close of
-74-
<PAGE>
business on the relevant Record Dates according to their terms and the
provisions of Section 307.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and any premium shall, until
paid, bear interest from the Redemption Date at the rate prescribed therefor in
the Security.
Section 1107. Securities Redeemed in Part.
---------------------------
Any Security which is to be redeemed only in part shall be surrendered
at a Place of Payment therefor (with, if the Company or the Trustee so requires,
due endorsement by, or a written instrument of transfer in form satisfactory to
the Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing), and the Company shall execute, and the Trustee
shall authenticate and deliver to the Holder of such Security without service
charge, a new Security or Securities of the same series and of like tenor, of
any authorized denomination as requested by such Holder, in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Security so surrendered.
ARTICLE TWELVE
Sinking Funds
Section 1201. Applicability of Article.
------------------------
The provisions of this Article shall be applicable to any sinking fund
for the retirement of Securities of a series except as otherwise specified as
contemplated by Section 301 for Securities of such series.
The minimum amount of any sinking fund payment provided for by the
terms of Securities of any series is herein referred to as a "mandatory sinking
fund payment", and any payment in excess of such minimum amount provided for by
the terms of Securities of any series is herein referred to as an "optional
sinking fund payment". If provided for by the terms of Securities of any
series, the cash amount of any sinking fund payment may be subject to reduction
as provided in Section 1202. Each sinking fund payment shall be applied to the
redemption of Securities of any series as provided for by the terms of
Securities of such series.
-75-
<PAGE>
Section 1202. Satisfaction of Sinking Fund Payments
with Securities.
-------------------------------------
The Company (1) may deliver Outstanding Securities of a series (other
than any previously called for redemption) and (2) may apply as a credit
Securities of a series which have been redeemed either at the election of the
Company pursuant to the terms of such Securities or through the application of
permitted optional sinking fund payments pursuant to the terms of such
Securities, in each case in satisfaction of all or any part of any sinking fund
payment with respect to the Securities of such series required to be made
pursuant to the terms of such Securities as provided for by the terms of such
series; provided that such Securities have not been previously so credited.
--------
Such Securities shall be received and credited for such purpose by the Trustee
at the Redemption Price specified in such Securities for redemption through
operation of the sinking fund and the amount of such sinking fund payment shall
be reduced accordingly.
Section 1203. Redemption of Securities for Sinking Fund.
-----------------------------------------
Not less than 60 days prior to each sinking fund payment date for any
series of Securities, the Company will deliver to the Trustee an Officers'
Certificate specifying the amount of the next ensuing sinking fund payment for
that series pursuant to the terms of that series, the portion thereof, if any,
which is to be satisfied by payment of cash and the portion thereof, if any,
which is to be satisfied by delivering and crediting Securities of that series
pursuant to Section 1202 and will also deliver to the Trustee any Securities to
be so delivered. Not less than 60 days before each such sinking fund payment
date the Trustee shall select the Securities to be redeemed upon such sinking
fund payment date in the manner specified in Section 1103 and cause notice of
the redemption thereof to be given in the name of and at the expense of the
Company in the manner provided in Section 1104. Such notice having been duly
given, the redemption of such Securities shall be made upon the terms and in the
manner stated in Sections 1106 and 1107.
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Company's Option to Effect Defeasance
or Covenant Defeasance.
-------------------------------------
The Company may elect, at its option by Board Resolution at any time,
to have either Section 1302 or Section 1303 applied to the Outstanding
Securities of any
-76-
<PAGE>
series designated pursuant to Section 301 as being defeasible pursuant to this
Article Thirteen (hereinafter called a "Defeasible Series"), upon compliance
with the conditions set forth below in this Article Thirteen.
Section 1302. Defeasance and Discharge.
------------------------
Upon the Company's exercise of the option provided in Section 1301 to
have this Section 1302 applied to the Outstanding Securities of any Defeasible
Series, the Company shall be deemed to have been discharged from any and all
obligations with respect to the Outstanding Securities of such series as
provided in this Section on and after the date the conditions set forth in
Section 1304 are satisfied (hereinafter called "Defeasance"). For this purpose,
such Defeasance means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by the Outstanding Securities of
such series and to have satisfied all its other obligations under the Securities
of such series and this Indenture insofar as the Securities of such series are
concerned (and the Trustee, at the expense of the Company, shall execute proper
instruments acknowledging the same), subject to the following which shall
survive until otherwise terminated or discharged hereunder: (1) the rights of
Holders of Securities of such series to receive, solely from the trust fund
described in Section 1304 and as more fully set forth in such Section, payments
in respect of the principal of and any premium and interest on such Securities
of such series when payments are due, (2) the Company's obligations with respect
to the Securities of such series under Sections 304, 305, 306, 1002 and 1003,
(3) the rights, powers, trusts, duties and immunities of the Trustee hereunder
and (4) this Article Thirteen. Subject to compliance with this Article
Thirteen, the Company may exercise its option provided in Section 1301 to have
this Section 1302 applied to the Outstanding Securities of any Defeasible Series
notwithstanding the prior exercise of its option provided in Section 1301 to
have Section 1303 applied to the Outstanding Securities of such series.
Section 1303. Covenant Defeasance.
-------------------
Upon the Company's exercise of the option provided in Section 1301 to
have this Section 1303 applied to the Outstanding Securities of any Defeasible
Series, (1) the Company shall be released from its obligations under Sections
1005 though 1011, inclusive, Section 801, and such other obligations as shall be
set forth in any supplemental indenture for the Securities, (2) the occurrence
of any event specified in Sections 501(3), 501(4) (with respect to any of
Sections 1005 through 1011, inclusive, and Section 801, and such other
obligations as shall be set forth in any supplemental indenture for the
Securities), 501(5) and 501(8) shall be deemed not to be or result
-77-
<PAGE>
in an Event of Default, in each case with respect to the Outstanding Securities
of such series as provided in this Section on and after the date the conditions
set forth in Section 1304 are satisfied (hereinafter called "Covenant
Defeasance"). For this purpose, such Covenant Defeasance means that the Company
may omit to comply with and shall have no liability in respect of any term,
condition or limitation set forth in any such specified Section (to the extent
so specified in the case of Section 501(4)), whether directly or indirectly by
reason of any reference elsewhere herein to any such Section or by reason of any
reference in any such Section to any other provision herein or in any other
document, but the remainder of this Indenture and the Securities of such series
shall be unaffected thereby.
Section 1304. Conditions to Defeasance
or Covenant Defeasance.
------------------------
The following shall be the conditions to application of either Section
1302 or Section 1303 to the Outstanding Securities of any Defeasible Series:
(1) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee that satisfies the
requirements contemplated by Section 609 and agrees to comply with the
provisions of this Article Thirteen applicable to it) as trust funds in
trust for the purpose of making the following payments, specifically
pledged as security for, and dedicated solely to, the benefit of the
Holders of Outstanding Securities of such series, (A) money in an amount,
or (B) U.S. Government Obligations that through the scheduled payment of
principal and interest in respect thereof in accordance with their terms
will provide, not later than one day before the due date of any payment,
money in an amount, or (C) a combination thereof, in each case sufficient,
in the opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to the
Trustee, to pay and discharge, and which shall be applied by the Trustee
(or any such other qualifying trustee) to pay and discharge, the principal
of and any premium and interest on the Securities of such series on the
respective Stated Maturities, in accordance with the terms of this
Indenture and the Securities of such series. As used herein, "U.S.
Government Obligation" means (x) any security
-78-
<PAGE>
that is (i) a direct obligation of the United States of America for the
payment of which full faith and credit of the United States of America is
pledged or (ii) an obligation 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 (i) or
(ii), is not callable or redeemable at the option of the issuer thereof,
and (y) any depositary receipt issued by a bank (as defined in Section
3(a)(2) of the Securities Act of 1933, as amended) as custodian with
respect to any U.S. Government Obligation specified in Clause (x) and held
by such custodian for the account of the holder of such depositary receipt,
or with respect to any specific payment of principal of or interest on any
such U.S. Government Obligation, provided that (except as required by law)
--------
such custodian is not authorized to make any deduction from the amount
payable to the holder of such depositary receipt from any amount received
by the custodian in respect of the U.S. Government Obligation or the
specific payment of principal or interest evidenced by such depositary
receipt.
(2) In the case of an election under Section 1302, the Company shall
have delivered to the Trustee an Opinion of Counsel stating that (A) the
Company has received from, or there has been published by, the Internal
Revenue Service a ruling or (B) since the date first set forth hereinabove,
there has been a change in the applicable Federal income tax law, in either
case (A) or (B) to the effect that, and based thereon such opinion shall
confirm that, the Holders of the Outstanding Securities of such series will
not recognize gain or loss for Federal income tax purposes as a result of
the deposit, Defeasance and discharge to be effected with respect to the
Securities of such series and will be subject to Federal income tax on the
same amount, in the same manner and at the same times as would be the case
if such deposit, Defeasance and discharge were not to occur.
-79-
<PAGE>
(3) In the case of an election under Section 1303, the Company shall
have delivered to the Trustee an Opinion of Counsel to the effect that the
Holders of the Outstanding Securities of such series will not recognize
gain or loss for Federal income tax purposes as result of the deposit and
Covenant Defeasance to be effected with respect to the Securities of such
series and will be subject to Federal income tax on the same amount, in the
same manner and at the same times as would be the case if such deposit and
Covenant Defeasance were not to occur.
(4) No Event of Default or event that (after notice or lapse of time
or both) would become an Event of Default shall have occurred and be
continuing at the time of such deposit or, with regard to any Event of
Default or any such event specified in Sections 501(6) and (7), at any time
on or prior to the 90th day after the date of such deposit (it being
understood that this condition shall not be deemed satisfied until after
such 90th day).
(5) Such Defeasance or Covenant Defeasance shall not cause the
Trustee to have a conflicting interest within the meaning of the Trust
Indenture Act.
(6) Such Defeasance or Covenant Defeasance shall not result in a
breach or violation of, or constitute a default under, any other agreement
or instrument to which the Company is a party or by which it is bound.
(7) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent with respect to such Defeasance or Covenant Defeasance have been
complied with.
(8) Such Defeasance or Covenant Defeasance shall not result in the
trust arising from such deposit constituting an investment company within
the meaning of the Investment Company Act of 1940, as amended, unless such
trust shall be qualified under
-80-
<PAGE>
such Act or exempt from regulation thereunder.
Section 1305. Deposited Money and U.S. Government
Obligations to be Held in Trust;
Other Miscellaneous Provisions.
-----------------------------------
Subject to the provisions of the last paragraph of Section 1003, all
money and U.S. Government Obligations (including the proceeds thereof) deposited
with the Trustee or other qualifying trustee (solely for purposes of this
Section and Section 1306, the Trustee and any such other trustee are referred to
collectively as the "Trustee") pursuant to Section 1304 in respect of the
Securities of any Defeasible Series shall be held in trust and applied by the
Trustee, in accordance with the provisions of the Securities of such series and
this Indenture, to the payment, either directly or through any such Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Holders of Securities of such series, of all sums due and to
become due thereon in respect of principal and any premium and interest, but
money so held in trust need not be segregated from other funds except to the
extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 1304 or the principal and interest received in
respect thereof other than any such tax, fee or other charge that by law is for
the account of the Holders of Outstanding Securities.
Anything in this Article Thirteen to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or U.S. Government Obligations held by it as provided in
Section 1304 with respect to Securities of any Defeasible Series that, in the
opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, are in
excess of the amount thereof that would then be required to be deposited to
effect an equivalent Defeasance or Covenant Defeasance with respect to the
Securities of such series.
Section 1306. Reinstatement.
-------------
If the Trustee or the Paying Agent is unable to apply any money in
accordance with this Article Thirteen with respect to the Securities of any
series by reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, then the
Company's obligations under this
-81-
<PAGE>
Indenture and the Securities of such series shall be revived and reinstated as
though no deposit had occurred pursuant to this Article Thirteen with respect to
Securities of such series until such time as the Trustee or Paying Agent is
permitted to apply all money held in trust pursuant to Section 1305 with respect
to Securities of such series in accordance with this Article Thirteen;
provide, however, that if the Company makes any payment of principal of or any
- ------- -------
premium or interest on any Security of such series following the reinstatement
of its obligations, the Company shall be subrogated to the rights of the Holders
of Securities of such series to receive such payment from the money so held in
trust.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
--------------------------------
-82-
<PAGE>
TESTIMONIUM
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, and their respective corporate seals to be hereunto affixed
and attested, all as of the day and year first above written.
The Rouse Company
By......................
Attest:
........................
The First National Bank
of Chicago
By......................
Attest:
........................
-83-
<PAGE>
SIGNATURES AND SEALS
ACKNOWLEDGMENTS
STATE OF MARYLAND )
) ss.:
COUNTY OF )
On the .... day of ..........., ...., before me personally came
..........................., to me known, who, being by me duly sworn, did
depose and say that he is .................... of The Rouse Company, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
........................
STATE OF ILLINOIS )
) ss.:
COUNTY OF COOK )
On the .... day of ..........., ...., before me personally came
..........................., to me known, who, being by me duly sworn, did
depose and say that he is .................... of The First National Bank of
Chicago, one of the corporations described in and which executed the foregoing
instrument; that he knows the seal of said corporation; that the seal affixed to
said instrument is such corporate seal; that it was so affixed by authority of
the Board of Directors of said corporation, and that he signed his name thereto
by like authority.
........................
-84-
<PAGE>
Exhibit 4.3
[Form of Fixed Rate Note]
REGISTERED REGISTERED
No. FXR- [PRINCIPAL AMOUNT]
CUSIP:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF. THIS SECURITY MAY NOT BE TRANSFERRED TO, OR REGISTERED OR
EXCHANGED FOR SECURITIES REGISTERED IN THE NAME OF, ANY PERSON OTHER THAN THE
DEPOSITARY OR A NOMINEE THEREOF AND NO SUCH TRANSFER MAY BE REGISTERED, EXCEPT
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE. EVERY SECURITY
AUTHENTICATED AND DELIVERED UPON REGISTRATION OF TRANSFER OF, OR IN EXCHANGE FOR
OR IN LIEU OF, THIS SECURITY SHALL BE A GLOBAL SECURITY SUBJECT TO THE
FOREGOING, EXCEPT IN SUCH LIMITED CIRCUMSTANCES./*/
THE ROUSE COMPANY
MEDIUM-TERM NOTE
(Fixed Rate)
ORIGINAL ISSUE INITIAL APPLICABILITY OF
DATE(S): REDEMPTION MODIFIED PAYMENT
PERCENTAGE: UPON
MATURITY DATE: ACCELERATION:If
INTEREST PAYMENT yes, state Issue
INTEREST RATE: PERIOD: Price:
INTEREST PAYMENT APPLICABILITY OF APPLICABILITY OF
DATE(S) ANNUAL ANNUAL REDEMPTION
REDEMPTION PERCENTAGE
OPTIONAL PERCENTAGE INCREASE:
REPAYMENT REDUCTION:
DATE(S): If yes, state each
If yes, state redemption date
INTEREST ACCRUAL Annual and redemption
DATE: Percentage price:
Reduction:
INITIAL MANDATORY
REDEMPTION DATE: REDEMPTION:
The Rouse Company, a Maryland corporation (together with its
successors and assigns, the "Company"), for value received, hereby promises to
pay to ______________________, or registered assigns, the principal sum of
____________________ on the Maturity Date specified above (except to the extent
redeemed
- --------------------------
/*/ Applies only if this Note is a Registered Global Security.
<PAGE>
or repaid prior to the Maturity Date) and to pay interest thereon at
the Interest Rate per annum specified above from the Original Issue Date
specified above until the principal hereof is paid or duly made available for
payment (except as provided below), in arrears monthly, quarterly, semiannually,
or annually as specified above as the Interest Payment Period on each Interest
Payment Date (as specified above), commencing with the first Interest Payment
Date next succeeding the Original Issue Date specified above, and on the
Maturity Date (or any redemption or repayment date); provided, however, that if
-------- -------
the Original Issue Date occurs between a Record Date, as defined below, and the
next succeeding Interest Payment Date, interest payments will commence on the
second Interest Payment Date succeeding the Original Issue Date to the
registered holder of this Note on the Record Date with respect to such second
Interest Payment Date.
If this Note is a Global Security, payment of the principal of this
Note, any premium and the interest due will be made by the Company through the
Trustee to the Depositary. If this Note is not a Global Security, payment of the
principal of this Note, any premium and the interest due at the Maturity Date
(or any redemption or repayment date) will be made in immediately available
funds upon surrender of this Note at the office or agency of the Trustee or such
other paying agent as the Company may determine maintained for that purpose (a
"Paying Agent"), or at the office or agency of such other Paying Agent as the
Company may determine. If this Note is not a Global Security, payments of
interest to be made other than at the Maturity Date may be made, at the option
of the Company, by check mailed to the address of the person entitled thereto as
it appears on the security register at the close of business on the Regular
Record Date corresponding to the relevant Interest Payment Date.
Interest on this Note will accrue from the most recent Interest
Payment Date to which interest has been paid or duly provided for or, if no
interest has been paid or duly provided for, from the Original Issue Date, until
the principal hereof has been paid or duly made available for payment (except as
provided below). The interest so payable, and punctually paid or duly provided
for, on any Interest Payment Date, will, subject to certain exceptions described
herein, be paid to the person in whose name this Note (or one or more
predecessor Notes) is registered at the close of business on the date 15 days
prior to an Interest Payment Date (whether or not a Business Day) (each such
date a "Record Date"); provided, however, that interest payable on the Maturity
-------- -------
Date (or any redemption or repayment date) will be payable to the person to whom
the principal hereof shall be payable.
Payment of the principal of and premium, if any, and interest on this
Note will be made in such coin or currency of the United States as at the time
of payment is legal tender for payment of public and private debts.
-2-
<PAGE>
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee, as defined on the reverse hereof, by manual signature, this Note
shall not be entitled to any benefit under the Indenture, as defined on the
reverse hereof, or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this Note to be duly
executed under a facsimile of its corporate seal.
DATED: THE ROUSE COMPANY
[SEAL] By:__________________________
Title:
Attest:
By:_______________________________
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities issued
under the within-mentioned Indenture.
THE FIRST NATIONAL BANK OF CHICAGO, as Trustee
By:_________________________________
Authorized Officer
-3-
<PAGE>
[FORM OF REVERSE OF NOTE]
THE ROUSE COMPANY
MEDIUM-TERM NOTE
This Note is one of a duly authorized issue of Medium-Term Notes
having maturities of more than nine months from the date of issue (the "Notes")
of the Company, limited in aggregate issue price to $150,000,000. The Notes are
issuable under an indenture, dated as of ________, 1995 between the Company and
The First National Bank of Chicago (the "Trustee"), as the same may be amended
and supplemented from time to time (referred to herein as the "Indenture"), to
which Indenture reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities of the Company, the Trustee
and holders of the Notes and the terms upon which the Notes are, and are to be,
authenticated and delivered. The terms of individual Notes may vary with
respect to interest rates, interest rate formulas, issue dates, maturity dates,
or otherwise, all as provided in the Indenture. To the extent not inconsistent
herewith, the terms of the Indenture are hereby incorporated by reference
herein.
Unless otherwise provided on the face hereof in accordance with the
provisions of the following two paragraphs, this Note will not be subject to any
sinking fund and will not be redeemable or subject to repayment at the option of
the holder prior to maturity.
Unless otherwise indicated on the face of this Note, this Note may not
be redeemed prior to the Maturity Date. If the face of this Note indicates that
this Note is subject to (i) "Annual Redemption Percentage Reduction" or (ii)
"Annual Redemption Percentage Increase", then this Note may be redeemed in whole
or in part at the option of the Company on or after the Initial Redemption Date
specified on the face hereof on the terms set forth on the face hereof, together
with interest accrued and unpaid hereon to the date of redemption (except as
provided below). If this Note is subject to "Annual Redemption Percentage
Reduction", the Initial Redemption Percentage indicated on the face hereof will
be reduced on each anniversary of the Initial Redemption Date specified above by
the Annual Percentage Reduction specified on the face hereof until the
redemption price of this Note is 100% of the principal amount hereof. If this
Note is subject to "Annual Redemption Percentage Increase", the redemption
prices of this Note from time to time shall be as set forth on the face hereof.
Notice of redemption shall be mailed to the registered holders of the Notes
designated for redemption at their addresses as the same shall appear on the
Note register not less than 30 days nor more than 60 days prior to the date of
-4-
<PAGE>
redemption, subject to all the conditions and provisions of the Indenture. In
the event of redemption of this Note in part only, a new Note or Notes for the
amount of the unredeemed portion hereof shall be issued in the name of the
holder hereof upon the presentation and cancellation hereof.
Unless otherwise indicated on the face of this Note, this Note shall
not be subject to repayment at the option of the holder prior to the Maturity
Date. If so indicated on the face of this Note, this Note may be subject to
repayment at the option of the holder on the Optional Repayment Date or Dates
specified on the face hereof on the terms set forth herein. On any Optional
Repayment Date, this Note will be repayable in whole or in part in increments of
$1,000 (provided that any remaining principal amount hereof shall not be less
than the minimum authorized denomination hereof) at the option of the holder
hereof at a price equal to 100% of the principal amount to be repaid, together
with interest hereon payable to the date of repayment. For this Note to be
repaid in whole or in part at the option of the holder hereof, the Company must
receive at the corporate trust office of the Trustee, at least 30 days but not
more than 60 days prior to the repayment, (i) this Note with the form entitled
"Option to Elect Repayment" on the reverse hereof duly completed or (ii) a
telegram, facsimile transmission or a letter from a member of a national
securities exchange or a member of the National Association of Securities
Dealers, Inc. (the "NASD") or a commercial bank or trust company in the United
States which must set forth the name of the holder of this Note, the principal
amount of this Note, the principal amount of this Note to be repaid, the
certificate number or a description of the tenor and terms of this Note, a
statement that the option to elect repayment is being exercised thereby and a
guarantee that this Note to be repaid, together with the duly completed form
entitled "Option to Elect Repayment" on the reverse hereof, will be received by
the Trustee not later than the fifth Business Day after the date of such
telegram, facsimile transmission or letter; provided, that such telegram,
--------
facsimile transmission or a letter from a member of a national securities
exchange or a member of the NASD or a commercial bank or trust company in the
United States shall only be effective if in such case, this Note and form duly
completed are received by the Company by such fifth Business Day. Exercise of
such repayment option by the holder hereof shall be irrevocable. In the event
of repayment of this Note in part only, a new Note or Notes for the amount of
the unpaid portion hereof shall be issued in the name of the holder hereof upon
cancellation hereof.
Interest payments on this Note will include interest accrued to but
excluding the Interest Payment Dates or the Maturity Date (or earlier redemption
or repayment date), as the
-5-
<PAGE>
case may be. Interest payments for this Note will be computed and paid on the
basis of a 360-day year of twelve 30-day months.
In the case where the Interest Payment Date or the Maturity Date (or
any redemption or repayment date) does not fall on a Business Day, payment of
interest, premium, if any, or principal otherwise payable on such date need not
be made on such date, but may be made on the next succeeding Business Day with
the same force and effect as if made on the Interest Payment Date or on the
Maturity Date (or any redemption or repayment date), and no interest shall
accrue for the period from and after the Interest Payment Date or the Maturity
Date (or any redemption or repayment date) to such next succeeding Business Day.
This Note is unsecured and ranks pari passu with all other unsecured
---- -----
and unsubordinated indebtedness of the Company.
This Note, and any Note or Notes issued upon transfer or exchange
hereof, is issuable only in fully registered form, without coupons, in
denominations of $1,000 or any integral multiple of $1,000 in excess thereof.
If an Event of Default with respect to the Notes shall occur and be
continuing, the principal hereof may be declared due and payable in the manner
and with the effect provided in the Indenture.
If the face hereof indicates that this Note is subject to "Modified
Payment upon Acceleration," then the applicable Pricing Supplement will set
forth additional terms applicable hereto.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the holders of the Securities of any series under the
Indenture at any time by the Company and the Trustee with the consent of the
-6-
<PAGE>
holders of a majority in principal amount of the Securities at the time
Outstanding of each series to be affected. The Indenture also contains
provisions permitting the holders of a majority in principal amount of the
Securities of each series at the time Outstanding on behalf of the holders of
all Securities of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the holder of this Note shall
be conclusive and binding upon such holder and upon all future holders of this
Note and of any Note issued upon the transfer hereof or in exchange herefor or
in lieu hereof whether or not notation of such consent or waiver is made upon
this Note.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and any premium and interest
on this Note at the times, place, and rate, and in the coin or currency, herein
prescribed.
Upon any consolidation of the Company with, or merger of the Company
into, any other Person or any conveyance, transfer or lease of the properties
and assets of the Company substantially as an entirety in accordance with the
Indenture, the successor Person formed by such consolidation or into which the
Company is merged or to which such conveyance, transfer or lease is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under the Indenture with the same effect as if such successor Person
had been named as the Company herein, and thereafter, except in the case of a
lease, the predecessor Person shall be relieved of all obligations and covenants
under the Indenture and the Securities.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Note is registrable in the Note Register
of the Company, upon surrender of this Note for registration of transfer at the
office or agency of the Company in any place where the principal of and any
premium and interest on this Note are payable, duly endorsed, or accompanied by
a written instrument of transfer in form satisfactory to the Company and the
Note Registrar duly executed, by the holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Notes of like tenor, of
authorized denominations and for the same aggregate principal amount will be
issued to the designated transferee or transferees. No service charge shall be
made for any such transfer, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith.
-7-
<PAGE>
Prior to due presentment of this Note, the Company, the Trustee and
any agent of the Company or the Trustee may treat the Person in whose name this
Note is registered as the absolute owner hereof for all purposes, whether or not
this Note be overdue, and neither the Company, the Trustee nor any such agent
shall be affected by notice to the contrary.
This Note shall for all purposes be governed by, and construed in
accordance with, the laws of the State of New York.
As used herein:
(a) the term "Business Day", when used with respect to any Place of
Payment, means a day that is not a Saturday or Sunday and that is not a day on
which banking institutions are generally authorized or obligated by law or
executive order to close in that Place of Payment, the State of Maryland or the
City of New York;
(b) the term "United States" means the United States of America
(including the States and the District of Columbia), its territories and its
possessions; and
(c) all other terms used in this Note which are defined in the
Indenture and not otherwise defined herein shall have the meanings assigned to
them in the Indenture.
-8-
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM-as tenants in common
TEN ENT-as tenants by the entireties
JT TEN-as Joint tenants with right of
survivorship and not as tenants in common
UNIF GIFT MIN ACT-..........Custodian............
(Cust) (Minor)
Under Uniform Gifts to Minors Act................
(State)
Additional abbreviations may also be used though not in the above
list.
_____________________
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
[PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE]
_______________________________________!
!
!
___________________________________________________________________
___________________________________________________________________
[PLEASE PRINT OR TYPE NAME AND ADDRESS INCLUDING ZIP CODE, OR ASSIGNEE]
________________________________________________________________________________
the within Note and all rights thereunder, hereby
________________________________________________________________________________
irrevocably constituting and appointing such person attorney
________________________________________________________________________________
to transfer such Note on the books of the Company, with
________________________________________________________________________________
full power of substitution in the premises.
Dated:_____________________
NOTICE: The signature to this assignment must correspond with the name as
written upon the face of the within Note in every particular without
alteration or enlargement or any change whatsoever.
-9-
<PAGE>
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) the Company to repay the within
Note (or portion thereof specified below) pursuant to its terms at a price equal
to the principal amount thereof, together with interest to the Optional
Repayment Date, to the undersigned, at
________________________________________________________________________________
(Please print or typewrite name and address of the undersigned)
If less than the entire principal amount of the within Note is to be repaid,
specify the portion thereof (which shall be increments of $1,000) which the
holder elects to have repaid: _____________________; and specify the
denomination or denominations (which shall not be less than the minimum
authorized denomination) of the Notes to be issued to the holder for the portion
of the within Note not being repaid (in the absence of any such specification,
one such Note will be issued for the portion not being repaid):
__________________________.
Dated:____________________ _________________________________________________
NOTICE: The signature on this Option to Elect
Repayment must correspond with the name as
written upon the face of the within instrument in
every particular without alteration or
enlargement.
-10-
<PAGE>
Exhibit 4.4
[Form of Floating Rate Note]
REGISTERED REGISTERED
No. FLR- [PRINCIPAL AMOUNT]
CUSIP:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF. THIS SECURITY MAY NOT BE TRANSFERRED TO, OR REGISTERED OR
EXCHANGED FOR SECURITIES REGISTERED IN THE NAME OF, ANY PERSON OTHER THAN THE
DEPOSITARY OR A NOMINEE THEREOF AND NO SUCH TRANSFER MAY BE REGISTERED, EXCEPT
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE. EVERY SECURITY
AUTHENTICATED AND DELIVERED UPON REGISTRATION OF TRANSFER OF, OR IN EXCHANGE FOR
OR IN LIEU OF, THIS SECURITY SHALL BE A GLOBAL SECURITY SUBJECT TO THE
FOREGOING, EXCEPT IN SUCH LIMITED CIRCUMSTANCES./*/
THE ROUSE COMPANY
MEDIUM-TERM NOTE
(Floating Rate)
ORIGINAL ALTERNATIVE APPLICABILITY MINIMUM
ISSUE DATE: RATE EVENT OF ANNUAL INTEREST
SPREAD: REDEMPTION RATE:
MATURITY PERCENTAGE
DATE: SPREAD REDUCTION: INTEREST
MULTIPLIER: RESET
INTEREST If yes, DATES:
PAYMENT INTEREST state Annual
DATE(S): PAYMENT Percentage INTEREST
PERIOD: Reduction: RESET
INITIAL PERIOD:
INTEREST INITIAL APPLICABILITY
RATE: REDEMPTION OF ANNUAL APPLICABILITY
DATE: REDEMPTION OF MODIFIED
INTEREST PERCENTAGE PAYMENT UPON
ACCRUAL INITIAL INCREASE: ACCELERATION:
DATE: REDEMPTION
PERCENTAGE: If yes, If yes,
MAXIMUM state Annual state Issue
INTEREST BASE RATE: Percentage Price:
RATE: Increase:
OPTIONAL
REPAYMENT
DATE(S):
MANDATORY
REDEMPTION:
- -----------------------
/*/ Applies only if this Note is a Registered Global Security.
<PAGE>
SPREAD (PLUS
OR MINUS):
The Rouse Company, a Maryland corporation (together with its
successors and assigns, the "Company"), for value received, hereby promises to
pay to ______________________________________, or registered assigns, the
principal sum of ______________________________ on the Maturity Date specified
above (except to the extent redeemed or repaid prior to the Maturity Date) and
to pay interest thereon, from the Original Issue Date specified above at a rate
per annum equal to the Initial Interest Rate specified above until the first
Interest Reset Date next succeeding the Original Issue Date specified above, and
thereafter at a rate per annum determined in accordance with the provisions
specified on the reverse hereof until the principal hereof is paid or duly made
available for payment. The Company will pay interest in arrears monthly,
quarterly, semiannually or annually as specified above as the Interest Payment
Period on each Interest Payment Date (as specified above), commencing with the
first Interest Payment Date next succeeding the Original Issue Date specified
above, and on the Maturity Date (or any redemption or repayment date); provided,
--------
however, that if the Original Issue Date occurs between a Record Date, as
- -------
defined below, and the next succeeding Interest Payment Date, interest payments
will commence on the second Interest Payment Date succeeding the Original Issue
Date to the registered holder of this Note on the Record Date with respect to
such second Interest Payment Date; and provided, further, that if an Interest
-------- -------
Payment Date or the Maturity Date or redemption or repayment date would fall on
a day that is not a Business Day (this and certain other capitalized terms used
herein are defined on the reverse of this Note), the required payment of
principal, premium, if any, or interest otherwise payable on such date need not
be made on such date, but may be made on the next succeeding Business Day, and
no interest shall accrue for the period from and after such Interest Payment
Date, Maturity Date or redemption or repayment date to such next succeeding
Business Day.
If this Note is a Global Security, payment of the principal of this Note,
any premium and the interest due will be made by the Company through the Trustee
to the Depositary. If this Note is not a Global Security, payment of the
principal of this Note, any premium and the interest due at the Maturity Date
(or any redemption or repayment date) will be made in immediately available
funds upon surrender of this Note at the office or agency of the Trustee, or of
such other paying agent as the Company may
<PAGE>
determine maintained for that purpose (a "Paying Agent"), or at the office or
agency of such other Paying Agent as the Company may determine. If this Note is
not a Global Security, payments of interest to be made other than at the
Maturity Date may be made, at the option of the Company, by check mailed to the
address of the person entitled thereto as it appears on the security register at
the close of business on the Regular Record Date corresponding to the relevant
Interest Payment Date.
Interest on this Note will accrue from the most recent Interest
Payment Date to which interest has been paid or duly provided for or, if no
interest has been paid or duly provided for, from the Original Issue Date, until
the principal hereof has been paid or duly made available for payment (except as
provided below). The interest so payable, and punctually paid or duly provided
for, on any Interest Payment Date, will, subject to certain exceptions described
herein, be paid to the person in whose name this Note (or one or more
predecessor Notes) is registered at the close of business on the date 15 days
prior to a n Interest Payment Date (whether or not a Business Day) (the "Record
Date"); provided, however, that interest payable on the Maturity Date (or any
-------- -------
redemption or repayment date) will be payable to the person to whom the
principal hereof shall be payable.
Payment of the principal of and premium, if any, and interest on this
Note will be made in such coin or currency of the United States as at the time
of payment is legal tender for payment of public and private debts.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee, as defined on the reverse hereof, by manual signature, this Note
shall not be entitled to any benefit under the Indenture, as defined on the
reverse hereof, or be valid or obligatory for any purpose.
-3-
<PAGE>
IN WITNESS WHEREOF, the Company has caused this Note to be duly
executed under a facsimile of its corporate seal.
DATED: THE ROUSE COMPANY
[SEAL] By__________________________
Title:
Attest:
By__________________________
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities issued
under the within-mentioned Indenture.
THE FIRST NATIONAL BANK OF CHICAGO, as Trustee
By:___________________________
Authorized Officer
-4-
<PAGE>
[FORM OF REVERSE OF NOTE]
THE ROUSE COMPANY
MEDIUM-TERM NOTE
This Note is one of a duly authorized issue of Medium-Term Notes,
having maturities of more than nine months from the date of issue (the "Notes")
of the Company, limited in aggregate issue price to $150,000,000. The Notes are
issuable under an indenture, dated as of _____________, 1995 between the Company
and The First National Bank of Chicago (the "Trustee"), as the same may be
amended and supplemented from time to time (referred to herein as the
"Indenture"), to which Indenture reference is hereby made for a statement of the
respective rights, limitations of rights, duties and immunities of the Company,
the Trustee and holders of the Notes and the terms upon which the Notes are, and
are to be, authenticated and delivered. The First National Bank of Chicago has
also been appointed Calculation Agent (the "Calculation Agent", which term
includes any successor calculation agent) with respect to the Notes. The terms
of individual Notes may vary with respect to interest rates, interest rate
formulas, issue dates, maturity dates, or otherwise, all as provided in the
Indenture. To the extent not inconsistent herewith, the terms of the Indenture
are hereby incorporated by reference herein.
Unless otherwise provided on the face hereof in accordance with the
provisions of the following two paragraphs, this Note will not be subject to any
sinking fund and will not be redeemable or subject to repayment at the option of
the holder prior to maturity.
Unless otherwise indicated on the face of this Note, this Note may not
be redeemed prior to the Maturity Date. If the face of this Note indicates that
this Note is subject to (i) "Annual Redemption Percentage Reduction" or (ii)
"Annual Redemption Percentage Increase", then this Note may be redeemed in whole
or in part at the option of the Company on or after the Initial Redemption Date
specified on the face hereof on the terms set forth on the face hereof, together
with interest accrued and unpaid hereon to the date of redemption (except as
provided below). If this Note is subject to "Annual Redemption Percentage
Reduction", the Initial Redemption Percentage indicated on the face hereof will
be reduced on each anniversary of the Initial Redemption Date specified above by
the Annual Percentage Reduction specified on the face hereof until the
redemption price of
-5-
<PAGE>
this Note is 100% of the principal amount hereof. If this Note is subject to
"Annual Redemption Percentage Increase", the redemption prices of this Note from
time to time shall be as set forth on the face hereof. Notice of redemption
shall be mailed to the registered holders of the Notes designated for redemption
at their addresses as the same shall appear on the Note register not less than
30 days nor more than 60 days prior to the date or redemption, subject to all
the conditions and provisions of the Indenture. In the event of redemption of
this Note in part only, a new Note or Notes for the amount of the unredeemed
portion hereof shall be issued in the name of the holder hereof upon the
presentation and cancellation hereof.
Unless otherwise indicated on the face of this Note, this Note shall
not be subject to repayment at the option of the holder prior to the Maturity
Date. If so indicated on the face of this Note, this Note may be subject to
repayment at the option of the holder on the Optional Repayment Date or Dates
specified on the face hereof on the terms set forth herein. On any Optional
Repayment Date, this Note will be repayable in whole or in part in increments of
$1,000 (provided that any remaining principal amount hereof shall not be less
than the minimum authorized denomination hereof) at the option of the holder
hereof at a price equal to 100% of the principal amount to be repaid, together
with interest hereon payable to the date of repayment. For this Note to be
repaid in whole or in part at the option of the holder hereof, the Company must
receive at the corporate trust office of the Trustee, at least 30 days but not
more than 60 days prior to the repayment, (i) this Note with the form entitled
"Option to Elect Repayment" on the reverse hereof duly completed or (ii) a
telegram, facsimile transmission or a letter from a member of a national
securities exchange or a member of the National Association of Securities
Dealers, Inc. (the "NASD") or a commercial bank or trust company in the United
States which must set forth the name of the holder of this Note, the principal
amount of this Note, the principal amount of this Note to be repaid, the
certificate number or a description of the tenor and terms of this Note, a
statement that the option to elect repayment is being exercised thereby and a
guarantee that this Note to be repaid, together with the duly completed form
entitled "Option to Elect Repayment" on the reverse hereof, will be received by
the Truste e not later than the fifth Business Day after the date of such
telegram, facsimile transmission or letter; provided, that such telegram,
--------
facsimile transmission or a letter from a member of a national securities
exchange or a member of the NASD or a
-6-
<PAGE>
commercial bank or trust company in the United States shall only be effective if
in such case, this Note and form duly completed are received by the Company by
such fifth Business Day. Exercise of such repayment option by the holder hereof
shall be irrevocable. In the event of repayment of this Note in part only, a new
Note or Notes for the amount of the unpaid portion hereof shall be issued in the
name of the holder hereof upon cancellation hereof.
This Note will bear interest at the rate determined in accordance with
the applicable provisions below by reference to the Base Rate shown on the face
hereof based on the Index Maturity, if any, shown on the face hereof (i) plus or
minus the Spread, if any, and/or (ii) multiplied by the Spread Multiplier, if
any, specified on the face hereof. Commencing with the first Interest Reset
Date next succeeding the Original Issue Date specified on the face hereof, the
rate at which interest on this Note is payable shall be reset as of each
Interest Reset Date. The Interest Reset Dates will be the Interest Reset Dates
specified on the face hereof; provided, however, that (i) the interest rate in
-------- -------
effect for the period from the Original Issue Date to the first Interest Reset
Date next succeeding the Original Issue Date specified on the face hereof will
be the Initial Interest Rate, (ii) except in the case of Floating Rate Notes
which are reset daily or weekly, the interest rate in effect hereon for the ten
calendar days immediately prior to the Maturity Date hereof (or, with respect to
any principal amount to be redeemed or repaid, any redemption or repayment date)
shall be that in effect on the tenth calendar day preceding the Maturity Date
hereof or such date of redemption or repayment, as the case may be and (iii) in
the case of Floating Rate Notes which are reset daily or weekly, the interest
rate in effect for the period beginning on the second Business Day immediately
prior to the Maturity Date or the date of redemption or repayment and ending on
such Maturity Date or date of redemption or repayment, as the case may be, will
be that in effect on the second Business Day preceding such Maturity Date or
date of redemption or repayment, as the case may be. If any Interest Reset Date
would otherwise be a day that is not a Business Day, such Interest Reset Date
shall be postponed to the next succeeding day that is a Business Day, except
that in the case of a LIBOR Note, if such Business Day is in the next succeeding
calendar month, such Interest Reset Date shall be the immediately preceding
Business Day.
The Interest Determination Date pertaining to an Interest Reset Date
for Notes bearing interest calculated by
-7-
<PAGE>
reference to the CD Rate, Commercial Paper Rate, Federal Funds Rate and Prime
Rate will be the second Business Day next preceding such Interest Reset Date.
The Interest Determination Date pertaining to an Interest Reset Date for Notes
bearing interest calculated by reference to LIBOR shall be the second London
Banking Day preceding such Interest Reset Date. The Interest Determination Date
pertaining to an Interest Reset Date for Notes bearing interest calculated by
reference to the Treasury Rate shall be the day of the week in which such
Interest Reset Date falls on which Treasury bills normally would be auctioned;
provided, however, that if as a result of a legal holiday an auction is held
- -------- -------
on the Friday of the week preceding such Interest Reset Date, the related
Interest Determination Date shall be such preceding Friday; and provided,
--------
further, that if an auction shall fall on any Interest Reset Date, then the
- -------
Interest Reset Date shall instead be the first Business Day following the date
of such auction.
The "Calculation Date" pertaining to any Interest Determination Date
will be the earlier of (i) the tenth calendar day after such Interest
Determination Date (or, if such day is not a Business Day, the next succeeding
Business Day) or (ii) the Business Day immediately preceding the applicable
Interest Payment Date.
Determination of CD Rate. If the Base Rate specified on the face
------------------------
hereof is the CD Rate, the CD Rate with respect to this Note shall be determined
on each Interest Determination Date and shall be the rate on such date for
negotiable certificates of deposit having the Index Maturity specified on the
face hereof as published by the Board of Governors of the Federal Reserve System
in "Statistical Release H.15(519), Selected Interest Rates," or any successor
publication of the Board of Governors of the Federal Reserve System
("H.15(519)"), under the heading "CDs (Secondary Market)," or, if not so
published by 9:00 A.M., New York City time, on the Calculation Date pertaining
to such Interest Determination Date, the CD Rate will be the rate on such
Interest Determination Date for negotiable certificates of deposit of the Index
Maturity specified on the face hereof as published by the Federal Reserve Bank
of New York in its daily statistical release "Composite 3:30 P.M. Quotations for
U.S. Government Securities" ("Composite Quotations") under the heading
"Certificates of Deposit." If neither of such rates is published by 3:00 P.M.,
New York City time, on such Calculation Date, then the CD Rate on such Interest
Determination Date will be calculated by the Calculation Agent referred to on
the face hereof and will be the
-8-
<PAGE>
arithmetic mean of the secondary market offered rates as of 10:00 A.M., New York
City time, on such Interest Determination Date, for certificates of deposit in
the denomination of $5,000,000 with a remaining maturity closest to the Index
Maturity specified on the face hereof of three leading non-bank dealers in
negotiable U.S. dollar certificates of deposit in The City of New York selected
by the Calculation Agent for negotiable certificates of deposit of major United
States money center banks of the highest credit standing in the market for
negotiable certificates of deposit; provided, however, that if the dealers
-------- -------
selected as aforesaid by the Calculation Agent are not quoting as mentioned in
this sentence, the rate of interest in effect for the applicable period will be
the same as the CD Rate for the immediately preceding Interest Reset Period (or,
if there was no such Interest Reset Period, the rate of interest payable hereon
shall be the Initial Interest Rate).
Determination of Commercial Paper Rate. If the Base Rate specified on
--------------------------------------
the face hereof is the Commercial Paper Rate, the Commercial Paper Rate with
respect to this Note shall be determined on each Interest Determination Date and
shall be the Money Market Yield (as defined herein) of the rate on such date for
commercial paper having the Index Maturity specified on the face hereof, as such
rate shall be published in H.15(519) under the heading "Commercial Paper," or if
not so published prior to 9:00 A.M., New York City time, on the Calculation Date
pertaining to such Interest Determination Date, the Commercial Paper Rate shall
be the Money Market yield of the rate on such Interest Determination Date for
commercial paper of the Index Maturity specified on the face hereof as published
in Composite Quotations under the heading "Commercial Paper." If neither of
such rates is published by 3:00 P.M., New York City time, on such Calculation
Date, then the Commercial Paper Rate shall be the Money Market Yield of the
arithmetic mean of the offered rates as of 11:00 A.M., New York City time, on
such Interest Determination Date of three leading dealers in commercial paper in
The City of New York selected by the Calculation Agent for commercial paper of
the Index Maturity specified on the face hereof, placed for an industrial issuer
whose bond rating is "AA," or the equivalent, from a nationally recognized
rating agency: provided, however, that if the dealers selected as aforesaid by
-------- -------
the Calculation Agent are not quoting as mentioned in this sentence, the rate of
interest in effect for the applicable period will be the same as the Commercial
Paper Rate for the immediately preceding Interest Reset Period (or, if there was
no such Interest
-9-
<PAGE>
Reset Period, the rate of interest payable hereon shall be the Initial Interest
Rate).
"Money Market Yield" shall be the yield calculated in accordance with
the following formula:
Money ~ Market ~ Yield ~ = ~ {D ~ x ~ 360} over {360 ~ - ~ (D ~ x ~ M)} ~ x ~
100
where "D" refers to the applicable per annum rate for commercial paper quoted on
a bank discount basis and expressed as a decimal and "M" refers to the actual
number of days in the interest period for which interest is being calculated.
Determination of Federal Funds Rate. If the Base Rate specified on
-----------------------------------
the face hereof is the Federal Funds Rate, the Federal Funds Rate with respect
to this Note shall be determined on each Interest Determination Date and shall
be the rate on such date for Federal Funds as published in H.15(519) under the
heading "Federal Funds (Effective)," or, if not so published by 9:00 A.M., New
York City time, on the Calculation Date pertaining to such Interest
Determination Date, the Federal Funds Rate will be the rate on such Interest
Determination Date as published in Composite Quotations under the heading
"Federal Funds/Effective Rate." If neither of such rates is published by 3:00
P.M., New York City time, on such Calculation Date, the Federal Funds Rate for
such Interest Determination Date will be calculated by the Calculation Agent and
will be the arithmetic mean of the rates for the last transaction in overnight
Federal funds as of 11:00 A.M., New York City time, on such Interest
Determination Date arranged by three leading brokers in Federal funds
transactions in The City of New York selected by the Calculation Agent;
provided, however, that if the brokers selected as aforesaid by the Calculation
- -------- -------
Agent are not quoting as mentioned in this sentence, the rate of interest in
effect for the applicable period will be the same as the Federal Funds Rate for
the immediately preceding Interest Reset Period (or, if there was no such
Interest Reset Period, the rate of interest payable hereon shall be the Initial
Interest Rate).
Determination of LIBOR. If the Base Rate specified on the face hereof
----------------------
is LIBOR, LIBOR with respect to this Note shall be determined on each Interest
Determination Date as follows:
-10-
<PAGE>
(a) LIBOR will be, as specified on the face of this Note, either (i)
the arithmetic mean of the offered rates for deposits in U.S. dollars
having the Index Maturity designated on the face of this Note, commencing
on the second London Business Day immediately following that Interest
Determination Date, that appear on the Reuters Screen LIBO Page as of 11:00
a.m., London time, on that Interest Determination Date, if at least two
such offered rates appear on the Reuters Screen LIBO Page ("LIBOR Reuters")
or (ii) the rate for deposits in U.S. dollars having the Index Maturity
designated on the face of this Note, commencing on the second London
Business Day immediately following that Interest Determination Date, that
appears on the Telerate Page 3750 as of 11:00 a.m., London time, on that
Interest Determination Date ("LIBOR Telerate"). "Reuters Screen LIBO Page"
means the display designated as page "LIBO" on the Reuters Monitor Money
Rates Service (or such other page as may replace the LIBO page on that
service for the purpose of displaying London interbank offered rates of
major banks). "Telerate Page 3750" means the display designated as page
"3750" on the Telerate Service (or such other page as may replace the 3750
page on that service or such other service or services as may be nominated
by the British Bankers' Association for the purpose of displaying London
interbank offered rates for U.S. dollar deposits). If neither LIBOR Reuters
nor LIBOR Telerate is specified on the face of this Note, LIBOR will be
determined as if LIBOR Telerate had been specified. If fewer than two
offered rates appear on the Reuters Screen LIBO Page, or if no rate appears
on the Telerate Page 3750, as applicable, LIBOR in respect of that Interest
Determination Date will be determined as if the parties had specified the
rate described in (b) below.
(b) With respect to an Interest Determination Date on which fewer than
two offered rates appear on the Reuters Screen LIBO Page, as specified in
(a)(i) above, or on which no rate appears on Telerate Page 3750, as
specified in (a)(ii) above, as applicable, LIBOR will be determined on the
basis of the rates at which deposits in U.S. dollars having the Index
Maturity designated on the face of this Note are offered at approximately
11:00 a.m., London time, on that Interest Determination Date by four major
banks in the London interbank market selected by the Calculation Agent (the
"LIBOR Reference Banks") to prime banks in the London interbank market
commencing on the second London Business Day immediately
-11-
<PAGE>
following that Interest Determination Date and in a principal amount equal
to an amount of not less than $1,000,000 that is representative of a single
transaction in such market at such time. The Calculation Agent will request
the principal London office of each of the LIBOR Reference Banks to provide
a quotation of its rate. If at least two such quotations are provided,
LIBOR in respect of that Interest Determination Date will be the arithmetic
mean of such quotations. If fewer than two quotations are provided, LIBOR
in respect of that Interest Determination Date will be the arithmetic mean
of the rates quoted at approximately 11:00 a.m., New York City time, on
that Interest Determination Date by three major banks in The City of New
York selected by the Calculation Agent for loans in U.S. dollars to leading
European banks having the Index Maturity designated on the face of this
Note commencing on the second London Business Day immediately following
that Interest Determination Date and in a principal amount equal to an
amount of not less than $1,000,000 that is representative of a single
transaction in such market at such time; provided, however, that if the
-------- -------
banks selected as aforesaid by the Calculation Agent are not quoting as
mentioned in this sentence, LIBOR with respect to such Interest
Determination Date will be the rate of LIBOR in effect on such date.
Determination of Prime Rate. If the Base Rate specified on the face
---------------------------
hereof is the Prime Rate, the Prime Rate with respect to this Note shall be
determined on each Interest Determination Date and shall be the rate set forth
in H.15(519) for such date opposite the caption "Bank Prime Loan." If such rate
is not yet published by 9:00 A.M., New York City time, on the Calculation Date,
the Prime Rate for such Interest Determination Date will be the arithmetic mean
of the rates of interest publicly announced by each bank named on the display
designated as page "NYMF" on the Reuters Monitor Money Rate Service (or such
other page as may replace the NYMF page on such service for the purpose of
displaying the prime rate or base lending rate of major New York City banks)
(the "Reuters Screen NYMF Page") as such bank's prime rate or base lending rate
as in effect for such Interest Determination Date as quoted on the Reuters
Screen NYMF Page on such Interest Determination Date, or, if fewer than four
such rates appear on the Reuters Screen NYMF Page for such Interest
Determination Date, the rate shall be the arithmetic mean of the prime rates
quoted on the basis of the actual number of days in the year divided by 360 as
of the close of
-12-
<PAGE>
business on such Interest Determination Date by at least two of the three major
money center banks in The City of New York selected by the Calculation Agent
from which quotations are requested. If fewer than two quotations are provided,
the Prime Rate shall be calculated by the Calculation Agent and shall be
determined as the arithmetic mean on the basis of the prime rates in The City of
New York by the appropriate number of substitute banks or trust companies
organized and doing business under the laws of the United States, or any State
thereof, in each case having total equity capital of at least U.S.$500 million
and being subject to supervision or examination by Federal or State authority,
selected by the Calculation Agent to quote such rate or rates.
If in any month or two consecutive months the Prime Rate is not
published in H.15(519) and the banks or trust companies selected as aforesaid
are not quoting as mentioned in the preceding paragraph, the "Prime Rate" for
such Interest Reset Period will be the same as the Prime Rate for the
immediately preceding Interest Reset Period (or, if there was no such Interest
Reset Period, the rate of interest payable hereon shall be the Initial Interest
Rate). If this failure continues over three or more consecutive months, the
Prime Rate for each succeeding Interest Determination Date until the maturity or
redemption of this Note or, if earlier, until this failure ceases, shall be
LIBOR determined as if the Base Rate specified on the face hereof were LIBOR,
and the Spread, if any, shall be the number of basis points specified on the
face hereof as the "Alternate Rate Event Spread."
Determination of Treasury Rate. If the Base Rate specified on the
------------------------------
face hereof is the Treasury Rate, the Treasury Rate with respect to this Note
shall be determined on each Interest Determination Date and shall be the rate
for the auction held on such date of direct obligations of the United States
("Treasury Bills") having the Index Maturity specified on the face hereof, as
published in H.15(519) under the heading "Treasury Bills--auction average
(investment)," or if not so published by 9:00 A.M., New York City time, on the
Calculation Date pertaining to such Interest Determination Date, the auction
average rate on such Interest Determination Date (expressed as a bond
equivalent, on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis) as otherwise announced by the United States Department
of the Treasury. In the event that the results of the auction of Treasury Bills
having the Index Maturity specified on the face hereof are not published or
reported as provided above by 3:00 P.M., New York City time,
-13-
<PAGE>
on such Calculation Date or if no such auction is held on such Interest
Determination Date, then the Treasury Rate shall be calculated by the
Calculation Agent and shall be a yield to maturity (expressed as a bond
equivalent, on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis) of the arithmetic mean of the secondary market bid
rates, as of approximately 3:30 P.M., New York City time, on such Interest
Determination Date, of three leading primary United States government securities
dealers selected by the Calculation Agent for the issue of Treasury Bills with a
remaining maturity closest to the Index Maturity specified on the face hereof;
provided, however, that if the dealers selected as aforesaid by the Calculation
- -------- -------
Agent are not quoting as mentioned in this sentence, the Treasury Rate for such
Interest Reset Date will be the same as the Treasury Rate for the immediately
preceding Interest Reset Period (or, if there was no such Interest Reset Period,
the rate of interest payable hereon shall be the Initial Interest Rate).
Notwithstanding the foregoing, the interest rate hereon shall not be
greater than the Maximum Interest Rate, if any, or less than the Minimum
Interest Rate, if any, specified on the face hereof. The Calculation Agent
shall calculate the interest rate hereon in accordance with the foregoing on or
before each Calculation Date. The interest rate on this Note will in no event
be higher than the maximum rate permitted by New York law, as the same may be
modified by United States Federal law of general application.
At the request of the holder hereof, the Calculation Agent will
provide to the holder hereof the interest rate hereon then in effect and, if
determined, the interest rate that will become effective as of the next Interest
Reset Date.
Interest payments on this Note will include interest accrued to but
excluding the Interest Payment Dates or the Maturity Date (or earlier redemption
or repayment date), as the case may be; provided, however, that if the Interest
-------- -------
Reset Period with respect to this Note is daily or weekly, interest payable on
any Interest Payment Date, other than interest payable on any date on which
principal hereof is payable, will include interest accrued through and including
the Record Date next preceding the applicable Interest Payment Date. Accrued
interest hereon shall be an amount calculated by multiplying the face amount
hereof by an accrued interest factor. Such accrued interest factor shall be
computed by adding the interest factor calculated for each
-14-
<PAGE>
day in the period for which interest is being paid. The interest factor for each
such date shall be computed by dividing the interest rate applicable to such day
by 360 if the Base Rate is the CD Rate, Commercial Paper Rate, Federal Funds
Rate, Prime Rate or LIBOR, as specified on the face hereof, or by the actual
number of days in the year if the Base Rate is the Treasury Rate, as specified
on the face hereof. All percentages resulting from any calculation of the rate
of interest on this Note will be rounded, if necessary, to the nearest one
hundred-thousandth of a percentage point (.0000001), with five one-millionths of
a percentage point rounded upward, and all dollar amounts used in or resulting
from such calculation on this Note will be rounded to the nearest cent (with
one-half cent rounded upward). The interest rate in effect on any Interest Reset
Date will be the applicable rate as reset on such date. The interest rate
applicable to any other day is the interest rate from the immediately preceding
Interest Reset Date (or, if none, the Initial Interest Rate).
This Note is unsecured and ranks pari passu with all other unsecured
---- -----
and unsubordinated indebtedness of the Company.
This Note, and any Note or Notes issued upon transfer or exchange
hereof, is issuable only in fully registered form, without coupons, in
denominations of $1,000 or any integral multiple of $1,000 in excess thereof.
If an Event of Default with respect to the Notes shall occur and be
continuing, the principal hereof may be declared due and payable in the manner
and with the effect provided in the Indenture.
If the face hereof indicates that this Note is subject to "Modified
Payment upon Acceleration," then the applicable Pricing Supplement will set
forth additional terms applicable hereto.
-15-
<PAGE>
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the holders of the Securities of any series under the
Indenture at any time by the Company and the Trustee with the consent of the
holders of a majority in principal amount of the Securities at the time
Outstanding of each series to be affected. The Indenture also contains
provisions permitting the holders of a majority in principal amount of the
Securities of each series at the time Outstanding on behalf of the holders of
all Securities of such series to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the holder of this Note shall
be conclusive and binding upon such holder and upon all future holders of this
Note and of any Note issued upon the transfer hereof or in exchange herefor or
in lieu hereof whether or not notation of such consent or waiver is made upon
this Note.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and any premium and interest
on this Note at the times, place, and rate, and in the coin or currency, herein
prescribed.
Upon any consolidation of the Company with, or merger of the Company
into, any other Person or any conveyance, transfer or lease of the properties
and assets of the Company substantially as an entirety in accordance with the
Indenture, the successor Person formed by such consolidation or into which the
Company is merged or to which such conveyance, transfer or lease is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under the Indenture with the same effect as if such successor Person
had been named as the Company herein, and thereafter, except in the case of a
lease, the predecessor Person shall be relieved of all obligations and covenants
under the Indenture and the Securities.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Note is registrable in the Note register
of the Company, upon
-16-
<PAGE>
surrender of this Note for registration of transfer at the office or agency of
the Company in any place where the principal of and any premium and interest on
this Note are payable, duly endorsed, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Note registrar duly
executed, by the holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Notes of like tenor, of authorized denominations and
for the same aggregate principal amount will be issued to the designated
transferee or transferees. No service charge shall be made for any such
transfer, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Note, the Company, the Trustee and
any agent of the Company or the Trustee may treat the Person in whose name this
Note is registered as the absolute owner hereof for all purposes, whether or not
this Note be overdue, and neither the Company, the Trustee nor any such agent
shall be affected by notice to the contrary.
This Note shall for all purposes be governed by, and construed in
accordance with, the laws of the State of New York.
As used herein:
(a) the term "Business Day," when used with respect to any Place of
Payment, means a day that is not a Saturday or Sunday and that is not a day on
which banking institutions are generally authorized or obligated by law or
executive order to close in that Place of Payment, the State of Maryland or the
City of New York;
(b) the term "London Banking Day" means any day on which dealings in
deposits U.S. dollars are transacted in the London interbank market;
-17-
<PAGE>
(c) the term "United States" means the United States of America
(including the States and the District of Columbia), its territories and its
possessions; and
(d) all other terms used in this Note which are defined in the
Indenture and not otherwise defined herein shall have the meanings assigned to
them in the Indenture.
-18-
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM-as tenants in common
TEN ENT-as tenants by the entireties
JT TEN-as Joint tenants with right of
survivorship and not as tenants in common
UNIF GIFT MIN ACT-..........Custodian...............
(Cust) (Minor)
Under Uniform Gifts to Minors Act..................
(State)
Additional abbreviations may also be used though not in the above
list.
_____________________
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
[PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE]
_______________________________________!
!
_______________________________________!
________________________________________________________________________
[PLEASE PRINT OR TYPE NAME AND ADDRESS INCLUDING ZIP CODE, OR ASSIGNEE]
________________________________________________________________________
the within Note and all rights thereunder, hereby
________________________________________________________________________
irrevocably constituting and appointing such person attorney
________________________________________________________________________
to transfer such Note on the books of the Company, with
________________________________________________________________________
full power of substitution in the premises.
Dated:_____________________
NOTICE: The signature to this assignment must correspond with the name as
written upon the face of the within Note in every particular without
alteration or enlargement or any change whatsoever.
-19-
<PAGE>
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) the Company to repay the within
Note (or portion thereof specified below) pursuant to its terms at a price equal
to the principal amount thereof, together with interest to the Optional
Repayment Date, to the undersigned, at
________________________________________________________________________
(Please print or typewrite name and address of the undersigned)
If less than the entire principal amount of the within Note is to be repaid,
specify the portion thereof (which shall be increments of $1,000) which the
holder elects to have repaid: _____________________; and specify the
denomination or denominations (which shall not be less than the minimum
authorized denomination) of the Notes to be issued to the holder for the portion
of the within Note not being repaid (in the absence of any such specification,
one such Note will be issued for the portion not being repaid):
_____________________________________.
Dated:_______________________________ ____________________________________
NOTICE: The signature on this Option
to Elect Repayment must correspond
with the name as written upon the
face of the within instrument in
every particular without alteration
or enlargement.
-20-
<PAGE>
EXHIBIT 5.1
February 9, 1995
The Rouse Company
10275 Little Patuxent Parkway
Columbia, Maryland 21044
Ladies and Gentlemen:
We are acting as special counsel to The Rouse Company, a Maryland
corporation (the "Company"), in connection with the preparation of a
Registration Statement on Form S-3 (File No: 33-57347) (together with any
amendments thereto, the "Registration Statement") under the Securities Act of
1933, as amended (the "Securities Act"), covering U. S. $150,000,000
aggregate issue amount of debt securities (the "Securities") to be issued
from time to time by the Company. Capitalized terms used herein have the
meanings set forth in the Registration Statement, unless otherwise defined
herein.
We have examined the originals, or certified, conformed or reproduction
copies, of all such records, agreements, instruments and documents as we have
deemed relevant or necessary as the basis for the opinion hereinafter
expressed. In all such examinations, we have assumed the genuineness of all
signatures and the conformity to original or certified copies of all copies
submitted to us as conformed or reproduction copies. As to various questions
of fact relevant to such opinion, we have relied upon, and assumed the
accuracy of, certificates and oral or written statements and other
information of or from public officials, officers or representatives of the
Company and others.
Based upon the foregoing and subject to the limitations set forth herein,
we are of the opinion that, when the Registration Statement has become
effective under the Securities Act, the terms of the Securities and their
issue and sale have been duly established in conformity with the Indenture so
as not to violate any applicable law or agreement or instrument then binding
on the Company and the Securities have been duly executed and authenticated
in accordance with the terms of the Indenture and issued and sold as
contemplated in the Registration Statement, the Securities will constitute
valid and binding obligations of the Company, subject to (i) bankruptcy,
insolvency, reorganization, fraudulent transfer, moratorium or other laws now
or hereafter in effect affecting creditors' rights generally, and (ii)
general principles of equity (including, without limitation, standards of
materiality, good faith, fair dealing and reasonableness) whether considered
in a proceeding in equity or at law.
We note that, as of the date of this opinion, in the case of a Security
denominated in a foreign currency, a state court in the State of New York
rendering a judgment on such Security would be required under Section 27 of
the New York Judiciary Law to render such judgment in the foreign currency in
which the Security is denominated, and such judgment would be converted into
United States dollars at the exchange rate prevailing on the date of entry of
the judgment.
This opinion is expressly limited to the laws of the State of New York. In
so far as our opinion involves the laws of the State of Maryland, we have
relied with your consent solely on the opinion of Richard G. McCauley, Esq.,
general counsel of the Company, addressed to us of even date herewith, a copy
of which is attached hereto. To the extent that such opinion contains
conditions and limitations, we are incorporating such conditions and
limitations herein.
<PAGE>
Page 2
February 9, 1995
The Rouse Company
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the references to this firm under the caption
"Legal Matters" in the Prospectus and the caption "Validity of the Notes" in
any Prospectus Supplement forming a part of the Registration Statement. In
giving these consents, we do not hereby admit that we are in the category of
persons whose consent is required under Section 7 of the Securities Act.
The opinions expressed herein are solely for the benefit of The Rouse
Company.
Very truly yours,
FRIED, FRANK, HARRIS, SHRIVER & JACOBSON
By: /s/ Timothy E. Peterson
-----------------------------------
Timothy E. Peterson
:pdg
<PAGE>
February 9, 1995
The Rouse Company
10275 Little Patuxent Parkway
Columbia, Maryland 21044-3456
Fried, Frank, Harris,
Shriver & Jacobson
One New York Plaza
New York, New York 10004
Ladies and Gentlemen:
I have acted as counsel for The Rouse Company, a Maryland corporation (the
"Company"), in connection with the preparation of the Registration Statement on
Form S-3 (No. 33-57347)(together with any amendments thereto, the "Registration
Statement") which was filed by the Company under the Securities Act of 1933 (the
"Act"), covering U.S. $150,000,000 aggregate issue price of debt securities (the
"Securities") to be issued from time to time by the Company. Capitalized terms
used herein have the meanings specified in the Registration Statement, unless
otherwise defined herein.
In that capacity, I have examined the originals, or certified, conformed or
reproduction copies, of the Articles of Incorporation of the Company, as amended
and restated, the Bylaws of the Company, as amended, and all corporate
proceedings, records, agreements, instruments and documents, and such statutory,
constitutional and other material as I have deemed relevant or necessary as the
basis for the opinions hereinafter expressed. In connection therewith, I have
assumed the genuineness of all signatures on original or certified copies and
the conformity to original or certified copies of all copies submitted to me as
conformed or reproduction copies. As to various questions of fact relevant to
such opinions, I have relied upon certificates and statements of public
officials and officers or representatives of the Company and others.
Based upon the foregoing, and subject to the limitations set forth herein,
I am of the opinion that:
1. The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Maryland.
<PAGE>
The Rouse Company
Fried, Frank, Harris
Shriver & Jacobson -2- February 9, 1995
2. The Company has all the requisite corporate power and authority to enter
into the Indenture and to issue the Securities and to perform its obligations
thereunder.
3. Execution and delivery of the Indenture and the Securities have been
duly authorized by the Company.
I wish to advise you that I am a member of the Maryland Bar and accordingly
limit the opinions expressed herein to matters of the laws of the State of
Maryland.
I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the references to my opinion under the caption
"Legal Matters" in the Prospectus and the caption "Validity of the Notes" in any
Prospectus Supplement forming a part of the Registration Statement. I hereby
also consent to the reliance of this opinion by Fried, Frank, Harris, Shriver &
Jacobson. Except as specifically provided above, this opinion may not be quoted
or relied upon by any other person without my prior consent.
Very truly yours,
/s/ Richard G. McCauley
Richard G. McCauley
RGM/pdg
<PAGE>
Exhibit 12.1
THE ROUSE COMPANY AND SUBSIDIARIES
Computation of Ratio of Earnings to Fixed Charges
(dollars in thousands)
<TABLE>
<CAPTION>
Nine months ended
September 30, Year ended December 31,
------------------- ----------------------------------------------------
1994 1993 1993 1992 1991 1990 1989
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings (loss) before income taxes, extraordinary
loss and cumulative effect of change in accounting
principle............................................. $ 6,377 $ 2,118 $ 3,072 $(20,783) $ 5,245 $ 257 $ 17,831
Fixed charges:
Interest costs........................................ 163,786 165,227 219,705 221,907 219,538 200,469 175,740
Capitalized interest.................................. (5,033) (7,244) (8,899) (15,098) (21,243) (29,947) (23,283)
Amortization of debt issuance costs................... 1,581 2,293 2,801 3,571 3,173 2,833 2,298
Portion of rental expense representative of
interest factor(1).................................... 11,055 14,136 15,988 14,739 15,265 12,465 12,517
Support for debt service costs provided to
affiliates accounted for under the equity method...... 0 23 31 389 1,106 2,081 1,005
Adjustments to earnings (loss):
Minority interest in earnings of majority-owned
subsidiaries having fixed charges..................... 1,530 1,344 1,909 1,747 2,118 1,698 1,691
Undistributed earnings of less than 50%-owned
subsidiaries.......................................... (121) (51) (68) (84) (540) (222) (371)
Previously capitalized interest amortized into earnings:
Depreciation of operating properties(2)............... 2,752 2,704 3,605 3,474 3,145 2,683 2,323
Cost of land sales(3)................................. 1,376 1,063 1,627 1,295 928 956 1,455
-------- -------- -------- -------- -------- -------- --------
Earnings available for fixed charges $183,303 $181,613 $239,770 $211,157 $228,735 $193,273 $191,206
======== ======== ======== ======== ======== ======== ========
Fixed charges:
Interest costs........................................ 163,786 165,227 219,705 221,907 219,538 200,469 175,740
Amortization of debt expense.......................... 1,581 2,293 2,801 3,571 3,173 2,833 2,298
Portion of rental expense representative of
interest factor(1).................................... 11,055 14,136 15,988 14,739 15,265 12,465 12,517
Support for debt service costs provided to
affiliates accounted for under the equity
method................................................ 0 23 31 389 1,106 2,081 1,005
-------- -------- -------- -------- -------- -------- --------
Total fixed charges $176,422 $181,679 $238,524 $240,605 $239,082 $217,848 $191,560
======== ======== ======== ======== ======== ======== ========
Ratio of earnings to fixed charges..................... 1.04 -- 1.01 -- -- -- --
======== ======== ======== ======== ======== ======== ========
</TABLE>
____________________
(1) Includes (a) 80% of minimum rentals, the portion of such rentals considered
to be a reasonable estimate of the interest factor and (b) 100% of
contingent rentals of $4,150,000 and $7,133,000 for the nine months ended
September 30, 1994 and 1993, respectively, and $10,006,000, $8,106,000,
$8,458,000, $5,588,000 and $5,458,000 for the years ended December 31,
1993, 1992, 1991, 1990, and 1989, respectively.
(2) Represents an estimate of depreciation of capitalized interest costs based
on the Company's established depreciation policy and an analysis of
interest costs capitalized since 1971.
(3) Represents 10% of cost of land sales, the portion of such cost considered
to be a reasonable estimate of the interest factor.
(4) Total fixed costs exceeded the Company's earnings available for fixed
charges by $66,000 for the nine months ended September 30, 1993 and by
$29,449,000, $10,347,000, $24,575,000 and $354,000 for the years ended
December 31, 1992, 1991, 1990, and 1989, respectively.
<PAGE>
Exhibit 12.2
THE ROUSE COMPANY AND SUBSIDIARIES
Computation of Consolidated Coverage Ratio
(dollars in thousands)
<TABLE>
<CAPTION>
Nine months ended
September 30, Year ended December 31,
------------------ ------------------------------------------------
1994 1993 1993 1992 1991 1990 1989
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings before depreciation and deferred taxes
from operations (EBDT).......................... $ 67,115 $ 53,066 $ 78,281 $ 52,282 $ 46,820 $ 50,290 $ 57,084
Consolidated interest expense.................... 158,753 157,983 210,806 206,809 198,295 170,522 152,457
Preferred stock dividends........................ --- -- -- -- -- 2,273 2,593
-------- -------- -------- -------- -------- -------- --------
$225,868 $211,049 $289,087 $259,091 $245,115 $223,085 $212,134
======== ======== ======== ======== ======== ======== ========
Consolidated interest expense.................... $158,753 $157,983 $210,806 $206,809 $198,295 $170,522 $152,457
Preferred stock dividends........................ -- -- -- -- -- 2,273 2,593
-------- -------- -------- -------- -------- -------- --------
$158,753 $157,983 $210,806 $206,809 $198,295 $172,795 $155,050
======== ======== ======== ======== ======== ======== ========
Consolidated coverage ratio...................... 1.42 1.34 1.37 1.25 1.24 1.29 1.37
======== ======== ======== ======== ======== ======== ========
</TABLE>
<PAGE>
Exhibit 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
---------------------------------------------------
The Board of Directors
The Rouse Company:
We consent to the use of our report incorporated herein by reference and to
the reference to our firm under the heading "Experts" in the prospectus.
/s/ KPMG PEAT MARWICK LLP
------------------------------------
KPMG PEAT MARWICK LLP
Baltimore, Maryland
February 9, 1995
<PAGE>
Exhibit 23.2
CONSENT OF INDEPENDENT REAL ESTATE CONSULTANTS
----------------------------------------------
The Board of Directors of The Rouse Company:
We consent to the incorporation by reference in Amendment No. 1 to
the Registration Statement of The Rouse Company (the "Company") on Form S-3
(Registration No. 33-57347) of our report dated February 23, 1994, on our
concurrence with the Company's estimates of the market value of its equity
and other interests in certain real property owned and/or managed by the
Company and its subsidiaries as of December 31, 1992 and 1993, which report
appears on page 21 of the 1993 Annual Report to Shareholders that is
incorporated by reference in the Annual Report on Form 10-K of the Company
for the year ended December 31, 1993, and to the reference to our firm
under the heading "Experts" in the Prospectus that is a part of such
Registration Statement.
/s/ Deborah A. Jackson
---------------------------------
LANDAUER ASSOCIATES, INC.
New York, New York
February 9, 1995
<PAGE>
Exhibit 25.1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM T-1
--------
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(B)(2)
-----
---------------------------------
THE FIRST NATIONAL BANK OF CHICAGO
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)
A NATIONAL BANKING ASSOCIATION 36-0899825
(I.R.S. EMPLOYER
IDENTIFICATION NUMBER)
ONE FIRST NATIONAL PLAZA, CHICAGO, ILLINOIS 60670-0126
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
THE FIRST NATIONAL BANK OF CHICAGO
ONE FIRST NATIONAL PLAZA, SUITE 0286
CHICAGO, ILLINOIS 60670-0286
ATTN: LYNN A. GOLDSTEIN, LAW DEPARTMENT (312) 732-6919
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
-----------------------------------
THE ROUSE COMPANY
(EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER)
MARYLAND 52-0735512
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
10275 LITTLE PATUXENT PARKWAY
COLUMBIA, MARYLAND 21004-3456
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
DEBT SECURITIES
(TITLE OF INDENTURE SECURITIES)
<PAGE>
ITEM 1. GENERAL INFORMATION. FURNISH THE FOLLOWING
--------------------
INFORMATION AS TO THE TRUSTEE:
(A) NAME AND ADDRESS OF EACH EXAMINING OR
SUPERVISING AUTHORITY TO WHICH IT IS SUBJECT.
Comptroller of Currency, Washington, D.C.,
Federal Deposit Insurance Corporation,
Washington, D.C., The Board of Governors of
the Federal Reserve System, Washington D.C.
(B) WHETHER IT IS AUTHORIZED TO EXERCISE
CORPORATE TRUST POWERS.
The trustee is authorized to exercise corporate
trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR
------------------------------
IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH
SUCH AFFILIATION.
No such affiliation exists with the trustee.
ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A
-----------------
PART OF THIS STATEMENT OF ELIGIBILITY.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
2
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago and State of Illinois, on the 6th day of February,
1995.
THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE,
BY /S/ R. D. MANELLA
R. D. MANELLA
VICE PRESIDENT AND SENIOR COUNSEL
*Exhibits 1, 2, 3, and 4 are herein incorporated by reference to Exhibits
bearing identical numbers in Item 12 of the Form T-1 of The First National
Bank of Chicago, filed as Exhibit 26(b) to the Registration Statement on
Form S-3 of Dow Capital B.V. and The Dow Chemical Company, filed with
the Securities and Exchange Commission on June 3, 1991 (Registration
No. 33-36314).
3
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
February 6, 1995
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between The Rouse Company
and The First National Bank of Chicago, the undersigned, in accordance with
Section 321(b) of the Trust Indenture Act of 1939, as amended, hereby consents
that the reports of examinations of the undersigned, made by Federal or State
authorities authorized to make such examinations, may be furnished by such
authorities to the Securities and Exchange Commission upon its request therefor.
Very truly yours,
THE FIRST NATIONAL BANK OF CHICAGO
BY: /S/ R. D. MANELLA
R. D. MANELLA
VICE PRESIDENT AND SENIOR COUNSEL
4
<PAGE>
EXHIBIT 7
A copy of the latest report of conditions of the trustee published
pursuant to law or the requirements of its supervising or examining
authority.
5
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
Call Date: 9/30/94 ST-BK: 17-1630 FFIEC 031
Page RC-1
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR SEPTEMBER 30, 1994
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business
day of the quarter.
SCHEDULE RC--BALANCE SHEET
<TABLE>
<CAPTION>
LESS
C400 THAN -
DOLLAR AMOUNTS IN ---- ------
THOUSANDS RCFD BIL MIL THOU
----------------- ----- ------------
<S> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository
institutions (from Schedule RC-A):
a. Noninterest-bearing balances and
currency and coin(1)..................... 0081 3,677,034 1.a.
b. Interest-bearing balances(2)............. 0071 7,396,406 1.b.
2. Securities
a. Held-to-maturity securities (from
Schedule RC-B, column A)................. 1754 169,280 2.a.
b. Available-for-sale securities (from
Schedule RC-B, column D)................. 1773 533,138 2.b.
3. Federal funds sold and securities purchased
under agreements to resell in domestic
offices of the bank and its Edge and
Agreement subsidiaries, and in IBFs:
a. Federal Funds sold....................... 0276 3,758,277 3.a.
b. Securities purchased under agreements to
resell................................... 0277 983,109 3.b.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income
(from Schedule RC-C)..................... RCFD 2122 14,933,756 4.a.
b. LESS: Allowance for loan and
lease losses............................. RCFD 3123 355,626 4.b.
c. LESS: Allocated transfer risk reserve.... RCFD 3128 0 4.c.
d. Loans and leases, net of
unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c)..... 2125 14,578,130 4.d.
5. Assets held in trading accounts............. 3545 9,793,010 5.
6. Premises and fixed assets
(including capitalized leases).............. 2145 506,298 6.
7. Other real estate owned
(from Schedule RC-M)........................ 2150 48,699 7.
8. Investments in unconsolidated
subsidiaries and associated
companies (from Schedule RC-M).............. 2130 7,269 8.
9. Customers' liability to
this bank on acceptances outstanding........ 2155 583,073 9.
10. Intangible assets (from Schedule RC-M)...... 2143 122,763 10.
11. Other assets (from Schedule RC-F)........... 2160 1,217,250 11.
12. Total assets (sum of items
1 through 11)............................... 2170 43,373,736 12.
</TABLE>
- ------------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held in trading accounts.
6
<PAGE>
Legal Title of Bank: The First National Bank of Chicago
Address: One First National Plaza, Suite 0460
City, State Zip: Chicago, IL 60670-0460
FDIC Certificate No.: 0/3/6/1/8
Call Date: 9/30/94 ST-BK: 17-1630 FFIEC 031
Page RC-2
SCHEDULE RC-CONTINUED
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN
THOUSANDS BIL MIL THOU
----------------- ------------
<S> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices
(sum of totals of columns A and C
from Schedule RC-E, part 1).............. RCON 2200 14,587,998 13.a.
(1) Noninterest-bearing(1).................. RCON 6631 5,788,459 13.a.(1)
(2) Interest-bearing........................ RCON 6636 8,799,539 13.a.(2)
b. In foreign offices, Edge and Agreement
subsidiaries, and IBFs (from Schedule
RC-E, part II)........................... RCFN 2200 9,974,515 13.b.
(1) Noninterest bearing...................... RCFN 6631 850,522 13.b.(1)
(2) Interest-bearing......................... RCFN 6636 9,123,993 13.b.(2)
14. Federal funds purchased and
securities sold under agreements to
repurchase in domestic offices of the
bank and of its Edge and Agreement
subsidiaries, and in IBFs:
a. Federal funds purchased.................. RCFD 0278 2,211,005 14.a.
b. Securities sold under agreements
to repurchase............................ RCFD 0279 765,393 14.b.
15. a. Demand notes issued to the
U.S. Treasury............................ RCON 2840 102,201 15.a.
b. Trading Liabilities...................... RCFD 3548 6,291,743 15.b.
16. Other borrowed money:
a. With original maturity of one year
or less.................................. RCFD 2332 3,237,167 16.a.
b. With original maturity of more than
one year................................. RCFD 2333 491,176 16.b.
17. Mortgage indebtedness and obligations
under capitalized leases.................... RCFD 2910 275,794 17.
18. Bank's liability on acceptance executed
and outstanding............................. RCFD 2920 583,073 18.
19. Subordinated notes and debentures........... RCFD 3200 1,325,000 19.
20. Other liabilities (from Schedule RC-G)...... RCFD 2930 638,753 20.
21. Total liabilities (sum of items 13
through 20)................................. RCFD 2948 40,483,818 21.
22. Limited-Life preferred stock and
related surplus............................. RCFD 3282 0 22.
EQUITY CAPITAL
23. Perpetual preferred stock and
related surplus............................. RCFD 3838 0 23.
24. Common stock................................ RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to
preferred stock)............................ RCFD 3839 2,289,398 25.
26. a. Undivided profits
and capital reserves..................... RCFD 3632 403,835 26.a.
b. Net unrealized holding gains (losses) on
available-for-sale securities............ RCFD 8434 (3,441) 26.b.
27. Cumulative foreign currency translation
adjustments................................. RCFD 3284 (732) 27.
28. Total equity capital (sum of items 23
through 27)................................. RCFD 3210 2,889,918 28.
29. Total liabilities, limited-life
preferred stock, and equity
capital (sum of items 21, 22, and 28)....... RCFD 3300 43,373,736 29.
</TABLE>
<TABLE>
<CAPTION>
Memorandum
<S> <C> <C>
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below
that best describes the most comprehensive level of auditing work
performed for the bank by independent external auditors as of
Number
--------------
any date during 1993..................................................... RCFD 6724 N/A M.1.
</TABLE>
1 = Independent audit of the 4 = Directors' examination of the bank
bank conducted in accordance performed by other external auditors
with generally accepted (may be required by state chartering
auditing standards by a authority)
certified public accounting 5 = Review of the bank's financial
firm which submits a report statements by external auditors
on the bank 6 = Compilation of the bank's financial
2 = Independent audit of the statements by external auditors
bank's parent holding company 7 = Other audit procedures (excluding
conducted in accordance with tax preparation work)
generally accepted auditing 8 = No external audit work
standards by a certified public
accounting firm which
submits a report on the
consolidated holding company
(but not on the bank
separately)
3 = Directors' examination of the
bank conducted in accordance with
generally accepted auditing
standards by a certified public
accounting firm (may be required
by state chartering authority)
- -------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
7
